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Why rampant video game sales are bad for players

thecastledoctrine.net

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Re: Why rampant video game sales are bad for players

#31

Post by corysama »

We're talking about two very different types of pricing strategies that each work very well for two very different types of release.

With a big-bang, "it's done, ship it" release, going out at a high price captures high revenue from the few high-expectation customers. Dropping the price later captures remaining revenue from the many low-expectation customers. Steam-style repeated sales have the bonus marketing benefit of being noteworthy and counter-intuitively do not appear to cannibalize high-revenue sales much if at all.

With a slow-burn, "it's not done yet" release, going out at a low price matches the general low expectations for the product and has the bonus marketing benefit of getting talkative early-adopters on board early and also getting them increasingly excited as development proceeds. As quality increases, price increases accordingly. This has the bonus feature of putting some time pressure on customers who are on the fence about the cost/value proposition, but want to lock in a lower price by buying early.

Re: Why rampant video game sales are bad for players

#32

Post by jasonlotito »

WalterSear wrote: post #23
jasonlotito wrote: post #4

> If you buy it at launch, are you going to be screwed a few weeks later by a sale? Am I going to make you wish that you waited? Maybe I'm the odd one out, but I'd only feel that way if your game wasn't good. I happily buy games at full price, and if they are good, they are good. The reason why sales on Steam or other places work so well in attracting people like me is that those places are marketing themselves. Stea…

I wouldn't have bought 90% of the games I have if I hadn't been introduced to them in some kind of sale or bundle.

What point are you trying to make? That you only brought them because they were on sale, or that you only knew to buy them because they were being promoted through what happens to be a sale?

Re: Why rampant video game sales are bad for players

#33

Post by XorNot »

stefan_kendall wrote: post #27
TrainedMonkey wrote: post #19

I think this misses a few key points: 1. Steam is digital, there is almost no cost associated with "selling" a game, almost everything you sell is profit. Thus, it is somewhat disconnected from standard sales where dropping price too much can hurt you. 2. Steam does not allow you to buy physical games, you can't take a game out of steam. What you are paying for is for game to be added to your digital collection. Coll…

More users is not always a good thing. Support costs increase linearly for a while with the user base, and then I'd suppose superlinearly. Apple has departments of people dedicated only to taking phone calls. I would rather have 10 users at $10,000 each than 100,000 users at $1 each.

Games aren't business software. You had to fix the bugs anyway, but you don't have to add new features all the time after release.

Re: Why rampant video game sales are bad for players

#34

Post by teamonkey »

minimaxir wrote: post #7
jamie_ca wrote: post #3

Earlier quoted context omitted.

Kerbal Space Program is (mostly) doing the same as Minecraft. As they're hitting milestones the base price has been increasing, but they're still allowing themselves to get pegged during the major Steam sales. The other potential problem with rampant Steam sales (because honestly, they've won the mindshare) is that it's affected my price sensitivity. There's so many good games out there that I've picked up for a pitt…

What's really scary is how fast some of the AAA games drop in price. Bioshock Infinite on the PC went from $60 to $10 during Amazon/Steam sales in less than 6 months.

Most AAA games still have ridiculously short tails. Even before the sales at 6 months Bioshock Infinite was probably at something like 80-90% of its expected lifetime revenue.

The game is also free on PS3 for PlayStation+ members this month. I noticed that all of the games due to be on PS+ this month (BI, Brothers, Don't Starve, etc.) were heavily discounted in the Steam sales.

Re: Why rampant video game sales are bad for players

#35

Post by teamonkey »

jiggy2011 wrote: post #5

I think the biggest benefit of Steam sales is probably lowering piracy. Some large number of the people who got the game at 75% off would probably have just pulled it off a torrent site had that option not been available rather than pay full price.

By the time a AAA title gets discounted in a Steam sale it will have been available to torrent for a long time already. A game that lasts a few days without being cracked is remarkable.

Re: Why rampant video game sales are bad for players

#36

Post by qbrass »

lmm wrote: post #29
mxfh wrote: post #20

Earlier quoted context omitted.

Once they add a option to skip/autoplay the predictable-outcome fighting sequences I would buy any sequel. Seriously if you're over 30 you shouldn't have to prove to anyone anymore that you can beat scripted hoards and boss fights. Some goes for Spec Ops: The Line after playing the first two levels I preferred watching the play-through on youtube over having to kill the equivalent of whole population Staten Island on…

> Once they add a option to skip/autoplay the predictable-outcome fighting sequences I would buy any sequel. Seriously if you're over 30 you shouldn't have to prove to anyone anymore that you can beat scripted hoards and boss fights. What? You bought an FPS (or at least a game with FPS elements). The mechanics of that, the co-ordination and the thinking, are part of the game, part of the challenge, part of the fun. I…

They're speed bumps with guns. The strategy for killing them hasn't changed since Space Invaders.

