game-ism.com

game-ism.com header image 2

The Twenty Dollar Question

August 11th, 2008 · 7 Comments

TWENTY BUCKS FOR A SQUEEZY

Lately I’ve been playing on the cheap.  I find that I don’t have a lot of time to invest in longer “full” games, so I’ve been spending twenty bucks here, fifteen bucks there, and enjoying some of the “indie” fare gaming has to offer.

I go on these cheap spurts on a semi-regular basis.  Usually when I’m not interested in the full priced titles out at the moment, or when I don’t have a lot of time to invest in them (like now).  Some of them I’ve regretted (some of the Pop-Cap fare of late), and others, such as Braid, I’ll be re-enjoying over and over.

There’s been a bunch of whining from many forum corners about some of the pricing on the small fare stuff, mostly revolving around Penny Arcade’s offering and the aforementioned Braid.  I, personally, don’t understand the complaints.  Besides Penny Arcade’s strip on the subject chronicling what people will pay $20 for, I’ve been wondering why wouldn’t someone pay $20 for a game.

Fact is, people do pay $20.  For lots of games.  Back when I got my start in videogames, I was working on kiddie “click and play” adventure CD-ROMs, and we studied the competition a lot.  Tiger Electronics priced all of their handheld disposable games at $19.99.  Our marketing director finally cornered theirs, and asked why they set their pricepoints on nearly everything at twenty bucks.  The answer?  It’s the amount of money that Soccer Moms find “disposable” every time they make a trip to Wal-Mart or Target with their kids in tow.  Basically, it’s “shut up” money so their kids can take home a new toy every trip to the superstore.

Consoles have an equivalent of this, the “Greatest Hits” or “Platinum” versions of games.  Basically, games that have met the minimum sales requirements of a given console (usually 500k units sold) are waived the $10/unit fee from the console manufacturers, and given special pricing of $19.99 (and a repackaging with the new Greatest Hits branding).  These, in a way, are the rough equivalent of the Tiger Electronics titles.  The branding gives parents who wouldn’t know better the confidence that this is twenty bucks well spent.  The price point is below the refusal threshold, and everyone knows that the eventual consumer will have a good time with the title.  It’s a guaranteed satisfaction for your twenty dollars.

I began this piece wondering why someone would be so willing to shell out $40 and up for a “premium” title, but would balk at the idea of a downloadable title which costs ostensibly half, yet still offers up a roughly equivalent amount of enjoyment, despite a possibly lower level of “quality.”  While wrapping my head around this phenomenon, I came to the conclusion that we’re all assuming that the people complaining about the “high” pricepoint of DLC titles are the same people who readily consume the $60 titles.

I’m pretty sure they’re not.

I have a feeling that the reason why the complainers want these premium DLC titles to only cost $5 is because $5 is their spending threshold.  They’re renters.  If they do purchase premium console titles, they do so at the “boutique” stores where they trade in the last game they played for credit, virtually renting their titles from the retailers.

Asking them to spend $15-20 on DLC is like asking them to give up three weeks worth of rentals (or half of their Netflix/Gamefly subscription), or completely axing their GameStop trade-in budget for the month.  The fact that the software is only available via direct download is what’s key here.  It can’t be rented.  It must be purchased.  Since there is no other option, the only outlet is complaint.

So let them complain.  They weren’t going to buy it anyway.

The fact of the matter is that if the pricing wasn’t right on the PA title or Braid, people wouldn’t have purchased them, and that’s simply not the case.

[del.icio.us] [Digg] [Reddit] [Slashdot] [StumbleUpon] [Email]

Tags: business

7 responses so far ↓

  • 1 Nihohit // Aug 12, 2008 at 2:33 am

    oh, you were right on the spot – until the last sentence.
    really – some people would’ve purchased Braid for 25 dollars, maybe even 30. more people would’ve purchased Braid if it was priced 15 or 10 dollars. It’s not that complex. A pricing is “right” when it maximizes the amount of profit for the manufacturer, whether by a high profit, or by a big pool of buyers.

  • 2 Roc // Aug 12, 2008 at 9:33 am

    Every time the gaming internets get their britches in a bunch, it’s useful to step back and see if their whinging comports with reality -at all-. Usually, it doesn’t. Whereupon we can breathe a sigh of relief and ignore them.

