Forward Push (Stern's Influencer Day)

Inside Stern’s Influencer Day | The Business of Pinball | A Moment I’ll Never Forget | Creator Highlights | More!

Be warned. This is a long one. We’re clocking in at over 4,000 words following our trip last week to Stern’s factory as part of their Influencer Day.

Feel free to consume at your own pace; I’ve tried to break things up into smaller topical chunks of more digestible info and included some takes and analysis you won’t find anywhere else.

I also include a ton of photos. For those of you who are accustomed to reading this in your inbox (the way it’s usually intended), I recommend pulling this up on a browser for the best experience—you can do that here.

This Week’s Pinball Agenda:

  • Song of the Week (actually two songs of the week)

  • Sponsor of the Week

  • Pinball News of the Week

    • Recapping Stern’s Influencer Day

      • The Factory Tour

      • The Business of Pinball (and a breakdown of the pinball market)

      • Insider Connected Updates

      • A Moment I’ll Never Forget

  • Creator Highlights of the Week

  • Poll of the Week

Song of the Week

This week, we will have two songs of the week to break things up. Starting with Let’s Push Things Forward, the 2nd single from The Streets’ 2002 debut classic, Original Pirate Material.

It’s an early 2000s UK hip-hop track from an artist with one of the most unique sounds I’ve ever heard. On the surface, this mashup of styles and musical approaches should not work. The beats and the vocals almost seem at odds with each other. Singer Mike Skinner’s lyrical delivery feels stunted and awkward, particularly when contrasted with more mainstream hip-hop of the modern era.

But somehow, it works.

Later on, we’ll highlight Le Tigre’s 1999 banger, Deceptacon, off of their self-titled debut, which is an incredible song in its own right, but I’m also using it to pay off a cheesy sub-head pun about BOM.

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Recapping Stern’s Influencer Day

Tim Sexton showing off his game.

Where do I start after last week's events?

The beginning sounds good.

In the last couple of updates, I alluded to scheduling conflicts that would take me out of my usual publishing schedule, but I couldn’t share much more.

That scheduling conflict was a trip out to Stern Pinball’s HQ in Elk Grove Village to tour their new factory, play John Wick, learn more about the business of pinball, and spend time with the people behind the games we play.

To say this came together quickly would be an understatement. It wasn’t on my radar until a few hours after sending our newsletter on the 10th, when I received an email from Stern’s Director of Marketing, Zach Sharpe, asking if I could attend a Stern factory tour on the 23rd. Stern offered to cover travel expenses (so, disclaimer, we received free things), and I still only half believed this opportunity would materialize until I received the green light to book my travel several days later.

It was a whirlwind trip.

Flying out of Boston at the crack of dawn on the 23rd, with activities planned at Stern all day, and then flying back out early on the 24th. No formal agenda was shared, except for our start time and the fact that a tour and evening activities would be involved.

While the timing of this event may seem curious to some (it was to me), Zach did offer in his initial outreach that this initiative had been in development for some time (maybe even dating back to pre-pandemic times), according to info shared on the LoserKid Pinball Podcast.

And let's be real. However, it came about; I was stupidly excited to partake.

A Quick Aside on Media & Influencer Events

It’s not lost on me that not everyone reading this newsletter comes from the same background I do. These kinds of brand-sponsored influencer events are exceedingly typical across various industries.

In my 20s, Ford tapped me and my wife to help launch the Fiesta as part of the 2nd chapter of the Ford Fiesta Movement. Ford flew us out to Detroit for orientation, gave us a car for 6 months, a laptop, a DSLR, and some budget, and our goal was to promote the ever-loving heck out of the thing through a series of events and challenges. We worked with local artists to create a mural and a wacky short film, sponsored an indie rock show, and other community-focused activities.

I’d do something similar a few years later but on the corporate PR side. This time, I helped organize and chaperone a trip of airline frequent flyers on behalf of then-client American Airlines on a massive behind-the-scenes trip that involved flights from NYC to London to Dallas to Seattle and Los Angeles, complete with special tours of the American Airlines HQ facility, Boeing factory, and more.

