I recently read an article that sparked me to think about how video games could use better market segmentation strategies. The article defines segmentation as follows:
“separating your customers into different groups according to how much they are willing to pay, and extracting the maximal consumer surplus from each customer.”
The video game industry historically does not have the varied strategies of selling their products in the same way the movie industry or book industry does. For a given movie, they have theater sales, DVD, Pay-per view, rentals and so on. Books have the books itself and audio versions. For videogames we pretty much sell it once and that’s it. I don’t think we receive revenue from used game sales or rentals. I lump digital distribution and retail sales as one because the user experiences the game in the same way. In contrast with movies, people experience the content in vastly different ways with theater, DVD and broadcast delivery mechanisms.
I’m growing impatient with the industry continually creating games that are much to long for their own good, often damaging to the overall quality of the game experience because the game has to be padded with extra content to meet some arbitrary requirement for length of gameplay experience. I long for a game much like Full Throttle or Portal where it’s about 2hrs long to play through. Admittedly, Full Throttle and Portal took me at least 4 hours to play, but they are the closest example I have to what I’m looking for. My responsibilities and interests (such as writing articles like this one) do not allow me to sit for hours on end to play, let alone finish epic games of 10+ hours. These days, a game that is advertised as being more than 20+ hours really turns me off.
In an effort to introduce some ideas for market segmentation (focusing on singleplayer games) and satisfying my desire for much shorter games I propose the following various “packages” of games:
$30 – Core Experience Package
Contains the 2hr core gameplay experience package. No extra collectible items (t-shirt, art book, etc) or downloadable content access codes.
$60 – Extended Experience Package
This is more like the current offerings of games, like Halo3, GTA IV or Gears of War 2. The overall story and progression is the same, you even get to see all the same enemies, locations, characters, weapons, power-ups, etc that the Core Experience Package has but everything is longer. The battles are extended to include more waves. The cinematics may have extra scenes that provide extra context. Think of this as equivalent to a movies’ “Director’s Cut”. It’s the same overall experience but with more of it.
$80 – Collectors Extended Experience Package
Same as the $60 Extended Experience Package, but includes the extra collectible items, like the art book, toy figures, strategy guide, t-shirt, or access code for one piece of downloadable content.
$100 – Lifetime Collectors Extended Experience Package
Includes everything from the $80 Collectors Extended Experience Package plus lifetime access to ALL future downloadable content at no extra cost.
$20 – Lifetime DLC Package (Note: DLC = downloadable content)
Includes lifetime access to all DLC at no additional cost.
Players could combine packages, such as the Lifetime DLC Package and the Core Experience Package, totaling $50. Still cheaper than the $60 Extended Experience Package. Or if they are a light fan of the game they only have to pay $30 for the Core Experience and then maybe one or two DLC offerings, if that.
Personally, I don’t think I’d ever go pay for more than the $30 Core Experience but I do know people that I suspect would even go for the $100 package. Despite my confidence there are some important open questions I have:
1. In what ways can the Extended Experience game be different from the Core Experience game without Core players feeling like they are missing out on the overall experience? You can’t risk leaving out a cinematic or gameplay mission that core players feel would hurt their experience.
2. Do players see any value to the price points? How much could one person spend if they paid for all DLC separately? Does the Lifetime DLC package potentially save them money?
What about you, do you see potential for this idea or do prefer to see it die in a fiery death? Any suggestions for improvement?
© 2008, Reid Bryant Kimball. All rights reserved.