If you take a closer look at the casual games market you’ll find a lot of diversity. Some games offer more than 30 hours of playtime, some just over six hours. Some games have an old fashion art style, while some are made with 3D graphics that have Pixar quality written all over them. Some genres are relatively easy to develop and other genres are harder for developers to master.
You would think this is a perfect market to create a sophisticated pricing strategy, but instead the casual games market is beginning to look like a “one price fits all” market. In fact, a cardinal rule of pricing is: “If You Have One Price, It’s The Wrong Price For Everyone.“
There is a very simple explanation as to why a “one price fits all” strategy is wrong. The products being offered to the consumers of this growing market just aren’t the same. In fact, they couldn’t be farther apart in some cases. This confuses the consumer. For $ 6.99, the consumer sometimes gets a game with 25+ hours of playtime, high-end graphics and animations, while the next day the same person gets 6 hours of playtime and graphics that looked like they were made in the early 1980s. These games should never be offered at the same price.
To compensate, the industry now invented something called the premium, or collectible game. This confuses the consumer even more. Paying almost three times the normal price for a wallpaper and a strategy guide. Would you do that? It a temporary fix, but not a cure for the long term.
My wife often likes the most expensive shoes. She says: “These shoes are worth it.” Who am I to judge? On the other hand, she sometimes goes for the bargains as well. Why would this behavior be much different when it’s about games?
What started all this and why we aren’t able to turn it around are big question marks for me.
We did some research on some of our own titles and found that consumers are willing to pay for quality. A good quality game is much more profitable at a higher price point. So much is certain for us.
Now, some of you might think this is bad news for the consumer, because they have to pay more. In fact it isn’t bad news at all, they pay more for higher quality, or longer playtime, both of which give them more satisfaction. Knowing that there is a higher price for better quality gives developers like ourselves the motivation and funding to create even better games, and to be more innovative. In the end, this gives the consumer more choice and a variety of games at different quality levels and price points, which is in turn is better for the industry as a whole.
How do we introduce flexible pricing in the casual games downloads space?
First of all, give games a rating and determine their value through that. This mechanism has to be approved by publishers and developers, which would turn it into an important industry-wide standard. Rate each game on playtime, replay value, overall quality and playability. I don’t have the exact solution, because it needs some serious thought and research. For now I am thinking about something similar to console games with their well known “triple-A” titles. If we are able to introduce something like that, our pricing problem is history.
I would suggest three categories – regardless of what they’re actually called – that represent basic, medium and high quality in a way the consumer will understand. The industry should come up with a huge campaign so all consumers know what to expect. Every category would have its own price point, of course.
Secondly, we need a new relationship between publishers and developers based on a need to take care of each other’s interests. Don’t make price point decisions with only your own interest in mind, but make decisions that keep the industry healthy. We love our work, we love making casual games, but most of all we want to improve ourselves by making better games.
By enabling us (developers) to do what we love to do most, publishers will profit from it as well, which is a good and healthy situation. More high quality games will enter the market. Our ultimate goal should be keeping the casual game consumer satisfied. The way we’re going now, I don’t think we are making this happen.
In my opinion, flexible pricing based on a dynamic marketplace, where each game is individually priced based on things like gameplay length, genre, and how long it’s been out for, is the way to make this a healthy industry. If it works for every single other product sold – whether it be shoes, movies, books, or food – surely it’ll work for casual games.
In 2001, Horst Streck founded I Sioux Media Productions, which is now operating in the casual games industry under the Youdagames brand. Together with his two partners, he has turned Youdagames into an important player in the casual games industry in a relatively short period of time. As the CEO, Horst is responsible for building strong relations with important partners and distributors within the industry. As a result, Youda games are now played by a broad audience worldwide.