Price-Sensitive Gamers
- Thread starter mmadsen
- Start date
I'll just chime in and agree with those who say that they wished that some RPG books cost more.
I want the best RPG books I can get. I want brilliant people to be able to support themselves by writing and producing great material for this hobby. This is my favorite hobby. I want it to be better. And I'm willing to pay for it.
I want the best RPG books I can get. I want brilliant people to be able to support themselves by writing and producing great material for this hobby. This is my favorite hobby. I want it to be better. And I'm willing to pay for it.
I think a more applicable test would be the one I brought up earlier: Have you bought the whole line of splatbooks? If you haven't, would you buy them at 50% off?
I haven't bought any of them, even though I'm not a starving college student. I would buy some of them, I suppose, at half off. I seem to be price sensitive.
(I don't think I'd ever buy a character sheet, since I can just roll my own in HTML or Word -- and it'll take all my House Rules into account.)
Mistwell
Crusty Old Meatwad
I really think some of the people posting in this thread are unrealistic about the relationships between number of units sold, price, and profits in this industry. I think the major error might be in an assumption that everything is exactly linear.
For example, I think a somewhat common belief here that, if a book sells for $20 now and sells 1000 copies, and instead it sold for $10 and sold 4000 copies, that the creators would make twice as much money.
That isn't how it works. Let's use an example of a new splat book called "Elitists and Peasants, A Guidebook to Aristocrats and Commoners" ("E&P" for short). E&P costs $8 to produce.
Example 1: Not wanting to experiment with pricing, the creators of E&P decide to price the book at the same price as other splat books, and mark it ay $20. The book ends up selling to 1000 people. Net Profit: $12,000.
Example 2: The creators, wanting to reach a wider audience, decide to mark E&P to $10. The book sells to 4000 people (four times as many as the $20 book). Net Profit: $8000.
Example 3: The creators only want to reach their hard-core fans, and decide to mark the book at $25, which is $5 more than other splat books. The book sells to 500 people (half as many as the $20 book). Net Profit: $8500.
In these examples, the $20 price makes the most amount of money, the $10 version the least, and the $25 version somewhat in-between the two (showing that there are diminishing returns to increasing prices). There are a few flaws with the results of course, since production costs do go down a bit as print runs increase. However, because this is a niche market, print runs will not reach materially large quantities to make a big difference in the results. And, of course, production costs vary for companies and products. But, I think this is a fair example.
The point of this whole exercise is to demonstrate that lower prices do not necessarily equate to higher profits, even if a LOT more people buy the product. Generally speaking, in this market, it is not a smart economic move to lower prices and try to make up for it with larger volumne. Production costs are simply too high, and the potential market too small, to make this pricing tactic work in this field. It's a better bet that raising prices by about 25% will ultimately result in higher profits. Even if you lose 25% - 30% of your customers, you still make more money. And, it is rather unlikely that you will lose that many people, if your product is high quality. There will be a highest possible price, beyond which you start to lose money. I just don't think we have hit that perfectly balanced price yet (and persoanally think it is about 25% more than the current pricing on WOTC books).
For example, I think a somewhat common belief here that, if a book sells for $20 now and sells 1000 copies, and instead it sold for $10 and sold 4000 copies, that the creators would make twice as much money.
That isn't how it works. Let's use an example of a new splat book called "Elitists and Peasants, A Guidebook to Aristocrats and Commoners" ("E&P" for short). E&P costs $8 to produce.
Example 1: Not wanting to experiment with pricing, the creators of E&P decide to price the book at the same price as other splat books, and mark it ay $20. The book ends up selling to 1000 people. Net Profit: $12,000.
Example 2: The creators, wanting to reach a wider audience, decide to mark E&P to $10. The book sells to 4000 people (four times as many as the $20 book). Net Profit: $8000.
Example 3: The creators only want to reach their hard-core fans, and decide to mark the book at $25, which is $5 more than other splat books. The book sells to 500 people (half as many as the $20 book). Net Profit: $8500.
In these examples, the $20 price makes the most amount of money, the $10 version the least, and the $25 version somewhat in-between the two (showing that there are diminishing returns to increasing prices). There are a few flaws with the results of course, since production costs do go down a bit as print runs increase. However, because this is a niche market, print runs will not reach materially large quantities to make a big difference in the results. And, of course, production costs vary for companies and products. But, I think this is a fair example.
