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Think Before You Bundle
by Josh Fairhurst on 07/10/14 01:27:00 pm   Featured Blogs

The following blog post, unless otherwise noted, was written by a member of Gamasutra’s community.
The thoughts and opinions expressed are those of the writer and not Gamasutra or its parent company.

 

Hi [Insert Developer Name Here],

            We really like [Insert Game Name Here] and would love to include it in our upcoming bundle over at [Insert Bundle Site Here].

If you’ve recently released a game on Steam, chances are high that you - or someone else on your team - have received an email that starts out like this. While bundles are a great way to generate interest and fast cash off of your titles, I’d strongly recommend due diligence and research before agreeing to be included in any bundle.

Since I started Mighty Rabbit Studios in 2010, we have developed and released two games: Saturday Morning RPG and Breach & Clear. Both games have since been released on Steam and have performed wildly different in terms of sales. While this can be explained by a number of factors (Saturday Morning RPG is super niche while B&C is not, etc.), one of the key factors Saturday Morning RPG is not selling well is because we bundled it too early with sites that did not have our best interests in mind – which leads me to why I am making this post: developers need to seriously consider all the ramifications of bundling. I’m sure there is plenty who do this already – but I’m also sure there are plenty of people out there like myself, who would jump at any opportunity to spur revenue.

Saturday Morning RPG has been in four bundles: Indie Royale, Groupees, Indie Gala, and Blink Bundle. Each bundle has their own benefits, but only one of them has a serious flaw that I was totally blind to:

Indie Gala

When I was approached to include Saturday Morning RPG in Indie Gala it seemed like a wonderful opportunity. From what I had seen, Indie Gala was consistently the second highest grossing bundle out there – behind Humble Bundle, the golden standard of bundles. There is a reason for this: Indie Gala’s model panders to third-party resellers. This is bad. Like, really bad. It will absolutely kill your game’s long-term saleability.  Third-party resellers are effectively the seedy black market of Steam keys – they will sell keys for your game without your knowledge, at a fraction of your Steam price. Many times these prices will only be pennies on the dollar of your original price – which reflects how little they paid for the keys in the first place.

You see, Indie Gala has this thing called “Happy Hour” where to spur sales they allow 2-for-1 deals on keys. Pledge the minimum $1 and you’ll get two keys for each game instead of one.  Sometimes the happy hour deals will even yield 4-for-1 deals instead of the usual 2-for-1. On top of that, Indie Gala offers tiered “gifting” which allows you to buy multiple copies of the bundle at progressively lower prices, the more you buy. This is perfect for resellers looking to get a couple hundred, or even thousand keys. Especially when the tiered gifts get crazy cheap during happy hour (these offers stack!). Oddly enough, Indie Gala’s happy hour actually lasts eight to ten hours and sometimes arbitrarily longer. It will occur multiple times throughout the bundle, so there is almost no chance customers/resellers will miss it.

After all was said and done, we made approximately $0.09 per copy of Saturday Morning RPG sold during Indie Gala. I knew the per copy yield wouldn’t be high going into the bundle, but what I did not predict was the long term effect resellers would have on the game.

After we were in Indie Gala, sales on Steam flat lined – our only way to generate sales at this point is to discount the game. It simply can’t sell at MSRP any more. One simple decision to be in a bundle permanently destroyed our sales. Four months after the bundle, sales still haven’t recovered due to the bundle and the easy availability of the game through resellers certainly isn’t helping. Saturday Morning RPG had a small market to begin with, and the few people who were buying it are savvy enough to search outside of Steam for better deals.

The core problem is that Indie Gala is not designed with the developer’s best interests in mind. It’s designed to make money, which is sensible, but when most of that money comes from resellers – it’s hard to argue any benefit to the developers. Humble Bundle actively changed their system to fight resellers, which is absolutely commendable considering their revenue took a huge nosedive after the change (which I believe occurred after the WB bundle). They are protecting developer interests above all else – something all bundles should do.

When you are asked to be in a bundle, make sure that your interests are protected. The quick cash and instant exposure is good, but consider the potential long-term costs. Don’t make the mistake I did and send your own game to the bargain bin way ahead of its time.

