Payment Model Perspective

I was browsing Kotaku the other day, and came across an article/review of a mobile game called Wayward Souls. Truthfully, I only read it because the byline mentioned Secret of Mana, which is relevant to my interests; it is, incidentally, probably my second-most played game of all time right behind A Link to the Past. Did you realize that SoM came out in the US 20 years ago this past October? Two decades.

Anyway, Wayward Souls is whatever – doesn’t seem to capture much of SoM’s magic beyond the pixel and music style based on the video alone. What was interesting to me though, was when they mentioned in the video that they’re going with the MineCraftian business model, e.g. selling it for $5 at first, and increasing the cost as time goes by. To me, this raises a number of interesting questions. First… is there a term for this payment model? I use MineCraft as perhaps the most well-known example, but surely it was tried beforehand.

Second, does it feel bad to anyone else?

I mean, I understand the logic behind it. Traditionally, game companies are going to want to charge full MSRP at release to capture the dollars of whom we now term “whales,” e.g. the people who would have paid $100 for the game, if they had charged that much. As time goes by, the price comes down via sales and whatnot to capture the players who would have bought it for less than MSRP. The MineCraft model seems like it should never work, but actually makes a lot of sense when you realize that the traditional model relies on a well-informed and excited playerbase for your game – in an ocean of crappy mobile games, you’re not going to have the whales spending money out of the game. This alternative model lets you build buzz somewhat organically, and then try and capture the big spenders as you ride the wave home. Plus, it sort of short-circuits the “wait until the Humble Bundle sale” strategy insofar as it will supposedly be more expensive the longer you wait (which ironically sorta is how Humble Bundles work).

Like I mentioned though, the MineCraft model doesn’t particularly work for me. It grates, like a piano out of tune. But I can’t fully articulate why though, especially when you consider nearly all games do this via cheaper preorders. Damn near everything is 20% off on GreenManGaming before it comes out. Sometimes a game will drop in price within the first three months (and sometimes faster these days, if they miss the forecasts), but it’s usually quite some time before it drops below the preorder price. So… what’s the difference, really? I can’t even claim that it’s because of psychological manipulation, because that’s pretty much behind all sales strategy. It just feels… bad, somehow. And causes me to mentally dig my heels in and wait for the Humble Bundle because screw you for defying the natural order of things. Or something.

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Posted on April 28, 2014, in Commentary and tagged , , , , , , . Bookmark the permalink. 7 Comments.

  1. Taking advantage of the propensity of many gamers to inaccurately estimate how much they’ll like a particular game, especially during the pre-launch marketing hype cycle?

    Buying a game sight unseen without any demos or let’s plays or ordinary everyday player feedback (early adopters will naturally have a skewed perspective, especially if they paid money already, since rationalization sets in) that can offer a more accurate picture of what you’re getting?

    Dunno. I don’t think the payment model works that well for things that aren’t Minecraft and can build a runaway positive feedback loop, but it makes a certain kind of logical sense and can’t really hurt either, right? It’s just a way to scoop more dollars out of fools that are willing to be parted from them, just like how one takes advantage of whales and launch day purchasers willing to pay a premium to play the game at that precise time, and then grab more money off the long tail via discounts.

    Full disclosure: I bought Minecraft at around the $15 mark and have been really happy that I got in at that precise time with that particular game. It’s exactly what I would feel it is worth, whereas the full price now still feels inflated to me.

    It’s like trying to catch a stock at the right timing or something, many people might get it wrong and feel regret or loss later. Maybe in the long term, this is a model that shoots itself in the foot like rampant pay 2 win, as customers get scared off from buying into the model, a la Facebook Zynga games?

    What are your thoughts on the Kickstarter model anyway? The price for supporting those games sight unseen also starts out fairly high, with the voluntary option of paying even more for extra goodies, as opposed to the discount model that seems to appeal to the more miserly crowd with too many games and too little time (me included.)

    • I wrote about the Kickstarter model previously, and my feelings haven’t really changed. I like that games (etc) which would unlikely to ever be made have their chance. On the other hand, I spent $85 on Hex, a few months before Hearthstone came and blew it completely out of the water. The only other game I Kickstarted was Darkwood, which also isn’t out yet. Both of these are a reaction of sorts to my failure to back FTL and Starbound (I think) when I had the chance to get in early at a lower price point.

      So to answer your question, I do view Kickstarter as more a preorder than the MineCraft model, at least when A) it’s already funded, and B) it’s cheaper than at release. I doubt I could argue the position logically however.

  2. Airlines have the same price model.

  3. I’m not sure who would benefit from that scheme on either side… it certainly doesn’t fit my historic (or preferred) buying patterns. I buy stuff I want at release at full price if I have the time to play it, otherwise I buy it when it hits whatever price is reasonable at the time down the road. If that model became popular I’d be underpaying for games I’m actually looking forward to and not playing games that are more borderline… that’s good for me $-wise but not in terms of me actually financially contributing to gaming companies in any meaningful way.

    Longer-term, though, in a world with more and more (sometimes pay-in) pre-release content being available, I could see this becoming more common. Pay $10 to get in at the alpha period, $20 to get in at the beta period (or free for alpha users if they provided enough useful feedback or played enough to have “earned” their $10 discount, otherwise they pay the $10 delta) and $50 at release, again either granting access to those who bought in early or they can pay the difference at that point if not.

    (I’m sure my personal desire to see software testing move back to a paid – or at least compensated – model is driving that thought, though, it may be wholly impractical for any number of reasons in the real world)

  4. While you confess a dislike for this model, I would guess that to the average customer out there, it has an opposite effect: “buy it for cheap right now” or “only 5$ until end of the week!”-marketing works like a charm in many areas of business. People feel smart whenever they get something cheaper (even if it really isn’t), so psychologically it’s a draw. If the game turns out to be great and popular later on, you’ll be the smug one thinking that you only paid half of what everyone else is paying now.

    So, that’s why they do it. it works a lot of the time and involves the same risk as other payment models where you pay more upfront and never know what you’re getting, either. in branches where there’s a lot of free-to-play around everything gets harder to market of course, but the cheaper early bird is still easier to pull off than the 150$ pre-order.