Re: Why rampant video game sales are bad for players

#37

Post by Periodic »

wonderzombie wrote: post #30

This is the problem with assuming humans are all rational, utility I maximizing machines. When a game like Skyrim comes out, I don't care that it'll be $45 instead of $60 in some months. My friends are playing it, the Internet is playing it, people are making memes. I picked $45 as an example price on purpose, because games which are brand new (according to my anecdata as someone who couldn't stop refreshing Steam in…

The author somewhat addressed this when he mentioned that the number of people buying in at the lower price that wouldn't have bought at full price have to offset the people who wait.

However, I think you're completely right that the number people imagine exist may not be there. Obviously 100% of the sale buyers would have paid full price. I know that the majority of games in my Steam collection are not games I would pay full price for, but they are game that I was happy to pick up in a Humble Indie Bundle. Half the games in those bundles I don't even plan on playing ever and just bought because they were bundled with a few games I thought might be interesting.

Choosing to participate in a sale increases revenue over not participating, but the author is worried about a world where sales become the new norm. Of course, if that's the case, bump your price from $16 to $30 and feel free to participate in those 50% sales after you've done your initial price bump. The market will sort that out.

Additionally, sales are great for increasing brand awareness. Many retail sales aren't designed to make money on their own as much as get people into the store where they might buy full-price merchandise. As an anecdote, I bought Terraria for something like $2.50 on a steam sale. When I first heard of it I thought it didn't sound that great. It turns out I love it and spent 60+ hours playing in in the span of a month. Now I will definitely buy the company's next game, Starbound for full price when it's released. If they hadn't had the sale I would never have bought either game.

Re: Why rampant video game sales are bad for players

#38

Post by Dysiode »

I'm largely a fan of the idea I've felt the burn of the "I paid full price for this because I appreciate your work but now it's 33% off?" moment (Borderlands anyone?). I want to see that abolished. Because I've seen a lot of negative feedback of the argument, I want to offer an addition to it.

As an example, I had my eye on Kentucky Route Zero since I saw it in IGF and I fit the example user "It'll go on sale. I'll wait" But after a year it only went on sale for 50% (crazy, I know) and that happened a couple times. At that point, I knew it wasn't going to go to 66% or 75% any time soon so I picked it up. I can see a happy medium with sales where you make it clear that you won't go on sale for a certain period of time and/or for a specific discount. You don't necessarily have to verbalize that either. I don't follow any KRZ news but it was clear that that price point was not going to change quickly. This way you still get the press about sales (I saw a lot of KRZ at 33% and 50%) without having to screw fans over.

I'm sure there are a few ways of strategizing it that would require some experimentation (e.g. a bit before a steam sale, have another 10% type discount like might be seen on launch week but make it clear that it's not going to go below that). There are also more mediums for sales with the Humble Store now you see a lot of games with shallower discounts.

I will say I don't think this model works as a long term plan however. I like the idea of starting low for pre-orders and then increasing the price over time, but I don't think it would work as expected over a two week period. With Minecraft there was the expectation of more content over a period of a year or so between increases. It may still be viable but that may be a case for early access. Make it clear there that the price will increase when it's finished.

I hate seeing what appears like developers feel like they have to sell out on their baby, and I hope something like this can work.

Re: Why rampant video game sales are bad for players

#39

Post by chii »

teamonkey wrote: post #35
jiggy2011 wrote: post #5

I think the biggest benefit of Steam sales is probably lowering piracy. Some large number of the people who got the game at 75% off would probably have just pulled it off a torrent site had that option not been available rather than pay full price.

By the time a AAA title gets discounted in a Steam sale it will have been available to torrent for a long time already. A game that lasts a few days without being cracked is remarkable.

Whether there is a torrent available doesn't really factor in to the decision to buy a game on sale.

If a game is deemed "worth it" by a buyer, they are going to purchase it, instead of torrenting it. Or, rather more frequently i assume, they first torrent the game when it comes out and full price, play a bit and find it not that great. Then, when time comes for a sale, the gamer chooses to buy it and replay it, because the price is worth it.

Re: Why rampant video game sales are bad for players

#40

Post by chii »

XorNot wrote: post #33
stefan_kendall wrote: post #27

Earlier quoted context omitted.

More users is not always a good thing. Support costs increase linearly for a while with the user base, and then I'd suppose superlinearly. Apple has departments of people dedicated only to taking phone calls. I would rather have 10 users at $10,000 each than 100,000 users at $1 each.

Games aren't business software. You had to fix the bugs anyway, but you don't have to add new features all the time after release.

and also, i don't see a game (even MMO style game) taking calls and operating a call center. At best there's some admin/moderating role, and it'd be asynchronous, and cookie cutter style responses.
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