The fact that the pinball industry rarely held these kinds of events always seemed a bit strange, which was one of the reasons we put together the Media Mixer at Pinball Expo in 2023.

The Stern Factory Tour

CEO Seth Davis greeting us

We arrived at the Stern Factory around 12:30 p.m. for a 1 p.m. start. After checking in at the front desk, we were greeted by most, if not all, of Stern’s executive team: Gary Stern (Founder), Seth Davis (CEO), George Gomez (CCO), John Buscaglia (CRO), and many other Stern team members who would be joining us throughout the day.

From there, we received a few ground rules, which largely amounted to only taking photos when we were expressly permitted to do so (we had the green light for maybe 80% of our experience).

We started in the main area, which for the tour was set up with copies of John Wick, Jurassic Park (30th Anniversary Edition), James Bond 007 60th Anniversary, and Elvira’s House of Horrors (Blood Red Kiss Edition).

From there, we approached the product development studio (no photos allowed), where most of the game development team sits. Upstairs from this area on the 2nd floor were executive offices (fittingly, Gary Stern’s office overlooks the factory floor).

George Gomez led this portion of the tour and noted an old flat-file cabinet pushed up against the side of the wall. Apparently, this cabinet contains all the physical blueprints and playfield drawings for Stern’s historical catalog of games. The team is working on digitizing these and will then donate them to the Strong National Museum of Play.

Dwight Sullivan in action

At this point, we were handed off to the care of Dwight Sullivan for one of his well-practiced and enthusiastic tours. Side note: if you’re attending Pinball Expo this year, please attend his “Let’s Make a Deal” session!

Donning protective eyewear, we snaked our way through every area of the factory that I could see, save for the room where all the new games were in active development. That area was opaquely and purposefully walled off (in my head, I think the walls were floor-to-ceiling, but they may not have been that tall).

The factory is big.

This isn’t the first time I’ve seen large-scale manufacturing facilities in person, but knowing the relative scale of the pinball business to some others, I was struck by the size and scope of the operations. From the receiving area (where you can still find a bunch of old Data East and Sega game parts) to shipping, Stern is a well-oiled pinball-producing machine.

We were even allowed to see Stern’s Model Shop, where many of the playfield parts are produced (think wire forms, mechs, etc.). For those who have been reading for some time, recent hire Derek Karaminian now works there, and it was a surreal moment to walk in and see him posted up at his station just a few days after officially joining the team.

The famous Hannefin pinball press, which goes back to the Gottlieb years.

The Business of Pinball

The next phase of the tour was by far my favorite. This is where Stern demonstrated a bit of corporate vulnerability and took a few unorthodox risks.

We were all asked not to take photos or to repeat word-for-word some of the things that were shared (Gomez saying, “I better not see this on the Internet tomorrow” stands out), so while I furiously pecked away in my notes app, I’ll mostly be summarizing some of the things we learned and walking a fine line between transparency and accidentally sharing trade secrets.

From the factory floor, we were led to one of their primary conference rooms (Cheetah, I believe?), which are all named for classic Stern Electronics games. We filed in, and once everyone took a seat, we were instructed NOT TO TAKE PHOTOS…but I may have snapped one or two before those instructions were given.

The room where it happened.

There, George Gomez, alongside Gary Stern and Seth Davis, walked us through a PowerPoint deck titled “Influencer Day.pptx” or something. It made me chuckle.

The whole point of the presentation was to give us more context about Stern, the business of pinball, and the logic behind certain decisions or outcomes that may otherwise seem at odds with what the pinball-buying public might prefer. We started with licensing, discussed the realities of bill-of-materials (BOM) and how that translates to pricing, the different types of pinball buyers, touched on Insider Connected, and some other customer pain points the Stern team was evaluating solutions for.

Languishing in Licensing

This was a fascinating part of the presentation, given how much of modern pinball revolves around brand licensing. We were largely correct in our characterization of the challenges when the controversy first popped up, but it was nice to see things both reinforced and expanded upon by Gomez and the team.

For example, one of my big takeaways, which may seem obvious to anyone who has spent time working with large organizations, is that Stern has to navigate the politics and dysfunction present in many of these companies. The left hand doesn’t always know what the right is doing, and even when that line of communication is established, sometimes those hands still want to pull in opposing directions.

