#8460883, By Cannibal Digital Distribution/Second Hand Compromise Idea

  • Cannibal 26 Feb 2012 20:19:35 8 posts
    Seen 6 hours ago
    Registered 12 years ago
    They still make more money but they make it in a different way while also minimising middle men alternatives. It's a long game rather than a short one. They are like a casino. The consumer might temporarily be ahead but in the end the house always ends up with their cash.

    Say they sell 50,000 digital copies of a game in week 1 at a cost of 50 per unit. After 3 months the initial buzz has worn off and sales slow. Under old thinking people would have bought a physical copy and traded that game in and publishers would see none of that money. They instead go the route of DLC to keep making money off of consumers after the initial purchase which is pretty inconsistent.

    With this, after that initial 3 months they get to make more money of the same consumer again. Say 10,000 of the original 50,000 buyers put their game up for auction. Publisher says it wants 10 commission on every sale and the market determines it worth 30. Publisher gets 10, consumer turned retailer gets 20 and the new consumer gets the game at a 20 discount.

    You've achieved a few things here. The publisher has not just made more money off the original consumer through commission, but also has the potential to make even more because now that same consumer has a further 20 credit to play with. You could set it up so that the selling publishers games are immediately advertised to the consumer who received the credit.

    You've also grown your market. You gain extra sales from those who are wary of DD because it is so final and have no way of shifting your game. You gain more again from those who would have never bought your game at full price and will probably auction it again in another 3 months making you even more money. You also get a cut of a market that previously the publishers couldn't touch. All in all, your game goes to work for you for much longer than it previously did under the old system. It will still be making the company money years down the line.

    And the consumer is on the surface happy because it is perceived as working in their favour. If they think they are getting value then they will give more return business with the credit that never leaves the store and they will start the cycle over again. No money is ever taken out, only put in.
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