 


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Comments


Isaac Nichols
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Wow, I didn't realize the people purchasing bundles are reselling steam keys. Thanks for the post!

Jonathan Brodsky
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I am pretty sure that you can Cease and Desist those 3rd party key resellers. My understanding owning a steam key does not give you the right to resell the steam key, that requires a distribution deal with the game owner. We have yet to engage in sending out C&Ds to these resellers, but I know of at least one other indie that has done it and had good results.

Christian Nutt
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Some interesting conversation about this popped up on Twitter as Gamasutra-affiliated people began to post this one...

https://twitter.com/simoncarless/status/487666062222032896

https://twitter.com/RaveofRavendale/status/487666432508182529

Read both threads, is my advice!

Simon Carless
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FWIW - I do think that some of those 'Happy Hour'-like bundle behaviors - and very low minimums on bundle purchases - do end up with Steam key re-sellers buying a LOT of keys.

But on the other hand: a) IndieGala doesn't work on a key system any more, somebody pointed out on Twitter, so that helps going forward. b) The 'long tail' of Steam game sales may be almost this 'bad' anyway, other people pointed out on Twitter.

[Disclaimer: As well as helping to run Gamasutra, I was a previous co-runner of Indie Royale, and Indie Gala was a rival at the time.]

Robert Fearon
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It's also kinda telling how little bundling did for sales looking at that graph. As you're fully aware one of the earlier benefits was an uptick in promotion and in sales as well as a bit of cash quickly, that's not really been a thing outside Hundles for a while now and the cash to dev has tanked a lot also from the numbers I've seen. Annnd of course, with stuff like Kiss we've got middle men punting stuff into bundles just to make things really messy.

I think right now we just need a lot more discussion on when and where bundling is the right thing to do. I have a lot of time and respect for the way IR used to be a nice incentive for bringing XBLIG stuff and the like into the limelight a tad so it performed a nice (and welcome) secondary function there too. Now pretty much everywhere non-Humble seems to be a lot more just making up the numbers and prodding devs before they're even on Steam to keep the system ticking over so I'm struggling to see the benefits beyond the quick cash hit.

Which isn't to understate how important that cash hit can be for some folks, naturally. But yeah, more talk on what can go wrong/right and when people feel is the right time to throw your work in one. I suggested Mike cobble something together earlier but I'd forgotten the whole IR links but maybe someone else could take up the mantle and run with that.

Casey Blakeney
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Coordinator of Blink Bundle here.

I do think the promotion aspect of the non-Humble bundle market is probably exaggerated. That's why I don't really go out of my way to up sell it. Other than a few outliers the evidence just isn't really there to make promotion a main selling point for developers to bundle. You'll usually see a fair amount of people "playing" the titles during the run of the bundle, but often they are games that have the trading card feature included. So even that bump in numbers can be misleading.

I think this has become more true as the price of bundles has dropped. Not only are there more resellers picking up bundles, but also you get more bundle buyers that are in that +1 to their Steam library group, or those with excessive backlogs that maybe one day will play the game.

With regards to original post and related comments about resellers I think the effect of game links tends to be a bit exaggerated as well. By itself it doesn't solve a problem, since many resellers still actively buy bundles including them. It's only certain sites that have discontinued them being being.

That said...they can be effective as part of an overall strategy to protect your participating developers as best you can. Part of it is simply making it more aggravating for the resellers to exploit. Limiting the amount of purchases in an hour and limiting the overall amount of bundles a buyer can purchase is part of that. Making it so they have to purchase one at a time is also another way. There are many ways to address it. Obviously without taking your actions too far, so that you don't aggravate genuine customers in the process.

But to be honest if a reseller can purchase 10-12 games for $1 or $2 then the chances of any strategy being effective is extremely unlikely. Resellers will evade a lot of barriers for that kind of potential for profit. The lower the price per game gets the more attractive it becomes to the reseller market.

