Is the age of discounts over?

[mhacdebhandia]

Even if you do assume these to be true, just because I end up paying the same (or almost) at both Amazon.com and the FLGS, that doesn't mean I'm going to start erring on the side of the FLGS. Amazon.com (and the Web as a whole as a resource) offers me a level of convenience and selection that most FLGSs in existence simply can't.

I think there are definitely limits, as you say. Even if I paid the exact same price for Complete Divine from Amazon as I would from my local gaming store, the "real price" is affected by several factors:

• My ability to shop at Amazon from my desk
• My need to travel to the store and its related costs (transport fares, petrol, parking)
• Shipping costs and time from Amazon
• My ability to pay with my American Express card at Amazon
• My ability to pay with my American Express or EFTPOS (direct debit) card at a store
• My ability to look through a prospective purchase in a store
• The chance that I will notice something else I want in a store which never comes up while browsing Amazon
• Stores sometimes do carry things which Amazon does not

It's not really as simple, for me, as saying that of course a full-service store will suit me better if the prices are the same. There are a great many touted advantages of full-service stores which aren't relevant to me at all:

• I don't need to meet new gamers in a store - I have SUTEKH for that
• I don't need to play games in a store (and, in fact, would not) - I have SUTEKH for that
• I don't need to hear advice or rumours from the staff - I am on EN World, after all

Of course, it's all pretty much personal. For instance, since I live in Australia and the nearest store worth visiting is in the city, 45 minutes' one-way drive from my home, it's actually much better for me to buy my books from Amazon even including shipping, what with petrol and parking - not to mention the effect of the current severe weakness of the U.S. dollar against our own. If I lived or worked closer to a gaming store, and/or the Australian dollar began to fall against the U.S. dollar, those advantages would disappear.

I'm also not sure that this change will drive me back to the gaming store - not that the Australian market will be of much concern to American companies - simply because Australian stores price their books much higher than the U.S. recommended retail price, due to the cost of international shipping.

Even shopping online with a Sydney retailer like Napoleons, I'd pay A$50.00 for the Player's Handbook - US$42.40, $12.40 more than the R.R.P. Shipping might even it all out, but Amazon has a much larger range - and, as I have done the last few times I've ordered from Amazon, I've added fiction and nonfiction to the order. There's no way to do that with Napoleons!

 

[freyar]

Well, this has been very interesting reading. Without getting into how tragic the FLGS tragedy of the commons is, Ryan Dancey makes a few statements about economics that don't strike me as quite right.

First off, he says that gaming demand is inelastic, meaning that people won't buy a similar (but not identical) product at a lower price. So if people want M:tG, they won't buy a cheaper knock-off. But he seems to ignore the fact that people will buy less of M:tG at a higher price (until WotC comes out with newer, cooler cards). Of course, this isn't really the issue with this court decision; WotC can set the price where it wants based on their understanding of the supply/demand curve and either (a) tell retailers exactly the price or (b) suggest a retail price. The point is, WotC can adjust the price either way so consumers get it at the correct point on the supply/demand curve. In this, it seems like R.D. might be right that fixing a price across the board might help the LGS (or at least not hurt it). But how important that is has been the debate here.

The other thing that he implies is that removing antitrust barriers from the market is capitalism (true enough, in a strict laissez faire sense) and therefore great for consumers. W/o straying into politics, let's just say that pure capitalism tends to end up in the form of monopolies (Ma Bell, MS, etc), which isn't always great for consumers. There is a reason antitrust laws were instituted, after all.

In the end, though, I'm glad this decision seems unable to affect the Canadian market. Since I moved here a year ago, I've been appalled at the ridiculous "exchange rate" for USD/CAD with respect to book retail pricing. The only way to get fair value for my dollar is through deep discounting.

 

[JoeGKushner]

No. That's an obviously untrue assumption based on illogical emotional ties to the notion of an FLGS. The local Barnes & Noble sells more copies of the D&D Basic Game than I've ever seen stocked at a game or comic book shop.

Aren't the book chains one of the things that White Wolf and other large companies have brought to the table so to speak when doing imprints? That they can be sold in larger retailers and online? Take away the discount and the incentive to buy such from Amazon.com or Buy.com goes away and the sales decline overall. It's not mom and pop shops selling the majority of gaming products these days.

 

[JoeGKushner]

WotC should know that the market value of the books/miniatures is well below the MSRP. If they no longer have to inflate MSRP to push up the street price then they could lower the MSRP and bring back FLGS.

At least I can hope.

What commoedies, once raised, have a history of going down and staying down? Not too many I can think of off the top of my head.

 

[Whizbang Dustyboots]

What commoedies, once raised, have a history of going down and staying down? Not too many I can think of off the top of my head.

Only illegal drugs readily spring to mind. Write your own joke here.

 

[Lanefan]

While this doesn't directly affect me in Canada, it seems this ruling is all about clashing rights:

- the publisher's or manufacturer's right to set a price for their products, vs.
- the retailer's right to sell those products for whatever price they want, vs.
- my right to buy those products for the lowest price I can find, if I so desire.

I'll be surprised if this ruling stands up in the long run.

Still, if you're selling a product at a profit of $4 per unit, and could sell twice the number of units if you lowered the price and took a profit of only $2 per unit (thus making the same overall total profit), why not lower the flippin' price and make the produce more accessible?

Lane-"this is why trade-based economics don't get DM'ed in my games"-fan

 

[Warbringer]

What commoedies, once raised, have a history of going down and staying down? Not too many I can think of off the top of my head.

silver

 

[jodyjohnson]

What commoedies, once raised, have a history of going down and staying down? Not too many I can think of off the top of my head.

I don't expect them to go down and stay down. I suspect there would be a market correction though.

If the average street price (what people are actually paying) for RPG books/minis is close to 65% of MSRP (via the discount market), I have a hard time seeing enforced MSRP without moderating what would otherwise be a sudden 50% increase (perceived and real).



I like DDM ... at $10 a booster. I won't just buy less at $15. I won't buy any.

The randomised system requires that I buy in bulk to average out the randomness.


I like D&D and while I agree with RyanD that the market is inelastic, it is still just a niche luxury item market. At the end of the day all we really need is a couple books or even just the SRD.

 

[Dannyalcatraz]

Still, if you're selling a product at a profit of $4 per unit, and could sell twice the number of units if you lowered the price and took a profit of only $2 per unit (thus making the same overall total profit), why not lower the flippin' price and make the produce more accessible?

Every company that is smart about setting prices does what is called a breakeven analysis.

You examine your product line, figuring out the per unit costs and try to determine at what point (for a given price) your company will break even for each product. This analysis includes factoring in what it costs to make a production run of a given size.

While Company X might be able to double sales 2x by droppin prices from $4/unit to $2/unit, that doesn't mean their costs stay the same. This means that their profit after the $2 price drop may not be $2/unit. For instance, they may have a physical plant only barely capable of producing the current production run, and doubling the run may force them to expend money to increase their manufacturing capability, meaning building or acquiring a new production facility or outsourcing production, increasing warehousing capability, and even hiring new personnel. To meet that higher production run, that $2 price drop gets coupled with their per unit costs may increase by $1 or more.

And that is assuming they have the money to make that move, or can get a loan to make that move.

 

[Banshee16]

Or they won't. Maybe they'll just pocket the extra cash.

PS

That's making a big assumption they're going to to get it out of my wallet. I typically buy the books I really want at the FLGS. I buy the "extras", that I can't justify paying full price for, on the discount sites.

Raising the prices will just result in me not buying that extra book. No way around it.

Wonder who had to get bribed to pass that ruling?

Banshee