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Old 03-31-09, 01:17 PM   #13
jolle
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Default Re: Warren Spector on Game Prices

Gabe Newell mentioned some stats off Steam at DICE 2009.
http://xbox360.ign.com/articles/955/955392p4.html
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on that weekend sale we also talked about the fact that there's going to be new content coming, that we're going to be doing one of these updates. Everything that we've seen says if you hit the more dimensions that you can touch a customer at the same time you get a nonlinear reaction from the market. So we did this sale, and had some really interesting numbers. First off, the Steam sales were up by a factor of 30, right? Not 30 percent, but by a factor of 30.
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I think the thing that some people would say is all you're doing is screwing your retail partners... ...You can see there was no difference. We weren't cannibalizing retail sales at all.
And the real point here:
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After Christmas we implemented discounts. And so the minimum discount on Steam for all the products was 10 percent. We saw 35 percent increase in sales, not in units but in sales. In real dollars or euros or whatever. And the interesting thing is if you want to 25 percent off, you know, every publisher and developer got to make its own decisions about how it wanted to participate. If you go to 25 percent, you see this huge factor of 7 increase in the revenue you're generating. Clearly there was some function that was going on there. Then you go to 50 percent, still seeing increase. That's great. But you go to 75 percent off. And people are making almost 15 times as much money by getting to what apparently is a much more natural price point for our products and our content.
ofcource, Digital distribution doesnt carry a production overhead per unit as retail copys does with disc printing, case, manual etc.
But still, those numbers agree with Spectors views.
The lower price increases sales enough to make it more profitable.
Might not be as great and increase as when its on sale, but people would prolly still by alot more games, and be less picky about the pretty nondescript Metacritic grades, games with a bad score can still be appreciated by alot of people.

Also, am I the only one that keep seeing the comment "Meh, Ill pick it up once it hits the bargain bins" or "IŽll prolly get this when it drops below 20 bucks" on this and other forums?
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Old 04-01-09, 12:41 AM   #14
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Default Re: Warren Spector on Game Prices

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Originally Posted by jolle View Post
Gabe Newell mentioned some stats off Steam at DICE 2009.
http://xbox360.ign.com/articles/955/955392p4.html




And the real point here:


ofcource, Digital distribution doesnt carry a production overhead per unit as retail copys does with disc printing, case, manual etc.
But still, those numbers agree with Spectors views.
The lower price increases sales enough to make it more profitable.
Might not be as great and increase as when its on sale, but people would prolly still by alot more games, and be less picky about the pretty nondescript Metacritic grades, games with a bad score can still be appreciated by alot of people.

Also, am I the only one that keep seeing the comment "Meh, Ill pick it up once it hits the bargain bins" or "IŽll prolly get this when it drops below 20 bucks" on this and other forums?
I think it's a matter of perspective. If games were all $20.00 at launch, there'd be no room to move, and I think sales would eventually be flat... especially because the perceived value of the game via MSRP is now lower, the purchaser assumes that the product is worth less, and may not bite at discount prices quite so readily.

But take a game that's normally $50.00 and reduce the price for a limited time, then you'll get a lot more interest because a) people want to get the deal now, even if they don't intend to play the game until later, and b) the perceived value of the product is still $50.00, even if the purchaser is only paying $25.00.

In all honesty, I think the price points are fine. People wanting to pay for the privilege of playing a game as soon as its released will pay full price, others will wait. For the publisher it's win-win. People pay an inflated price on release to have a game as soon as it's available, and when those sales flatten out, lower the price to get a second wave. This is something Steam does especially well and I look forward to their sales. Retail, I think I've rarely seen a good deal on an A rated game anywhere near as early as I see them on Steam.

Gabe's no dummy... this marketing strategy could explain why Steam prices are often higher than other sites. Sales mean more when the deal looks better.
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Old 04-01-09, 12:58 AM   #15
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Default Re: Warren Spector on Game Prices

I could see the need for more flexibility in game prices maybe, rather than an overall decrese in prices.

Something like Wanted should really come out at $20 or $30, but there's this image that games should always be $50-$60 at launch and if they aren't they're crappy budget titles. That could change, and should. Lower prices could mean more sales out of the gate, when the PR is rockin', rather than months later when they drop in price.

Then of course we could see games like Fallout 3 going for $70 or more. I remember paying $80 for Shadowrun on the SNES.
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Old 04-01-09, 09:49 AM   #16
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Default Re: Warren Spector on Game Prices

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I don't find $50 for a game unreasonable considering what you get out of it. As long as it does not go above that it does not stop me from buying the game.
I think that's the main point, it's whether or not you feel you've got your moneys worth. The price of games could be $100 if it provided $100 worth of entertainment. The best example is wow players. They easily spend more than that per year to be able to play it, and I really don't hear people complaining about the price because they can justify it since the game has a never ending amount of content.

As a side note, I was thinking about this the other day. One of the things that I really miss about some older games is the ability to play it with your friends. I'm talking about on the pc btw. There are no split screen modes for most games anymore. If I want to show someone my fancy new game I got we can't play it together unless they also shell out cash for it. Games like Warcraft 2 and Age of Empires 2 allowed other people to play even on different pcs using "spawns" of the game. They couldn't play single player or multiplayer, but if I installed it and hosted a multiplayer game two other people could join in on the fun (7 for Warcraft 2). To me this gives the game a lot more value since you can still play games with your friends. I don't own Call of Duty: World at War, and I don't intend on purchasing it because I'm not going to play it but once or twice. It sucks because I have two other friends that do play it. So if they are playing it I can't join in on the fun. Compare that to a game like Halo; if they are playing it I could just drop in at either of their houses and get a little gaming in with them. Chances are good I might have enough fun that I'll go out and buy the game as well so I can play SP or play MP on my own console. (And could have other friends over so they can play it with everyone)
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Old 04-01-09, 12:12 PM   #17
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Default Re: Warren Spector on Game Prices

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... I remember paying $80 for Shadowrun on the SNES.
Yeah, I'm certain games have come down a lot in price since the good old days. I was young, but I recall my parents paying $70-$80 for NES games or even Atari 400 games way back in the early to mid '80s. With inflation, that would be at least $100/game in today's currency?
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Old 04-01-09, 12:55 PM   #18
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Default Re: Warren Spector on Game Prices

I think HW prices are the bigger problem and that today's software is mainly made to sell new HW.
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Old 04-01-09, 02:11 PM   #19
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Default Re: Warren Spector on Game Prices

I think 50USD is reasonable. Except I don't pay 50USD... I pay 80USD. ::

FML
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Old 04-01-09, 03:59 PM   #20
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Default Re: Warren Spector on Game Prices

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I think 50USD is reasonable. Except I don't pay 50USD... I pay 80USD. ::

FML
Well you should have known better than to be born outside the super spectacular united states.
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Old 04-01-09, 11:40 PM   #21
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Default Re: Warren Spector on Game Prices

I'll join the Mobile Infanty and become a Citizen.
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Old 04-02-09, 12:05 AM   #22
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I'll join the Mobile Infanty and become a Citizen.
Maybe someday soon we could get married so you get a green card.

C'mon California!
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Old 04-02-09, 12:09 AM   #23
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Default Re: Warren Spector on Game Prices

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Maybe someday soon we could get married so you get a green card.

C'mon California!
WoW that went from Starship Troopers to queerfest... wow...
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Old 04-02-09, 12:22 AM   #24
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Default Re: Warren Spector on Game Prices

VelvetMafia just signed in.
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