That’s kind of why I never feel great about buying video games. The price is pretty much entirely arbitrary.
Like yeah, they did an investment, it is fair that they recuperate that. But the actual price they need to ask of each customer entirely depends on how many customers there are.
And so, they will always start out asking more than what they expect to need to ask of each customer, which just feels like I’m paying too much.
But even when they do put it on sale, there’s likely going to be sales in the future where they sell it for even less. It’s not like they need to empty out a warehouse or such, where they put up uniquely low prices. So, even when I could get a game on a sale, I’ll feel like I could also just wait longer…
You basically described the economic concept of consumer surplus. When a product is entirely dependent on the price a consumer is willing to pay because the supply is infinite, the natural result is… this.
Except they shouldn’t be price discriminating; it’s easier and more effective to just offer tiered pricing structures (e.g. collectors editions) and eventual sales (e.g. 50% off after a year) to hit people at different places on the supposed consumer surplus curve. As you note, the undermines your confidence in the prices but you’re likely a little lower on the curve compared to the “must have on day one” crowd.
That said, the whole theory also explains why freemium is so attractive. When there’s no price minimum, the optimal price is 0 and you work your way up with features and perks (while also raising the price people are willing to pay by getting them hooked). It’s all nasty business, lol
That’s kind of why I never feel great about buying video games. The price is pretty much entirely arbitrary.
Like yeah, they did an investment, it is fair that they recuperate that. But the actual price they need to ask of each customer entirely depends on how many customers there are.
And so, they will always start out asking more than what they expect to need to ask of each customer, which just feels like I’m paying too much.
But even when they do put it on sale, there’s likely going to be sales in the future where they sell it for even less. It’s not like they need to empty out a warehouse or such, where they put up uniquely low prices. So, even when I could get a game on a sale, I’ll feel like I could also just wait longer…
You basically described the economic concept of consumer surplus. When a product is entirely dependent on the price a consumer is willing to pay because the supply is infinite, the natural result is… this.
Except they shouldn’t be price discriminating; it’s easier and more effective to just offer tiered pricing structures (e.g. collectors editions) and eventual sales (e.g. 50% off after a year) to hit people at different places on the supposed consumer surplus curve. As you note, the undermines your confidence in the prices but you’re likely a little lower on the curve compared to the “must have on day one” crowd.
That said, the whole theory also explains why freemium is so attractive. When there’s no price minimum, the optimal price is 0 and you work your way up with features and perks (while also raising the price people are willing to pay by getting them hooked). It’s all nasty business, lol