    It’s simply not worth the intellectual effort to examine the bitching about pricing for wet edge, portal, braid or too many colors in diablo 3.

    To see so many publications get interview time with Jonathon Blow these past days — and then so thoroughly waste it by talking about -pricing- is depressing.

    Our community apparently has no -clue- how to deal with the kinds of meaningful games we claim to desire. We clearly have no apparatus for appreciating and digesting what’s important; no organ to filter trivial bullshit out of our attention.

    This is why we can’t have nice things.

  • 3 spitfire // Aug 12, 2008 at 9:40 am

    Yeah, I actually started this piece with the idea of examining changing the $60 pricepoint to a $20 pricepoint, and seeing if that would change how people buy games, ’till I realized that the people doing the whining aren’t really doing any buying at all.

  • 4 Skye // Aug 12, 2008 at 9:43 am

    Price point is always an interesting question. What can the market support? Who is the target audience and what are their spending habits? What is the mechanism to deliver the product?

    I would like to know the average age of the people complaining. My feeling is that it is a younger group that does not possess the disposable income but are wired in and ready to complain, a.k.a. teenagers. At present I had no issues purchasing Braid, but when I was 15 then 15 dollars would have been a hard bit of cash to come buy. Now I can save $15 dollars by not drinking a couple beers when I go out.

    To complicate things a bit further XBLA itself presents an interesting challenge because of the purchasing mechanism. In order to purchase points then you need a credit card. I would argue that the system in place there is set more for the adult gamer. Braid and Penny Arcade adventures struck me as games geared more for that group, so pricing them at 15-20 dollars made sense. That group can use the delivery mechanism with minimal difficulty and has the disposable income to purchase the product.

    On the flip side, the mechanism in place for buying say a 40-60 dollar game is frankly easier to use for a 15 year old kid. Save up your allowance, go to the store, buy your game. As you touched on, when you are done with it, bring it back and get credit towards another purchase.

    So in the end I think it is not the price point that is the real culprit here, people are buying the games. I think it is the delivery mechanism used that is more of the issue.

  • 5 spitfire // Aug 12, 2008 at 9:44 am

    Niholit: I’ve actually seen Marketplace data that says that you’re incorrect. People will buy DLC games/levels/songs if it’s under X pricepoint (the pricepoint being relative to the content. Songs are obviously cheaper than games, small games are obviously cheaper than more complex productions like Braid). So long as you are underneath that threshold, the sales numbers are the same.

    In other words, Braid would have sold the same # of units at $10 than they would have at $20. There are no metrics which show that there is a discernable difference in sales between the two. If there was, “Greatest Hits” games would cost less than $19.99.

  • 6 Malt eye me d’ya ground up « Alabaster Crippens doesn’t know what’s going on // Aug 12, 2008 at 4:45 pm

    [...] quite unique. I expect I’ll buy it. I find it hard not to buy cheap games (this is called clever pricing policy. I fall for their trickery). Again, give us a shout if you fancy sharing some tracks and [...]

  • 7 iKonik // Aug 13, 2008 at 9:51 pm

    I get where you are going with this but I disagree on who is doing the complaining. I think while the renters you mentioned might be part of who is complaining, they certainly aren’t the only ones.

    The people who are buying games permanantly are also complaining, but it is because of an incorrect paradigm on the consumer’s part. They will pay $60 for an entire boxed game, but not $20 for a downloaded game. Why?

    I think it is because people have come to expect 2 price ranges depending on the game, (this is excluding DLC). Downloaded games people expect to be from $5-15 dollars, because that is where the typical price is. It goes the same with the boxed games. If a boxed retail game was listed at $70 instead of $60, people will be less likely to buy the $70 dollar game. Simply because they will think ‘Man, this game is expensive, maybe I should get Game B instead…’.

    Regardless of what Braid has to offer, people will still cringe at the price tag because it is out of the norm. It is more expensive than other games, and the typical person will be less likely to research what exactly this game offers that explains the price tag.

    The problem does not lie on Braid’s developers, or anyone for that matter, the problem is just what has become common on the online marketplace. Until that changes, 20 dollar games will not sell as much if they are aiming at the general public, (PA was an exception, because in my opinion that game was aimed at the hardcore audience).

Leave a Comment