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Examining Indie Game Pricing
As the second Humble Indie Bundle flourishes, having taken in over $1.5 million in pay-what-you-want sales, the Opposable Thumbs blog has taken a look at indie game pricing in general, trying to determine how low price points and frequent sales affect their popularity in an ocean of $60 blockbusters. Quoting:
"... in the short term these sales are a good thing. They bring in more sales, more revenue, and expand the reach of games that frequently have very little marketing support behind them, if any. For those games, getting on the front page of Steam is a huge boost, putting it in front of a huge audience of gamers. But what are the long-term effects? If most players are buying these games at a severely reduced price, how does that influence the perception of indie games at large? It's not an easy question to answer, especially considering how relatively new these sales are, making it difficult to judge their long-term effects. But it's clear they're somewhat of a double-edged sword. Exposure is good, but price erosion isn't. 'When it comes to perception, a deep discount gets people playing the game that [they] wouldn't play otherwise, and I think that has both positive and negative effects,' [2D Boy co-founder Ron Carmel] told Ars. 'The negative is that if I'm willing to pay $5 but not $20, I probably don't want to play that game very much, so maybe I'm not as excited about it after I play it and maybe I drive down the average appreciation of the game.'"
Personally, I wouldn't have bought those games at larger price. Gish and World of Goo maybe, but others are so so and not that interesting. You will find lots of more fun from Steam sales or Good Old Games. But since I could get them cheaply (I paid $5 so I'm not a total jackass), could as well get them to fill up my Steam games list.
Need more demos for games. Sometimes a game looks like shit but may play really well or vice versa. I'm more willing to download a demo or a game with limited features then I am just to plunk down some cash after only seeing only a handful of screen shots and no video.
Does it give a strength bonus, an extra attack, or +D3 hit points?
Confucius say, "Find worm in apple - bad. Find half a worm - worse."
I've bought quite a few indie games off of steam and a couple of older titles off of GOG, all of them for less than twenty bucks a pop, and in most cases I feel I got my money's worth. I don't think I'd have bought most of them at triple-A retail prices, not because I'm a cheapskate, but because the games in question aren't valuable enough to me to justify the higher price tag.
I should also point out that most high profile games don't meet my criteria for the higher price tag either. Of the games I've bought this year, I can only think of two that were worth paying sixty at launch. For everything else, I've waited until the price dropped, or it went on sale. I don't think that the average gamer decides what a fair price ought to be based on what the average price is; we balance how many hours of entertainment we're going to get out of a game, and then decide what we think of as a good price for those hours. I've certainly felt ripped off in the past, buying a game at launch only to find it's only good for a few hours of play, hence my current purchasing habits.
Worrying about price erosion seems like looking at the problem backwards. Make a game worth charging sixty bucks for, and you'll sell it for sixty. Make it worth forty, and you might sell copies at sixty, but many gamers will wait for the price to come down before they buy. And the days of a game only being on the store shelves for a month before being taken down are rapidly vanishing, along with the shelves and the brick-and-mortar stores that house them.
Erotic is when you use a feather. Exotic is when you use the whole chicken.
An indie developer studio can charge $5-15 per game and most of the cash goes to the people who made it. A traditional big studio game sells for $50 and maybe ten cents goes to the developers. The rest goes to a faceless corp that is manned by MBas who hate games anyway.
We need to keep in mind that online game sales are intangible products. Sure, as a publisher you're paying a few pennies for the download, but the difference is quite negligible, whether you sell 10 copies at $50, or 100 copies at $5. People are already used to "community support", i.e. forums, so if a lower price results in a greater net profit, there's no reason not to aim for such.
Indie games have such small user bases that the growth potential is tremendous. By selling the game at a very low price, you're effectively buying customers. If you do a good job of entertaining them, they will buy your next game. It's nearly-free publicity, which is good because at that level, the game house probably can't justify the expense of a real marketing campaign. Realistically, if you're bringing in less than six figures with your product, be it a game or app, you're better off lowering the price and considering that discount your "marketing cost", rather than paying up-front for promotion which may or may not recoup the investment. Why gamble the company when you can get rich slowly ?
