Showing posts with label Economics. Show all posts
Showing posts with label Economics. Show all posts

Tuesday, January 15, 2008

A New Taxonomy of Gamers: Supply and Demand

This is the eighth in an 11-part series. To start from the beginning, read part one: "What We Talk About When We Talk About Games." Or read the previous post, "Cash Rules Everything Around Me."

In the last part, we determined that all bad games are too long, but that a good game could be too long, too short, or just right. Let's look at how these can be applied to the question of value.

Any bad game is a waste of money (although you could argue that many games become more attractive in the bargain bin). Not all good games provide an equal value for your gaming dollar -- but your idea of value depends on the worth you ascribe to your own time. Someone who levies the "good and too short" criticism wants to minimize his dollar cost per hour, and considers value through that lens. A 10-hour game that retails for sixty bucks is worth $6 per hour. A 40-hour game at the same price costs only $1.50 per hour -- a relative bargain.

That calculus only works if your time is worth similarly little. That's not meant to sound as brutal as it does. It just means that a person who has forty hours to commit to a single game is selling their own time in bulk, and can afford to charge less for it. Consider now the person for whom gaming time is at a premium: it may be a better value to them to pay more per hour of gameplay, because otherwise they're not actually getting what they paid for -- they may play half of a $60 game, or $30 worth. We'll delve a little more deeply into this matter in the next case study. For now, we need to think of what to call these people.

The terms "Wholesale Players" and "Premium Players" carry some unfortunate connotations because there seems to be an implicit judgment of the quality of the games those people play, or even of the persons themselves. Yet if you think of the comparison solely in terms of the efficacy of the business models each category alludes to, you'll see why it works. A big box store like Wal Mart makes billions of dollars due to volume. A small boutique makes more money per square foot than Wal Mart, because they charge more for their products, but there's a hard cap on how much product they can sell. Both companies can be profitable.

Armed with these terms, we can strip out the personal value judgments and consider only the pecuniary ones. The Wholesale Player, who needs to move dozens of hours to make a profit, has a supply problem when a game is "too short." When a game is too long, it's a case of the Premium Player finding himself unable to meet the game's demand. Now, the "too short" criticism makes sense no matter what game it's applied to, because we know who is making it. And if we disagree, we have a more positive and productive way to engage the issue than simply saying "Nuh-uh!"

Earlier, we looked at Guitar Hero as a game that appealed to Skill Players and Tourists. So, too, can we point to a recent game that offered equal value to Wholesale Players and Premium Players.

Next: Case Study: The Orange Box