D&D 5E Greg Leeds talks about D&D

[Mistwell]

It isn't any evidence at all. Net revenue isn't profit

While that is true that it isn't profit, it's much closer to profit than you're implying. It's the money left from sales after you deduct the sales expenses and cost of the goods. That's what a lot of people mean when they say profit.

At some point, the following becomes true:
Almost everyone who plans to own the core 3 books owns them.

Not really. While the market is not infinite, it appears to have so much room to expand that it can expand for an incredibly long time such that it might naturally be time for a new edition prior to the expansion of the market ending. A lot of WOTC's sales appear to be from new buys to D&D, younger players who have never played D&D before.

Game stores don't want to pay up for the core 3 books because they'll get undercut by Amazon/BN and they'll mostly just take up shelf space.

This assumes people are not coming to the game store to buy a board game, seeing the new D&D game there that they've read an article about, and deciding to buy it. It also assumes the Adventurers League isn't working to generate new sales with customers coming to the game store to play - which all accounts say is untrue. ICv2, which measures game store sales (and who coincidentally is behind this interview), indicates sales remain strong in the retail stores. So, at least so far, your analysis is not holding true from what I can see.

 

[delericho]

You seem to be confusing revenue with profit. The interview claimed revenue was up (although it did not say by how much) but didn't mention profit, unless I missed it.

You're right - in the text you quoted the one instance that says "net profit" should read "net revenue" instead. Fortunately, that doesn't change my argument.

 

[Corpsetaker]

At the very least, this can hopefully serve as a bit of counter-evidence to those who claim that WotC's current strategy is an objectively bad one that will inevitably financially ruin them. D&D isn't suffering under this plan, so it alone will not lead to D&D's failure.

I don't think anyone ever said the game would financially fail but the game itself can still fail while giving them more money in their pocket. The problem with corporate BS is that you have to wade hip deep though it in order to find reality.

Is their strategy working? That is a yes and a no. If their strategy is for more money in their pocket after their investment then yes it's working because overall they are spending less money on the game. They have cut staff and cut production. Mix that with a starved public and you make more money. Is this better for the game itself? No it's not. We are getting less quality and less frequent product.

I would say this edition has sold no better than the previous ones. They just managed to spend less money this go around so while you may be making more money this time, it doesn't mean you are doing any better overall.

 

[delericho]

Yeah. But look at this q&a exchange. It sucks the very soul out of what I love about D&D.

Businessman talks about business aspects of D&D (and Magic) in business terms. It's not really shocking - for the soul of D&D, if there is such a thing, you probably want a different thread.

 

[delericho]

At the very least, this can hopefully serve as a bit of counter-evidence to those who claim that WotC's current strategy is an objectively bad one that will inevitably financially ruin them. D&D isn't suffering under this plan, so it alone will not lead to D&D's failure.

People tried very hard to discredit the "D&D is really on a tear" thing a few months back, despite it being shown that that couldn't just be a relative measure against last year and that it had to be noteworthy against Hasbro as a whole. Given that, I doubt they'll be swayed by this.

 

[Mistwell]

I don't think anyone ever said the game would financially fail

Several people said the game would financially fail. A couple of them are still active on this forum.

They have cut staff

Actually they've increased staff. I even asked Mearls about this just yesterday on Twitter and he agreed they've hired people lately. From best estimates, they've doubled the D&D staff since the launch of 5e.

We are getting less quality and less frequent product.

The "less quality" is a highly subjective opinion of yours, but you're stating it as if it is a fact. If we take objective measures, your opinion isn't well supported for the bulk of D&D fans.

I would say this edition has sold no better than the previous ones.

Both Mike Mearls and Jeremy Crawford have said it's sold better than the same period of time for 3.0e, 3.5e, and 4.0e. We can easily ask them again on Twitter if you're not satisfied with what they said before. Would that convince you that your statement is incorrect, or would you just shift to a different standard?

 

[Morrus]

I would say this edition has sold no better than the previous ones.

How on earth would you conjure up such a statistic? How many copies has this edition sold? That's the very minimum data point you need to make such an assertion. I strongly suspect that you do not have any such data, and are in position to be making such an assertion.

 

[MwaO]

While that is true that it isn't profit, it's much closer to profit than you're implying. It's the money left from sales after you deduct the sales expenses and cost of the goods. That's what a lot of people mean when they say profit.

Revenue is the amount of money that the company gets from selling the product. The MSRP of 5e was higher than 3e/4e, but the price I paid for 5e books was less than what I paid for 3e/4e books.

i.e. Amazon/BN discounted the price more heavily, and sold more books. That implies WotC's getting less money per book from Amazon/BN than they did in previous editions.

ICv2, which measures game store sales (and who coincidentally is behind this interview), indicates sales remain strong in the retail stores. So, at least so far, your analysis is not holding true from what I can see.

ICv2 was behind the previous interview, too where Leeds described sales as 'very, very strong'

The question is not what is necessarily happening now. At some point in the relatively near future, unless there's lots of growth in players of D&D, sales of the core 3 books must drop. Then either there's another product waiting in the wings or revenue drops. That's happened in every edition and prior to this, bloat was the outcome.

 

[Tony Vargas]

You're right - in the text you quoted the one instance that says "net profit" should read "net revenue" instead. Fortunately, that doesn't change my argument.

'Net revenue' was an interesting choice of metric. Net revenue includes discounts & incentives and non-sales revenue, like licensing fees. Saying 'net revenue' instead of 'sales' or 'revenue' implies the gain is from something other than just moving books - like whatever they made off Sword Coast Legends, or some other revenue stream the IP is generating for them. Or, it may just mean that sales are up, but that there's some arcane (npi) accounting factor in how they get books published that makes net revenue a more valid or just better-looking metric than gross sales.

Whatever the slow pace of publication is doing for them business wise, it recalls the early day of AD&D, and slows 'bloat,' neither of which seem like a bad thing.

 

[fjw70]

By your logic, there is no bad time to be working on a replacement. If it's doing bad obviously you'd want to work on a replacement, and if it's doing well you're saying you want to work on a replacement, so when would you not work on a replacement?

WOTC appears to be planning for a long term, evergreen product in 5e. That makes now a bad time to work on a replacement, if indeed their plan is working.

What the heck are you talking about? Someone implied that it didn't make sense that 4e was doing fine in 2011 since they had already started working on 5e by that time. I was saying (paraphrasing here) that you don't wait until your product tanks before starting to work on its replacement (if you can help it).

I never said you have to start working on the replacement product the minute the current product is released. Only that you should start working on it before the current product tanks.

If WotC though 4e was doing fine in 2011 but thought that it wasn't sustainable very much longer than that was a good time to start working on a replacement (there are other reasons to work on a replacement but I am trying to keep this in context).

So I agree with you that if it takes three years to delevop a replacement product and you don't think you will need it for ten or twenty years then now is not a good time to spend much resources on that replacement. Nothing I have said it incompatible with this.