Pricing Hurting Sales?

[Bebop Cola]

ORIGINAL: Kal Naar
I think no one is trying to be a marketing guru here, but between:

1. the astronomical price of the game after 2 years of being launched.

and

2. the fact is very hard to bring other people into the game, even if they like it, because not everyone is willing to spend 80€ for it.


Makes people believe that a price reduction would be beneficial.

That's just the thing. Unless you're privy to the workings of the business, you can't really know why the pricing and distribution models are the way they are. There may very well be a good reason for it. Touting how a price decrease would increase sales or that Steam is the best and/or only way to distribute the title without having any idea why the current models are the way they are isn't really sound advice. Sound advice requires that the position be an informed one, not a guess.

Price decreases are a gamble. You are gambling that a decrease in price will increase sales, but if it doesn't you're pretty much sunk. New and existing customers tend to not be especially understanding of price increases necessary to cover operating costs when sales refuse to pick up to cover the difference after a price decrease. The decrease might work, or it might not. Developers gotta eat, though. If the price decrease fails to increase sales enough to keep them fed, it can be a product killer as surely as a price set too high.

Steam comes with its own baggage, and as has been discussed in the Steam threads, that baggage is largely unknown. Just because everyone and their dog knows about Steam does not mean that every title that's offered through Steam becomes a rockstar. Whether they become successful or not, what baggage does Steam membership carry with it?

In other words, I'm fairly sure that those involved in the business have given careful consideration to their pricing and distribution models. Absent detailed information into the workings of the business everything else is just uninformed speculation and, quite frankly, almost certainly coming from people who neither own nor run a game company.

No offense folks, just keep speculation and suggestions in perspective here.

[Gareth_Bryne]

May I remind ya'll that, unlike certain other game production studios, Matrix Games keeps on living and producing? A very true story often repeated nowadays is:

-- game studio grabs superproject,
-- overextends,
-- sells incomplete for cheap/standard price,
-- goes bankrupt financially and morally amongst howling of fans.

DW is a game you have to commit to. And when you do, in 90%+ cases, your commitment is justified. And speaking from a personal budget management perspective, 40$ and 80$ are not too far apart. Unless you live on social services support.

[Veloxi]

I honestly don't see why there are so many HOSTILE responses to this issue. Are y'all worried that you'll lose some sort of elitist status if the masses are able to afford these games or some such? Help me understand why y'all are so mad about folks like me WANTING the game to get more exposure and sales, and one of the best ways to do that is lower prices a bit.

Y'all should read this blog post by Jeff Vogel, founder of Spiderweb Software, as to why they lowered the prices of ALL of their games, which has led ultimately to more sales for them. It's very enlightening.

[Veloxi]

Honestly, man, that's just cold. That might be your perspective, but it's not the same for everyone, and when people will bitch about a game costing $5 on iTunes instead of $1, for example, you might wanna think of how times have changed. Not everyone can spare $40 extra on something sight unseen, you know.

And speaking from a personal budget management perspective, 40$ and 80$ are not too far apart. Unless you live on social services support.

[Gareth_Bryne]

Times have indeed changed, and a price difference for a game should never be able to influence your personal/family budget. Food, clothes and home always come first. That said, in the gaming world, DW is a rare 80$ (66$ in bundle) in the age of 40$, and a gem of rare quality. Consider also the millions paying much larger amounts for official WoW server time. 5 buck Androiders are not a good example.

In other posts I noted the lack of exposure, so I agree with you on that. Lack of exposure leads to lack of acceptance

[Bebop Cola]

ORIGINAL: Veloxi

I honestly don't see why there are so many HOSTILE responses to this issue. Are y'all worried that you'll lose some sort of elitist status if the masses are able to afford these games or some such? Help me understand why y'all are so mad about folks like me WANTING the game to get more exposure and sales, and one of the best ways to do that is lower prices a bit.

Y'all should read this blog post by Jeff Vogel, founder of Spiderweb Software, as to why they lowered the prices of ALL of their games, which has led ultimately to more sales for them. It's very enlightening.

I think you're mistaking disagreement for hostility. People disagree that these suggestions will translate to any improvement, or that they're feasible. Maybe they would, but then again maybe they wouldn't. Absent knowledge of the research and analysis performed by those inside the business, anything the fans put forth is just a guess. Moreover, what works for one business may not work for all businesses. There are some generalities common across a particular industry, but no one-size-fits-all business model.

That said, there is irritation here. However, I think it's less with your desire that the game get more exposure and sales(who could argue with those?) and more with the fact that new threads pop up repeatedly suggesting the same ideas as if no one has ever considered these things before. The "elitist" straw man certainly doesn't help soothe frustrations or further the conversation, however.

