Friday, April 30, 2010

Live And Die By The Sale

Last weekend, DDO had a pretty major sale going. All adventure packs were 30% off, and the $50 Turbine Point package was awarding 6,900 points instead of the usual 5,000 points (138 points/dollar instead of 100). This week, things are back to normal, which may translate into far less money spent in the store this week.

The Impact of a Sale
For a practical example, look at the Ruins of Threnal Adventure Pack. This pack has a list price of 550 Turbine Points, which is $5.50 at the standard exchange rate. The 30% sale discounted it to 385 TP, which, at the sale exchange rate, works out to $2.89. In other words, the two sales stacked for a discount of a whopping 47.5%. This was a major incentive to buy (and, perhaps as importantly, spend) points, and I'm guessing that they did indeed do a lot of business last weekend.

The problem is that, where I would have paid $3 for this pack, I was not willing to put $47 - three months sub to the MMO of my choice - on deposit with Turbine simply to secure the exchange rate deal. Buying Turbine points in any quantity smaller than $50 is a much worse deal (in addition to not getting the bonus sale points), and this particular pack was more of a want than a need, so I decided to pass. Now, with the sale over and the pack costing twice as much, I'm even less likely to bite.

The Inflexible Sale
Sales are a powerful tool - I literally went from never having played DDO to buying $50 worth of points when the 6900 point deal was offered back in March. The problem is that the sale price affects the perception of the regular price. Worse, having such a large difference (38%) between sale and regular exchange rates makes just about any other sale Turbine could come up with moot; I'm not going to leave 1900 points on the table by purchasing $50 worth of points when there isn't a sale on, just to save a few hundred points in discounts on some adventure packs.

In the end, the content I bought with the points I had banked will last me for a while yet, but I will probably end up scaling back my DDO time (and therefore any possibility of making DDO purchases) until the next time a sale happens when a $50 purchase fits in my budget. (Given the history of LOTRO promotions, I'm not too worried about the wait.)

I'm okay with that for the most part, as I'd never really planned to have DDO be my primary full-time game anyway. Turbine might be less okay with that, if they are under pressure to produce regular monthly income. In this particular case, the inflexible nature of their heavily sale-incentivized payment model has literally cost them a purchase.

I guess they believe these kinds of promotions train players to spend more liberally in the short-medium term, and that this will ultimately be worth more than the amount of money they lose from players who actually care about sticking within a budget. In the long term, this type of attitude plays a big part in why non-item-shop players get the impression that item shop games are out to soak them for all that they're worth. Perhaps Turbine may not feel that they have the luxury of worrying about that right now, but it could come back to bite them later.


Stabs said...

I've always looked on sales as indicators of what an item should cost and on standard prices as a bit of a rip off for just about everything.

For instance my local supermarket has a 2 litre bottle of Coke on sale for 17p (about 30 cents) where normally it costs ten times as much.

I agree completely that it conditions us away from paying the non-sale price but I think we're the minority and most people don't really care.

Essentially retail shops and now DDO operate a two-tier system. One that appeals to people who are impulsive and a bit careless with money and one that appeals to the more careful spender.

At the end of the day they take money off both types by operating the two tiers.

Brian 'Psychochild' Green said...

What Stabs said The fancy term for this is "price discrimination", where you try to get people to pay the maximum they likely normally would.

I'm with Green Armadillo here. I started playing DDO with the Massively group and I threw down some cash to buy some points. I bought a bunch of adventure packs with them, and the Warforged race. (There's a sale on Monks this week, BTW.) Turbine was unlikely to get my money without an incentive like a sale and I spent a lot of points on adventure packs when they were discounted.

But, what Stabs said is right. They're probably banking on the fact that people will eventually want the shinies and won't have the patience to wait for a sale. So, they'll make some more money out of the majority of people who have poor impulse control. For the rest of us cheap bastards... I mean, thrifty shoppers, they'll get our cash when it seems like an unbelievably good deal. Sure, maybe some impulsive people might buy when the sales are on, but that's a small amount of money to lose in the long run. I'm sure they are happy to have any cash flow. And, as I said before, they're probably working on adding more content to get people to keep spending more money in the future.

At any rate, I'm enjoying it. And $50 isn't bad to spend on a game, especially when I have a regular group waiting for me on Wednesday nights. ;)

Green Armadillo said...

The difference here is that relatively few people are going to decide that they're not going to bother trying soda because they can get unlimited tap water at home and they can't be bothered to watch for sales. The perception that item shop games are all out to rip players off is actually deterring players from trying them. (Whether the players in question would have been nonpayers anyway is a separate question.)

Stabs said...

"The perception that item shop games are all out to rip players off is actually deterring players from trying them."

I think very few players share this perception. I don't.

I've played quite a lot of DDO since September. I've spent $50. I've hugely optimised my account unlocking over half the adventure packs. I'm overall very happy with the deal.

I've got much better value than 3 months of $15/month.

Next, as I said, it's a sliding scale. People who think spending $50 can spend $6. People who don't want to pay that can play for free.

Apart from the offerwall Turbine have handled their F2P scheme very sensitively with very little outrage over their price points.

I think you're just about the first person I've ever seen complain.

Coreus said...

I had the same experience in Steam the other day. I'd resolved to buy Trine after seeing a few videos of it and knowing that I always enjoy that kind of puzzle-y platformer, but upon loading it up in the Store saw that it had been discounted to $5 just the week before. This caused me to rethink my decision to spend the $20 to buy it and instead download the demo, which to be honest I wasn't terribly impressed with, finding the hybrid character/mouse controls fiddly and unintuitive.

I may well go back to it later and love it [and then buy it], but it is interesting that this shift in perceived value just from knowledge of a past discount cost the developer at least one full-price sale. Maybe they should consider removing past news articles informing people of the sales once they're over? =)