Investment analyst company Goldman Sachs has downgraded the shares of the GAME group down to 'sell'.

The GAME group has had its shares downgraded from 'neutral' to 'sell' by investment analysts at Goldman Sachs. The change in rating was primarily introduced due to increased competition in the digital market from publishers and their refocus on traditional retail stores according to Gamesindustry.biz.

GAME recently stated that they intend to further pursue the digital market, partially in response to a poor Christmas performance. The company intend to triple its digital sales to �300 million by 2013 through promoting the service to its in-store shoppers using their reward card scheme.

"The group's direct competition in online pricing is causing gross margin erosion, while we view the strategy to improve store content, layout and staffing as negative to profitability in the near term. Longer term, we expect the rate of increase in digital downloads direct from publishers to be a threat to mint software sales, the pre-owned market and Game's movement to gain market share in digital content. Consequently our EBIT forecasts have come down by 16 per cent in 2012 and 28 per cent in 2013."

Goldman Sachs statement.

GAME CEO Ian Shepherd argued that customers would use GAME's online services to purchase downloadable content and other online products after having purchased the boxed copy in-store. He also claimed: "Having a great retail space will catapult us into a leading position in digital and downloaded content."