-Billco, Fnarg.com
... indies are competing with discounted AAA games from years prior. It's hard to charge ~$20+ dollars for an indie game when you can get yesteryears hit games for the same or less.
If someone decided that Mass Effect 2 was worth $30 to them, but the publisher of Mass Effect wouldn't sell it for less than $50, then the publisher will get $0 because the customer will wait for it to come up cheap & used, not buy it at all, or pirate it.
Publishers who suffer massively from piracy should re-think their product pricing. A customer will only pay what they want anyway.
where are they ? i havent seen once since late 90s.
Starcraft 2 came out this year and I think it was $60.
Its not about that and you know it. Just today I fired up steam and bought 11 games, one indie bundle,(Pretty much solely for Crayon Physics, which I played the demo of last year where it stuck in my mind), the new monkey island installments and an older game that I wanted to reacquire. Total spent? 24 bucks.
I'd love to play black-ops, but not at 60 bucks. I bought MW2 at that price, the last 1/3rd of the single player campaign sucked, and the multi-player was cheap radar/wall hacky/wonky death from above garbage, and don't even get me started on the console bullshit matchmaking. Just because they throw 30 million bucks into production does not guarantee them my hard earned cash either. Will I buy it and play it? Probably, once it hits 20 bucks on steam in a year or so. Or I can pick it up used at about that price for the xbox.
Too many of us have been burned by buying something that was nothing but over-hyped crap. Apparently it's not just me who is tired of it, I'm no longer bleeding edge, I don't have to have it right when it comes out, specially if I know its something that I'll be able to buy at 1/2 price in 6 months.
Low prices are exactly what the gaming industry needs...
The production costs of a game are a one-off cost, the actual media/distribution cost is trivial which means that even priced at $1 the game can be profitable with enough sales. Now if the price is low enough, more people will buy it - look at iphone games, i know plenty of people who would never bother buying full priced games but are quite happy to pay $5 or less for an iphone game.
And of course, when the prices are low enough you squeeze the for-profit pirates out of the market (writable media costs a lot more than having thousands of copies pressed).
At $5 it becomes a casual purchase, but at $60 it's a purchase seriously worth thinking about for most people..
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This. We've even recently pointed out how possible it is. You absolutely must be creative, though, and come up with novel gameplay that a lot of people (not necessarily including yourself) will enjoy. You will never be able to compete with the big houses on the quality of your art, but if you provide compelling gameplay people will beat a path to your door.
>Find an engine with the right contract (free), code it up (free) art it up (free), add sounds (free/low cost bulk deals), music (free if skilled/a
>band friend?), spin up a really good press release with a few (many) thousands of US$ to get your brand out.
Unless you found a place for cheap slave labor, it won't be that easy. You might some people who want to do some of this for free, but getting all of them aligned and agreeing on a game is no small feat. Or maybe you're a superstar who can do all of this by him or herself. In that case, kudos.
I'm sure the path to good indie games is filled with unfinished, directionless projects and games severely lacking in one area or another.
"When it comes to perception, a deep discount gets people playing the game that [they] wouldn't play otherwise, and I think that has both positive and negative effects," Carmel told Ars. "The negative is that if I'm willing to pay $5 but not $20, I probably don't want to play that game very much, so maybe I'm not as excited about it after I play it and maybe I drive down the average appreciation of the game.
I very much disagree with this sentiment. Maybe he's referring to reviewer scores, but appreciation itself is not a zero sum game. If person A loves a game, and person B only enjoys it slightly - there was still more enjoyment derived than if only person A had played it...
I love buying games at $5-10 - not only do I get ~7 for the price of a new retail game, but there isn't any urge to "get my moneys worth". If I enjoy it great - and if not I don't feel bad because it was only a couple bucks - on to the next one. That's how it should be - getting something you enjoy, not feeling pressured to play something you really don't because you paid a lot for it.
