An Arcade Game Company that Withstood the Test of Time - ICE Games | Ep. #011

On this 11th episode of The E-Comm Show, our host and BlueTuskr CEO Andrew Maff is with Josh Krouse of Ice Home Arcade Game, a long-time manufacturer and innovator of our favorite coin-operated amusement games.

As the industry-leading manufacturer of sports games for the home, arcade, and office since 1982, ICE has placed itself in a formidable position, creating games that have stood the test of time. Listen to Andrew and Josh as they talk about how to build a brand that lasts, adapting e-commerce to ICE’s business model, pricing strategies, managing online ads and affiliate marketing,  product development, handling day-to-day operations, and what it really takes to keep your customers coming back for more.

Tune in and enjoy today's episode of The E-comm Show!

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Side Hustle That's Worth Seven Figures

SPEAKERS

Andrew Maff & Amber Thibaut

CONNECT WITH OUR HOST: AndrewMaff.com  |  Twitter: @AndrewMaff | LinkedIn: @AndrewMaff

About the Guest Speakers

Before beginning my current position at ICE I have spent the past 8 years heavily involved in the startup community in Buffalo NY, and have developed mityo.com as a CEO and founder and also as a co-founder I developed and launched classavo.com with different levels of involvement and growth scaling for both of those businesses. The experience took me through project management, product development, and product management, graphic design, software development, and R&D, licensing partnership in the Ed Tech Space, logistics of designing a website and app in the food and grocery delivery space, to the graphic design and boutique interior design space to custom commercial direct print flatbed printing and then also multiple levels of pitching and to investors including pitching in person to the team at Y Combinator and fundraising and developing education technology in the Ed Tech space before the current explosion in Ed Tech growth during COVID. The last project I worked on before joining ICE to develop and grow our Home Arcade Game business was developing MITYO as a new Supply and Demand search engine for local and geographically centric shopping as a result of the COVID supply chain disruptions.

At ICE I joined the company to develop new Ecommerce strategies, marketing, and advertising for homearcadegames.com as well as to develop a stronger network and physical retail presence with dealers and resellers for the home game market and the social media following we have on various platforms. We have seen new market developments in the home game space due to COVID and we see these as important market segments we can grow to complement our national and international arcade and coin-op business at icegame.com In the first year of my onboarding at ICE growth in the Home Arcade Game Business has increased substantially we're growing our month over month and year over year revenue each month as we test out new advertising creative on a weekly basis and increase our ROAS and use data to drive our decision-making process. Bringing our platform to Shopify Plus was also something I felt was an important step for us at ICE so that we could better scale our business and growth in e-commerce and understand the consumer decision-making process behind each sale.
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Transcript:

00:03

You know Google's great because you can target people that are already searching for what you want or what they want to buy. This is Johnna of Bow Wow Labs. Hey, this is Amber of Coco Moon. This is Josh Krouse of ICE home arcade games.com. And you're listening and you're listening, you're listening to The E-comm Show.

00:28

Welcome to The E-comm Show, presented by BlueTuskr. The number one place to hear the inside scoop from other e-commerce experts share their secrets on how they scaled their business and are now living the dream. Now, here's your host, Andrew Maff. Hello,

00:49

everyone, welcome to another episode of The E-comm Show. I'm your host, Andrew Maff. And today I am joined by Josh Krouse of ICE or Innovative Concepts and Entertainment. Josh, how are you doing? Ready for a good show?

01:00

Absolutely. Thanks for having me on Andrew, happy to share our company and history with you and look forward to talking through everything.

01:11

Beautiful, really appreciate having you on the show. I'm always super excited for every show for some individual reason. And for you guys, specifically, you have the coolest product line. Like at the end of this. I'm scouring your website. And I'm going through it because there's so much stuff I want to get into. But I also want to get into obviously the E-commerce side of things and figure out how you guys tick but let's pretend that no one knows who you guys are. And anything around those lines. So why don't you just give us a little bit of background on ice? And we'll start from there. Sure.

