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Sacrosanct
Can you please skip the rhetorical attacks and get to the substance?
How does choosing between brands of jam or any other example in the article you linked relate to WotC publishing additional material for 5E?
Let me give an example where your article is relevant: In miniatures wargaming, a huge amount of WW2-era kits are available in 20mm -- arguably more than any other scale. In the past few years, however, 28mm WW2-era miniatures have been selling very well despite there being a far more limited range of kits available. I believe the key factor is that all those 20mm kits are available from tons of different companies and none of them do a great job of making their product lines easy for potential customers to understand. Meanwhile, the 28mm market for WW2 miniatures has been centralized under one company (Warlord Games, if you are curious) who invested in a graphics-intensive website that is easy for customers to navigate.
Now -- using the same example -- here's how your article is not relevant. Over time, Warlord Games has expanded their range of 28mm WW2 miniatures. They began with the Big Four powers (US, UK, Russian, Germany) and made the most common miniatures for those powers: regular infantry, the tanks that saw the greatest production in history, etc. But over time they have added more options to those lines: variants of certain tanks, special forces, etc. They have also added miniatures for other powers, like France and Italy.
Expanding their line does give the customer more choices -- but it is not driving down their sales. Quite the opposite. Because this is not the type of choice that fosters choosing not to choose, like the confusing state of the 20mm miniatrues market, where customers don't know who makes what even if almost everything is already available.
D&D 5E is much closer to my second example than my first. We are talking about products that expand a single, current product line managed by a single company.
Yes, but the key issue that is frequently lost is what this means to the business. Sales aren't what keep a business going,
profits are.
Each product has a production cost, and you don't start making money until that production cost is recouped (which includes R&D, a portion of your operating expenses during the period, advertising, salaries, and actual production costs, etc.). If the release of your next product takes away sales from the first product, then you are cutting into your margin - that is, your profit. If you release too many too quickly, you can get to the point where sales are spectacular, but you aren't making any profit. Which means you are losing money.
But it's amazing what you can find online:
https://www.acaeum.com/library/printrun.html
Note specifically the section talking about the 3rd Edition. "Starting with the launch of 3rd Edition, we've cut down the number of adventures from 6-8 per year to 1 per year, so that has cut down on cannibalization of the market. Thus, sales for a new D&D adventure are now more like 35,000 to 60,000 units."
That's a huge increase in the number of sales per adventure over the 7,000-15,000 units mentioned for the '90s.
Here's the difference: Your preproduction costs are fixed. Once they product is released they are done. Let's say it's $100,000. And say your profit is $10 per unit.
7,000 units = $70,000 margin, and a net loss of $30,000
15,000 units = $150,000 margin, and a profit of $50,000
35,000 units = $350,000 margin and a profit of $250,000
60,000 units = $600,000 margin, $500,000 profit.
Now say you release 4 adventures instead that sell 15,000 units each, for a total of 60,000 units. Your profit? $200,000, less than half of your profit on selling the same number of units for a single product.
Then you decide you want to increase sales more. OK, how about 10 products? And average sales are $10,000 each. The end result, you barely break even. You are competing with yourself and losing.
Purchasing less because there are too many choices is only one potential issue. The real issue is that too many choices
can and frequently
does reduce your profit. The reason is simple, many people have a limited budget they set aside for a hobby such as this. Maybe it's one book a month. Maybe it's one every 3 months. In addition, they might look at the two products and decide that one looks pretty good, but the other looks great. So they buy the one that looks great to them and skip the other one. Either way, you've taken away a sale from one product that would have sold otherwise in a significant number of opportunities.
Go back and look at the numbers in that article again. The more products released, the less per item were sold, and profits dropped precipitously - to the point that the company (TSR) was bankrupted. Your business model is based on selling 50-150,000 units per item, and you're only selling 7,000-15,000 or less.
Also note that for the same reasons, launching a new edition is far, far more expensive than reprinting an existing edition. Another reason why I think this edition will last a long time.
Ilbranteloth