For example, it’s frequently the case that the department at, say, Disney responsible for creating film content for a character like Deadpool has little interaction with the department responsible for creating licensed goods, and even if they did, they might be operating under different sets of brand guidelines or business KPIs.

Pinball is also a type of licensed product that is far more complex than what most licensors are used to managing. If you think of most licensed goods you might encounter in the wild (an action figure, a t-shirt, a Lego set), a pinball machine may be more of a rocket ship in comparison.

Kyle Spiteri walking the floor with Beck Gallagher (HUPChallenge)

The licensor has to approve every single detail of the game, from the sound design to the shooter knob, and sometimes those pieces are presented in isolation, so the Stern team has to conduct a ton of product education to make sure the licensor understands the decisions being made.

Even then, it’s not always a foolproof process, and it’s not uncommon for Stern to inadvertently uncover aspects of the IP that even the license holder didn’t realize or maybe hadn’t even considered.

These things factor heavily into IP selection, too. It’s always going to be an easier (and less expensive) process to work with an experienced partner who is familiar with the product than someone brand new to the world of pinball.

So, while Stern is often pitched by licensors interested in a pinball machine, it isn’t always going to be a good fit.

Stern has to weigh a number of other factors, too, like if the IP has enough of its own audience ecosystem to meet Stern’s objectives while helping with broader audience expansion efforts.

Importantly, they also have to consider if their internal teams have any personal interest in the IP itself. Those teams want to create the best pinball product possible, and that’s extremely difficult to do if you have zero personal attachment to the theme.

Personally, I could never write this newsletter for cars instead of pinball machines because I don’t care enough about cars to draw the creative inspiration necessary to produce quality work.

The same forces are at play with Stern’s team.

Who took the BOM from the BOMPALOMPALOMP?

The next section of the presentation focused on giving us more context about the much-maligned BOM (bill-of-materials) talking point.

The meat of the message was fairly straightforward: BOM is a guardrail, not a hard line (all businesses try to control the cost of product), and there is a lot that goes into one game’s BOM that isn’t always reflected in what you can see on the playfield—things like licensing costs, legal fees, software development time, and a lot more.

One particular anecdote that stood out was Gomez’s explanation of tooling, how it is incorporated into a game, and its production budget.

John Wick playfields.

In layman's terms, tooling is the process of creating something that enables the creation of more things at scale. Think of a mold for plastic pieces or templates for metal parts like wire forms. It’s optimal from a business standpoint when that tooling work can be spread out (amortized) over many different games rather than producing something that might only be used in a single game.

Producing a one-off component for a game does happen, but it means that there’s less budget for other parts of the project, and that has to be accounted for.

So when a new game gets critiqued as a “parts bin” game, is that a fair characterization?

I don’t think so.

It reflects smart and efficient engineering and product design decisions more than an indicator of prior game sales or Stern’s effort level.

A Spectrum of Customers

Pre-tournament announcements at Logan Arcade

In regards to the John Wick conversation and why that particular IP was selected, besides some of the points above, it was also impressed upon us that Stern has a wide range of customers to serve, and not every game or product decision is going to serve every audience equally.

Some projects may be intended more as market expansion opportunities (like John Wick, for example). Others may be focused on the collector audience (James Bond), and some may even be intended just for the most hardcore pinheads (Black Knight: Sword of Rage).

The quote that stood out here was one provided by Sam Stern (Gary’s Dad): “Every game finds a home.” Some have more potential homes than others.

As a community, we over-index on the needs of one of those customer groups (the collector/LE buyer) because we assume that high cost = high importance, but I’m unsure if that’s always true.

Pinball Buyer Segmentation

Pinball Customer Segments

This speaks to one of Stern’s challenges as a business, which is partially reflected in outward-facing marketing decisions and why there was some pushback at how the Wick release was executed.

If you segment the pinball market into three main groups: Pinball Buyers, Pinball Enthusiasts, and those who are Pinball Receptive, there seems to be a bit of an inverse relationship between things like realized revenue, revenue potential, difficulty to acquire, and expense to maintain.

