The Socio-economic Implications of the Mansion
The Mansion is an interesting experiment for Sony, in terms of sales volume versus transaction numbers.
If the typical personal space is an average price of five dollars, then one user purchasing the whole Mansion for $35 equals seven standard transactions. This means that this space only needs one-sixth the number of purchasers to end up ahead (one-seventh would be a break-even).
Case in point: I’ll wager that the gold suit, which has often been derided as gaudy and overpriced, is probably one of the most financially successful virtual items in Home. The development cost likely wasn’t any greater than for any other piece of virtual clothing, and given its remarkably high price, it would’ve had a much higher ROI margin than the typical virtual item, even though the number of transactions was lower.
There’s also an interesting bit of market dynamics at work here: set the price high for a commodity — even if that commodity has no resale value — and you can actually generate additional sales from a percentage of users who simply want “bragging rights.”
There are some interesting societal implications for the future of Home commodity sales (and target marketing) based on the projected success of the Mansion. Is this the next logical step in Sony attempting to generate more revenue from those users who have the disposable income to burn?
As an aside, I do still feel strongly that the “modular add-on” concept is a brilliant innovation in personal-space design. It generates further revenue from users who purchase a core space and fall in love with it. Certainly, had the Log Cabin or Waterfall Terrace offered add-on spaces back when they were released, I would’ve snapped them up in a heartbeat.
The more I think about that “freemium” neologism, the more it does seem to perfectly fit Home. Although the Mansion itself doesn’t aesthetically appeal to me, I do certainly hope it succeeds, and succeeds wildly.
January 6th, 2011 by NorseGamer | 2 comments
NorseGamer is the product manager for LOOT Entertainment at Sony Pictures, as well as the founder and publisher of HomeStation Magazine. Born and raised in Silicon Valley, he holds a B.A. in English/Creative Writing from San Francisco State University and presently lives in Los Angeles. All opinions expressed in HSM are solely his and do not necessarily reflect the views of Sony DADC.
LinkedIn
Twitter
I bought the Mansion as soon as it came out. A great tour by HCV CONRAD_MAX sold me on it as a fun space. I want to encourage innovation, esp add-ons. I’d love to scuba dive off my Santorini yacht, fish from the pier of my Tropical Escape, land on a beach from my Ameratsu, row the boat docked… & so on. This is almost certainly a one-time purchase depending on the quality and *playability* of the extras. I *really don’t like* fixed furniture. I like to furnish & refurnish my spaces.
I’m surprised how many of my friends have purchased it. If this is a representative sample, Sony is really cleaning up with this space. I’m still not attracted to it, but I’ll be watching with interest as the add-on spaces appear.