01:37

Absolutely. So our company started in 1982 with our first product, which, you know, was a huge success. It was the Czechs bubble hockey game. We invented it shortly after the USA, vers Russia Winter Olympics game, and based around that game, and it was just a huge success, sort of helped our company grow right from the start, you know, into a global brand. You know, our game became a staple of arcades, bars, and family entertainment centers around the country and around the world very quickly. And that product has helped us grow throughout the years, the brand recognition and the name recognition checks, bubble hockey, you know, go hand in hand. And so you know, that's helped us and we've kept things very consistent throughout the years as well as an American-made company. All of our games are made right here in Buffalo, New York, Clarence specifically. And so all of our products are made in the USA. And you know, with checks we then released a game afterward called kicks, which was our bubble soccer game. Initially, you know, we actually had a turf playfield inside the dome. A lot of people remember the blue button from the checks game. Since then we kind of grew we got into ticket redemption, cranes clogged games, we had a huge Dave and Busters brought it in and a lot of our other arcades around the world, the dealer no deal game was a huge success for us. We do tons of licensed products. You know our one of our best most successful games is our ice ball Pro. Our ice ball effects, which we've made to the ice ball Pro for the home market, our NBA game time arcade game, which is you know, basketball style, arcade game NBA hoops, you know, the games that we make, people might not necessarily always associate with our company in our brand. But when you see them in Arcade, you recognize them instantly. So from there, we've kind of you know, grown and just the past 10 years we've taken checks direct consumer with, you know, bubble hockey, calm, super checks, calm and now we have home arcade games calm. And that's kind of, you know, grown our direct consumer business in such a way that we felt, especially with the onset of the pandemic last year, that we should expand those home game offerings to include our baseball Pro or NBA game time pro Jurassic Park Pro Superkicks pro we introduced a few years ago. We have a home air hockey game now. And we partner with a few of our other American made arcade game partners such as stern pinball, arachnid, and Chicago, Chicago games to help you know, build out that lineup of arm games and that's a short condensed history, but I think it helps to kind of explain where we have been and how we got to now You know, we've seen a ton of successes here with the, you know, great reopening across the world, like arcades and family entertainment centers have reopened and people are still in process of building out their new game rooms and going through the renovations that they've started during COVID. And we're just kind of seeing, hey, some people still want to stay at home. And we have the perfect solution, whether you're going to stay at home, or you're going to go out and hang out with your friends in Arcade. Awesome.

05:32

So one of the pros and cons of this podcast is that it's also video recorded. So if anyone is listening to this podcast, head over to our YouTube and check out Josh's background because he's got his in his showroom. And he's got it just looks like I don't know how you guys get any work done. Because I would just be I'd be testing all the time. And just given the cams good time. Um, so your role there you are a Sales and Marketing Associate. Is that specifically for its HomeArcadegames.com? Correct?

06:05

Yep, absolutely. So, you know, my role in joining the company was to take the direct to consumer sales, for home products, and also, the build out a reseller network for the home products. to the next level, we have, you know, established distributors in the coin-operated space, have been with us for decades, that, buy our products and sell to coin-operated entertainment centers around the world. But we also are now we've built out a reseller network to carry our home games. So if you're in California, and you're in Los Angeles, or you want to go check out our games, you can visit one of our resellers out there and visit their showroom or you're in Florida or Texas, anywhere on the East Coast. Something that we really want to help people get a sense of what our games are like, it's, it's one thing to see it online, through our website, and check it out. But a lot of people want to get their hands on the product first and tested, which we completely understand we let people book appointments with us and come into our showroom. If they want to check out our games, we also give tours. And you know, you know, just through a combination of both having resellers and a really stellar online shopping experience, we think that both of those things helped to build trust in our direct-to-consumer products. I think you know, our expectation is that we can make this part of the business as successful if not more successful than the arcade. Because the direct consumer Avenue, although it takes a little bit more time to set up, I think and pay dividends if built out properly. Yeah. So I

08:08

love that you're on the sales and marketing side because that's right up my alley. So we can we could do this all day. So you obviously have a product line, that's a relatively higher price point than most e-commerce sellers are used to. So what is your strategy? When you're kind of like, you know, when you're setting up all your marketing, whether it's through social or paid ads, or any content creation or anything like that, like? How are you kind of focusing on making sure that you're honing in on that audience that can afford this product and has the room in their house for it?