The point of this whole exercise is to demonstrate that lower prices do not necessarily equate to higher profits, even if a LOT more people buy the product. Generally speaking, in this market, it is not a smart economic move to lower prices and try to make up for it with larger volumne. Production costs are simply too high, and the potential market too small, to make this pricing tactic work in this field. It's a better bet that raising prices by about 25% will ultimately result in higher profits. Even if you lose 25% - 30% of your customers, you still make more money. And, it is rather unlikely that you will lose that many people, if your product is high quality. There will be a highest possible price, beyond which you start to lose money. I just don't think we have hit that perfectly balanced price yet (and persoanally think it is about 25% more than the current pricing on WOTC books).
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Just some other observations about myself. I'm fairly price inelastic when it comes to WoTC stuff. I've bought most of the splatbooks, and with my group we have gotten them all. Plus, I have all of the FR stuff. However, I didn't buy all of it at one time, I allot myself basically one book a month to buy, that happens to be the rate WoTC releases books, a coincidence? WoTC knows what they are doing and I bet most gamers out there can save up $10 a week and buy FRCS. It sounds like a lot of bones to drop at one time, but not so bad spread out(like most things). An example of bang for your buck, the Faiths and Pantheons book was raised $3 from Magic of Faerun and Lords of Darkness, but now I get hard cover and a few extra pages, the bang for my buck just increased and I will gladly pay for that!
Someone started to bring in the idea of department stores to model gaming stores, they are two different types of business models. Your department store tries to push lots of product with very little markup, as example Wal-Mart. If you push enough product, you will compensate for the lower markup. Most gaming stores don't push that much product, even the big ones really don't. Also, the most bang for your buck are CCGs. If you have a small gaming store, go in and just ask them what makes them the most money, I bet they will say Yo-Gi-Oh(I think that's right). The guy who runs the one across from my campus used to run one in Puerto Rico, he said Pokemon was what saved him from going out of business, so stupid Americanme does have it's purposes..to keep your gaming store open
Gariig
Someone started to bring in the idea of department stores to model gaming stores, they are two different types of business models. Your department store tries to push lots of product with very little markup, as example Wal-Mart. If you push enough product, you will compensate for the lower markup. Most gaming stores don't push that much product, even the big ones really don't. Also, the most bang for your buck are CCGs. If you have a small gaming store, go in and just ask them what makes them the most money, I bet they will say Yo-Gi-Oh(I think that's right). The guy who runs the one across from my campus used to run one in Puerto Rico, he said Pokemon was what saved him from going out of business, so stupid Americanme does have it's purposes..to keep your gaming store open
Gariig
Desdichado
Legend
I am price sensitive, but my demand is fairly inelastic! 
Voadam
Legend
I am fairly price sensitive, I buy most new books at at least 30% off. I have never paid for character sheets, I have only two WotC splat books, and I would not have gotten the big sourcebooks I own if I had to pay full price. Even though CoC looks good, I can not bring myself to spend that much on it, even at 30% off. I was kicking myself when I walked into a store and saw the WoT book at 50% off which I did get at 30% off and was pretty happy (at the time). I did pick up Living Greyhawk and Ragnorak both for 50% off but I passed on Dark side sourcebook. I have even picked up a number of Ars Magica sourcebooks from John nephews Mail order sales.
I am moving towards more pdfs than books when I splurge now, although I still have a lot of wish list books, most of which I don't buy even though I have the money to do so. (they are expensive, they take up space, and I have limited free reading time, I'm also pretty cheap).
I am moving towards more pdfs than books when I splurge now, although I still have a lot of wish list books, most of which I don't buy even though I have the money to do so. (they are expensive, they take up space, and I have limited free reading time, I'm also pretty cheap).
Flexor the Mighty!
18/100 Strength!
I am very price sensitive. I have given a lot of thought to buying the D20 COC and the new SW core book but won't at $40 bucks. I don't care to pay more for full color artwork in a borderline anime style.( 
) I don't care how "slick" it looks. What does it do? How much info do you get for your money? Books like the GURPS basic set are great values. You aren't paying for flashy artwork and fluff but for tons of useful stuff. But if WOTC had put that same book out it would have been 45 bucks instead of 30 due to flashier looks.
I wish people would quit comparing movies to RPGs. A great movie stays with you looooooooong after the running time is over.
) I don't care how "slick" it looks. What does it do? How much info do you get for your money? Books like the GURPS basic set are great values. You aren't paying for flashy artwork and fluff but for tons of useful stuff. But if WOTC had put that same book out it would have been 45 bucks instead of 30 due to flashier looks. I wish people would quit comparing movies to RPGs. A great movie stays with you looooooooong after the running time is over.
