SCEA Top Ten PlayStation Home Items (By Number of Units Sold) for October 2012, With Consumer Trend Analysis
by NorseGamer, HSM Editor-in-Chief
Richard Garriott, in HSM #10, described gaming’s shift towards a freemium commerce model as the industry’s Third Age — no doubt a Tolkienesque reference, but nonetheless quite accurate. And this shift means that the field of behavioral economics is much more heavily weighted than it was in years past; the marketplace is enormously crowded today, and there’s a whole lot of intense scrutiny and study being applied to what actually makes gamers pull out their wallets.
It’s also a subject I love to write about. No, I don’t have a degree in behavioral economics, but I do have something better: a decade of practical experience up to my eyeballs in it, thanks to working in resort development. If there’s one thing that HomeStation analyzes which no other Home media site really goes near, it’s the business side of Home.
Perhaps it’s a reflection of the HSM team, since we’re a generally older group with a lot of private-sector and entrepreneurial experience; perhaps it’s simply a matter of our fascination and willingness to explore the moving parts behind the magic. Whatever the reason, one of my personal goals with HSM was and is to help get the audience thinking more like content developers themselves — to see Home not just as consumers, but as businesspeople themselves. This hasn’t always lent itself well to popularity contests on the Sony forum, but as one of my favorite bosses used to say, “There’s perception and then there’s reality — and everything’s happier and more profitable in the long run when you make them the same.”
Which brings us to these top-ten lists from SCEA. If there’s one thing I want to encourage other Home journalists to do, it’s to analyze the story behind the story. Stop it with the Ctrl-C/Ctrl-V copypasta in your mad dash to be “first.” That’s lazy. Instead, try digging into the why of the story. Why do certain virtual commodities sell better than others? Why do consumers respond positively to one type of Home experience, yet reject something else which might be very similar? Why are people motivated to spend money on luxury experiences, be they virtual commodities, vacations, nicer clothes or anything else?
Of course, this brings up the question of why you’d want to go through that much work. Simple: Home’s developers are doing the same thing. They want to know why consumers are behaving the way they are. The more you can analyze and offer insights into this, the greater the likelihood that your feedback might just have an impact on some of Home’s future developments. Which, lest we forget, fellow community journalists, is one of the primary reasons why any of us — regardless of the gonfalon we fly — got into this to begin with.
And these top-ten sales lists from SCEA are a beautiful place to start. Here’s the raw data itself. If you study these lists over enough months, consumer trends start to emerge. From trends, new products are conceived and new budgets projected. And when there was a brief interruption in the flow of this data, you wouldn’t believe the number of e-mails I got, asking where the analysis was. Because what we have to say, as consumers, matters.
I’m no one special. Just as HearItWow created the HomeCast because it filled a void that no one else was tackling, so I’m doing the same thing with these sales lists simply because no one else is. And just as, in time, other Home filmmakers took HearItWow’s formula and built their own shows upon its foundation, so I would be thrilled to see other journalists diving into these sales lists. Because the more active voices there are in the community that display more than just knee-jerk fanboy sentiments (positive or negative), the healthier we all are as a result.
So let’s dive into the October list, then:
You know the drill, and it’s great to write about it again. Let’s break this list down and analyze the stories behind the story!
Your argument is invalid.
A. Say what you want — games are where the money is.
There are only five developers on this list, and none of them are SCEA. Even more notable, though: seven out of the ten slots are chewed up with Home game currencies. Tickets, coins, tokens and chips, oh my!
There are a few reasons why this is a big deal. First of all, despite any protestations to the contrary, Home’s overt shift towards being more of a gaming platform is good for business. Period. We predicted Home 2012 would be the Year of the Game (an easy prediction to make, since we knew what was coming), and now that we’re at the end of the year, it’s blatantly obvious that games are the true source of long-term revenue in Home. Home 2013 looks to continue this trend, and with good reason: people can say whatever they like, but ultimately it’s the money that talks.
Another interesting note is that HSM editor SealWyf’s economic analysis from earlier this year, in which she concluded that “tokenizing” sales by creating internal currencies that could be purchased with dollars was an excellent formula for better long-term profitability, was absolutely correct. Mass Media, Digital Leisure and Lockwood have battled it out all year with tickets, chips and tokens, respectively, and now Hellfire Games is in the thick of it with their coins.
The lesson here is that if you have the right kind of game, consumables are a successful path to long-term profitability. This doesn’t work with every game — certain titles, like SodiumOne, were very successful with a completely different economic approach — which is important to remember when developing a game around a freemium business model. So let’s talk Hellfire for a moment…
B. Home Tycoon is a bona fide hit.
Every so often I have to eat my words, and this is one such occasion. When Home Tycoon first came out, I reviewed in favor of the game but I thought their freemium economy model didn’t deliver enough bang for the buck. Turns out Jeff Posey and his team have the last laugh, because hot damn, Hellfire scored a commercial hit with their game, chewing up three slots on the list with Home Tycoon gold coins.
This is particularly interesting to me for three reasons:
1.) Novus Prime, Hellfire’s debut game, is generally considered to be one of Home’s classic top-tier games. Yet it only charted once — in its opening month — and only took up one slot. It never charted again. Obviously the game performed well, and received major content updates to keep consumer interest in it, but it does not appear to have made the same kind of splash as Home Tycoon. Granted, Novus Prime was originally designed as a PSN title, whereas Home Tycoon was built from the ground up (pun unintended) as a freemium Home game, so it has a somewhat different freemium model underneath it.
2.) The PlayStation Blog is an extremely important piece of marketing. With so many high-profile content releases coming out in rapid succession earlier this year, it was easy for even the most massive Home game to be relegated to little more than flavor of the week. What’s key to any major Home game, in order to maintain long-term visibility after the initial release, is to have content updates already planned for release in the ensuing weeks. If you look at the PlayStation Blog, which announces new Home content every Monday, Hellfire’s had something to announce for Home Tycoon nearly every single week since the game released. That means Hellfire is getting a lot more Sony PR exposure than rival games, both in the blog and in Home itself thanks to the Message of the Day — which, if we’re honest, are the two most important spotlights a Home developer can currently strive for in order to maximize audience penetration. And thus the lesson is obvious: it’s not just how well you build something — it’s how well you can keep the spotlight on it. Somebody give Hellfire’s Ben Lewis a cookie, because that marketing plan is as brilliant as it is simple, and Home Tycoon has benefited considerably from some very smart planning and content release scheduling by the Hellfire team.
3.) While I may personally think Home Tycoon is a bit overpriced for consumable goods, and the screaming children on the Sony forum love to howl to the heavens about price gouging, Home’s developers have learned one of the first rules of sales: start high. You can always discount and run special offers and events, but if you start low, you have nowhere to go. As we learned in resort development, “$40,000 may sound like a lot of money to your client, but if you start at $80,000 — and hold it, and defend it, and squeeze out every objection, and you know they want it — only then do you do the drop, and then you end up with $40,000. But if you open with forty, you’ve got nowhere to go, and you end up with twenty. And neither our budget, nor yours, will allow for that.”
(If I sound like some heartless capitalist who’s completely on the dark side of the Force, I’m not; I just don’t have any patience left for the children on the Sony forum who cling to some over-romanticized version of Home from four years ago and somehow think everything should be priced under a dollar. And that especially includes the people who know better, but continue to rail against Home’s developer pricing strategies in order to score popularity points. Good lord. Developers don’t live on sunshine and rainbows, and the margins are much narrower than you think.)
C. If Home is to have more social depth, it must be via features which can be monetized.
If there is one area in which Home is sadly deficient, it’s in improvements to its social interface. And while there will be core updates which improve things somewhat, the stark reality is that if you want social enhancements, you’re going to have to pay for them.
Case in point: thanks to Home 1.7, we now have downloadable dance moves and locomotions — which you can purchase. And I think this is fantastic; virtual companions have more or less run their course in Home, and Sony created an absolutely ingenious use of the same memory channel for developers to exploit and derive revenue from.
Thanks to Atom Republic wanting to make a quick buck, you can dance like Psy in Home now. This is a good thing.
For those of you who think this is wrong, or immoral, or greedy: get over it. The first rule of economics is that people respond to economic incentive. Rather than sit and wait for Sony to incur the cost of a core update to give the consumer base even more free stuff to enjoy a free service, there’s a far greater likelihood of Home’s social interface improving at a faster rate if there are clearly definable means by which it can be monetized. Sony incurred the cost to create Home 1.7, allowing developers to sell new dances, gesticulations and locomotions — a new revenue stream which Sony gets a cut of, thus justifying the sunk cost.
Personally, I’m curious to see just how far this can be pushed. For instance, would it be possible for a developer to create a “dialogue pack” that could be purchased and downloaded, giving users a broader spectrum of pre-written questions and statements to choose from?
Economic incentive drives innovation and enhancement. Everything has a dollar symbol attached to it. The sooner you realize this is a good thing, the sooner you can start framing feedback in a way that could make a real difference. A wishlist is only as good as the number of people who will actually fork over money to buy it.
D. Notice what’s missing?
Sometimes what’s absent from this list is as conspicuous as what’s on it.
No virtual companions. No personal estates. No furniture. No clubhouse skins. And — most tellingly — no clothing.
The reason why this is so interesting is twofold: first, clothing sales had been consistently slipping lower and lower on the sales lists, with female items eventually disappearing entirely and male items holding a tenuous grip on the bottom of the list. This suggests that perhaps there is a saturation point with virtual apparel, coupled with a consumer shift towards gaming experiences rather than social experiences.
More importantly, though — the clothing items that held on the longest really didn’t make any sense. Neon-green high-tops? Why did they show up at all, let alone show up on consecutive lists? Statistical outliers usually have a story behind them.
