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[Jason Bakker]

I think a lot of the time, planning and formulas regarding getting sales for games start from "having a successful game, how do you then maximize the number of sales." I think what Paul is saying is that you have to start from "having a game that nobody has heard about and nobody cares about, how do you then get it to be successful." It's a much more depressing place to start from, which is probably it's glossed over in the planning phase of many startup indie developers...

But anyway, if you have any brilliant ideas for going from zero to successful, let me in on them okay

[Muz]

also, i thought you posted this topic to get opinions on the subject from people with experience in it? if you're just going to argue against everything they say, what's the point of the topic?

Ah, no offense meant. The reason I started this thread was because of some disagreements with the standard business model, which means I'd disagree with some things from industry experts. I could go to a business consultant, give him a sack of money, and nod to everything he says, even with bits and pieces I disagree with, and feel like I wasted a sack of money. But I think an open discussion and some arguing on both sides is more interesting and helps us understand each other better. Besid

I think we're all talking about the same thing when it comes to marketing. Everyone's saying that it has to reach as many people as possible as early as possible. I did gloss over it, because I believe my current team's strength is in marketing, enough to reach a few thousand comfortably. But I did take it into consideration and tweaked the pricing to focus a little more on marketing. I'm still keeping the heavy discount before release, though, mainly to reward the people who have the loyalty to pre-order the game.


But back on indie publishing, because it's something I really want to do. The funny thing is everyone agrees that marketing is important, but won't pay someone to do it. So far, the idea has been to 'buy out' something and keep 50-75% of the profits, which seems a bit ludicrous, but they're accepting all the risks involved in it. There's the alternative of leaving part of the risk onto the developer with a very low cut, but that seems like a rip-off.

I'm sort of thinking that no profit cut and charging marketing fees would be the best deal for everyone, but I could see people getting worried that we won't do our best if the final sales aren't tied to the fee. What do you guys think?

[obscure]

I am with Paul on this. Your post just doesn't make sense. No one can pre-order your game if they don't know it exists. Reducing the price of a game that no one knows about wont suddenly make them know about it.

I have and am working with several indie developers and it is brutal how hard it is to raise awareness. It is like trying to push a car up a hill. Once you are at the top and it starts to roll down hill you are sorted but getting to the top in painfully slow - which is why you need to start your marketing efforts early.

It is a real catch 22. No one knows about your game so you set up a blog. No one reads it because they don't know you exist - so you send out a press release. Trouble is almost no one publishes it because...
1. They have no idea who you are (and are too busy to go and find out)
2. They have 15 other press releases that day and only time to write about 3 or 4 things - They pick the 3 or 4 things that their readers already know about.

Out of a couple of hundred people you email the release too (who you had to spend time tracking down) about 5-10 of them actually publish anything. Most of those are small blogs that have about 50 readers and even if you do manage to get your release/screens/video onto IGN it just gets lost under the weight of CoD4, Halo and GTA.

Even when they do the amount of work involved is silly. I recently sent a press release about a game play video to one of the big sites. They didn't post it. Two weeks later followed up with screen shots - they posted those. Contacted the editor to thank them and mentioned that we have a video and would they like to post that. He says yes and his assets database guy contacts me directly - sent him the link and it wasn't posted. So now I have to chase up this guy to try and get him to post the video of a game he hasn't heard of.

You can bet if this was GTA 7 or something similar the video would be up within 20 seconds but it isn't - It is an indie game they know almost nothing about and that makes a huge difference when trying to generate any awareness.

[ElGenerator]

Random thoughts on your posts:

The reason I started this thread was because of some disagreements with the standard business model, which means I'd disagree with some things from industry experts.

There is something like a standard business model in the industry? Which one would that be? Publisher advances? Self funding self publishing? There are so many business models out there that I hardly found any standard. Care to elaborate yours? Because I haven't seen any thought on who is going to pay your bills.

The main business would be a light game development business, probably focusing on easier, less risky games like MMORPGs, web browser games, and semi-casual games at first.

Less risky? LESS FUCKING RISKY? Tell that your VC guy. "High in, High out" is his motto. No risk, no money. If there would be less risk we would all be sitting in money. But the thing more important is: Focus on something. You want to do MMOs? Fine, focus on doing MMOs. Because you know, all successful guys out there did one thing and one thing only: ID focused on 3d shooters, LucasArts focuses on Star Wars games, Ford started with one and one car only in their beginning. I don't say it is bad that you have a vision what your company should be like in some decades but you won't be successful if you don't focus on something. Sounds like a mantra and I don't want to sound smart-alec.

