The World Really Isn’t Flat: Xbox Live Indie Games & Pricing

Believe it or not, there are people out there still who insist the Earth is flat.  As in, they still exist.  Today.  In 2012.  I’m not joking.  They have a website and everything.  This is not a tongue-in-cheek movement.  These guys really, truly believe that the entire population of Earth has been bamboozled into believing the world is round.  This an example of a phenomenon in society called “denialism.”  Denialism is defined as a conscious rejection of an indisputable fact to avoid an uncomfortable truth.

Denialism is practiced among some Xbox Live Indie Game developers.  They still cling to a belief that selling their games above the minimum price Microsoft requires is a viable strategy.  Despite overwhelming evidence to the contrary, they truly believe that their game will be the exception to the reality of the marketplace.  In essence, they are telling people that the world is flat, and they’re willing to throw themselves off the edge of the Earth to prove it.

Imagine how Ian Stocker, creator of the sublime Escape Goat, felt when he discovered the world was not flat.

It was announced today that pricing policy has once again changed for Xbox Live Indie Games.  As of this Wednesday, developers can change their prices once every seven days.  The immediate reaction this?  “Finally, we can have sales!”  Oh dear.

Here is the reality that you, Xbox Live Indie Game developers, have been dealt.  You have no marketplace share.  You have less representation on the Xbox 360 dashboard than accessories for avatars.  There is no tab that announces when an indie game’s price has been changed.  There is no tab that announces when a game has been patched.  XBLIG sites do less than a fraction of the traffic of mainstream gaming sites.  In short, you probably have a better chance of being struck by lightning than having a hit Xbox Live Indie Game.

I’m going to pull a number completely out of my ass and guess that 99.9% of all XBLIG sales come from impulse buyers.  People who have just a few spare points left and would rather have a game than a sombrero for their avatar.  The games they purchase are selected directly from the dashboard, not from reading sites like mine.  When they go to the marketplace, there are four tabs for indie games: sort by genre, sort by name, best-selling, and new releases.  New releases and best-selling are the key here.  This is where almost all decisions to buy an Xbox Live Indie Game are made.  It’s not on Xbox.com, it’s not from Kotaku, and it’s not from Indie Gamer Chick.  It’s on the dashboard.  The point of sale.  Xbox Live Indie Games are a pack of gum next to the cash register at a grocery store.

This is why temporary sales on Xbox Live Indie Games won’t work.  Because  most consumers don’t pay attention to the scene.  They select games based off the available tabs on the dashboard, and that does not feature a “recent price drops” tab, at least for XBLIGs.  It probably never will.  Without that, a price drop means diddly squat to consumers.  If they see a game that is 80MSP that normally sells for 240MSP, they don’t know they’re saving points.  Consequently, they have no way of seeing if a game they were previously interested in has gone on sale, unless they gain that knowledge directly from the developer or from following the scene.  As I’ve previously established, there’s very little interest from consumers in taking the time to do so.  The scene is so small that calling it niche almost feels like a stretch.  If you price at anything above what your minimum requirement is, you miss that one chance.  If you’re lucky enough that someone takes the time to look at your game on the marketplace, it’s probably off of the new release tab.  Once that 240MSP price tag is spotted by the consumer, your game’s hope of being purchased by that individual is likely gone.  Forever.  After all, you’re competing directly against hundreds of games that will price at 80MSP.  Consumers get four screen shots and a brief description of the game to go off of.  Maybe your 240MSP title is better than the three 80MSP titles that person has their eyes on.  But is it one-for-the-price-of-three better, when you have so little info of the game there to base your decision on?  I really hope this is sinking in.

“Hey wait, FortressCraft and TotalMiner has grossed over $1,000,000 and they’re priced at 240MSP!  See, the world is flat!  I told you so!”  Um, no.  The world you’re living in really is round.  Those guys live in an entirely different universe altogether, where your laws of physics don’t apply to them.  Which is ironic given that the physics in such games are typically way fucked up, but that’s beside the point.  Minecraft just became the best-selling Xbox Live Arcade Game in record time.  Before it came to the platform properly, the original PC game had spawned an entire cottage industry of clones, mods, and communities.  It’s fair to say that the genre is trendy right now.  The games that climbed the best-selling charts did so because there was an immediate demand for that type of game on a console.  Period.

Pictured: A really good game that did not have tens of millions of people drooling over the prospect of it.

Of course, sometime soon one or both of those games will probably have a special one-week-only 80MSP sale, which will cause a spike in their sales figures, and this will be all the proof that XBLIG flat-Earthers need that sales can work.  They’ll probably also point to games like Escape Goat and Take Arms, which started at 240MSP and then caught on fire after their prices dropped.  But that’s also a little different, because both games dropped their price around the time that Microsoft’s original price-change policy went into effect.  It got mainstream attention and larger sites covered it.  Escape Goat and Take Arms happened to be two of the best games that took advantage of that, even though both games were small enough to have been priced at 80MSP from the get-go.  Ask those guys what they would do.  If they knew then what they know now, they would have priced their games at 80MSP.  They’ve both said so on this very website and elsewhere.  Hell, if some misguided developer had a wonderful game and plans to overprice it, they would probably get on their hands and knees and beg the person to reconsider.  Why?  Because they care about the community, and they know the reality they live in.  It might not be fair or just, but it is the cards you’ve been dealt.  You can keep trying to prove the world is flat, but the only thing that is going to fall off the face of the Earth is your game’s sales figures.

