in Conferences and events

One Price Does Not Fit All

A few days ago I gave a talk at Evolve 2011 (part of the Develop Conference in Brighton, England) titled “One Price Does Not Fit All”.

The main idea of the talk was the importance of “flexible pricing”: Letting players spend as much money as they want to get more enjoyment out of the game and customize their play experience. Flexible pricing can result in revenues much higher than the traditional fixed price approach (derived from manufactured goods). It’s also orthogonal to the concepts of freemium and social games, and we’re only scratching the surface in ways to effectively implement it in games.

Here’s the official conference abstract:

Did the biggest fans of your game spend more money on it than someone who played it just a few times? If not, you’re leaving a huge percentage of money on the table. This session will talk about how digital distribution has made fixed prices obsolete and how you can take advantage of flexible pricing through in-app purchases in your games. We’ll also talk about the consequences (good and bad) of making a game free to play. The session will present hard data from iOS platforms, but applies to all digital distribution platforms.

Screen shot 2011 07 24 at 12 11 23 PM

Answering questions preemptively: I definitely don’t think that allowing players to spend the amount of money they want is “evil” in any way. And someone during the comment came up with a great point: Isn’t it more “evil” to have players spend $60 on a game, just to find out 10 minutes afterwards that they don’t like it or it doesn’t run very well on their system/network?

 

I was going to record the audio, but unfortunately I forgot to turn on Audacity before the talk. Note to self: Start recording when I set up the laptop, even if it’s 10 minutes ahead of time.

 

[Slideshare mobile]
[Slides in pdf format]

  • Sekhat Temporus

    Demo’s used to be a good way of discovering if a game could run on your system, and a good indicator of whether you’d like the game. However, game companies seem to have forgotten about demo’s and those that do remember only give you such a fraction of a game that you can’t form a starting opinion on it. In my opinion a demo should give you a good idea what the game is about. So if your a puzzle game, pick a few easy puzzles, a few medium puzzles and a few harder ones so that people can see how the puzzles might progress and learn the rules of the game. Story driven games should perhaps give you the first “Chapter” of the game, that includes the start of the story and enough gameplay to understand how to play it. etc.

  • Sam

    That’s what made the shareware model so successful. You would get the first episode of the game for free (eg Commander Keen 1: Marooned on Mars) and then have to pay for the rest. That first episode was a full, decent game in it’s own right. I think there’s a lot of scope for this model today with digital distribution.

  • I’m assuming by “flexible pricing” you really mean DLC and/or in app purchases.

    I don’t find DLC evil. I’d be happy to pay $20 for GTA4 with only access to the first Island and $10 for each of the other 2 islands or something like that.

    I also don’t have a problem with “real” in app purchase like if I could buy extra special cars or weapons or something in GTA4

    I do have a big problem though and consider it pure evil to pay for “virtual consumables” For example if I had to pay for gas in GTA4. That IMO would be evil.

    • I get that you don’t like it and you wouldn’t play a game like that, but I still think that *evil* is not the right adjective for that situation. Greedy or bad design might be more like it.

      What if: You had to pay for gas in GTA4 with in-game currency, which you earn by doing missions, tricks, whatever. But you also had an option to say “whatever, I don’t have time for that, I’m happy to pay some money to get a full tank of gas”. Is that wrong in any way? You’re giving players more options to customize the game experience to their likes.

      • Maybe if you can come up with a real world analog?

        The problem I have with “virtual consumables” that makes them seem “evil” (sorry) is that I’m not actually paying for anything.

        When I buy a consumable in the real world I’m paying for the time and effort to deliver that consumable. When I pay for DLC I’m paying a 1 time fee for a portion of the effort to make the DLC. But when I pay for a virtual consumable I’m paying for nothing what-so-ever. The consumer is paying, the provider is providing nothing.

        I suppose renting a movie online is similar in some sense but for some reason it feels different in a games. Paying $20 a month to access a game feels better than paying for virtual consumables. Probably because pretty much any game that charges by time to play is almost always providing something real (access to server time).

  • Dominic Wood

    A similar concept is used by the premium rate phone industry – whilst some subscribers may only spend the minimum subscription a percentage may spend 30-40 euro on a service. That’s why that industry is very interested in any user that purchases a service – the first sale may just be a one off – but next time they may ‘hook’ them in paying a substantial amount. These numbers are traded (where legal) at a premium. Maybe we can learn from this – nuture the users who are prepared to pay something and then target them with stuff they just have to have!  There is a huge market in untapped FTP mobile traffic waiting to be monetized.