Question: “Why does publisher X have such greedy business practices?”
Answer: “Companies exist to make money!”
I see this exchange a lot, and the sad thing is that both the question and the answer are misguided. Jim Sterling touched on this a few weeks ago, but I thought I’d dig a little deeper and talk about why the problem is cluelessness, not greed.
When people accuse a company of being “greedy”, they make it sound like they think the company ought to make less money out of the kindness of their hearts. But this isn’t really about money, or companies making too much. EA has been doing layoffs and struggling in various ways for years, and that doesn’t make their behavior any less annoying to consumers. Apple and Starbucks are notorious for selling things with massive markups, yet both companies have rabid fans who can’t wait to hand over their cash for the Next Delicious Thing. Meanwhile, people are becoming enraged at one-dollar items for sale in Dead Space 3. This isn’t because people are mindless sheeple, or irrationally biased against EA, or because people are bad at math. It’s because the most important aspect of these transactions isn’t the price, but the consumer experience.
About twenty-five years ago, fast food places invented the idea of the value meal, combo meal, or whatever you call it when you order one item to get several. Before this, you had to order your burger, fries, and a drink individually. With a combo meal, you could just order a single item for a single price. Sure, maybe you used to get a small drink and now you get a medium and you didn’t usually get fries and now you do, but by gathering up the items under a single price point the restaurant can make things more convenient, get you to buy more food, and leave you with the impression that you somehow saved money. This was smart. This was a system devised by people who understood what consumers wanted and how they behaved.
The stupid way around would be to make more money by charging people for small items. Charge for napkins. Charge for condiments. Charge for the cup, the ice, the tray, and the utensils. Charge people to enter the store, charge them to talk with other patrons, charge them for the bathroom, for window seats, for privacy, and for access to WiFi. This is how EA has been selling their games.
People will call the second idea “greedy”, even if it makes less money than the combo meal idea. This isn’t about greed, it’s about customers feeling respected and not being unduly hassled over trivial things. Even more importantly, this is about convenience.
When someone is contemplating spending sixty USD, the last thing you want is for them to hesitate over concerns with side transactions: Microsoft points, online passes, account creation, activation keys, privacy concerns, server availability, pay-to-win items, DRM, or any of the other stupid crap that creates stress and keeps games from being fun. It’s not about the ten bucks or about the quality of the item being offered. In the end, it’s about the customer feeling like they are going to get a whole and complete product when they put their money down. They don’t want to worry about buying DLC (or not) on day one and wondering how much of this extra content will be missed or how it fits into the product as a whole.
This is also why the whole “online games broken at launch” issue is so powerful. The botched launch of SimCity is just the latest in a long line of similar debacles. Sure, these outages are “temporary” and “only impact some users”, but these are incredibly inconvenient. Not just inconvenient for the people who can’t play, but for people considering buying and game and worrying if they will face similar problems. Online, your company can live or die on the convenience of your service.
People will pay for convenience. This is doubly true of digital transactions. This is what makes EA businesses practices so awful. They’re not just making the product more expensive, but also making it far less convenient to use. This is a brain-dead and tone-deaf way to engage with their audience, and it helps explain why EA is so reviled by their own customers. They’re trying to turn games from a product to a service, and their service is so bad it borders on sabotage.
Valve’s Steam sales are the videogame equivalent of a combo meal: A system designed to get you to spend more, while somehow leaving you with the impression that you saved money. I have an embarrassing number of games that I’ve never even installed, but I bought them because the price was low and I didn’t want to miss out. I allow the Steam update window to appear at launch, so that I can see if more deals show up. I know from reading what others have said that I am not alone in this behavior. Steam has not only sold us games we never intended to buy, but they’ve trained us to treat their advertisements like a reward. Steam didn’t do this by accident. They did it because it makes money. And people love them for it. .
The problem isn’t greed. Valve is “greedy”, but they’re good at it. After handing over my money I feel like I’ve won. EA isn’t more greedy than Valve, they’re just inept and clueless. When I buy from EA (or heck, even when I get something free from Origin) I walk away with the feeling like I’ve been unduly hassled and disrespected.