08:38

Yeah. So I think one of the nice things about what I'm trying to do is that with the bubble hockey game, specifically, we've been selling that directly online for the past 10 years. And it's helped us to sort of, you know, find out what our, you know, buyer persona looks like, because, you know, it's been selling for a long time based off of, you know, the popularity of it as an arcade game, people are familiar with a growing up with the nostalgia. So we kind of has a good idea of what the target audiences going into this. We're not starting completely fresh. I guess one of the other parts of that is, you know, now with the onset of Facebook advertising and the nuance that you have there, and how granular you can be with targeting, I think, you know, although there have been some privacy changes with the iOS updates and iOS 15 And I think we're still going to see a lot of data built out through what we're able to do with Facebook. You know, love-hate it. It's right now, the only game in town when it comes to finding new audiences, I think, you know, Google is great because you can target people that are already searching for what you want, or what they want to buy. But Facebook, I think is still the best way through Facebook and Instagram marketing, specifically through paid advertising, to build out new customers. And so what that looks like for us is we, we do everything in house, whether it's, you know, filming. So we'll set up a day, we'll get you games together for a photoshoot, we'll bring people in, we'll have them play our games, and they'll fill out a really cool game room, either in somebody's home or in a different room. If it's in our factory, we've done shoots in our showroom before. And so, you know, between showing people what it's like to actually have our games in their home, building out really cool renders that represent what they're going to buy. It's a multi-pronged approach. But I think the bottom line is, you know, running, paid advertising seems to be the most effective way to build out new audiences right

11:23

now. So you said you're doing all this in the house right now?

11:27

Yeah, so. So I think I kind of got ahead of myself, we do have an external ad agency that we work with. And we. So we develop all of our products, you know, build out the renders and house, we do all the engineering and determine the marketing sort of words and terms and all that spec is done in house. And we do use external photographers we bring in people. But all of our renders are done in the house of the game design. And then yeah, some of the advertising we work with an external agency on p3, media. They've been great. We started working with them this year, and years prior, we used a clever method. And so for online advertising, specifically, now these and for web development, actually on Shopify, p3 helped us transition from our old storefront, which was on ASP, storefront. dot net. So they took us from there to Shopify Plus, which has been tremendous, I think, in terms of overall smartphone management. Yeah. It's a, it's been a long process. And I think we really just started using Shopify in July. But you know, a lot of moving parts. And I think we're setting ourselves up for success if we're really looking forward to what's gonna happen this holiday season. Yeah,

13:09

yeah, I'd imagine that's probably a really good time for you guys. What do you what are you kind of prepping for q4? Because I know typically, you know, everyone's pretty much starting now, if they haven't already started prior. So what do you guys kind of got in line for that?

13:24

So we're really now working on building out more personalized. I want to say personalized media for our customers. So we're beginning weekly newsletter series, really kind of detailing all of our games to kind of know, get our customers who have signed up to our newsletter have previously purchased from us before, get them more acquainted with our new game offerings. You know, between that and building out new concepts like the wooden base super checks Pro, I mentioned before the video started, the solid four-inch-thick maple really helps to complement somebodies game room, whether it's, you know, a game room with a pool table, or they've got a wine bar, you know, kind of gives you that more rustic home feel. So, you know, I think we're trying to thread the needle on build something for everybody, this year. Really, also build awareness whereas last year, this was a really new concept. You know, people know us as having bubble hockey, but they didn't know us for other games. So I think just building awareness and making sure people get their gifts on time. Nice. So you had

14:56

mentioned you guys were mainly focused on Facebook, Instagram, For your paid advertising with obviously like some Google thrown in there for, you know, higher search intent. But have you guys tried any other platforms at all? Have you gone down the Pinterest route or Snapchat or Tik Tok or anything like that? How have those gone for you guys?

