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Why Steam sales are good
by Daniel Macedo on 12/19/12 05:11:00 pm   Featured Blogs

The following blog post, unless otherwise noted, was written by a member of Gamasutraís community.
The thoughts and opinions expressed are those of the writer and not Gamasutra or its parent company.

 

Excluding the obvious. To the consumer, lower prices for the same product is always better. The problem here is that some publishers (*cof* EA *cof*) was saying that franchise value is diminished by sales that Steam organize.

If you don’t play on PC or don’t know what I’m talking about here’s the short version: Valve’s online shop (Valve developed Half-Life, Team Fortress 2 and Portal), so-called Steam (http://store.steampowered.com) promote sales with price cuts up to 90% to some titles. These sales happen usually twice per year: at Christmas and at the American summer (Note: In the other half of the world it’s winter in June/July). The discussion comes from that.

I’m forced to come here and say that these sales do exactly the opposite. They improve franchises’ values. Of course these older games will be sold for less money, but this comes with many advantages.

First point is that a larger numbers of people will play the previous games of franchises that are still active. A fact that should be understood and known nowadays is that, in the entertainment world, the best marketing tool for your product is the product itself. For franchises this is true for their previous titles. That’s why franchises are so “safe”. People know the previous work and are comfortable betting on something they already know. This generates a problem with innovation in this industry but this is not important now.

One of the results of this is that the number of people willing to buy new titles from that franchise increase. After all, the number of people that know and like that franchise increase due to more accessible prices to know that universe.

Other advantage of these sales is to set “AAA” games prices to the same level of casual games. It was proofed countless times that there is a larger number of people that is willing to pay the smaller, casual price. This may well be the entering point for casual consumers of videogames that start to look for the next level of dedication. There is no nature’s law that states that “hardcore” players never where casual. And I believe this kind of new blood influx will be larger and larger and we will just win with the industry’s growth in that way.

Finally, the best reason for these sales is to enable the possibility of testing and helping Indie developers buying their games for even lower prices, even more than usual. Here the reasoning is the same as franchises, but with the entire Indie market. Once people is captivated by indie games and some prejudices are destroyed it becomes easier to sell other indie games to these people. Personal experience.

And if you don’t accept my logic just read this interview ( http://www.eurogamer.net/articles/2012-07-11-valve-counters-eas-steam-sales-cheapen-intellectual-property-accusation ) where Jason Holtman, business development chief from Valve, states that this movement is positive but don’t explain why. If you need more here comes something stronger: This is the fourth or fifth time that Steam is doing this sale week. And they can only change game prices with developers’ authorization. If this was bad for business, do you really believe that developers would enable this practice? Yep, I don’t believe so either.

 

This is a reprint from http://cmdredem.tumblr.com/post/27175775457/why-steam-sales-are-good


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Comments


Groove Stomp
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I've been discussing this with my brother recently.
In a very specific instance, I found that I personally felt Metro 2033 was being undervalued by THQ. However, that's a very interesting case because of THQ's financial situation and their amazing willingness to try anything to generate revenue.
I also shouldn't be too worried, as I only actually bought Metro 2033 when it dropped to $5, and I'm now a series fan.

Daniel Macedo
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In my humble opinion the THQ strategy of sales and subsequent Humble Bundle was not about taking THQ away from the jaws of bankruptcy. It was about showing shareholders that THQ IPs are still strong and that it`s worth keeping THQ in control of this IPs instead of a liquidation to pay creditors. Cash flow is always welcome and all, but I think it`s more about keeping THQ together as a corporation than anything else.

And if you look carefully, THQ is one of the best publishers out there. So it would be very sad to see THQ go away like that.

John Flush
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When I buy a game for the first time that I have been holding back on I do it because I know I have too much to play and I'm only going to try the game if I get it on the cheap. When it happens I prefer to buy from GOG.com or Steam. Funny thing is if I buy the game and enjoy it, I will usually buy the same game on the other service once it gets cheap again. I get it on Steam for convenience (patches better, more integration, time tracking of how much I play a game, etc), but I buy off GOG because they know I want to play the game DRM free.

Without the initial sale though, I probably wouldn't try most of the games at all. I mean who doesn't have a massive backlog of stuff to play that really interests them? That is what gets a day one purchase for me, and all the rest I only get when it is cheap. The game either hooks me and I'll be first in line (at full price) for the sequel, or at least they got something out of me. Win/win.

Kenneth Blaney
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Not to be nit-picky, but this stuck in my head:
"the American summer (Note: In the other half of the world itís winter in June/July)"
It isn't an "American summer", it is a "Northern summer". Calling it an American summer seems to include South America as having a July summer, but it is actually winter in July in South America.

Beyond that stupid and unrelated quibble, I think you are exactly on point. The number of people who hear about a game for the first time from these sales or are reminded of games they used to play far, FAR outstrips the number of people who say, "I'm going to wait until this is on sale."

Daniel Macedo
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Yeah, you`re right... Is just my brain working in english that defaults to America as a location reference.

Jeremy Reaban
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I wonder though, if that complaint didn't have some effect on Valve, because so far, this winter's Steam sales have been relatively modest in terms of discounts compared to their usual sales. Rather than 75-85%, we're mostly seeing 50% or so, with some 66% for flash deals, and only 75% on some older titles.

Other digital retailers are having some deep discounts though, Gamer's Gate and Amazon in particular.

Still, I was hoping to get either Xcom or Fallen Enchantress cheap, looks like it won't happen, half off is the best I've seen for Xcom, and I'm not sure even that much for FE. Stardock is somewhat notorious for never putting its games on sale though.


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