It feels to me like Hasbro has lit a fire under Wizards of the Coast, and given them

[Smeelbo]

According to the PowerPoint slides used to discuss D&D Essentials internally at WotC, they estimate there are about 1.5 million current 4E players. At least one in five of those possesses at least one book, or more likely three or more. The gross profit for WotC on a typical 4E hardcover is probably in the neighborhood of a few dollars.

Not sure how much their development costs are, but at $10/month for DDI, probably they gross about $7 profit, or the equivalent of selling two hardcovers. Could be more, as much of the development costs are probably underwritten by book sales.

30,000 DDI subscribers at $7 profit per month yields about $200K per month, or about $2.5M profit per year. That's equivalent to the profit of selling just about 700K hardcovers a year.

If among 1.5M 4E players, 300K of those buy six books a year, they generate about $10 million in gross profit per year. Based on the buying habits I observe, that is, in a group of five players, one player, usually the Dungeon Master, buys almost all the books that are bought, and most everyone relies on someone else's copy of most every book, then the books generate more income than DDI, but require more up front investment.

For return on investment, DDI is a much better deal for them. It only lacks sufficient volume: 30K is not nearly enough customers. Indeed, extrapolating from Reknown Rewards, that is, 5 Reknown for creating a character using DDI, versus 3 Reknown for using Player Handbook 3, suggests they are looking to grow the subscription model.

Indeed, the main purpose of this fall's D&D Essentials may actually be not to sell more books, but rather, more DDI Subscriptions. Hmmm....

Smeelbo

 

[haakon1]

Reknown

The D&D Encounters promotion itself directly pushes specific products by penalizing players in-game who do not use those products. For each player that attends, the event coordinator is supposed to record their Reknown, nominally a measure of how successful and therefore famous their character is. At specific Reknown thresholds, the player gains an additional encounter power for their character. However, the largest rewards are for using specific products.

I'm a fan of "core rules only", for simplicity and consistency.

How many XP per session should I reward for those who stick to the PHB?

Of course, I'm running 3.5e anyhow, so this doesn't affect me at all (and I'd ignore it if I were running 4), but it's amusing.

 

[thatdarnedbob]

<snipped>

Maybe you should appreciate the fact that WotC has lit a fire under you with their D&D Essentials line, which will force you to reach out to new players instead of relying on the existing customers who you will gradually lose to other retail outlets. Seriously though, I've transferred the vast majority of my gaming purchases to Amazon because the faceless people filling my orders with them and the gaming stores that list products on their site give me a much better service experience than my local gaming stores with owners similar to you.

 

[mudbunny]

3 renown points for using PHB3 and 1 (I believe) for using the Character Builder, when the rewards are obtained at 30 and 50 total renown points, when the rest of the points are gotten via in-game actions, is hardly "penalizing players" who don't use those products.

In any case, right from the start, WotC has said that part of their plan would be to attempt to draw in players who had never played D&D before. The Essentials line is designed directly for that. Also, the Essentials line will also be useful for existing players. According to WotC, none of the material in the Essentials line will be copy/pasta from the existing books. It will all be new material. New builds, etc. If pushed properly by store owners, it should do very well IMO.

 

[Windjammer]

Maybe you should appreciate the fact that WotC has lit a fire under you

That's the funniest line I've read all week, and I regret I didn't think of it when drafting my OP (cited in the OP to this thread*):

NEWS FLASH - WotC lights fire under retail stores ... Greg Leeds weighs in: "Yep, we deeply care about them. Whence the friendly fire."

*Speaking of which: Smeelbo, you'll want to read that other thread to see how people took the remainder of your post, most of which you repeated upthread.

 

[GMforPowergamers]

First, from a game store's point of view, there will be no significant new 4E D&D product for the 4th Quarter, that is the all important Christmas Retail Season, which for most game stores accounts for nearly half of annual sales volume. That is, I do not expect that game stores will do well with D&D Essentials, because game stores tend to sell primarily to the existing base of gaming customers, and are not well positioned to recruit large numbers of new customers. D&D Essentials will have almost no appeal to existing 4E customers.

wont some of the essentials target both new and old customers? I mean the new rules compandium, the tiles set both of witch target just as many people who played in 4e game day 1 as those that start brand new. Add to that the starter set has new powers and builds so some (mostly no DDI subscribers) current players will want those. Depending on the set up many of those books can be good (mostlikely not great) sellers

Second, Wizards is being nakedly aggressive in promoting 4E. For example, the last two promotional adventures, PHB3 Game Day and D&D Encounters, unlike previous efforts, have an actual staff of over two dozen credited, including a designer, an editor, and a managing editor. They are by far the best effort to date, having taken me only an hour or two to fix the errors, omissions, inconsistancies, and lameties, compared to 10-20 hours for previous adventures. They almost don't suck.

so to recap, the promotions ment to get people into your store is being improved... well that seams good to me, like they are helping you... then again I liked every game day in 4e (I played for every phb, and for the mm2 and dmg2) so I guess that almost doesn't suck is very subjective...