The company has certainly considered the pricing and distribution models available, and the fans have heard the suggestions from other fans or considered them on their own. Steam is the proverbial 800 pound gorilla and isn't missed by anyone. The idea that people prefer to buy cheaper things over more expensive things(with some exceptions) is not novel or surprising. The reasonable conclusion, then, is that there is a legitimate reason the pricing and distribution models in place were chosen. The suggestions of Steam distribution and cheaper prices are just that, largely uninformed suggestions, and shouldn't be taken for especially insightful business acumen.

[Cauldyth]

Time for grumpy old man rant!

Back in the early 90s, in Canada, a typical PC game was $70. If you adjust that to 2012 dollars, that's about $110. Now you can buy brand new AAA games for $40, and even the big name ones go on sale for 50% off or more, shortly after release.

I'm guessing that pattern is largely due to digital distribution being cheaper than retail copies, plus gaming going mainstream so that a given game can expect to sell more copies overall. Either way, it's a pretty dramatic pricing trend though.

[lukaszgwozdz2]

I don't live on social services, far from it. That doesn't change the fact that I make purchases based on the perceived value of the product. I would not spend $50 on a cup of coffee even though I could afford it. I also wouldn't spend $90 on a box that *may* contain a game I like.

I have bought a few games from Matrix in the past and I know that they publish ambitious but often flawed games. That's understandable given the budgets and studio sizes and I'd be perfectly fine with buying 10 games for $20 each to find a few I really like. If I'm being told to buy 3-4 games for $50-$90 that's a whole different story and much more risk I'm taking on. The irony of it is that Matrix would make much more money off me if they made their prices more approachable and easier to write off if I end up not liking a game or three. There's a lot of other Matrix games I wanted to try but at $50 and my chances of liking the game around 30-40% it's not worth it.

I thought about this more and it's really not about DW specifically. I'm more frustrated with the way Matrix in general is firmly entrenched in siege mentality and it all ends up being a self fulfilling prophecy. Strategy/wargames don't have to follow flight sims to extinction, but pricing them so that only existing fans will take a chance on new games has a good likelihood of causing that. It certainly has kept me from joining the "niche" although I'm perfectly willing to.

Forget about Steam. Even if you compare Matrix to Paradox in terms of how to market and sell games, I think there's your proof that ambitious and often flawed games (that fits most if not all Paradox's games incidentally) don't have to remain entrenched and insular. One can only hope.

[Bleek]

Supply and demand, the audience is now bigger as more people can afford and therefore have a game capable PC.

[lukaszgwozdz2]

ORIGINAL: Bebop Cola
The company has certainly considered the pricing and distribution models available, and the fans have heard the suggestions from other fans or considered them on their own. Steam is the proverbial 800 pound gorilla and isn't missed by anyone. The idea that people prefer to buy cheaper things over more expensive things(with some exceptions) is not novel or surprising. The reasonable conclusion, then, is that there is a legitimate reason the pricing and distribution models in place were chosen. The suggestions of Steam distribution and cheaper prices are just that, largely uninformed suggestions, and shouldn't be taken for especially insightful business acumen.

I think that the company did consider the pricing at some point, but honestly it feels like it may need a refresh. I don't think anybody is saying that hardcore wargames should sell for $2 on the iPhone. I also agree that with the amount of marketing Matrix does (which is pretty much zero) short term sales would not work. That said, lowering prices of older titles (a year or two, or three) seems like a much less risky proposition. The hardcore fans, who I salute for keeping the genre alive, would buy it shortly after release full price. The less hardcore and less likely to like the game fans would buy it at a discount later and generate additional word of mouth. Hey, maybe they'd even become more hardcore and buy future titles at full price!

Matrix, dear brothers in arms, maybe it's time for a few experiments. You know how much you make on $80 titles - you've done that for a good while now and you're the only one doing it. How about dropping the price of DW and all expansions to something accessible to someone who's not a committed hardcore fan and seeing how many copies you sell. I only complain because I care.

[feelotraveller]

Of course increased prices diminish overall sales - that's some sort of Einsteinian law of relativity isn't it?  [:D]
 
Seriously though, I credit Matrix with knowing what they are doing.  Further I support them, even though as a consumer I would like to be paying less...
 
Here's a story with no access to the actual revenue/sales figures.
 
If DW is priced at $20 six people purchase the game immediately.  But that saturates the market and no one will buy in the future (since all potential customers have purchased the game).  On the other hand if DW is priced at $80 only one person will purchase the game immediately but another one person will buy the game at some future date.  Bottom line: the higher pricing will end up making more for Matrix and providing additional support for further developing the game (assuming they don't take the money and run, but I am not expecting that).

