Sale pricing on Steam games: 50% off = 3000% increase in sales

http://arstechnica.com/gaming/news/2009/02/left-4-dead-sees-3000-jump-in-sales-on-steam.ars

by tkiley • 17 years ago

37 12 17 years ago

tkiley2• 17 years ago

Part of the 3000% jump was probably due to the fact that this particular sale made the front page of reddit and digg, but still, it's quite impressive.

greendestiny• 17 years ago

They did have more general numbers, where a 50% cut is a 320% increase. As revenue increase the cuts work out as:

10% cut : 22% increase

25% cut : 159% increase

50% cut : 110% increase

75% cut : 293% increase

tkiley2• 17 years ago

That's pretty amazing. I wonder what happens to revenue in the weeks following the sale; do sales dry up completely, or do they stay strong as players recruit their friends, perhaps?

trjordan• 17 years ago

This is the same thing that Apple saw in the app store: when you get people comfortable with the idea of consistently buying, and it's easy, sales soar. It jives with how I think about purchases as well. A $40 purchase is a big deal, but it's very easy to spend $10 4 times.

It'll be interesting to see how far we can push this model. I don't believe in the micropayments or subscription models as a panacea, but it's pretty clear that digital distribution allows for greater volume at lower cost. Will great games like L4D make enough money at $10? $5? $1? Will app store games make enough at $0.10? $0.01?

It'll be interesting to see what it does to quality as well. Steam seems to be doing well with quality, even when distribution costs are nearly nothing, but the Apple's app store has seen a huge number of cheap, addictive games because they make more money for less development time. Hopefully it all balances out, but more and more, software will lose the ability to price itself as a physical good that comes in a box. Where does it settle?

In any case, I'm excited.

ja2ke• 17 years ago

Steam has a fair amount of suspicious games. Nowhere near the amount as the App Store since Steam isn't a self-publishing platform, you have to sign agreements with them and get an account rep and stuff.

Steam excels because it does a far better job than than the App Store of making sure that quality is always on the front page, while also making sure that the front page changes often. I think they have found a good meeting point between content/metrics-driven decisions and an editorial voice for picking what gets featured. The App Store, not so much.

JeffL• 17 years ago

Does anyone have an idea on how to guess or find out how sales of a subscription based game would be affected by cuts in price, say from a baseline of $10/mo?

I've always thought that $10 is so little that the biggest barrier to paying is just the reluctance of getting out the credit card or the idea of paying at all, but maybe that's wrong.

earl• 17 years ago

That's a pretty remarkable price elasticity of demand, and it kind of makes me wonder about the rationality of the purchasers. If a game costs $50, a 25% cut merely saves you $12.50 -- that is enough to more than double revenue? Odd.

ovi256• 17 years ago

It was a special case, as the "Left for Dead" sale was featured on major online social news outlets. So i think it is not at all representative for the general case. But the article contains data about the general case, and they are encouraging : 50 percent sale = 320 percent increase in sales.

wlievens• 17 years ago

Was there a drop in retail sails to compensate?

Sale pricing on Steam games: 50% off = 3000% increase in sales

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