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19 Responses to The World Really Isn’t Flat: Xbox Live Indie Games & Pricing

  1. The Grumble says:

    The weird thing is I think if anything it will end up being more established developers with what can best be described as a fanbase who will be able to pull off sales (if at all anyone does) so it will be the likes of Silver Dollar (If they have any above 80 point games) who will end up being able to work the sales angle.
    Or as was mentioned lots of companies changing their box art to represent the price cut for the game in some way, leading to more troubles

  2. Starglider says:

    Microsoft are rumored to be discontinuing Microsoft Points this year. If they are removing the need to prepurchase points and your ‘spare change’ theory is correct, that would kill XBLIG sales.

  3. mike says:

    Nice article.
    I think you summed up the situation very well here.
    While it is nice to have more options, its too little, too late in this case.
    We were all afraid with the intro of 80msp it would be a race to the bottom and that has certainly been my experience so far.

    • Kairi Vice says:

      I just won a $5 bet with Brian. He said nobody would use the term “Race to the Bottom.” I said they would. I win.

      Let’s talk about a race to the bottom. What do people, want? Lower prices. At one point, the center of commerce in a typical US town was the main street. And then came the malls, which centralized everything, and it killed the main street. And then came the big box stores, with significantly lower prices, and it killed the malls.

      So did Wal Mart, Target, etc, were those guys “racing to the bottom?”

    • There’s a difference between a ‘race to the bottom’ and selling your product at a price people are willing to pay. If this ‘race to the bottom’ principle held true, then every retailer in the world would sell every product for a penny. They don’t. The ‘race to the bottom’ is an oversimplification of market forces.

      • I have to come back to this ‘race to the bottom’ thing.

        The bottom of what? What is the bottom? Are you saying that the lowest price equates to the lowest quality? Dead Pixels and Escape Goat suggest otherwise.

        Or are you saying it’s a race to the lowest price? If so…so what? No one can go lower than 80 MSP, so it’s not like there’s any sly undercutting going on. It’s not like you’re going to be out of pocket anyway, considering XBLIGs rarely make any significant money (not to mention Magical Time Bean’s experiment pointing to a lower price actually increasing overall revenue).

        So what does ‘race to the bottom’ mean? To paraphrase that worldly sage, Agent Smith: Can you tell me what it is? Do you even know?

  4. CJ says:

    Yup. But in XBLIG’s case, there’s no bottom. How worse can it get than $1 bargain bin games? No idea. I’m expecting a $0.50 price point this year.

  5. Panda Borg says:

    Great article, As a consumer who has purchased over 100 indie games I could tell you flat out if a demo is halfway decent and the game costs 80 msp I will buy the game as soon as the time on the demo expires. But when a game is 240 msp I am far more reluctant to spend the points and typically throw the game on a list of games that I want to eventually buy, but often never get around to.

    • That’s exactly the position I was in with Soulcaster. For months it was “I should get around to that one day” but there were always three other games clamouring for my 240 points. Once it dropped to 80, I bought it that day. I no longer had to gamble on it being as good as three other games combined.

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  7. Team Shuriken says:

    Not sure if someone’s going to read this here, but i made an experiment by putting Dream Divers at 240 points for 2 weeks.

    The game sales are very slowly decaying at this point, but the 2 weeks at 240 points sold for 9.5% more total income then the 2 previous weeks at 80 points. download count was roughly the same (less then 0.5% difference).

    Still, i put the game back at 1$ since the money difference isn’t significant enough for us to care and at equal money, we’d rather have more customers.

    The sample is a bit too low to draw real good conclusions (only 2400 downloads), but it seems like enough to show that this whole “1$ or die” bandwagon might be blown out of proportions by some.

    • Interesting. I’ll tweet it so that it gets some attention.

    • Keven says:

      Could it be related to the content of the game ? It seems Dream Divers tries to sell as being sexy. Could the market that is targeted with this game be less influenced then other game’s market (RPG, puzzle, etc) ?

      • Team Shuriken says:

        It could.

        My theory is that to have a chance at selling at 240+ points, you need to convey somehow that your production values are higher then the average games that sell at 80 points. Not necessarily better gameplay / depth wise, not necessarily smarter / better, just better production values. Our games usually convey this point with polished boxarts and some quality images sprinkled.

        Games like techno kitten adventure don’t have problems selling at 240 points and the aesthetic are a big part of why gamers overlook the price tag. Afterall, the people buying indie games are also into buying full retail or arcade title, so they are not freaked out by a 3$ price tag. They will get freaked out by a 3$ price tag if the boxart/general presentation is retro or not polished enough though.

        This theory is very general though and i feel like price points need to be evaluated on a per game basis, since there are probably a thousand valid ifs and buts to it.

        But there is not enough convincing data behind my theory, because there are too few games at 240 points that are enticing enough for gamers to want to give a try.

        I just felt like chiming in our personal data in this thread since we had been advocating forever that 3$ price point is not completely useless, though most didn’t believe there was any sense to our decisions.

      • Team Shuriken says:

        To add to this, even though i didn’t really analyze the data too much, i’m pretty sure we had a decent, long lasting income increase with beach paddle when price went down from 240 to 80.

        The perception of production values of beach paddle probably appear a lot lesser then that of dream divers. they both feature sexy drawings, but the perception of value of a game is made up of more then just being sexy or not. Beach paddle appears cheap since it’s not novel idea, and is less polished, therefore the 1$ price point works better for it.

        Paper RPG is slowly ticking some decent sales at 1$ too, but i am certain it wouldn’t sell at 3$.

        However a fully realized followup to the temple of dogolrak would certainly still sell at 3$ and not necessarily all that much more at 1$ (in other words, we’re not going to take a bet on the 1$ price point for our next fully realized choose your path style game)

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