Stern may derive 90% of its current revenues from Pinball Buyers, a comparatively small group relative to those who may be Pinball Receptive, but there are also infinitely more revenue opportunities among the Pinball Receptive.

It’s difficult (and expensive) to move someone from being Pinball Receptive to a Pinball Buyer. Still, once someone reaches that stage, they stick around for a while, and there’s a robust ecosystem of media entities, community groups, and other things that keep them engaged that Stern doesn’t have to pay for.

Sketching the Media Landscape

You can extend this thinking to some of the outlets in and outside of the pinball media space. There are those, like this publication and most people invited to the media tour, who cater mostly to the buyer or enthusiast market. Since we are already buyers or enthusiasts ourselves, we’re far easier to handle and work with than those who are maybe less familiar with pinball but extend into the Pinball Receptive space and beyond.

This speaks to the core of the problem with the Wick release and explains why Stern might have felt it necessary to push to re-engage with this community.

Where Stern’s Focus Usually Is

At least since I’ve been in pinball, Stern’s focus has primarily seemed to be top-of-funnel growth opportunities that served to move people down a Pinball Engagement Funnel (my words), mainly relying on the strength of their product and the pinball community to drive people from about midpoint in the funnel on down.

The problem is that without proper attention and investment, the ecosystem that supports the Pinball Buyers and Pinball Enthusiasts will start to decay and fracture, giving Stern a weaker foundation from which to build outward.

As niche content creators, we face a flavor of the same problem Stern does. Our core audiences (Buyers and Enthusiasts) aren’t going anywhere, but for those of us approaching this like a business, the revenue opportunity from those audiences is low compared to what can be found as you move upmarket from the core pinball buyer.

Where More of Stern’s Focus Should Be

This is why it is so important for Stern (and others) to make more attempts like this one to engage with the ecosystem of creators and influencers (I use that term broadly). Today’s niche publication might grow in size to some of these larger sites, and already have a level of pinball fluency that would be very valuable to a company like Stern, and that only happens with strong industry and community support at the grassroots level.

Insider Notes on Insider Connected

Brian Eddy watching a game of Wick.

I had a few notes on Insider Connected that I found interesting, and I think you might, too.

  1. Insider Connected’s goal is to expand the pinball player base.

  2. Stern is evaluating how to incorporate paid features (like home leaderboards) into the app without sacrificing the quality or utility that their free product currently provides.

  3. We’ve done some of our own analysis of the size and scope of IC here, and I thought the numbers shared with us were lacking in the kind of specificity I crave but broadly painted a picture of growth and success.

As I evaluate the pinball landscape, I think getting Insider Connected right is absolutely critical to Stern’s long-term success, as it aligns far better with the type of gameplay and community experiences that I think today’s gaming audiences want and is one of the few ways Stern can create new business value at scale from its entire userbase across both home and location users.

Playing the Long Game

Elliot Eismin and Tim Sexton showing off their game.

It’s clear that Stern is aware of the challenges it faces as a business today but has an eye trained on where it needs to be in the future to continue growing the pinball market and maintaining its leadership position.

Because of the time that it takes to move someone through each stage of the pinball buying journey, Stern would be in a tough place if they only focused on the themes and gameplay experiences that today’s 55-year-old man would like to see, as by the time they crank out 2-3 of those titles, the next crop of younger pinball players will have started to move into the pinball buyer stage, if they haven’t done so already.

For example, one of Stern’s priorities is making the pinball buying experience far easier. They recognize that certain aspects of the process (like setting up your game) could be improved to lower the barrier of entry. Think of initiatives like moving more of the setup and configuration to your phone.

Reading between the lines, I think Stern has to be evaluating its distributor-led sales approach, as it’s the largest hurdle to anyone buying a NIB game. However, those words were never blatantly spoken. It’s one of those things you can see happening in a hypothetical brainstorm where Stern throws everything on the table to evaluate its strengths and weaknesses as a business.

The other point that stood out along these lines and is relevant to the Wick discussion is that Stern has to work towards training the next generation of pinball-making talent. It’s why people like Elliot Eismin, Tim Sexton, Jack Danger, and Raymond Davidson get cracks at new projects or expanded roles.

