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GDC 2012: 'Don't underprice your mobile product' - Cave COO
GDC 2012: 'Don't underprice your mobile product' - Cave COO
March 8, 2012 | By Kris Graft

At GDC 2012, Mikio Watanabe, COO of CAVE, developer of shooters such as DeathSmiles, said when it comes to hardcore retro Japanese mobile games, don't sell yourself short.

Cave's first two efforts in the iPhone space were ports of its hardcore scrolling shooters EspGaluda II and Dodonpachi, and the studio has since released original iPhone games. Releasing those mobile games gave Cave some valuable lessons, Watanabe said.

"Setting a good price and making sure the port version is respectful to the original is very important," he said. "...Our belief is that people will pay premium prices as long as it's a good product. So with some of the Cave games we set the price at 1000 yen -- that's about $12-13." That's a far cry from the typical 99 cent games that proliferate the current mobile market.

"If it's a hardcore product, go for the higher price point," he said. "...Don't underprice your product."

Watanabe said that in Cave's experience, smartphone-tailored games cost around $250,000 to make. Forty percent of that goes towards engineering, 30 percent to graphics, 15 percent for localization and QA and 15 percent to audio and sound design, he said.

"What you wanna do is aim for a maximum play experience for the user. And if you manage to do this as long as it's a pretty well-known retro game, you will be able to get users to try it out, and the reviews should be pretty positive."

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jin choung
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it's funny how distinct and recognizable the smell of fear is.

Andrew Chen
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I...don't really follow.
Do you mean, from the above statements, Mr. Watanabe sounds afraid of the price situation?
I didn't get that impression in particular after reading his statements. Rather, I assumed these were the lessons his team absorbed based on sales results from the multiple products Cave has released on the App Store.
Or perhaps you meant that you attended the talk where this statement was made and, shall say we say, there was some funk...

jin choung
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i'm reading between the lines. when people talk about how OTHER PEOPLE price or SHOULD price, they're talking from fear - for themselves.

you can also tell this from some comments in this thread as well as people like nintendo head honcho.

Hakim Boukellif
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I'd be scared too if I faced to risk of no longer being able to create anything but mass market products with game design mostly being dictated by the marketing department.

Hillwins Lee
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Devaluation is here to stay wether you like it or not, effort should be focus on other monetization mechanics such as item mall

Michael O'Hair
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Hopefully a crash similar to the one in the early 80s washes away all the cheap 99-cent games and their add-on content monetization strategies, and games become worth their weight in data and money. Too many unimpressive games sold cheap on mobile platforms. Eventually the bubble will burst.

Brad Borne
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Wouldn't be way better if accessible core gaming continues to go mainstream, and is able to reach such bulk by digital distribution that we get no strings attached games for incredibly cheap?

Daniel Gooding
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@Michael "Eventually the Bubble will burst"

Expensive game development = The Slowly Bursting Bubble

Just look at all the larger studios shutting down, and new smaller tight knit studios springing up. Doesn't take a financial analyst to see the trends.

In My opinion
Those studios will bring forth the new wave of $10-15 games, crushing the $60 game release to only the elite studios.

As far as 99c games go
As long as colleges keep pumping out game dev/art students, then there will be a steady stream of 99c/freemium games Till eventually they start sending the message to the next generation that game dev is a very high risk field to be in despite the increasing number of sales every year.

E Zachary Knight
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"games become worth their weight in data "

Question: How does one weigh bits and bytes? You can't use a physical media as a 8Gig sd card weighs less than a DVD. A 64Gig SD card weighs less than a 64Gig Hard Drive.

David Phan
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>>>So with some of the Cave games we set the price at 1000 yen -- that's about $12-13." That's a far cry from the typical 99 cent games that proliferate the current mobile market.<<<

I want to know if Watanabe made that above statement:"That's a far cry from the typical 99 cent games that proliferate the current mobile market" or was that the writer's own opinion or an interpretation of something Watanabe said.

Context is important here because I don't think Watanabe was directing his concerns against $0.99 games or freemium games. According to the article, his direct quotes were addressing the niche or hardcore products to not undervalue their pricing.