Josh Fairhurst
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To be fair, Saturday Morning RPG was bundled in Indie Gala back in March - it still worked on a key based system at that point. I was not aware that it had changed; however, there's new bundle sites popping up daily that still work on a key system. It's worthwhile for anyone considering being in a bundle to research whether the site caters to resellers or not.

As for the long term sales of Steam games, I had intended to show Breach & Clear's sales vs. Saturday Morning RPG's. Breach & Clear hasn't bottomed out since it released in March. Since then it has only been in one bundle (Humble Bundle). The problem with doing that was that comparing the two is an apples to oranges situation in terms of the games' differing target audiences. I don't have any way to conclusively and definitively say that bundling killed Saturday Morning RPG's sales, but I can say without a doubt that it didn't really help.

Sebastian Gioseffi
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I join in to thank you for sharing. Very insightful article indeed.

Jasson McMorris
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Thanks for the article! This is definitely really interesting since I've been contacted by many of these mentioned bundle sites.

I did want to respond to those who saying that the sales were going to flatline anyways (Twitter). Having sales drop to 2-3 a day instead of 10-15 a day, while still low, makes a huge difference when talking long term.

Ana Morgan
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We just did a Groupees bundle with our game and we're still trying to decide whether it was a good idea. One problem is that Groupees only shows the number of bundles sold, not the actual sum, so it comes down to trusting them to be fair with how much money goes to the developers.

But now they we got Greenlit, we probably won't be doing another bundle any time soon. Only discounts on Steam, IGS and Itch.io.

About people reselling Steam keys they bought for nothing, yeah, that's nasty. But then our game is DRM free, people could go around selling it anyway. Not sure it's worth the time and effort to track these folks down and try to make them stop. We just have to rely on people who understand that the more money goes to the developers, the better the games they make.

Josh Fairhurst
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It's unfortunate, but bundles are pretty much the only way for smaller (or niche) games to get through Greenlight and on to Steam. If Groupees lead to your game getting through Greenlight, it was probably a solid idea. You've inevitably cannibalized some sales you could have gotten on Steam, but who knows when/if you would have gotten through Greenlight without the bundle.

Alex Van de Weyer
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This is more than a little unfair on Indie Gala, who for months now link directly to Steam and don't give out keys - this criticism is surely out of date? Almost every Bundle site that I've ever come across has worked on some sort of key system at first, so I don't see why Indie Gala deserve special criticism for using what was the best system available for a long time.

On the graph I would have to conclude that the bundle didn't affect the overall trend in Steam sales. To say the game wouldn't sell outside of sales after the bundle is surely a little misleading, because each game on the same trajectory would have the same problem I would think. There is no evidence there that the bundling had anything to do with it. It's also a little disingenuous because as it was mentioned there wasn't just one bundle, there were four at varying times - shouldn't they be plotted on the graph as well?

Robert Fearon
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An interesting question would be to ask whether them shifting to Steam auth instead of keys is related to what's discussed in this post and how. Y'know, rather than trying to work out whether someone is being "fair" to a company.

Given that unlike Humble who we're keen to stamp down on people buying in bulk to resell, IG have promoted opportunities to do so unlike every other bundler out there, it seems a stark turn of events to throw that away and change after so long. Let's remember that the "happy hours" on IndieGala WERE like nothing else other bundlers we're doing, THIS is why they get special consideration. No other bundler offered multiple sets of keys at a reduced rate, no other bundler had a "don't buy more than 2,000 keys" note to go alongside that. With a difference like that, yeah, we should look at how that effects game sales and the market in general and how and why this is different to other stores.

Even if they're no longer running with the key system, the ripples of when they were still effect people, right?

Alex Van de Weyer
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I agree with everything you say there. But surely guidance to developers on Indie Gala should be updated with the way the system currently works? Discussing the effect of what their system was 12 months ago isn't of as much use.

I remain unconvinced, even with the reseller issue, that bundles have any great effect on other sales. It would be nice to be able to prove one way or the other, as I feel the graph as supplied doesn't really tell the story that the article wants to suggest.

Robert Fearon
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It depends what sort of use you want from information, I guess. Personally, every experience and slither of information someone puts out there even if it's an imperfect assessment is another piece of information that can help people make sense of things. The more information and experiences we can get out there to the public, the more we can get closer to a good assessment of what happened and what is happening with something.