15:14

Yeah, actually, we recently started to sell our products on Amazon as well. I know that had been done years prior. And then this year, we are they contacted us. And we store again is a lot of work. You know, I don't know if it will be worth it. But we'll see. You know, and so we've done some Amazon ads in like the past month and a half since that store got up. Again, we'll see maybe it'll explode around the holidays. So far, it's its good visibility. But we did do Pinterest ads before we might ramp those up. Again, as we get closer to the holidays. You know, when we transitioned to Shopify, we did slow down a little bit on ad spend. We've had a tremendous year, but just wanted to kind of, you know, as we're doing these improvements to and, you know, as we're speaking within like the next two, maybe three months, or sorry, weeks, we expect to have our user interface and user experience update complete on our website. So, you know, we're, we transition to Shopify, and now we're redesigning so that customers have an even better shopping experience on the front end, and the back end, but you know, as it pertains to ADS, we've done Pinterest ads, Hulu ads, and Reddit ads, Bing Ads, as well. We've used other platforms that, you know, basically, our ads brokers like it, you want to, like different web banners and stuff. But we also do affiliate marketing, through ShareASale, with advertising purple as the agency. So really just kind of looking at all the different options out there. Had companies approached us about doing over the top ads, through, you know, their agencies, you know, larger, either radio companies or network, you know, broadcast and companies that broker those kinds of, you know, ads as well. So, there's a lot to think about, honestly.

17:42

I mean, there are countless platforms you can run ads on at this point, I'm impressed to hear who ads I don't hear that very often, from E-commerce sellers, typically, you know, anything that even borderlines traditional advertising, they always kind of get cranky about it. So it's, it's cool to hear you guys did that, how

18:00

did that go for you? Um, you know, I think we, we'd like to try it again, it's hard to kind of see what the results were from it. We did it only for you know, a brief two-month span of time. And, and it's not as nice, traceable, right, you're not gonna see somebody click through if they're watching their TV. Um, so I think we'd like to try it again. I think we just kind of, you know, it was right before we launched our Shopify store. So let's put this on hold for now. And then maybe look back at it as we get closer to the holidays. Do you guys ever, like discounts or anything? Yeah, so we started as we launched our, our new site, and we've built out an attentive SMS remarketing platform. So now, customers can sign up, receive $50 off when they put their email and their phone number. And then they join our SMS list. That's one of the discounts we offer. Traditionally, were really really don't want to say discount averse. But because everything is, you know, handmade. It's something that I feel is tough to discount. And so we try to kind of, you know, make it pretty straightforward when it comes to that in our pricing. We do now have a referral program, which is kind of now should probably make its way into the public view sooner than later. But right now, it's kind of behind the scenes but a fuse Sign up for our rewards program, you'll also see that we have a referral program. So if somebody buys something, you refer them to it. I think a lot of people that have been thinking about our products for a long time but maybe are less inclined to spend the full price would really love our referral program. But yeah, I think once we kind of flesh out the details without a little bit more, I think it's going to be something that people are going to love. Yeah,

20:28

I was just curious, because I know with, with Hulu, like any kind of traditional marketing, it's very difficult to track anything sometimes, you know, we've done stuff with, you know, you kind of offer a discount code for a specific added does through or Spotify or something like that if it's difficult to track, which is why I was curious. But either way, it's still really cool to hear that you guys have tried all those channels. How like, I know that, basically, once you surpass using one or two channels, and you get into using three or four different advertising platforms, attribution tracking, I don't care what company you work with, it's damn near impossible, because it's just such a fluid thing, especially as you mentioned, like with the iOS changes, and you know, with, with all the tracking, it's kind of getting removed from everyone, it's like digital is going almost more traditional like it once was. So how are you tracking the success of all those platforms?

21:21

Well, um, so how's really doing? Yeah, a couple of different ways. Obviously, there's the return on ad spend. You know, which is, I think, a pretty important metric. We also like to look at what we spent in the years prior, it's tough, I think, to make a comparison this year to last year because it was such an anomaly. And then also, the year before, for us, we didn't have the same product line, we had our super checks and our superkicks, that really, we introduced the other home games at the end of 2020. So it was around, I want to say October, November. So there wasn't much time, really, before we start advertising heavily. But yeah, we're looking at revenue, we're looking at ad spend, we're looking at months prior, you know, it's going to be something we're going to have to you know, look back at and analyze, you know, as we go into 2022. I think, you know, we've kind of found that there's a certain price point that we have to hit when it comes to advertising to really move the needle. You know, I think it's interesting, I guess, you know, some of it has to do with the cost of your products. And, you know, like ratio, at least this is what Facebook is told us, you know, hey, you got to spend, I don't know, and percent of what it costs to sell that product, or 10% of what it costs to build that product or the retail price to basically, you know, make a sale. So, you know, certain ads might cost. You know, it's hard to really say but it could be $500 per purchase. But I mean, some of that is just based on. They're a little tight-lipped about what they share with you, you know, could be 100 bucks per purchase, or $50 per purchase. It really I think is, you know, unfortunately, a lot of that proprietary sales, advertising algorithm stuff is really frustrating. Yeah.

