Determining the Optimal Price for Your Game

The recent announcement by Microsoft that Outer Worlds 2 would be priced at $69.99, following an initial decision to sell the title for $80, has sparked a heated debate about game pricing. This reversal was largely driven by backlash from consumers and the developer community, who viewed the initial price increase as a potential harbinger of widespread price hikes for individual games, particularly triple-A titles. The concern was further exacerbated by Nintendo's decision to price Mario Kart World at $79.99, which was seen as a potential benchmark for other publishers to follow. However, the conversation around game pricing is complex, with various factors at play, including the impact of Game Pass on lifetime sales and the relative value of games versus their pricing. As the industry grapples with these issues, mid- and budget-tier publishers are reassessing their pricing strategies in response. According to Chris Bergman, CEO and founder of Gylee Games, the team behind the beat-em-up title Ra Ra Boom, the decision to drop the price from $24.99 to $19.99 was driven by market conditions and the need to be competitive in a slightly depressed market. Bergman notes that price sensitivity is a significant issue, with consumers being more likely to purchase a game at a lower price point. Chucklefish product lead Alexis Trust points out that the release of AAA titles can impact sales of other games, particularly indie titles, which often have to compete with established IPs. The long-term success of a game is also influenced by its performance in the first three days, particularly on Steam, where getting great conversion rates and user reviews is crucial. Thomas Reisenegger, founder of indie publisher Future Friends Games, notes that some indie publishers are still basing their pricing decisions on outdated models, which can lead to poor sales. Tom Kaczmarczyk, CEO of games industry intelligence service IndieBI, explains that Game Pass is having a significant impact on consumers' perception of game prices, which in turn affects price strategy for publishers. Trust notes that changes in how premium games are monetized, particularly when they are live service titles, are altering how consumers consider the relative value of indie titles. While the market may be volatile, the fundamentals of game pricing strategy remain vital, with prices set by a wide range of criteria beyond just the price-tags of top-end titles. Bergman expects the market to bifurcate, with triple-A titles increasing in price and indie games becoming more affordable. Ultimately, everything from economic pressure on consumers to a game's genre impacts pricing strategy, and indie- and mid-budget publishers must be agile and adapt to changing market conditions to cater to value-hungry gamers.