You could almost extend that analogy to Stern’s CEO, Seth Davis. Though he’s been in the role for some time and has the credentials to run the show on his own, it felt at times like even he was taking a back seat to the likes of George Gomez and Gary Stern, two pinball vets who have probably forgotten more about pinball than Seth could ever hope to know. Other CEOs in a similar position may have taken the opportunity to assert their dominance in an attempt at performative leadership, but the fact that he didn’t do that was telling.

Even he is learning, growing, and adapting, much as his growing team is.

A Wall of TWIPYs

TWIPY Awards

After the Pinball Business 101 presentation, we were split into two groups and guided to Stern’s new streaming room, where we could finally spend some time playing Wick and talking to members of the design team.

There’s one specific moment from this part of the experience that I will always remember, and I think it speaks to where Stern’s corporate heart is, even if we don’t always see it from our vantage point.

Those who have followed This Week in Pinball closely know about the drama surrounding last year's TWIPY awards, so I won’t recap that here.

Those events sent me to a deep, dark place for longer than I’m comfortable with. Many people in the pinball community, particularly in the media, became a lifeline of sorts and encouraged me to keep going. Ultimately, it’s a bump in the road.

But when I considered the TWIPYs broadly and their place in pinball, it was never really clear to me that anyone other than Pinball Media cared much about the awards.

I offer all this to set up the impact of this particular moment.

We’re in the streaming studio, and Tim Sexton is demonstrating John Wick and some new code features he was working on.

I peel off from the group for a minute to get a better look at different areas of the room and see if I could get more interesting photos.

That’s when I spotted the back bar area. It took me a minute, but I suddenly realized what was prominently featured along the back of the wall (with dedicated lighting and everything): TWIPY awards—gobs and gobs of TWIPY awards.

It was then that I thought to myself, “Oh shit, so they do care.”

And maybe some of it is for show; after all, there aren’t a ton of industry awards in pinball. But I turned around, and there was George Gomez. We made eye contact. I think he read my face, knew what I was thinking, and gave me this knowing look.

It said, “See, we are paying attention, we care, and we get it: what you do does matter.”

I’ll never forget it.

Takeaways

Nerds on a party bus.

This is where I’ll leave this section of the newsletter and the main recap of Stern’s influencer event. There’s so much more I could talk about, like our office pizza party (I enjoyed it), our trip to Logan Arcade (it felt damn good to play in a tournament again), and other odds and ends that are being left out of the final edit. None of those things will have as much weight as what I’ve already shared, and this is a tome already!

Wick was ever present, and we were provided ample time to play it, but you could tell that selling us on Wick was mostly a secondary goal. Instead it felt like a giant exercise in transparency and relationship building.

Suffice it to say the whole thing was very well received. I don’t know that it will move the needle for John Wick sales, but I don’t think that was the point, either.

Creator Highlights of the Week

If you’re not tired of my thoughts yet, I was invited to the In Before the Lock show to discuss our analysis of potential Stern vault titles, the media event, and more. Please check it out!

  • Here are a few additional highlights of some of the coverage coming out of Stern’s media event:

Poll of the Week

Are the people who attended Stern's Influencer Day shills?

It's a question that's being asked.

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Last Week’s Poll Results

When you're at the cookout, which grilled food item do you prefer?

🟨⬜️⬜️⬜️⬜️⬜️ Hotdog (19)

🟩🟩🟩🟩🟩🟩 Hamburger (69)

⬜️⬜️⬜️⬜️⬜️⬜️ Something made of plants (7)

“feels like you're just testing to see if anyone is reading... oh well, I voted anyway. And now on to pinball...”

-Selected “Hamburger”

“To elaborate - I love a good hamburger at a cookout/BBQ, but my favourite part is the BBQ'd fruit and veg I do up alongside the meat. Grilled corn on the cob, pineapple rings, peppers, portobello mushrooms... I'm excited that grilling season is upon us.”

Selected “Something made of plants”

“It's a dog for me dawg. Don't be shy with the onions.”

Selected “Hotdog”

“Wood or charcoal no propane bullshit”

Selected “Hamburger”

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