Harry Fields
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There are Apps, and there are CrApps. If you're trying to dupe someone into a sale with a mediocre CrApp, then by all means, rely on penny prices and fleecing the user with cash shops. If your App is of quality and marketed well, price accordingly and you'll find paying rent much easier. That said, I'll continue to advocate the established paradigms that give value to our craft over ones that would see us all turned starving, albeit independent artists.

Rev. Stuart Campbell
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"If your App is of quality and marketed well, price accordingly and you'll find paying rent much easier"

Except, of course, that EVERY SINGLE piece of research on the subject proves the exact opposite. App Store games generate FAR more money at lower prices, in pretty much every combination of circumstances - unknown game reduced in price to give it a visibility boost, well-known title discounted in the short-term, already-successful hit cut over the long term to build userbase once it's already in profit, you name it. The result is always the same - sales up 10x - 100x, revenues up 5x - 20x.

John Flush
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I bought a $15 game from the iStore. Why would I do such a thing when there are free apps every day, and .99 games out there? Because it was a genre specific game that doesn't have much push anymore in the industry. I want to play certain types of games and I'm willing to pay for them. If you only have yet another "flick me" game with a new skin and you price that above 'free' you can go screw yourself. But if you are going to make a genre that is one of the few games for the system I'll gladly pay up the nose to play it.

For those of you that wonder, the game I paid for is a turn-based dungeon crawler.

David Holmin
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I hear you. This is the true potential of indie games and digital distribution, not the loads of casual time killer apps out there. I'd love to buy DeathSmiles for $15 if I had an iPhone. I already have the 360 port, but the iPhone version has a new mode.

Rev. Stuart Campbell
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Here's the truth about the pricing of Cave's apps: they sell roughly a HUNDRED times as many copies when launched at half-price as they do when they go up to the higher "normal" price.

Bryson Whiteman
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I'm trying to follow the logic of that article but I don't get it. The game sold 30,000 units in 3 days, during an announced sale, and an additional 10,000 units in the next 3 months. According to the graph shown, it seems like the sales had sort of fallen off at a steady rate regardless of the change in price. Which seems pretty natural, games tend to sell less as time goes by.

I think Cave's success may be telling of how they know who their audience is (many customers willing to import their games) and how they do solid ports (according to what they say). Many other companies like Square Enix do half-assed ports with choppy frame-rates and still charge these sorts of premium prices, which comes off as a slap in the face to their real fans.

And looking at Cave's site, they seem to plan sales often to generate interest in both new and older releases. Which is probably a good idea to do if you plan on offering higher prices.

Hakim Boukellif
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Given the nature of the game and the fact that it's a port, having exhausted most of its potential audience at that point in time with 30,000 sales doesn't seem too unbelievable. And while being a port lowers the potential audience size, at the same time it also increases the sales rate in the first few days after release, as there's less of a need to wait for public opinion to form. The lower price point would only accelerate this. So until there are actual numbers of how much of the potential audience has been reached (which I figure aren't actually possible to collect), there's no way of telling whether they would've made more revenue in total had they kept the lower price point.

There's also the matter of the perception of value of appstore users, which has been skewed to the low end due to the large amount of $.99 apps available. The lower the perception of value by the potential audience, the lower the amount of sales get as prices get higher compared to an audience with a higher perception of value. Given that, a prolific developer (within its niche, at least) like Cave selling their products at a higher price and advising others to not be afraid to do the same might be the economically more responsible action, even if it means less revenue in the short term.

Rev. Stuart Campbell
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See, for example, if you can spot the common link between all the peaks on this graph of the money made by Cave's second iOS title Dodonpachi Resurrection:

It's almost as if the revenue - not just the sales - spikes upwards dramatically whenever the price is lower.

Kenneth Blaney
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The strategy is this: price higher to let the people who will pay more actually pay more. Then decrease prices during sales to pick up impulse buyers. They can do better with dynamic pricing strategies than a single static lower price.

Rev. Stuart Campbell
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The casual viewer could be forgiven for thinking that the exact same pattern was repeated in the revenue graph for their debut title Espgaluda 2: