Deciphering The New HorrorClix Distribution System
by Aahz of ItsWickedFun.net

WizKids will be celebrating two anniversaries this year: The fifth anniversary of HeroClix will be marked by special summer tournaments for the Marvel Avengers and DC Justice League expansions while HorrorClix will celebrate its first anniversary this Halloween with the release of its third expansion - HorrorClix: Nightmares. These will also be the first expansions in each of their primary clix lines to be released under the new packaging and distribution system. This new system has two major components: 1) Diamond/Alliance is now the exclusive US distributor of WizKids products, and 2) the packaging system has been totally revamped. The online community has erupted over the changes, of course, but that is only to be expected. This article is intended to take a big picture look at these changes and try to determine what they mean to three of the four primary groups affected: consumers (both players and collectors), retailers (whether online or off, selling singles or sealed product), and WizKids. The fourth group affected, distributors, are not covered as the results there are clear: they're no longer allowed to carry WizKids product so will lose out on whatever clix sales they once received.

Distribution
WizKids announced in January that their products would no longer be available through the traditional network of independent game distributors. Instead all WizKids product in the US will now be distributed exclusively by Diamond/Alliance. Many arguments can (and have) been made against a company the size of WizKids signing an exclusive distribution deal, but in doing so, Diamond/Alliance was clearly the wisest choice as they are the largest distributor of both comics and games in the United States. WizKids stated that the decision to go with a single exclusive distributor was made for two reasons: 1) stop (or at least slow) the sales of online retailers who were selling sealed product at deep discounts, and 2) allow for special promotional opportunities.

Let's deal with the second reason first. Having an exclusive distributor certainly makes things easier on WizKids. They only have to deal with one “buyer” for their product which translates to significant savings in employee hours and payroll (the largest expense for any company). This is achieved through their new ability to have product shipped directly from the manufacturer to the distributor, largely removing the need for a warehouse (and warehouse staff) and as a result of more direct communication with their primary customer. Instead of spreading information to, and answering questions from, a dozen or so distributors they need only deal with one. It is then Diamond/Alliance who is responsible for disseminating this information to retail outlets.

WizKids has already announced several new or modified programs that they claim would have been impossible under the old distribution scheme: the Coming of Galactus and Starro Attacks events for HeroClix, the Cartoon Network promotion for the release of the Star Wars PocketModel TCG, and HorrorClix prize support being distributed through the same channels as product are the three most visible. A perfect example of the latter is that the Limited Edition figures for the HorrorClix: Freakshow New Guy Night event will be sent to retailers along with their initial order of Freakshow boosters ensuring that prize support will be available the day of the event (as long as the product itself arrives).

The effects of the distribution change on retailers are much more difficult to gauge. There have been reports of retailers who simply refuse to deal with Diamond/Alliance and therefore no longer carry WizKids product. Many other retailers have complained that their costs will go up as a result of this change, but they are willing to continue carrying WizKids product given their record of success in years past. Still others were already ordering through Diamond/Alliance, so this change has no real effect on their business.

To no one's surprise, WizKids product is still being offered by online retailers. A search for retailers offering complete cases of Freakshow (the first clix expansion affected by the change) does turn up fewer offers than a similar search for The Lab did in early January, but the prices are only slightly higher: $240 on the low end, as opposed to $220 for The Lab. While this is a price increase for those who shop for sealed product online, it seems doubtful many people will be driven back into their local game stores, where a sealed case will still cost them over $300 (with a 20% preorder discount).

Overall, WizKids clearly benefits from the exclusive distribution deal as they now have a more efficient and less expensive method of getting their product to market. Retailers seem to have been hurt by the change, but not to any extreme, and they should benefit from the new promotions available. Consumers, meanwhile, will either benefit somewhat (through better prize availability and special events), be egregiously harmed (no access to WizKids product), or largely not notice the change.