Further, Wizards is using both carrots and sticks to promote these events. The package for D&D Encounters includes numerous goodies, including a digtal camera, and a Pizza Hut Gift Card for $25. The stick is that if our store does not host these events, we will have to wait ten days to sell new D&D material, ten days that Barnes & Noble will have those goods for sale. No hobby store can really afford to refuse, otherwise their competitors will get a ten day head start. Of course, Barnes and Noble does not have to host any D&D Events.

so they give bonuses to places that give them time to promote there games... and I have never seen more then a handful of "I got X book early" posts, so I can't belive them breakign street date is all that common...

At specific Reknown thresholds, the player gains an additional encounter power for their character. However, the largest rewards are for using specific products. Someone playing a PHB Human Ranger using a photocopied character sheet will seriously have one less encounter power at first level than a Psion Shardmind made using Character Builder. Use of specific products are rewarded more heavily that completing all the quests offered, more than roleplaying "greatness."

so if I show up to less then half the games, but use all the books, and the ddi character builder, but another player makes every session, but only use phb1 who has more renown at the end of 10 weeks?

Third, sales of 4E books suck. Whereas I used to bring in a dozen or more of each new 4E book for opening week, I am down to half a dozen or less, depending. Sales of Martial Powers 2 were pathetic compared to Martial Powers 1. Looking at my sales numbers, non-D&D RPG sales will soon surpass D&D sales. And by soon, I mean in the next month or two.

maybe your open hostility to WotC as shown in this post comes across and limits your sales...

Sounds to me like Wizards is having a do-or-die moment. Who would be lighting a fire under Wizards except Hasbro?

Sounds to me like Wotc is doign what they promised 2-3 years ago and trying to grow the rp community as a whole..

Now if they were putting out PHB4 in sept, and MM4 in dec, then PHB5 in march, and MM 5 in May... then it would look like they were loading there big sellers to make money asap... then it might, but since they are working on long term plans (aka new players) isn't that the reverse of what you see?

 

[gamerprinter]

Related to Smeelbo's post

Related to Smeelbo's post, my local FLGS owner told me he orders one box of MTG cards and WotC ships him 10 boxes, if he refuses to accept the 10 shipped or complains to WotC, they withhold products from him on future orders. If he does not host the MTG events as per schedule, WotC withholds products on future orders.

The FLGS owner claims his store has a high rating at WotC, which means in order to maintain that rating he has to comply to any and all requests by WotC, cannot complain with shipments, has to abide by all events.

Though this refers to MTG, I believe he's in the same boat regarding 4e products.

He is primarily a comics shop, that also serves as an FLGS, but business is down in all aspects of his business, not just 4e and MTG sales. Being forced to purchase larger orders than he requires is further causing financial strain to his business, but if he does not comply to WotC requirements - they will screw him even harder.

It seems pretty heavy handed to me, and am glad I don't run an FLGS - I wouldn't want my merchandiser to force me to comply to all their needs, despite my bottom line.

Not so much a complaint as a comment. I don't buy 4e anything, nor WotC products, not for 3 years now.

 

[Ourph]

Who would be lighting a fire under Wizards except Hasbro?

Wizards.

Is it beyond the realm of possibility that these promotional events, rewards and incentives for customers and retailers are WotC's ideas? I know it detracts a little bit from the "OMG the sky is falling!" conspiracy theories to think that people at WotC actually have their own ideas and initiate their own policies without getting nasty, threatening letters from the "suits" at Hasbro, but it's not unusual for companies who care about their products and want to grow their business to come up with new promotions. In fact, it's pretty much been standard operating procedure for WotC to introduce a new organized play or player rewards program once a year since 4e came out.

I know people have stretched in the past to read signs of doom and gloom for WotC in things that (to most people) would seem to be positives (like PHB2 selling out early), but suggesting that WotC's choice to promote their products and reward loyal customers and retailers is a sign that they are circling the drain pretty much takes the cake.

 

[Fifth Element]

Sounds to me like Wizards is having a do-or-die moment. Who would be lighting a fire under Wizards except Hasbro?

Their own management? Why does it have to be an external force?

 

[Windjammer]

Related to Smeelbo's post, my local FLGS owner told me he orders one box of MTG cards and WotC ships him 10 boxes, if he refuses to accept the 10 shipped or complains to WotC, they withhold products from him on future orders. If he does not host the MTG events as per schedule, WotC withholds products on future orders.

The FLGS owner claims his store has a high rating at WotC, which means in order to maintain that rating he has to comply to any and all requests by WotC, cannot complain with shipments, has to abide by all events.

Though this refers to MTG, I believe he's in the same boat regarding 4e products.

He is primarily a comics shop, that also serves as an FLGS, but business is down in all aspects of his business, not just 4e and MTG sales. Being forced to purchase larger orders than he requires is further causing financial strain to his business, but if he does not comply to WotC requirements - they will screw him even harder.

It seems pretty heavy handed to me, and am glad I don't run an FLGS - I wouldn't want my merchandiser to force me to comply to all their needs, despite my bottom line.

Not so much a complaint as a comment.

And appreciated as such. My jaw dropped when reading your post because I'm personally far removed from retailers' experience with WotC, not being one myself.

That said, I'd appreciate further feedback on your post by retailers (here's hoping some are actually reading this thread) with respect to
1) whether they've shared this experience
2) how widespread these practices are from their experiences of dealing with companies other than WotC (i.e., is this fairly standard nowadays?)

Thanks,