[casual_games] Different Payment Models

[Michael Mei]

Regarding the evolution of the $19.95 price point. Long ago Real Networks
did some customer research and found that there's little price point
elasticity below $19.95.  There wasn't any significant increase in purchases
when the price point was reduced as a standard pricing.  And price points
above $19.95 for the average casual games caused a significant reduction in
purchases.

Some of the "more seasoned" veterans of the casual game space, please jump
in if I got this wrong.

Also, Reflexive actually saw a reduction in purchases when we reduced the
price point of Ricochet Xtreme to $9.95 for a significant time period.  In
my opinion, the user may feel that the game is of lesser quality because of
the lower price point.  A $19.95 price point may inherently give the game
the feeling of higher quality.  Remember...it's not from the perspective of
a Developer.  It's from the perspective of a 38yr old female who is the
target market and not on this distribution list.

I will shout out the disclaimer that the strategy for the $19.95 price point
may have been great for the past and current, and I'm not sure what it holds
for the future.

Michael Mei
Business Development
Reflexive Entertainment
www.Reflexive.com
949-830-1903  x30

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-----Original Message-----
From: casual_games-bounces at igda.org
[mailto:casual_games-bounces at igda.org]On Behalf Of Alex Amsel
Sent: Monday, October 09, 2006 9:23 AM
To: IGDA Casual Games SIG Mailing List
Subject: Re: [casual_games] Different Payment Models


$19.99 seems like a good price point to me. Once you get much under that
price, some developers will struggle to make a return (overall), and you
also don't give the publisher/portal far to go when trying to bump
sales/special offers. As things stand, the rrp is $19.99 but many
portals offer various schemes to get games cheaper.

Having worked extensively in the retail sector of games, the last thing
you want is to have a low rrp followed by even lower discounting. I've
seen where that goes and it isn't pretty, for developers or many
publishers. Sure you may grab some extra sales if the rrp of all games
was $9.99, but double average game sales across the board? I doubt it
you'd get anywhere close.

Also, I know that many companies have researched the time limit/product
content/price ratios very carefully and, generally speaking, the 1 hour
+ $20 + feature unrestricted has worked best for mainstream casual
titles. Like many of you, we'd also wondered how they'd arrived here and
had planned a series of tests. While we may still do some, I've seen
enough data to be convinced that it works as a general rule of thumb. I
would still like to be able to disable certain features and detect if a
game has been bought though, and I think certain games benefit from
slightly different models (less time, feature restrictions).

I'm very much a fan of micro-payments, but you need a critical mass of
people who use them or it just doesn't work. That's probably just a
matter of time, but whether it'll be next year or in 5 years is unclear.
Every year people say it will happen, and every year it doesn't, except
for on very specific games. Micro payments need to be global and either
for your entire market - e.g. XBLA, or much bigger than your market -
e.g. through paypal or a similarly known and accepted payment system.

Also, I don't feel pay per play is compatible with the casual world in
many cases. The casual demo model works because it draws people into the
game, and keeps things easy for a considerable amount of time. The pay
per play model requires repeated plays, so each game can't be too long.

Pay per time playing could work but I'm not sure if there is a
psychological element to get over. I'm working with a pay-per-play model
at the moment but that's more along the lines of if you play for an
hour, you a subsequently billed accordingly, and the product revenue is
split according to the time spent on each product during that hour.

Advertising within the download is an interesting one. It would be nice
to generate a little revenue from each download, especially if people
play for more than a few minutes.

I also agree completely that there is no good reason players should be
able to cheat the DRMs by downloading the game from another provider -
that's plain daft and an easy fix, although I'm unsure how many sales
are really lost through this.

Just my random thoughts...

lharrick at san.rr.com wrote:
> Also, how did the standard of $20 per game come about?
>
> Personally, I think the price point is too high.
>
> I am one of those people who would almost never pay $20 for a game
> (compared to other forms of media and entertainment, I feel the price
> is not a good value)... but there are many games that I would buy if
> the price were lower ($5 -$10 range).
>
> - Liz
>
>

--

Alex Amsel
Tuna Technologies Ltd (Sheffield, UK)
Cross Platform Game Development
Tel: +44 (0)114 266 2211  Mob: +44(0)7771 524 632


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