23:41

So with that price point, kind of in mind, like I would also imagine that what will actually let me backtrack for a second, what do you know, the lifetime value? Do you see customers typically buying a second or third game?

23:56

Yeah. We do, which is awesome, right? I mean, when you're talking about a product that costs $3,000 to $11,000, depending on what you buy, you're gonna make multiple game purchase. Now we will offer a discount. You know, if it's a two-game three-game four-game purchase, there's a discount for you there. And, you know, we do actually see, you know, customers coming back after they've purchased their first game are telling their friends and it's hard to really say what that lifetime value is, at this point, but we have seen since we've introduced the new products, customers that bought one game for $3,000 buying four or five more to build out a game room, you know, and those, you know, carry different price tags if it's 5000 10,000. You know, it's, it's great. I think they're probably few Businesses like this where you're gonna see that lifetime value jumps so quickly. Obviously, you know, we're aware that the market for our products is smaller than T-Shirt Company. But we also have, you know, the reputation and the uniqueness inherent in our brand and our trademarks and other copyrights that allow us to be, I guess, you know, more effective at selling, you know, a unique product, then, yeah, say somebody else comes up with a knockoff.

25:45

I would also imagine you're shipping and correct me if I'm wrong, but I'd imagine your shipping is probably not cheap.

25:49

Right? Correct. Yeah. Everything ships, you know, the LTL. So, you know, super checks, comes in two boxes, the base and then the dome. Oh, that ships out. And you know, it takes about three to 10 business days, depending on the freight company that we end up using, but it's, it's not cheap. Um, but you know, we do offer free shipping, free standard shipping, which is a nice touch,

26:27

do you also ship globally?

26:29

We do. So we ship into Canada with customs, just because they charge us to bring games into Canada. And we ship globally, either directly or through our distribution partners, for example, and Europe. We work with Sega Europe, and they do our distribution UK. Different distributors throughout the Middle East and Asia. But yeah, South America, you name it. I know the

27:02

company itself. The main entity has been around since I believe the 80s. Right? Yep. 1982. Nice. So what is it you think on the direct consumer side now that you're kind of coming in and taking over, you know, helping out with Shopify Plus and everything? What do you think is going to help the direct-to-consumer side, get you guys over to the next level of you know, wherever your next target is?

27:26

Yeah. So I think, you know, as we grow this side of the business, for us, it's gonna be the same sort of things that brought us to success in the coin app space, you know, licensing, I think is going to be huge for us. Now, we've seen a ton of success with the NBA license, the NHL license, the MLS license, MLB. NFL, we have the NFL game called two-minute drill, you know, an arcade space, we have carnival games, as well, those are unlicensed, but you know, very, you know, thematic milk jug tossed on the clown, you know, whack and when was just like the test of strength, but we've made it skill. We did a Ghostbusters game, Angry Birds out the rope, you know, Doodle Jump. You know, beyond that, and just being creative, I think will help us as we look to build out the home space. With, you know, a similar template that brought success in the webspace. I mean, I'm not sure if you've seen it, but and the ball has seen a huge resurgence. And on game rooms. And I think some of that magic is the licensing. The size is also a factor, but the licensing and replayability I think those things are going to be important as we scale. Yeah. So what is what is

29:02

Does product development look like? Like, who has that job of coming up with all these cool games that you guys?