My idea for the pricing would be to make the prices automatically dynamic.

Groundbreaking. Try telling that your retailer. You know, the guy who owns the physical shelve space. Why should he bother with your -in his eys- stupid price finding, others can do with a fixed price! You are selling your games over the internet so you can always adjust prices? Fine. But you know, that "high demand, high price" schematic only works when there is some kind of shortage, right? Like there is only one gold coin left on mother earth. That is a physical shortage. Why should there be a shortage on virtual goods? I can copy these bytes and voilá, another copy made, no shortage. In short: Why would your customer pay for your freak price finding? Why should he not feel ripped off?

That's why piracy is rampant in places like China and Southeast Asia, all huge markets, but plenty of people who download a pirated copy and sell it at $3-$8 per game. The music industry made it into these places with lower prices, and I suppose the games industry could do the same.

A large (like 99%) portion of western games never makes it to the Asian market. The ones that actually get released fail terribly. And now don't tell me that Starcraft is huge in Aisa, because it is not. The market over there is A LOT different than the western market. And I am not talking big-eyes-big-boobs different, it is like another dimension. Doesn't mean it cannot be done though.

But back on indie publishing, because it's something I really want to do. ... and keep 50-75% of the profits...

Finally some focus! Found your niche, check! Found a growing market, check! But srsly.... 50-75% of the profit? You know, there is a reason why everyone (with a sane mind) is trying to avoid publishers like a bad prostitute when planning a start up. Their share is just too freaking high. I can't remember the exact numbers, but it was something around max 50% back in the days (for retail publishers, including everything from marketing to shelve space). Ask yourself: Can any indie developer afford to loose 50% of their profit? Why should they give YOU their previous money?

Lunch is calling... :D

[ஒழுக்கின்மை (Paul Eres)]

starcraft *is* huge in asia, although it's also heavily pirated (especially in china).

but i agree that there's no standard business model when it comes to small-scale game development. so it seems weird of him to just disregard what people with experience are recommending.

it's not like there is zero truth in what he's saying. for instance, i recently had a sale of immortal defense for $3 and sold as many copies of it as it sold in the previous two years. so reducing the price can and does have a big impact. but it wouldn't have sold those copies if it hadn't spent those two years gathering up fans and reviews and so on, because it was those fans and reviews that allowed those people to hear about it when the price was reduced.

i think it's just that everyone thinks they know everything, and they're always wrong.

[Muz]

Heh, it seems that this thread is reaching that point where people stop reading the post, and start reading the replies to posts and the replies to replies and things starts to get out of context. I'm not really eager to rephrase things and justify stuff, so let's leave it at that :/

I've found most of what I'm looking for, and a lot I didn't expect. The marketing thing took me by surprise. Of course we have to spend a few thousand marketing to customers, but what I've realized from TIGSource is that indie developers won't go with a publisher that doesn't have a good reputation. That nearly doubles the worth of marketing.

Another interesting thing is that games do spread by word-of-mouth. Going from posted figures on certain Facebook apps that don't advertise at all, it seems to reach peak growth at about 5 months, then increases slowly, but steadily later on, reaching a cap of 2.5M in 12 months. This is of course, from a (not very interesting) free-to-play-pay-for-less-grinding game that's designed to go viral. However, awareness doesn't mean sales, and it's still risky to rely on it.

I'm still skeptical of the game industry's approach to price, mainly because of the reasons people choose a price. I believe there's a better pricing model, with higher profit, more sales, but we'll just see whether or not it works

Thanks again for the comments. Let's see how this goes. I'll still be making freeware in whatever free time I have left, so things are not all about business

[ஒழுக்கின்மை (Paul Eres)]

it's good to be skeptical and experimental, just don't let your theories cause data misinterpretation (although that's hard to avoid for anyone). for instance, there are also a lot of people who believe the price for indie games is far too low right now, and that we should be charging around $30.

spiderweb software charges $30 for every game, and he's been making a living at indie games for 15 years now. so i think both a very low price and 10000s of sales per game and a very high price and 100s of sales per game can work (and both have worked), it depends on the context. so i am wary of just categorically saying that prices are too high or prices are too low, because different prices work for different games and for different people.

[Craig Stern]

i think it's just that everyone thinks they know everything, and they're always wrong.

