Babbage's Etc. Launches thegamestop.com; New E-Commerce Site Leverages Babbage's Etc.'s Buying, Distribution, & ``Brick-and-Mortar'' Presence To Deliver New Games To Gamers Faster.

GRAPEVINE, Texas--(BUSINESS WIRE)--July 22, 1999--

Babbage's Etc., a leader in PC and video games specialty retailing, today announced the launch of thegamestop.com (www.thegamestop.com), a new e-commerce "supersite" that puts a web interface on Babbage's Etc.'s enormous buying power and distribution infrastructure.

Specifically designed for gamers by people with a passion for games, thegamestop.com is the ultimate online destination for researching, buying or updating game products, or simply keeping abreast of the quickly-changing gaming industry.

The new site makes it possible for gamers everywhere to get "hot" product delivered to their door the same day it hits Babbage's Etc.'s retail stores. The site also permits shoppers dissatisfied with an online purchase to return or exchange items to any Babbage's or Software Etc. store.

"First To Market" Distribution Network

From the loading dock of the manufacturer's plant to the gamer's console, Babbage's Etc. caters to gamer's passion to buy new product first. The company's "rapid response" distribution network has shipping centers strategically located near popular software publishers. This allows Babbage's to pick up product faster and send it directly to its stores, shaving days off the distribution cycle.

Babbage's Etc. "first to market" system delivers new product to its retail and now online customers within 24 hours of release. At thegamestop.com, gamers can opt to have product shipped to their door, or can arrange for new titles to be picked up at a local Babbage's or Software Etc. store on the day of the release.

"Just like our stores, our online philosophy is to get hardcore gamers product first, product fast, and to keep them informed on what's coming out next," said Dan DeMatteo, President of Babbage's Etc.

Plug into Store Support

Part of Babbage's Etc.'s new standard in online shopping is to offer "multi-tier" customer support. Product purchased online can be exchanged or returned offline at any of the more than 480 Babbage's and Software Etc. retail outlets across the U.S.

"Our consumer research revealed that returning merchandise shipped directly to the consumer is considered one of the serious shortcomings of traditional e-commerce," said DeMatteo. "We're offering the convenience of buying online along with the benefit of walking into a store staffed by gaming experts to ask questions, exchange or even return product. By closely integrating our online with our brick and mortar infrastructure, we can offer the highest level of customer satisfaction."

"By linking their e-commerce initiative to their retail outlets, Babbage's Etc. is redefining e-commerce," said industry observer Evan I. Schwartz, author of the just released Digital Darwinism: Seven Breakthrough Business Strategies for Surviving in the Cutthroat Web Economy (Broadway Books). "In the future stores will act as an advertisement for the site and train customers to use the site. Babbage's Etc. is pioneering this type of online/offline integration."

Supersite Features

Thegamestop.com delivers an unsurpassed selection of current and pre-release entertainment software games, game hardware, accessories, strategy guides and everything else game related. The site offers gamers, parents and gift-givers:

-- "No money down" reservation policy on pre-release titles for home

delivery the same day they hit Babbage's and Software Etc. stores -- "Family Store" section designed to educate parents about the

gaming market and involve them in software selection for their

kids -- Hyperlinked e-mail "wish list" for gamers to send product

preferences to parents, relatives or friends who in turn can

review products before purchasing -- Affiliate agreements with trusted third party providers like The

Adrenaline Vault (www.avault.com), the premier information and

software download resource for serious gamers -- Authoritative editorial content including independent reviews,

product news and interviews from a growing network of content

partners including Gamer's Republic magazine

(www.gamersrepublic.com) -- Access to an extensive database of "first look" video game

highlight clips, PC game demos and game screenshots -- Site user customization according to game platform or game genre

and personalized e-mail updates

"Our goal was to create a new standard in online shopping for the gaming community," said Bruce Nelson, Babbage's Etc.'s Vice President of Internet Commerce. "Gamers told us they wanted an information-rich e-commerce site that provided a state-of-the-art online experience. We've created that environment and backed it with our industry-leading buying power, product fulfillment centers and our nationwide store network. With the best balance of commerce and content, thegamestop.com will bring them back again and again."

Strength In Numbers 

Babbage's Etc.'s move into cyberspace parallels its aggressive growth in its traditional retail business. The 480-store chain had fiscal 1998 sales of $465.2 million with comparable store sales up 22.4%. This double-digit increase has carried over to 1999 with a 13.2% Q1 increase over 1998. While the online segment of the business is expected to generate $5 million in sales by year end and approximately $20 million annually in 24 months, the traditional business is expanding aggressively with between 60-70 store openings this year.

Company Information

Babbage's Etc. is a leading specialty retailer of video games, PC games and gaming accessories. The privately held company boasts retail outlets, including Babbage's, Software Etc., Gamestop and Planet X locations, in 47 states and Puerto Rico. Babbage's Etc. is headquartered in Grapevine, TX.