Also from a marketing perspective I would expect to see more glowing reviews this way - people who don't care probably won't talk about your game - but there will be a few that picked it up on a whim and loved it. Those are the people who will tell their friends about the great deal/gem they found.
Captain anti-corporate there doesn't know what he's talking about.
First off, almost all games for big companies are works for hire. What that means is that the company employs the developers, designers, producers, artists, and so on to make the game. It can be as a full time or contract employee. Sometimes it is a regular salaried job (often the case for developers), sometimes it is a hourly contract (like $X/hour spent testing or something), sometimes it is a specified contract (like $Y to produce a musical score for the game). At any rate it is a very up front sort of arrangement, much of it very normal "employee works full time for employer" sort of thing.
The next thing is that these AAA titles are MASSIVE in terms of the teams that work on them. It isn't a developer, it is a team. Take Mass Effect 2. It credits 1 lead programmer, 1 assistant lead, 26 programmers, 3 localization programmers, and 6 additional programmers. So just on the pure "coding" part of development, there were 37 people. There were also all sorts of designers, testers, artists, voice actors, and so on. So, that no one person got a millions of dollars, even though the game had a multi-million dollar budget, is unsurprising. All those salaries and contracts add up to a lot.
Finally, as this all implies, the financial risk is assumed by the publisher. They pay people for their work, as the game is being developed. If it tanks, well the publisher is out their investment. If it succeeds, they make money. This isn't like an indy title where you put in work and hope to make money in the future and if it bombs, you get nothing for it. The people who made the game are compensated regardless of success.
Now I'm not saying all developers are paid what they ought to be (part of the problem is there is a bit of over supply since so many people want to make games) or that the publishers don't often make a lot of money (though many of them have gone through tough times, Atari has been bleeding red ink as of late). What I am saying is it is nothing like the music industry "We pay you a tiny royalty and deduct everything from it," system. It is very much a normal "pay for work" system as most of us have for jobs.
All the games in the bundle are "old" in indie terms (even some that are unfinished!). And the bundle will have more reach than normally these games can get. So the net result is that you are selling old indie games to people that normally would have never even know these games exist (so for these people, the games are new).
And is a lot of money!,.. for indie devs. Is very few money for a game studio, laugdable at, but for 1 dude, or 2 dudes, is a lot.
And is not the only way to sell indie games. is a complement. So these bundles what have created is a oportunity to reach more people, and sell old indie titles *again*, and at the same time make a lot of money. So is Win-Win-Win-Win for the indie dev's.
-Woof woof woof!
um... they just cost less to make? 2-3 devs over less than a year can dish out a decent quality indie game. We dont have huge content teams, we dont spend a huge amount on marketing, we dont pay huge royalties to engine devs, we dont have a publisher to swallow up a huge %. That is just how much it costs to make.
Proportions wise, it costs $23 mil to make a AAA title today and the average indie game costs lets say 120k to make (3 devs working for 6 months maybe) so its about what 1/200th of the cost? 1/200th of 60 is a lot less than $10 but that is because a lot of indie games simply sell a lot less.
I just bought "Defence Grid" for $2 on steam. It's not much money, but I wouldn't have paid any more, and wouldn't have even bothered to pirate it. I probably won't even play, but my brother uses my steam account and he might check it out.
My point is that $2 is a good impulse-buy price. I won't even bother to check a demo or reviews at that price. So that's $2 more than they would have gotten.
I'd be interested in seeing their total profit binned by price.
The source for the games in the first HIB except for world of goo (last time I checked) was released. So go and fix it :-)
I do too, and I'm sure many do the same. It must have something to do with the fact that MechWarrior 2 is a far better, more memorable game.
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Isn't that one of the major things that game publishers say as a reason why they don't program for Linux? The average Linux user is paying over twice what the Windows users pay. (Myself, I paid $15, meaning that I have now bought World of Goo three times, but I care more about giving to the charities.) Sorta shoots that argument in the foot doesn't it?