This is probably my new favorite quote. :D

[ஒழுக்கின்மை (Paul Eres)]

yeah -- it's just that i've been watching a lot of u.g. krishnamurti this year, so i've come to distrust beliefs in general. as soon as you believe something, you start twisting data to fit the beliefs, it's unavoidable. and it's of course just as true for that belief (data can be twisted to the idea that beliefs lead to the twisting of data)

[Muz]

spiderweb software charges $30 for every game, and he's been making a living at indie games for 15 years now. so i think both a very low price and 10000s of sales per game and a very high price and 100s of sales per game can work (and both have worked), it depends on the context. so i am wary of just categorically saying that prices are too high or prices are too low, because different prices work for different games and for different people.

Spiderweb Software makes my favorite RPGs. They can claim to make a game with 30 hours of fun and I'd believe them, because the demos alone are that good, and the full games are worth more than a week of fun. I've bought Avernum 1, 2, and 3, and because the full games are worth it, I have a lot of trust in them. Along with Unreal World and Dwarf Fortress, I think they've taken a nearly perfect approach.

Spiderweb's got a long track record of making great games and people have a lot of trust in them. With completely unknown games by unknown people, people are going to think many times whether it's worth it. Halving the price halves this reluctance, more marketing makes them trust it more because they hear about it. Both help sales and it's difficult to see which is the better long term solution.

In another sense, you have people who pay $30 on Evony before even getting in the real gameplay. And that $30 barely even helps them win. It's hard to put a value on games. An improvement on an existing concept should be worth more in every industry, but it's not. Higher price should make it seem more valuable in theory, but not many say "Hey, Final Fantasy XXI is $95 and Fallout 5 is $75, Final Fantasy must be a better game!"

[Radix]

Halving the price halves this reluctance

Pricing doesn't work that way, muzzlebutt.

[Snakey]

Reading this thread for quite some time now, and I don't actually understand how this is a game development company. Given that you're only really talking about the publishing side of things, do you plan to actually develop any of your own titles?

I'd recommend not to try to do both at the same time, as you probably don't have the staff or experience to handle two quite different businesses.

Given how indie game developers tend to be self sufficient, why would they choose an unknown publisher such as you vs someone that already has a stable audience such as Steam?

[obscure]

Halving the price halves this reluctance

Pricing doesn't work that way, muzzlebutt.

Not only does it not work that way but a dramatically lower price point can damage the perceived value of the game.

[Brice]

A lot of products do specials.  For example, "$20 for the first 50 purchasers, then it goes up to $40".  Valve also does lots of weekend specials on Steam for games, and that helps them test prices.

I agree with Snakey's post:  Small companies need to pick their core purpose and dominate it.  Don't let "we can do it all!" ego force you to do the manufacturing, marketing, and development (and not be profitable).  Decide if you're going to be a publisher or a developer, and then partner with other companies to make it happen.  That doesn't sound attractive right away, but it's the safer route in a world where you want to be as safe as possible.

[Muz]

OK, the business plan has been written up, just in the stages of finalizing. I think I've got a good plan here. We're going to focus on publishing first, just to get the economic aspects right. After all, the reason we're publishing is because there's nobody else out there to do it the way we want to.

On games being viral, you guys were right. Price has very little effect on it. Games do spread by word of mouth, sales are due to word of mouth, but lower prices don't change things. It's surprisingly stable, no matter what people try to do to make a game more viral, the best they can get is to double the rate. The "invite your friends" system Facebook uses is a marketing ploy, it doesn't change the conversion rate.

Sales price is still going to go up and down according to a certain factor, which is a core part of the business model. I've nailed down the ideal price for the best income. Funny thing is that I just realized that Big Fish Games sells games at $7, with some at $3. Burger King shovelware sold at $3 and made a hefty profit. Spiderweb Software's pricing system is indeed at the best price for various reasons.

I initially thought of lower prices to be the best way to fight piracy, but the damn credit card companies charging more for low prices and extra bandwidth costs from more sales would barely change a thing. IMHO, I'd still prefer to price as low as possible, though. It doesn't hurt anyone, and makes customers happier.

I've also noted that the biggest barrier to indie game makers is marketing. That's where my (currently unnamed) company comes in. Here's the final deal:

• We put up a server and a site to advertise games. We offer to handle payment, hosting, advertising. Maybe even shipping if we could get a partner to handle things.
• We charge you approx. 45% on every game handled through our site. It's probably something like 35-40% for hosting and website exposure, 5-10% for payments.
• If you decide to go with the hosting plan, we advertise your game for free since that helps both of us.
• Hosting mainly means that they buy the game from our site. We'd put light DRM and copy protection, nothing painful, and let them download the full game whenever they like after they've purchased it. If they've purchased the full game elsewhere, they don't get this benefit. We'd also include other features like allowing people to rate/review the game and stuff.
• If you go with our payment plan, we choose a nice price for you. Pricing is dynamic. It starts at a very low price like $5 and goes up to a certain level, based on one factor. After a certain period of time, it goes down. I'll explain below.
• You're also free to sell it outside our site, using other payment schemes or even host it on other sites. If a game is sold from off the site, we don't charge for hosting. All the hosting charges are from games downloaded from the site. If you don't like the pricing system, then we'll set it at what you think is right on the site.