In this case, the story that I can piece together comes from an unverified rumor that I received: that certain clothing items were selling incredibly well because they could be used for freeze attacks.
I have no idea if it’s true or not, but it does make a certain amount of sense. Freezing was turning into a legitimately horrendous problem in Home, and given the sheer frequency with which it used to take place, I’d be willing to believe there’s a correlation — particularly since, as soon as Sony patched the problem, clothing disappeared from the list.
Remember when the freezing hysteria was at its peak?
Again, I have no way of knowing if it’s true or not. Perhaps clothing, which was already on a sales decline, was simply muscled off the list due to high-profile gaming releases. On one hand, I never completely bought into the assertion that glitchers drove the vast majority of furniture sales in Home; on the other hand, it’s no crazier than Freakonomics’ assertion that legalized abortion is what finally ended the nation’s urban crime wave growth, because an entire generation of people who would have been born into such a high-risk environment simply never existed. I usually don’t give credence to unverified information that I receive — to consistently go down such a speculative road is irresponsible — but in this case it does make for an interesting theory, because Home users do tend to spend money on social meta-games of their own creation, even if this is slowly being replaced more and more with formal gaming experiences.
The larger issue here, though, is the complete lack of anything — aside from Lockwood tokens — that isn’t related to gaming or avatar movement on this list. And this makes sense; expanded avatar movements are the new market segment that isn’t supersaturated yet, and gaming has firmly taken root in Home as its primary method of monetizing over a long span of time. This is a somewhat polarizing point, but it can’t be ignored any longer. Regardless of your views on Home’s social-versus-gaming debate, the numbers don’t lie.
The real discussion that needs to take place — and we’ve covered this before — is what sort of game formula works best for monetizing the Home consumer base. Do you prefer cooperative or competitive games? Will you pay for a competitive advantage, and compete on an unfair playing field? Do you prefer consumables or permanent power-ups? How important is social interaction during gameplay itself? These questions, and more, need to be seriously examined as we conclude the year — because there are already some amazing projects in the works for 2013.
I, for one, am looking forward to what the new year brings. It feels like Home is finally starting to come into its own.
December 1st, 2012 by NorseGamer | 3 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.
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It’s no surprise to me that it’s tokens and baubles that are charting, and will continue to. As soon as you take away the true monetary value of the money you’re spending, people lose sight of how much things cost and what they’re really spending. Here: I’ll sell you 100 cat-fluff-balls for £2.99, and give you access to a catalogue of stuff priced in cat-fluff-balls so when someone asks how much you spent on that cute sofa with the kitty ears you’ll just ramble on about fur balls. Confuses to the point of price being irrelevant. I won’t buy any more Tycoon tokens, I got the smallest pack to get a car(coz I was sick of using the ambulance in limited time) and was crafty enough to squeeze two other add-ons outta that. But I just dont like the idea of consumables in Home much, I’d rather pay for a permanent ability or perk -- certainly wouldn’t rent anything. The thing I cant get past quite often is that nothing in Home exists as it is, so a non-existent item holds zero value for me in the long run, it’s only dependant on how much use/fun I’d get out of said item. Maybe because I’m a gamer, I’m used to earning such things in games within their own in-game currencies, and Home LOOKS like a game, that I still find the actual paying for stuff a bit of a bitter pill sometimes.
I’m gonna stop writing now since (yet again) Norse, one of your articles has got me jabbing at my phone rather than getting to work on time -- You’re bad for MY business Norse! LOL. Seriously though, you and I could talk about this stuff till TGE cows came Home I fear ; )
I think these stats are to be expected as the content releases in Home this past couple of months are almost exclusively either game or locomotion related. The midway and Lockwood tokens will always chart, that is obvious and it is good to see that Tycoon is making a splash too.
I think that Home needs to be a mix of both social and gaming to grow and thrive, and that is reflected here. I won’t be surprised to see Granzella get in on this months list with their skates, or Juggernaut with their hover boards either. Both of these are very popular now. I just hope that the developers realize that our avatars and what they can do in the social side is as important as the gaming, because when the rubber meets the road, even gamers in Home come here to talk to other gamers and meet with friends.
Nice read Norse, I think your right on the “money” with this one.
Hey! I’m there! I mean I bought things in the top ten list, 3 to be exact. Super flight is the obvious cheap way to get the speed bonus, beside the silly looking run. Tycoon was a sure hit on home. It’s the perfect casual gamer game. I never heard of the street move animation pack before I went to buy the “shame dad” outfit. Found out I could get 3 dances for a lower price than the outfit…
I dont like “tokens”, for the same reasons as KrazyFace and you (almost) always end up with unspent ones. (Wich is a good thing for the developpers) But they are a good way to to chart. You have dozens of items sold under 4 or 5 items.
N.B. Been a while since you granted us with your behavioral economics expertise Norse. Thanks for that one. We may be on “different side of the fence”
But I truly enjoy it. Marketing is a great way to understand the social aspect of something.