Excluding the obvious. To the consumer, lower prices for the same product is always better. The problem here is that some publishers (*cof* EA *cof*) was saying that franchise value is diminished by sales that Steam organize.
If you don’t play on PC or don’t know what I’m talking about here’s the short version: Valve’s online shop (Valve developed Half-Life, Team Fortress 2 and Portal), so-called Steam (http://store.steampowered.com) promote sales with price cuts up to 90% to some titles. These sales happen usually twice per year: at Christmas and at the American summer (Note: In the other half of the world it’s winter in June/July). The discussion comes from that.
I’m forced to come here and say that these sales do exactly the opposite. They improve franchises’ values. Of course these older games will be sold for less money, but this comes with many advantages.
First point is that a larger numbers of people will play the previous games of franchises that are still active. A fact that should be understood and known nowadays is that, in the entertainment world, the best marketing tool for your product is the product itself. For franchises this is true for their previous titles. That’s why franchises are so “safe”. People know the previous work and are comfortable betting on something they already know. This generates a problem with innovation in this industry but this is not important now.
One of the results of this is that the number of people willing to buy new titles from that franchise increase. After all, the number of people that know and like that franchise increase due to more accessible prices to know that universe.
Other advantage of these sales is to set “AAA” games prices to the same level of casual games. It was proofed countless times that there is a larger number of people that is willing to pay the smaller, casual price. This may well be the entering point for casual consumers of videogames that start to look for the next level of dedication. There is no nature’s law that states that “hardcore” players never where casual. And I believe this kind of new blood influx will be larger and larger and we will just win with the industry’s growth in that way.
Finally, the best reason for these sales is to enable the possibility of testing and helping Indie developers buying their games for even lower prices, even more than usual. Here the reasoning is the same as franchises, but with the entire Indie market. Once people is captivated by indie games and some prejudices are destroyed it becomes easier to sell other indie games to these people. Personal experience.
And if you don’t accept my logic just read this interview ( http://www.eurogamer.net/articles/2012-07-11-valve-counters-eas-steam-sales-cheapen-intellectual-property-accusation ) where Jason Holtman, business development chief from Valve, states that this movement is positive but don’t explain why. If you need more here comes something stronger: This is the fourth or fifth time that Steam is doing this sale week. And they can only change game prices with developers’ authorization. If this was bad for business, do you really believe that developers would enable this practice? Yep, I don’t believe so either.
This is a reprint from http://cmdredem.tumblr.com/post/27175775457/why-steam-sales-are-good