I think it neatly addresses all the problems. If we suck completely, we won't sell a thing on the site. You don't lose any money and you're free to sell it elsewhere. You don't pay any upfront costs. If you think your game would sell better on Steam or Big Fish, you could do so.

If you're worried of us underpricing you, then you can set your own prices and we just sell them at that price.

The main flaw I could see from this is that you could tell people to buy it from your site, not ours, and freeload on the free advertising. But if our marketing works, people would be buying it from the site. They won't get the benefit of downloading the full game from our site if they don't buy it there, though.

On the pricing system.. a nice little result is that games are priced what they're worth. This rewards people who have confidence in a game and buys it early or sits and waits for the price to drop later. There are people who think that a game less than $20 is garbage. If your game is worth it, then it will eventually go up to $20. If it's really good, and you give people a great demo, it'll go up to $30 or more.

[Alex May]

Here's the final deal:

• We put up a server and a site to advertise games. We offer to handle payment, hosting, advertising. Maybe even shipping if we could get a partner to handle things.
• We charge you approx. 45% on every game handled through our site. It's probably something like 35-40% for hosting and website exposure, 5-10% for payments.
• If you decide to go with the hosting plan, we advertise your game for free since that helps both of us.
• Hosting mainly means that they buy the game from our site. We'd put light DRM and copy protection, nothing painful, and let them download the full game whenever they like after they've purchased it. If they've purchased the full game elsewhere, they don't get this benefit. We'd also include other features like allowing people to rate/review the game and stuff.
• If you go with our payment plan, we choose a nice price for you. Pricing is dynamic. It starts at a very low price like $5 and goes up to a certain level, based on one factor. After a certain period of time, it goes down. I'll explain below.
• You're also free to sell it outside our site, using other payment schemes or even host it on other sites. If a game is sold from off the site, we don't charge for hosting. All the hosting charges are from games downloaded from the site. If you don't like the pricing system, then we'll set it at what you think is right on the site.

You'll have to do better than this. These are significantly less attractive than most other DD services - particularly, the commission. 45% is not competitive.

I get that you're doing an economy thing with the price so that's up to you, but the deal should be attractive to devs. If we can't set the price then at least throw us a bit more on (your already noncompetitive) commission seeing as you're taking that executive decision away from us.

Also forcing DRM is going to turn some people off, you need to be more flexible and less I'M FUCKING RIGHT, particularly given you've shown several times in this thread you're totally green and started learning the ropes just after you first posted.

[William Broom]

I'm not in any way an expert on business but it really sounds to me like you are unable to let go of this idea of fluid pricing. What you seem to have said in your latest post is "Yeah, changing the price doesn't actually work, but we're going to do it anyway."

[Jason Bakker]

I'd be interested to see you break down your service as compared to Steam, to convince me (as a potential developer selling games on your site) why I should bother!

It might also be a useful way to figure out where you need to be more competitive. For instance, if Steam's userbase at x million is balanced against your userbase of 0, then something (ie. the share you guys take) should probably swing the other way

[ஒழுக்கின்மை (Paul Eres)]

you need to be more flexible and less I'M FUCKING RIGHT

that's been the theme for this whole thread. it's funny that he's doing it again after just learning that most of what we said above regarding prices and word of mouth has been true.

45% to host a game and deal with credit card payments isn't competitive with folk like bmt-micro who charge 9.5%. he's absolutely disconnected with the realities of the indie game marketplace.

[deathtotheweird]

Hey, if you think you can do it-go for it. I'm sure you decided already about that though. it's worth a shot at least, as long as you do not ripoff the developers. But since people can go elsewhere with their games and get a better offer and less risk, I'd say finding competent developers and finding funding is your biggest hurdle. And honestly, the only way I could see you being able to find "game developers" is by finding kids still in college taking game development and design courses. And those are the kids most exploited, and you shouldn't do that. Bad karma.

Also, you shouldn't post this on here. Post it at the Indie Gamer Forum, it deals with more of the business side of indie games.

http://forums.indiegamer.com

Good luck.