IndieGameStand was built as a tool for indie game developers. Often the indie developers that make awesome games aren’t the best at this marketing/advertising thing. I thought it might be interesting to take a qualitative look at all the gaming bundles out there and really look at them as marketing tools for the indie game developer. This analysis is qualitative (rather than quantitative), but I welcome any indie game developers out there who have hard numbers to share data with us so that we can incorporate it in a follow-up post.
Once upon a time, I got a Masters in Economics. We all know supply and demand, but how does that all apply to games? As with any market, each game developer/publisher sets a price in order to maximize its profits. Of course in the real world, we don’t set our price once and draw up a simple linear graph to find economic equilibrium. Game prices change over time, there are daily deals, bundles and a bunch of other pricing mechanisms that are all built around selling games and making money. Similarly, a gamer is looking to optimize their purchases to get the best value with limited cash. They’ll spend more on a great game and less on a mediocre game. Of course time is also a limited resource, but let’s not get bogged down with all of the factors that go into a consumer’s purchase decision
A Game’s Lifetime
A basic assumption that I’m going to make in this post is that a game’s price is highest upon release (when it is most sought after) and that this price/value slowly decreases over time. Distributors adjust the price as the product gets older to sell more copies and maximize their revenue. There’s a great post here about a video game’s price cycle over 30 years: http://blog.pricecharting.com/2012/03/lifecycle-of-video-games-price-30-years.html
I think intuitively, this makes sense to all of us. I would argue that the indie game developer actually has an advantage over the AAA developers out there since alpha and beta funding is becoming so prominent. I would argue that we can also assume that a game’s value starts low when development first begins and increases as the game progresses and hits alpha and beta milestones. If you don’t believe me, just look at Minecraft. It started as a free demo/pre-alpha and then increased in price over time: $10-$15 during alpha, $20 during beta, and is currently $26.95.
A game’s sales are also somewhat predictable. When a game is brand new or just released, there are massive quantities sold at top price. We see this trend in everything from Halo 4 to a new game on Steam. When the game first becomes available or is considered *NEW* - gamers flock to check it out. Taking all of these assumptions, I have made a theoretical graph that shows off a game’s lifetime sales/revenue (Y-axis) over Time (X-axis)
So here’s what your typical indie game sales graph looks like. I didn’t put units on here since it’s all made up. It really just displays qualitatively what every game experiences during it’s lifetime. The quantities may differ, but this is the typical story:
- You start making a game or prototype and eventually it may be for sale. The first time that you put it up for sale or have a substantial update or alpha release, your sales will increase.
- When your game is even more polished and hits Beta, you’ll see another surge of sales if you’re alphafunding your game.
- Your game’s release (i.e. when it’s widely available) will always yield the highest sales. Your sales eventually taper off and become more consistent and predictable.
Sales, Bundles, Daily Deals
Steam Sales, IndieGameStand Sales, Humble Bundles and all the other bundles out there are great revenue generators and work because of their limited time frame and reduced prices. These events not only promote your game but they also boost your revenue for a set period of time like so:
How big the sale spike is depends on your game, what type of bundle or sale you’re involved in, web traffic/reach, and of course the duration of time that the game is available at a reduced price.
Finally: When to Utilize Game Sales and Bundles
The time to run sales, discounts and bundles for you game is most definitely during the long-tail period of your game’s lifespan. Every indie developer should try and maximize their profits and these types of promotions can greatly increase your stagnant long-tail sales.
A note on Bundles
Part of the reason that we created IndieGameStand was because of all the bundles out there and how we felt like we were buying the same games over and over again to get one or two that we really wanted. We feel that consumer choice is important and that indie games are awesome. Our system is built to offer consumer choice along with increasing the average price and perceived value of indie games.
