How EB Games future-proofed its business model by going omnichannel early
The Australian arm of video game and entertainment software retailer EB Games opened its first shop in New South Wales in 1997; 21 years later and the company still boasts 550 bricks-and-mortar stores across Australia and New Zealand, and another 100-plus shopfronts of its Zing Pop Culture entity.
A wholly-owned subsidiary of Gamestop since 2006, the parent company handles ERP and point-of-sale elements of the business, while e-commerce, omnichannel, and loyalty are all handled locally.
Speaking with ZDNet, EB Games head of technology for Australia and New Zealand Kevin Clarke explained that his teams are responsible for using technology in a way that benefits the local customers, allowing for a more specific focus on what they actually want.
After joining EB Games in 2010, Clarke was immediately charged with laying out the company's digital approach and although the EB brand was well-known, the online element was unchartered territory.
"When we went onto online it was really starting from zero in terms of sales," Clarke explained.
EB Games had some online traffic, so it started with a fairly small footprint, operating out of a co-located datacentre with a few servers. Clarke said that grew quite quickly and in an attempt to future-proof, EB purchased some hardware working on a three-year depreciation cycle.
"That was the infrastructure and we had the development team, and that paradigm worked quite well as we managed to keep pace with customer experience -- it was okay, the business was happy with what was going on, e-commerce grew, we rolled out our customer loyalty as well ... at that point, everything was going along well, we were rolling out bits and pieces," he said.
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But after moving its pre-order function online in 2011, as the company's first true foray into omnichannel, its online presence grew quite fast in the years following and its physical hardware became unable to scale. Clarke and his team needed the infrastructure to keep pace.
In 2016, EB Games turned to Amazon Web Services (AWS) and shifted its digital channel to the cloud.
"At that point we'd clearly exceeded the capacity of what we had in our co-lo and we were having to work around limitations in infrastructure with our software, so we compromised, in hindsight, on the design of some of our systems to work with what we already had, rather than buy more hardware," Clarke explained.
"Once we moved into AWS we found we were able to move faster with our projects, we reduced our costs, and we improved our user experience, definitely for peak performance but also day-to-day operations."
"When we moved to the cloud, we started thinking about the infrastructure security and development at the inception of projects, and that led to a better quality solution and being able to move faster and not hit road-blocks as we would try go through a release cycle."
Clarke touted the cultural change such a transformation brought with it, pointing to how the technology team is now focusing on trying to deliver as quickly as possible, and to the highest quality.
"We're trying to get to a continuous delivery model where we're doing continuous deployment -- last week we deployed into production 10 times across all of our systems; we've gone from deploying maybe every month, a few months, to multiple times a week," he said.
"Moving into the cloud was the catalyst to start that transformation -- it made us aware of what was possible, that we probably were blind to previously. As we've been able to move faster as a technology group, we've been able to bring the business along as well; when you are releasing so quickly, it changes the dynamic of what you can do with technology ... it forces an increased engagement from everyone, that's been a real positive."
As a result of heading to the cloud, EB Games has been able to scale its systems a lot more, with Clarke noting it gives the business confidence to use digital as a channel.
During the recent E3 (Electronic Entertainment Expo), EB's website received a heavy increase in traffic, with people jumping online to order once titles were announced during gaming's biggest show.
"We were able to fuse technology and bricks-and-mortar to provide this omnichannel experience," he said.
Read more: The best and worst of E3 2018 (CNET)
To Clarke, the challenge is still solving omnichannel; customers are still interested in the bricks-and-mortar element and the nostalgia attached to walking into a store, but many are making purchases online and comparing competitors' prices, as one example.
"I think it really has to be complementary -- solving omnichannel is really the next key problem," he added. "The business has to have confidence that the technology is going to give customers the experience that we offer them in stores.
"People are going to want to shop how they want to shop and to predict that, it's outside my qualification, but as a technologist in a retail environment I want to know that I'm not the limitation in terms of putting up a big selling item online and ordering it in any way they want ... having technology to enable that is really important."
According to Clarke, everything evolves and the business needs to focus on meeting customer needs at every stage of the transformation.
"I don't want technology to be a limitation in how we move forward as a business," he said. "It's easy to say we want to be agile, we want to be lean, but when the rubber meets the road, how is the business going to accept moving that quickly?
"Everyone wants to move faster ... but once you're confronted with moving that fast, how are you going to react? It's easy to want something you don't have -- but once you get it, it's a challenge."
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