[Bebop Cola]

ORIGINAL: lukaszg

I think that the company did consider the pricing at some point, but honestly it feels like it may need a refresh. I don't think anybody is saying that hardcore wargames should sell for $2 on the iPhone. I also agree that with the amount of marketing Matrix does (which is pretty much zero) short term sales would not work. That said, lowering prices of older titles (a year or two, or three) seems like a much less risky proposition. The hardcore fans, who I salute for keeping the genre alive, would buy it shortly after release full price. The less hardcore and less likely to like the game fans would buy it at a discount later and generate additional word of mouth. Hey, maybe they'd even become more hardcore and buy future titles at full price!

Your suggestion may very well be the correct way to go. Then again, without knowing the details of their business process it might not. A high price tag can certainly be a turn off, no one is denying that, but a high price tag may be a necessity for some other reason we're not privy to. For example, operating costs may be unusually high for some reason, or there might be licensing costs that need to be accounted for. Dropping the price might translate to increased sales to cover these relatively fixed costs, but if it doesn't the company can be sunk just assuredly as if they made too few sales at their higher price point.

The point is, it's not a simple choice of low vs high price. If it was, it would be a no-brainer.

[Kal Naar]

Perhaps what's really annoying people, is the lack of other activity in the forum, and that pricing, steam, kickstart threads represents the absolutely majority of posts.

I agree that it's a sad situation for such a wonderfull game, but without new information about patchs, expansions, what else is there to talk about?

I see a lot of people interested in the game and passing on it for price reasons and it's sad, because the crowd base could be increased and that would only benefit DW.
I don't pretend to have any information about marketing and distributing games or operating costs of companys involved, but I do manage a software development company and have some lights on the matter...

I really hope the current approach is worthwhile, and keeps DW evolving for many years to come.

ORIGINAL: feelotraveller

Here's a story with no access to the actual revenue/sales figures.

If DW is priced at $20 six people purchase the game immediately.  But that saturates the market and no one will buy in the future (since all potential customers have purchased the game).  On the other hand if DW is priced at $80 only one person will purchase the game immediately but another one person will buy the game at some future date.  Bottom line: the higher pricing will end up making more for Matrix and providing additional support for further developing the game (assuming they don't take the money and run, but I am not expecting that).

Here's a different story:

DW is priced at $80 and only one person will purchase the game immediately, after several months without sales the company still doesn't reduce prices waiting for the next sale that will make the break even. The next sale never comes and as the company operating costs are overwhelming it goes Bankrupt.

Bottom line: No more DW. The end.

[lukaszgwozdz2]

ORIGINAL: Bebop Cola
Your suggestion may very well be the correct way to go. Then again, without knowing the details of their business process it might not. A high price tag can certainly be a turn off, no one is denying that, but a high price tag may be a necessity for some other reason we're not privy to. For example, operating costs may be unusually high for some reason, or there might be licensing costs that need to be accounted for. Dropping the price might translate to increased sales to cover these relatively fixed costs, but if it doesn't the company can be sunk just assuredly as if they made too few sales at their higher price point.

The point is, it's not a simple choice of low vs high price. If it was, it would be a no-brainer.

You are of course right - the high price tag *may* be a necessity and, just like my position in this argument, it's hard to definitively prove it either way. I suspect it may be hard to prove even if we did have insight into the actual sales numbers since it's all about predicting the future.

However, there's an implicit assumption that the current pricing model results in maximum profits when all the evidence in the broader game industry is saying otherwise. I could point at multiple examples here - renaissance of cheap indie niche games, Steam sales and/or lower prices resulting in bigger profits, etc. A secondary and very unfortunate side effect is that the current pricing model is doing slow but steady damage to the niche.

Matrix *could* be a unique snowflake in the game dev business. More likely however, they refuse to change with the times because what they've been doing seems to keep them afloat and they are afraid of change. As long as I can remember, Matrix has been doing the same thing with the same prices and site design. Paradox does way more to try to push the envelope in terms of selling to niche audiences (e.g. DLC for Crusader Kings 2), and there's no reason Matrix can't do the same.

[malkuth74]

Matrix never drops there prices ever.

Harpoon still sells for 60 dollars even though its a 90s game. LOL.

[dlcooper]

ORIGINAL: malkuth74

Matrix never drops there prices ever.

Harpoon still sells for 60 dollars even though its a 90s game. LOL.

I don't know what type of business plan Matrix has or what type of thinking goes into their pricing. To me it seems like they really don't pay much attention to the rest of the market. Asside from the price of DW and the expansions, take another game on here for example: AI War Alien Bundle; on steam, gamersgate and the developers site it's $16.99 USD, on Matrix, the same package is $29.99. The Operational Art of War is another very old game that's on here for a high price. Armada is another one that's higher priced than other sites. Oddly, the Armada expansion seems to be priced normally.

[Bleek]

The price is a barrier for entry for all but the most niche of tastes.

Look at the wider market and it will tell how to position and price your product, it'll show you the trends of taste of budget.

