Home Insights Five Below to Get into Esports?

Five Below to Get into Esports?

by Alan Daniel

Five Below (FIVE) has been on an upward trajectory over these past five years. The share price was at $42.00 in November 2014 and is now at $126.74. Shareholders in Five Below have seen substantial returns over the past five years. It is an intriguing firm in an age where traditional retailers are going into bankruptcy or face significant debt burdens. Sears, JC Penney, Forever 21, and other name brand stores struggle while Five Below continues to gain confidence from its shareholders.

The publicly-held chain of discount stores, based in the United States, built its brand on items within the range of $10 or less. Five Below’s younger demographic seems to love Five Below, its low priced offerings. Revenues are up from $312 million in November 2018 to $417 million in August 2019. Operating income is also up from $15.5 million in November 2018 to $36.03 million in August 2019. The younger demographic of children, teens, and young adults seem to flock to the brand at present and are likely to continue to do so in the future.

The brand is aiming to increase and improve its staying power by catering to its younger demographic in an obvious way, games. The retailer will assess and target specific strategic locations in the United States and include esports gaming centers.

Five Below and Esports Experiments in 2020

Esports gaming centers? In regular retail brand that doesn’t engage in games? Yes.

Five Below aims to start with just a few of these gaming centers in its retail locations. Managers and business analysts will assess the reactions in these experimental stores before expanding the concept in more stores. Nerd Street Gamers will partner with Five Below on in implementing gaming centers in specific retail locations, according to the Inquirer.

Nerd Street Gamers, a national network of esports facilities and events, will play a critical role in creating the right environments and opportunities for gaming enthusiasts. The esports focused entity works to develop the esports ecosystem and foster talent within the sector for competitive tournaments. Nerd Street Gamers also has investments from Comcast Spectacor.

It will be fascinating to see how Five Below brings about a better experience for gamers. The retailer will have to compete against gamers’ homes and associated comforts to be relevant.

Technological Trends

Parents, researchers, and few parties may have issues with gaming and the influence it may have on youth. The truth is that gaming and esports are currently popular and will remain so moving forward. Traditional games such as Fortnite, Call of Duty, Diablo, and blockchain-based games such as LightNite, and Cryptokitties shows promise and growth.

Digital natives of future generations will continue to adopt and expect the convenience that technology provides in every aspect of their lives. They will expect a technological transformation in money, transportation, shopping, and socialization.

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