Some Quick Self-Promotion
IndieGameStand is still young, but our entire team is very happy with the user base and indie game fans that we have and the fantastic average price per game that we get for indie developers (typically around $2). Like all the other promotional indie sites, we believe the best time to utilize our service is after your game has been out for awhile OR before your game is released to increase your player base during your alpha/beta phases of your game. If you look at our past sales, Alpha/Betas have done really well on our platform and have even helped some games get greenlit. It’s a great way to infuse your game development with some funding to get you to that finish line. We believe the best times to feature your game on IndieGameStand are the highlighted areas below:
Let’s get more specific
Near the beginning of this post, I touched on a game’s price over time. I think that this is a very important factor when looking at what promotions, sales and bundles to do and in what order. A developer’s revenue is based on the price per unit and the number of units sold, so what’s the best way to maximize this? We definitely have noticed that when a game has been featured in a bundle before, it’s perceived value/price is lower… so go in with a plan:
Alpha/Beta Timeline -You’re game’s not finished here and you’re not making money if you’re not alpha-funding your game. I think alpha-funding is a great way to capture fans and revenue while you polish and complete your indie game. You can do it yourself, through Desura, schedule an IndieGameStand promotion, or maybe even use Kickstarter during this phase.
Release - Game is at Full Price - Market it like crazy! The more distribution platforms, the better IMO.
Sales are Stagnant - Ok, now game sales are stagnant, so what to do when it comes to sales and promotions?
Set your own Price Sales (i.e. Steam Sales) - What is your game usually available for on Steam/Desura/etc? $10, $20? Try doing a sale where your game is 25-50% off. Set a good sale price and see if your distributor will promote your game on their frontpage. There’s some great indie success stories with Steam Daily Deals or their Summer Sales. $5 per game is way better than $0.40 per game and these sales don’t last forever. Buying decision is still based on your individual game.
IndieGameStand - I would argue that you would want to do IGS before an indie bundle with the exception of maybe Humble Bundle. Humble Bundle pushes units, but is restrictive (Mac, PC, Linux - exclusivity) and less indie focused now. It’s also very selective and has a larger barrier to entry. Regardless, the beauty of IGS vs a Bundle is that it’s all about your game and your charity and the average price and value of your game is much higher ($2 per unit) and you’re getting a bigger cut of the total revenue vs the most popular bundle sites:
The table above is an accurate guess and average based on the public stats available on these other indie bundle sites. Humble Bundle stats were based on the most recent Android bundle and last Indie Bundle and all the other stuff was from the most recent bundles launched. Humble Bundle and IndieGala both allow the consumer to set the developer cut but by default it is 65% and 70% respectively. IndieRoyale does not publicly display their developer split. The Average Sale Price was used since that unlocks all the bonus games/content similar to IGS.
Of course the big factor that is left off this chart is units sold and total revenue per game/developer per outlet and they all run different lengths of time. Revenue per day seemed excessive since I really just wanted to loop back to our original game price over time theory. You can see from the above chart that your revenue per game is much higher with IGS than any bundling site, but this price is still lower than a set price on Steam or another site where you’re offering your game for 50% off or something like that.
As mentioned, Humble Bundle is certainly a monster in sheer reach and they likely have an exclusivity agreement about excluding your game from other bundles/promos for a set time (IGS has NO Exclusivity). If you can get in HB, from a business perspective, you should probably pursue it. Of course not everyone can get in and that’s why there’s so many other bundles out there. I would argue that you should strongly consider IGS prior to a bundle deal. Bundle purchasing decisions are based on the entire bundle and not your individual game. Therefore, it would stand to reason that being featured on IGS and then being involved in a bundle will have a relatively low impact on total bundle sales whereas we have seen that being featured in other bundles prior to IGS does seem to impact a game’s sale. Our most popular and successful games (Gnomoria/Gimbal) have all been featured on IGS before being bundled. The goal is to get your game to make you the most money through promotions and sales:
Feel free to disagree or add to this post. It would be great to do a more thorough analysis but each service is different when it comes to public data, so I had to be more qualitative. Good luck to all the indie game developers out there! Make money so that you can keep making awesome indie games!