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Tuesday, January 26, 2016

Oath of the Gatewatch Release Post-Mortem

I've written articles like this for every Magic: the Gathering expansion released since this business blog began!  They are some of the most heavily read and linked articles on this blog, so evidently people enjoy these observations.  Good enough for me!  (Enough that I basically copy the template and write in the details afresh each time.)  Here, then, is the DSGCW's experience with the release of Magic: the Gathering: Oath of the Gatewatch!

This expansion has heated up a Magic market that sat lukewarm since about November.  While eternal formats and sales of singles remained decent, the drop-off in Standard and draft attendance and the drop-off in sealed product purchasing from Battle for Zendikar were unwelcome developments.  As I wrote a few weeks ago, stores that depended on Magic had a fairly depressing Christmas.  I was grateful for the time I spent developing other product lines, because those performed well.  Magic was still the biggest single product line for revenue, but no longer utterly dominant.  With a lot on deck for 2016, now we want to see what portends for Magic: the Gathering in the year ahead.

First of all, a quick bulleted list of what Oath of the Gatewatch gave us:

  • Ultra-Chase Cards!  The final 20 "Zendikar Expeditions" land cards appeared in the set at a rate of roughly one card per 121 booster packs.  I discussed the "dangling carrot" of Zendikar Expeditions a few months ago in this article.  The card selection for the second run of Expeditions was great: an assortment of five-color and colorless utility lands joined the ten Shadowmoor/Eventide "filter lands" for this outing.  The economic effect remains as we saw it last fall: Standard players are trading Expeditions in immediately and using the store credit to complete their decks with regular cards, while players (like me) who enjoy beautifying our Commander decks have some new treasures to buy.
  • Cards for SuperFriends Commander decks!  Yes, a niche of a niche of gameplay usage, but nonetheless this set provided exactly this utility.  As my only Commander deck is a SuperFriends deck, I found this delightful.  I suspect most players are less enthused. 
  • Some standard "push" mythics that should see meaningful action, provided a deck arises by the weekend of February 6th, when the pros tell the hopefuls what cards everybody is allowed to play. 
  • Enough fat packs.  So far.  Despite selling more of them during release weekend than we sold of Zendikar fat packs in total to date, our supply is still holding up. 
  • A new basic land!  Maybe not in the strictest sense since it has no basic land type, and thus does not "turn Domain cards up to six," but Wastes is only the eighth card in Magic history that may be included in a deck in any quantity, after Forest, Island, Mountain, Plains, Swamp, Relentless Rats, and Shadowborn Apostle.  Moreover, it cleans up some of the rules of colorless mana generation and costing.  And, 
  • A good story, I guess, I kind of didn't pay attention this time but I got good feedback from customers who said they enjoyed it.  I did observe that the unquestioned ringleader of the Oathmakers was Nissa Revane, another step by Wizards to promote strong female protagonists, which I applaud. 
Meanwhile, here is what Oath of the Gatewatch did not deliver:

  • Any meaningful rare lands, with the jury still out on Mirrorpool.   
  • Enough Standard potential to draw heavy pre-order activity. 
  • That single, memorable, amazing card, though in time we may decide that Wastes is in fact the defining card of the block and affects Magic for years to come. 
  • Much in the way of new, non-reprinted cards with significant implications in Modern and Legacy. 

Attendance for the Prerelease tournament was down significantly from Battle for Zendikar, which broke all records.  We'll see if a visit to Innistrad can right the ship on this one.  This time around the take-and-drop was somewhat lower, but still noticeable.  Only 282 players were seated out of 414 player packs.

  • Saturday 12:01 a.m.: 68 players 
  • Saturday 11:00 a.m.: 38 players 
  • Saturday 3:00 p.m. (2-Headed Giant): 62 players (31 teams) 
  • Saturday 7:00 p.m.: 40 players 
  • Sunday 11:00 a.m. (2-Headed Giant): 36 players (18 teams) 
  • Sunday 3:00 p.m.: 38 players 

The biggest drops were the midnight and Saturday morning events, which speak to the effect of supersaturation of the market by new stores opening.  By Saturday night, many of them were out of product, and our remaining start times performed similarly to how Zendikar's did, with a player count in the final three events of 114 players, down only ten from the 124 we saw last time across those starts.  I fully expect our allocation to get punched in the sternum for the summer small expansion as a result of this underwhelming performance.  I know I wasn't alone, as other stores around town reported similar drop-offs in their first few events.

As before, the Prerelease was priced at $24.99 plus tax, whether paid in money or store credit.  Prize pools consisted only of the two boosters per player provided by Wizards of the Coast.  Once again online preregistration was sorely lacking, a problem we are closer to fixing but still have not yet finished.  The migration to Microsoft RMS with ComicSuite is something we want to do once and do right, and thus we're spending a little more into it and creating a more robust deployment.  This takes budget, and budget is parceled out over time.

Singles pricing had a great adjustment for us at the turn of the year, with the new TCGPlayer Market Price as a more reliable and more frequently updated benchmark that's based on actual sales and thus more difficult to manipulate.  Buy pricing was adjusted to 35% cash or 70% credit versus Market.  I'm seeing a few holes develop in our stock, such as we usually have to bump up the cash offer a bit to get dual lands and other higher-end material.  But mostly it works well and we're never stuck overpaying for chaff.  This made me a little more comfortable going into the open for Oath.  Broke the rest of the Prerelease packs and half a dozen cases.  It was enough.  Roughly even amounts of all mythics, and the following expeditions:

  • Strip Mine (sold on release day to yours truly) 
  • Ancient Tomb x 3 
  • Forbidden Orchard 
  • Eye of Ugin x 2 
  • a bunch of filter lands. 

We sell boosters at MSRP and boxes at 20% off MSRP, making off-the-shelf booster box sales about $115, or ~$123 after tax.  Despite the ongoing saturation of the market, we moved reasonable quantities of boxes and fat packs during opening weekend.  I did not yet need to restock immediately, which means hedging down on order quantities was the correct move (and I could safely have hedged down further). We now know the next expansion in April will be Shadows Over Innistrad, and with that being one of the best settings in Magic history, those of us on the retail side of the equation are excited and hopeful.

So that's it!  I am cautiously optimistic about Oath of the Gatewatch.  I like that the draft format is Oath-Oath-Battle, so that the small set will be opened enough to feed a healthy singles market.  I like that we're going encore-encore on the first two small blocks, to give players a chance to get comfortable before what I assume will be new territory in the fall.  I like that the summer fifth booster release is still yet to be announced; will it be the long-rumored Vintage/Eternal Masters that will bring back any unreserved card not nailed down?  I still need that judge foil Force of Will and it won't get any cheaper, but it will be nice to have a better supply of stuff like, potentially, Tops, Ports, Imperial Seals, and what have you.

Next week I'll move back into tradecraft with some more observations from the business side of the fence.  Thanks for joining us and have a great week!

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