When do you change your prices?

[paulkdad]

Over in this thread Valamir said:

If I had it to do over again, honestly, I'd probably sell Uni at $18.00 instead of $15.

And while I understand the "if I had it to do over again" sentiment, it did cause me to wonder this: Under what conditions it is deemed acceptable to increase one's asking price for a product? Here are some specific options:
[list=1]
[*]When it has been revised and/or expanded to the degree that it represents a new edition (including a switch from soft to hard cover)
[*]When a decision has been made to include new materials (such as including a pdf file with a printed edition)
[*]When the author/owner realizes that the product has been underpriced
[/list:o]
Obviously, unless some plan is in place to account for inflation, every year the author/owner makes less and less from his/her work. But does this mean that the games must be in a constant state of revision? Or does it simply mean releasing products in stages (for instance, soft cover, then soft cover + pdf, then hard cover) to allow for future pricing adjustments?

I guess the real question is, what strategies best allow for pricing adjustments without alienating consumers?

[TonyLB]

Well I just said "Hey, it looks like people will buy the product for more, so I'm raising my price.  Those of you who bought early are lucky ducks!"  I haven't heard any complaints.  Whether I'm selling less than I might have is hard to judge, because I don't have a historical trend to compare against.  My intuition is that it hasn't hurt sales, though.

There's much to be said for being straightforward, I think.

[philreed]

Having shipped the reprint of vs. Monsters off a week or so ago I just finished asking myself this same question. I debated dropping the price (vs. Monsters is 5.5x8.5, 80-pages, $15) but a talk with Key 20 Direct convinced me to leave the price alone. I hadn't even thought of _increasing_ the price.

What I will do, though, is consider higher prices for future games. Looking back I feel I could have easily increased the price $1 without having any effect at all on sales.

[Andrew Morris]

What I will do, though, is consider higher prices for future games. Looking back I feel I could have easily increased the price $1 without having any effect at all on sales.

As a buyer, let me just say that I like nice, rounded-to-the-nearest-multiple-of-five prices. If I want to, say, spend $50 at a website or convention, and two games that I want that are priced $15, one's priced $16, and one's $20, I'm going to dump the $16 game before the $20 game, simply because I'd rather end up at my $50 limit than at $46. So a $1 price difference in a book would actually make me buy a more expensive book instead. Admittedly, I'm probably not the norm, but I almost didn't buy Dogs in the Vineyard for this reason. If it hadn't had so much enthusiam and word of mouth and if I hadn't played it at a convention, I'd never have bought it.

[daMoose_Neo]

Usually if costs go up, least for myself. I want to make money, but I also respect gamers on a budget and aim there ^_^ Small grudge from coming to RP from CCGS.
I'm nearing the end of my first run on my Trinity starter decks for Twilight, and to get the second printing done will cost me a little more per unit. I will, however, be better able to control my inventory. $1 difference in my market definetly won't kill me- Retail stores are STILL selling the game at $6.20, so the consumer end won't notice the difference really. $1 MSRP increase still has those retailers well under the original MSRP of $8.

[jdagna]

I don't think you need any excuses to raise your prices if you feel like you need to.  This bizarre gamer idea that publishers somehow owe their fans certain things is really dysfunctional.  You produced a game.  They bought it.  All obligations are now over.  

Adding new material or versions might not be a bad idea, though.  It will provide a smokescreen for delusional gamers and it gives you a chance to sell the same book to your existing players, and that's also good for the bottom line.  It also gives you a chance for some good PR, news and reviews.  All news it good news, but a revised edition is more news-worthy than a straight price increase.

You could also consider explaining that the old price was an introductory price.  This appeals to the dysfunctional gamer's need to be someone cutting edge and special.

[Ron Edwards]

Hello,

I'll toss my voice in with a few others' posts so far, to say, "Look at it as if you were a restaraunt."

Almost all restaraunts begin their menus with fairly low prices, usually right at the point where they can barely profit. The goal at that point is simply to generate a reliable cycle of "Hey, we can make the rent."

If the restaraunt succeeds at this level, and many do not, then they always raise their prices. Now it's time to do a little better than making the rent, not only in terms of pocketable profit, but also in terms of setting up funds for improvements, or raises for the staff, and similar.

There's no "justification" for doing this, especially not from the customer's point of view. It is value-neutral.

Interestingly, it's also very rare in role-playing. There seems to be this widely-held notion among RPG publishers that raising one's prices is wrong somehow, but very few examples. To say, "Customers will automatically resent it" seems to me to be an self-generated, internalized fear of some kind.

Best,
Ron

[MatrixGamer]

My impressions about prices from haggling in third world markets is that people instinctually decide what something is worth even without thinking about it. You know you've crossed that line when people don't buy. Or you get a reviewer saying something like "seems pricy for what you get."

Ron mention restaurants starting with their prices low to get started. I can see doing this when you are learning your business. Then you are buying your experience by charging less, but once you know what you have is good this needs to stop. People respect fair prices. They may grumble but more reasonable prices indicate the person is being serious about their business and will thus be around next year. Low ball companies often aren't.

Look at your cost of sales, and advertising/overhead costs and figure out how much you want to make from this venture. If you're satisfies with the price it's by definition an okay price. If your calculations are wrong, you'll lose money - feel the pain - learn and not make the same mistake again.

No one needs to know everything about business right off the bat. If we all had MBAs we probably wouldn't make games - low profit margins! We'd be going after the big bucks.

Chris Engle
Hamster Press

[LloydBrown]

I guess the real question is, what strategies best allow for pricing adjustments without alienating consumers?

Games Workshop raises their prices every year.  They know not to stop when customers complain, but when they stop buying.  So far, they haven't stopped buying.

Low prices should not be a competitive point for you in your position.  A good game, an attractive graphic design, and a good support system should be your competitive edges.  Price it to make a profit on it, and don't be shy about it.

[guildofblades]

Well, so far we have considered price changes whenever we change the edition of the game in question.

First edition of our board game "The War to End All Wars" sold for $19.95. After major packaging upgrades (changing from just maps and rules shrink wrapped together into a ful blown board game) the price got hiked to $34.95 in the second edition. We used the same box presentation for the 2.5 edition, and since we print SRP on our box wraps, the 2.5 edition stayed the same price.

We have the design work on the 3rd edition of the game in the works right now. Though we plan the leave the game at $34.95 before we found it sell really well at that price point, even though it will once again have a great deal of packaging upgrades.

But here is the key. For both the 2.5 and 3rd editions, while we have huge packaging improvements, by finding better suppliers and coming up with better production methods, our actual production costs have dropped considerably each time, so our margins have actually improved dramatically. If that were not the case, I am sure we would have been pushing the envelop on price hikes for the new edition instead.

With RPG books, if you are doing PDF or POD producutions you can change your price at a whim. Your past customers won't complain that you raised the price, as they already bought the thing. You won't even have to mention the price increase to your future customers, as they likely won't have known about your product (and hence its original price) before they eventually stumble upon it. Its simply a non issue.

With regards to distributors and retailers, if you are doing business with either of those tiers, they won't care about a price hike either. Not so long as your product keeps selling.

There IS a happy price point at which things should be priced. Price a game too high and you will lose a lot of business to people not willing to plunk down that much money for it. Price a game too low and you will lose sales because the customers will instinctively wonder what's wrong with the game for it to be priced so low. I'm not saying you can't produce inexpensive games, but generally the production value has to be on a level comparable to the price being asked for it not to seem strange or wrong to the consumer.