I post on another computer forum and nearly every comment about DW was "I'll check it out when it's on sale", or "I'll buy it when it comes down in price". Unfortunately for many people the high cost of the game is more of a concern than the quality of the product. Brand new blockbuster PC titles sell for £30, many new games from smaller publishers now come in at £20-25, DW is neither blockbuster nor new and yet it still holds it's high price tag.

A case in point is 'Endless Space' which retails for around £20 for a brand new game with shiny modern graphics, it's an OK game but that's actually not that crucial here, what is important is the psyche of the buying public. Even a game with an average review score can chalk up strong sales if it's priced aggressively because the budget isn't a barrier and the psyche says "if I don't like it I've not wasted too much money".

It's the old VFM (value for money), if the product hold my attention for x amount of time and I spent x on it, did I get a decent return for my time and enjoyment (even if I didn't enjoy it as much as other similar things I do or have done)? The lower the value the easier it is to satisfy the subconscious thought path that steers decisions.

[Veloxi]

Someone just posted this on a forum I frequent:

I really want to try the game. I'm really the target audience, I love me some space strategy. Played the hell out of SE4, GalCiv 1 and 2, MoO3. But I've got too many games queued up after steam sales and whatnot to take a $90 dive into a game that I can't even find a demo for (is there one somewhere?).. and my wife would kill me. But if it came up on Steam for $20 or even $30 for the bundle I would probably pick it up without a second thought. There are a lot of other people like me.

The Neiman Marcuses of the world are losing to the Targets/Walmarts. There is a reason for that. I'm not sure if it's a good or bad thing in the long run, but ignoring the current trend in the economy (which in this case favors Steam and bulk sales/deep discounts) is a dumb idea.

And I'm seeing this type of response more and more often. I know people who would LOVE this game, but the price is the ONE thing putting them off, especially given the lack of a demo. It's just...REALLY depressing to see such a wonderful game like this remain way too niche due to its price, and not get the attention, visibility and exposure it deserves because many people can't overcome spending $90 on something basically sight-unseen. I've been gushing about DW since I finished my review on it, trying to get more people into it, and the barrier I keep running into is either high price or lack of a demo.

It just really makes me sad, is all, to see such a vibrant, unique and lovely product like Distant Worlds stay outside of gamers' hands due to these two factors.

[Veloxi]

Hey y'all, I wrote an Op Ed on this on my bloggy thing:

http://www.spacegamejunkie.com/oped/dis ... conundrum/

Y'all are more than welcome to vote in the polls and chime in and tell me if I'm wrong or not.

[Vedian]

ORIGINAL: Veloxi

Someone just posted this on a forum I frequent:

I really want to try the game. I'm really the target audience, I love me some space strategy. Played the hell out of SE4, GalCiv 1 and 2, MoO3. But I've got too many games queued up after steam sales and whatnot to take a $90 dive into a game that I can't even find a demo for (is there one somewhere?).. and my wife would kill me. But if it came up on Steam for $20 or even $30 for the bundle I would probably pick it up without a second thought. There are a lot of other people like me.

The Neiman Marcuses of the world are losing to the Targets/Walmarts. There is a reason for that. I'm not sure if it's a good or bad thing in the long run, but ignoring the current trend in the economy (which in this case favors Steam and bulk sales/deep discounts) is a dumb idea.

And I'm seeing this type of response more and more often. I know people who would LOVE this game, but the price is the ONE thing putting them off, especially given the lack of a demo. It's just...REALLY depressing to see such a wonderful game like this remain way too niche due to its price, and not get the attention, visibility and exposure it deserves because many people can't overcome spending $90 on something basically sight-unseen. I've been gushing about DW since I finished my review on it, trying to get more people into it, and the barrier I keep running into is either high price or lack of a demo.

It just really makes me sad, is all, to see such a vibrant, unique and lovely product like Distant Worlds stay outside of gamers' hands due to these two factors.

Well, I'm living proof of that.
I'm looking for an alternative to GalCiv 2 right now. Read tons of reviews, AARs, you name it. Yet, hard to choose, but my mind was slowly but surely leaning towards Distant World...until I found out that:
- the price for the whole thing (base + 2 expansions) is more than $90. That's easily twice as much as any great 4X on the market ! May not be comparable, but today Sword of the Stars 1 Complete is available for $6 (one-day promo, but it's there) - standard price is $25.

- plus, there is no demo: I want to believe the people saying it's a great game and all, but a game is, by essence, a very personal experience, and 2 people could love 4X space games, yet disagree on a particular game. You have to "feel" the game, and see if it is the game for you.

I may have overlooked the lack of demo if not for the price. But the combo sky high price + no demo is just too much I think. And I'm probably not the only one in that situation. Really, I just think DW may well be the right game for me, but I'm not willing to take that many risks (for my wallet ).