JoshGuru7
Golden Member
- Aug 18, 2001
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There are a couple of reasons why companies may want to push incoming cash flows out into the future when they could otherwise capture them now, but I don't think any of them apply here. Rather, the fact that the package gets better over time is a reflection of price discrimination.So with DLC approaches like this, it's almost like they're *encouraging* us to wait until it goes on sale rather than buy it Day One.
In their ideal situation they would just charge each individual person whatever that person was willing to pay. Outside of some sort of group auction that's not very feasible and so they try to capture the same effect by gradually making their offering better over time.
Generic "New content" price discrimination strategy:
Step 1: Launch at the highest price with the least features and sell it to all the consumers with high willingness to pay.
Step 2: Slightly reduce the price and add some features and sell it to the consumers with moderate willingness to pay.
Step 3: Drastically reduce the price and bundle it with as much already released content as possible, and hopefully get consumers with low willingness to pay to pull the trigger.
They really don't want consumers like you who might have bought in step 1 anticipating step 2 or step 3 and deciding to wait. Sales are not announced in advance and they never talk about long term pricing strategies at launch. You still pick up on the general trend but don't know exactly how long you're going to have to wait for as there are some titles that have held at steps 1 and 2 for many years, like Planescape Torment and Warcraft 3.