Packaging
In March WizKids announced that they were completely reworking the packaging of both their HeroClix and HorrorClix lines. The individual boosters have been made larger to accommodate five figures instead of four, while booster price has increased from $8.00 to $10.00. The size of a brick has been reduced from 12 boosters to 10 boosters and the size of a case has essentially been halved: from 4 bricks (48 boosters/192 figures) to 2 bricks (20 boosters/100 figures). Price per figure has stayed the same ($2 per figure) while the cost of the additional game components (plot twists, victims and minions) has increased negligibly. Additionally, the set size is being reduced from 96 figures to 60 figures.

In May they announced the actual rarity scheme as well:

With Super Rare figures taking a Common slot in one of three boosters (which is the same rarity as Unique figures are now) a new booster will look like this:

• Slot 1: Rare

• Slot 2: Uncommon

• Slot 3: Common or Uncommon

• Slot 4: Common

• Slot 5: Common or Super Rare

What this all means for the consumer depends on what type of consumer they are. It's a boon to new players as they won't notice the price increase, but it's much easier for them to build an effective army with one or two boosters under the new system than under the old. The new colored tabs make identifying the rarity of their figures much easier and that adds to perceived value as well. Additionally, a guaranteed (identifiable) rare in every pack is clearly a bonus.

Fans of the sealed environment (or those who buy only a few boosters) will notice benefits as well. Although Commons will more frequently be duplicated, these pieces are traditionally (and should be) those that can be effective in multiples anyway. Sealed tournaments should benefit from the greater variety of figures in each booster, and this new system could actually reduce the buy-in cost to two boosters instead of three should organizers decide to go that route. This is the only level where the “cardboard crunch” will really be felt as players will be receiving fewer victims, minions and Plot Twist cards per dollar spent. Luckily these items are frequently available for minimal trading or even given away by those players who tend to buy more product.

Players (or collectors) who participate in WizKids “But It By The Brick” promotions in order to receive those exclusive Limited Edition figures are possibly the largest beneficiaries of these changes. In the past a single brick would contain half the number of figures in the complete set, but would not really be near completion. They'd have numerous duplicate Commons and Uncommons (without completing either rarity), but only a third of the Rares and Uniques (now called Super Rares). Under the new system they'll have only a quarter of the Super Rares, but more than half of the Rare figures, and (most likely) a complete set of Uncommons and Commons with about six duplicate Common figures. Trading and single figure purchases should easily get them the specific figures they're looking for at a lower overall cost than in the past.

The final group of consumers are the ones with the toughest choices to make, but they should come out ahead regardless of which way they go. These are the set collectors and case buyers. With the size of a case being essentially halved, their first instinct will be to purchase two cases. Doing so will ensure they have enough figures of each rarity to complete a set, though it is less likely that the collation will work in their favor. They will, however, end up with more duplicate Rares and Uncommons than with a single case of past sets, including more than two complete sets of the rare figures. This should keep it from being too difficult to trade for any elusive Super Rares. Their other option is to purchase only a single case (two bricks), at a substantial savings over previous case prices, and search for the 6 Super Rare figures they're missing through trading or on the single figure market. As long as they pay less than $20 for each Super Rare figure needed to complete their set they'll still end up spending less money under the new system.

Retailers will have a higher price point, which is something they always enjoy, and the boosters will be the same physical dimensions as other CMGs on the market, making them easier to display. They should also benefit from the renewed interest a change of this magnitude brings to a game. Once consumers start digging into the new boosters they should feel they're receiving benefits from these changes, and when consumers feel they are benefiting, retailers will benefit as well. Additionally, the new packaging system will actually encourage more trading and traders need a place to meet with others, so the physical retailers will benefit from the increased player presence and excitement that trading brings to a store, while the online retailers should benefit from a more brisk singles market.

Finally, when consumers and retailers are happy they tend to buy more product, and that means good things for WizKids as well. All of this excitement should lead to both more individual sales and larger turnout to Approved Play events. Added to the savings in packaging expenses and the streamlined distribution system, the future is looking bright for their bottom line.

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