29:08

Yeah. Um, so drew Kraus. He's in charge of research and development. He's also our CEO, and my father, one of the partners of that company. He's been here, I want to say, probably somewhere between 20 and 25 years, started off his woodshop manager, you know, grew that part of the business and became the plant manager, operations and then partner and so he worked closely with our founder for many years and, you know, the game development side of the businesses very, very intense. So we are competitive. We come up with anywhere between three and six new titles a year. One of the games that we developed just before the pandemic, we made a giant display game called monopoly rolling go. So two monitors stacked upwards to give you a, you know, a sort of half-circle view of the Monopoly game board. So you roll a giant die giant monopoly die. And, you know, you spin through the properties, you can double down to get double the tickets. You know, that game is a huge success for us right now. And redemption, it's probably thought the number one ranked Redemption game for film entertainment centers just based on polling of arcades. You know, that part of the business is, a lot of it is again, you know, you base it on concepts, people come to us with designs, sometimes other times, it's completely internal, we'll make a design that somebody has, we're working on a licensing deal or some sort of royalty agreement. And then we'll build our own version. So we do all of our prototyping here because we do manufacture everything here, we have our woodshop, we have a steel and aluminum shop, we do powder coating, all of our manufacturing is done on our production floor. So you know, cabinets are built in the cabinet shop next to the woodshop. We have a paint shop and bring it out for assembly, we have a harnessing electronic shop tech room, we actually design the boards for the games as well. So we have engineers who will design custom boards. So pick and place machines that will put chips onto printed circuit boards. I mean, it's pretty intense. Nice.

31:47

So what is your day-to-day look like?

31:50

Yeah, so between sales and creative for online, working with our agencies, working with our customers, you know, fielding calls, emailing customers working with our resellers, you know, in some product, conversations about product development, you know, changes to the Shopify platform. So it's involved, there's travel as well. So I'll go out and visit resellers, you know, so a little bit of cold calling a little bit of inbound. You know, it's a little bit of everything. But, you know, ultimately, my role is to develop and build on the growth of the home side of the business. Nice. What is,

32:44

what is the next target? Like, I know, you kind of mentioned, like, you know, going through licensing and things like that, but yeah, I know, like with the Shopify Plus, that's just gone live, like, what is it, you think, is going to be that like, Okay, we've,

32:56

we've hit a new level there. Um, you know, I think it would be, first, it would be okay, we've doubled us, you know, business for the home base, I think, you know, doubling and then looking at that and saying, Okay, we really want to put more and, you know, and really, I believe that it can be as big as our arcade side of the coin. ops base. So, I think it's just as we look at how to scale what we're comfortable with in terms of scaling, adspend. And just the overall awareness of the side of the business. I think that's just kind of where we find ourselves. I mean, there are different product categories that we can get into as well that we haven't yet, but it's, you know, is it a connected experience that takes you, you know, beyond just playing the game at your home, maybe you're at your friend's house, hey, saving to my profile here, or you pick it up at your house or you're at the arcade and you bring your progress with you. There's just start tracking things that you could get into building on future experiences. On top of existing games, whether it's through free updates or subscriptions, you know, we've updated our icefall Pro and our NBA game time pro with additional game modes for free. There's a street racer game now on icefall Pro, which is basically you and your friends get three balls to move your car on the ice ball game, basically, you get three at a time and whoever scores the most signs of progress, there are three pitstops along the way. So it's a nice little party game with up to four players there. And then we did for basketball. We created a new time at mode so there's basically an hourglass timer that moves up and down. You get the most points for hitting it in the middle. segments there. So just coming out with new games, keeping people engaged, and listening to customer feedback, what are you looking for next, you know, for your game. And I think we're seeing some good signs they're,

35:18

obviously, really appreciate having you on the show, I don't want to take up too much more of your time. I know you guys are obviously incredibly busy over there. But I really appreciate you joining us. And this is that stereotypical moment where I let you take a minute here and kind of let everyone know where they can learn more about you

35:32

guys. Absolutely. Thanks, Andrew. Yeah, we've, I've enjoyed being on your show, and I appreciate the understanding. So if any of your listeners are interested in buying any of our games or finding out more, you can go to homearcadegames.com and search through our site. You can reach out to me directly with any questions, either via email, or my work cell phone. So that's J Krouse, jkrouse@icegame.com. Or you can call at 716-545-1220 Any of those options are great if you're just looking to learn more about what we do. I'm happy to help. Beautiful,

36:23

Josh, really appreciate having you on the show. Yeah, and thank you so much for everyone who listened make sure you guys tune in subscribe on any podcast platform you want to or head over to YouTube and subscribe there or just go to Ecommshow.com To learn more, but for usual appreciate everyone tuning in and we will see you all next week. Have a good one.

36:41

Josh, really appreciate having you on the show. Yeah, and thank you so much for everyone who listened make sure you guys tune in subscribe on any podcast platform you want to or head over to YouTube and subscribe there or just go to ecommshow.com To learn more, but for usual appreciate everyone tuning in and we will see you all next week. Have a good one.