Historical information like this is valuable.

The effects of something like this won't just apply to a single developer and the effects don't just disappear overnight. Maybe there's someone else sitting there scratching their head over some figures post bundle and this helps them put things into perspective. Maybe someone else has identified a similar thing but for them it was a positive experience and they want to come out and talk about that. Or maybe it's just awful all round or indeed, much of a nothing. If people don't speak out on it, we'll never know.

I honestly can't agree with the idea that bundles won't have an effect on other sales. We know that for a while, bundling had a positive effect on other sales. If that's a feasible and documented scenario (which it is), it's entirely possible for that to a) not be an across the board experience and b) to go in the opposite direction too. So again, more people speaking out helps us work this stuff out and give us an idea of the reality aaand we need stuff to contrast against. Then and now.

Does the graph tell the full story? No, I don't think it does. Does it prove anything? Well, no. It's a graph of sales and selling games is more complex which is why we need as much context and information as possible. Were things flatlining already? It looks that way. As Jasson McMorris points out earlier though, a drop of 10 copies on a low selling game makes a massive difference to you when it comes to counting the pennies. When it comes to a graph like this? It barely registers.

Josh Fairhurst
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We were in IG back in March, and at that point it was still key based and heavily targeted at resellers. It's refreshing to hear that IG has changed their system. Unfortunately, though, there's new bundle sites popping up all the time that still use key based systems. I was a bit unfair towards Indie Gala and I should have concluded in a way that was more clear - Indie Gala or otherwise, developers need to take the time to research ANY bundle site to make sure the site has their best interests in mind.

As for the other bundles - IR and Groupees happened pre-Steam, which we had to do to get through Greenlight. Blink Bundle happened during the big "Full Price" flatline before the summer sale. Our sales were pretty dead at that point. Indie Gala was our first "on Steam" bundle.

Felipe Budinich
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Considering that the average user on facebook has 100 "friends" it seems unlikely to me that someone would need to buy more than 200 keys.

I usualy buy ~10 if I like a bundle, as I hand them out to my students, but 100 keys? that must a tiny fraction of users.

It would be nice if bizdevs from the bundle sites shared user metrics, to see which % of users buy more than 100 keys.

Ron Dippold
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Humble Bundle refused to let me buy 10 copies of Mountain (at full price, a spendy $1 each) to give out to friends - I guess this is the reason, eh?

Austin Farmer
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Really great article, I'd never even thought about this before. I'm glad I read it.

Kenneth Blaney
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A really important topic, especially since any "The Indie Bubble is Popping" story isn't complete without a "because of bundles" line. There is a lot of hand wringing here about "was it worth it" but few people seem to be actually looking to answer that question (or, at least, sharing how they plan to answer the question). Actually, we can answer this question:

First, we must estimate what our total sales would have been without the bundle from a certain point on (excluding sales and promotions). For a certain amount of simplicity, we can model that with an exponential decay formula (a*e^(kt) where k < 0, a is the current sales and t is days) and then take the integral from 0 to the number of days until you stop selling your game at that price. Multiply that number of sales by the average income per sale. This gives you an estimate for the average value left in your sales.

Now, people here have commented that their sales have been cut in third (ish) so we simply apply the same process to "a/3 *e^(kt)". The difference between these two numbers is the income lost to eventual full price sales. If the money from the bundle is more than that difference, then the bundle was a good idea. If it is less, the bundle was a bad idea.

Clearly, it would be a good idea to know in advance whether or not working with a bundle is a good idea. As such, you could run these hypothetical calculations on your current numbers and then compare that to the (usually available, perhaps upon request) data about the average income from bundles. This, of course, discounts the value of anything like exposure you may gain from being in a bundle (likes on FB, subscribers to your newsletter, followers on Twitter... all of these have value), so you may still opt to take a small loss even after this formula if you want to effectively purchase advertising.

simon jones
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I think the evidence is inconclusive. Looks like sales were already heading downwards and it didn't sell much even at Indie Gala's low prices.


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