MSFS Addons pricing model...

[JNS 106]

18 minutes ago, ErichB said:

Economies of scale is one of the current advantages of the new sim.

You are correct, but even then, there are limits.

[bendead 1,085]

6 minutes ago, JNS said:

I think too many in this hobby want a lot, but don't really want to pay much for it

Well you can say that about pretty much everything. 

For me, about airport's addon, there is a psychological barrier, if it's under 10$ I might get 6-8 each month, but if it's over, I am going to be really picky and take the ones I will be using a lot, on FSX it was 1 airport every month or two.

About plane's addon it's different, the price does not matter as much, the complexity and innovation are the things I am looking the most, because I know I will use each one 50+ hours.

 

[ErichB 3,638]

9 minutes ago, JNS said:

You are correct, but even then, there are limits.

In general terms, it should result in lower prices for users.  We are seeing significant evidence of that.  For many years, the flightsim market has been focused on a niche set of users.    Overnight, flightsim has almost become mainstream which will have definite benefits for all

Edited September 22, 2020 by ErichB

[JBDB-MD80 1,470]

If you like the airport buy it if you plan to use it much, if not just move on no one is forcing anyone to buy anything.

Edited September 22, 2020 by jbdbow1970

[Elvensmith 165]

Going by previous versions of Flight Sim, my "ouch" threshold was £50 for study level stuff, like Level D or PMDG.
Intermediate stuff like Just Flight, £30.
Was never really interested in buying individual airports, taking the view you spend about 3 or 4 minutes there at either end of the flight, before they become a blur of pixels as you climb out. Global stuff OTOH was definitely de-rigeur for FS9 and FSX, both in terms of mesh and textures but can't see this being needed in FS20 with the default streaming terrain.

[F737MAX 5,552]

7 hours ago, toprob said:

I wonder what you are basing that on? I must admit I'm not a great businessman, but in my experience if I halve my price, I gain about 40% more sales -- so I end up with less. As I said, I'd love to have more customers through the new sim, and that may happen. If I do manage to double my customer base, then I look to see if I could tweak the price, but in 15 years I've always found the same sort of results.

If you don't mind a different perspective, the 15 years' selling experience you have was constrained by the flight sim hobby not only stagnating, but becoming ever more niche after the ACES studio was disbanded.

Simmarket isn't even close to being in the same league of exposure as Microsoft's own store.
Maybe worth talking to a few of the other scenery developers (if you haven't already) who have released a product for MSFS. Umberto / Virtuali at FSDreamteam has some interesting general sales numbers that he has shared on another similar thread.

Might also be worth listing either of your Nelson or Dunedin airport products at a much lower price once MSFS is released for Xbox to test the new market response. Obviously they won't be quite as popular as your Christchurch scenery, but you can get a feel what demand exists at a certain price point without losing the ability to make money on your most popular product.

Just my 2 cents.

[MatthewS 761]

1 hour ago, ErichB said:

Economies of scale is one of the current advantages of the new sim

My point in a nutshell. 🥜

[carlito777 712]

Developers have to get away from this ancient cost+ thinking of prices. Of course, you need to cover your costs and make a living. But in a sizeable market like MSFS you have to find the sweet spot in pricing to maximize your profits. Most likely you will get away with still charging the ridiculous P3D prices, because the enthusiast simmers will still buy airports even at those prices which in the end will somehow cover your costs and give you a decent profit. But what you should really do is to understand the relationship of price and demand. Most likely, developers can make much higher profits buy setting prices so that even the casual gamer buys the products. Selling 100,000 copies at $5 is much better than selling 3,000 at $30, because this is mainly a fixed cost business (plus some minor costs from support).

[Elvensmith 165]

What I pay for DLC will also be determined by the eventual stability and aesthetic of the core game, including the download and patching issues many are currently experiencing.

[steve310002 1,198]

I am in two minds regarding many of the addons airports we are seeing being released. Without a complete SDK, there are not too many 'cool' feature additions that one would expect in modern scenery payware addons in 2020 especially with how detailed MSFS already is. It has been more than a decade that we have had the likes of 'people flow' and 'nature flow' from Orbx but yet neither exist in MSFS sceneries they have so far released. It's the same with other details such as water puddles cannot be implemented on the ground scenery and issues with jetways in some scenery not working, or problems with terminal glass windows displaying in a weird way when it rains. 

When you buy addon scenery, it's for the details (at least for me) otherwise why bother? I see developers like Orbx rapidly releasing sceneries but with many of the standard features of before missing as per above. Sure, it is technically not their fault and due to SDK limits but it feels a little lacking compared to what we have previously seen accomplished in FSX in P3D and the quality often feels lacking compared with before (lower resolution textures ported over etc). Hopefully developers will update these existing releases for free when the SDK is complete but I fear we will see a 'version 2' pricing model in a couple of years which is probably built into their current strategy.

With the lower prices, I must admit I have bought several addons so far and happy to support quality developers (the best of which has been FSDreamteam's KORD). Definitely lower pricing is the way to go to increase sales volume especially since we are often missing 'wow' factors in the scenery like before (referring to the likes of people flow or nature flow etc.). I hope developers continue to up their game and that the SDK continues to be improved in a timely manner with Asobo listening to the needs of developers.

Edited September 22, 2020 by steve310002

[kaosfere 3,115]

5 hours ago, ErichB said:

Economies of scale is one of the current advantages of the new sim.

That's not what "economy of scale" means.  An economy of scale is the reduction in cost of production as the quantity produced rises.  An example would be getting a discount on some physical part when you buy it in bigger lots.  There is very little economy of scale in the production of relatively limited-market software.   You have a fixed cost that doesn't change much depending on how many you sell.  In fact, if you factor in the need for continued support after sale you probably have, overall, a negative economy of scale.

What we are talking about here is more a matter of the demand curve (how many people are willing to purchase a given commodity at a given price).    The amount you can decrease the price of a item is tied to where you are on the demand curve; if the demand curve is steep you can make a lot more sales with a small price reduction than you can when it is shallow.   The goal of every vendor to find the equilibrium point.

With the release of MSFS the demand curve has changed dramatically, moving upwards because of a larger market, and leftwards because of a "mainstream" vs "niche" market that's not as willing to pay high prices.  The thing is:  no one knows what the new shape is yet, that will take time to sort out.   It's even more complicated because as this is a very new market, and is likely to lose a lot of people over time, the shape of that curve is going to be continually changing for a while.

The amount to which developers change their prices in search of that equilibrium will be based on a combination of factors including their own tolerance for risk, their ability to absorb possible lost revenue, and their personal predictions on where the curve is headed.   At this point no one is "wrong", but the people who find it first will end up making a bit more money in the short term than those who follow the herd to it.

Edited September 22, 2020 by kaosfere

[ErichB 3,638]

2 hours ago, kaosfere said:

That's not what "economy of scale" means.  An economy of scale is the reduction in cost of production as the quantity produced rises.  An example would be getting a discount on some physical part when you buy it in bigger lots.  There is very little economy of scale in the production of relatively limited-market software.   You have a fixed cost that doesn't change much depending on how many you sell.  In fact, if you factor in the need for continued support after sale you probably have, overall, a negative economy of scale.

What we are talking about here is more a matter of the demand curve (how many people are willing to purchase a given commodity at a given price).    The amount you can decrease the price of a item is tied to where you are on the demand curve; if the demand curve is steep you can make a lot more sales with a small price reduction than you can when it is shallow.   The goal of every vendor to find the equilibrium point.

With the release of MSFS the demand curve has changed dramatically, moving upwards because of a larger market, and leftwards because of a "mainstream" vs "niche" market that's not as willing to pay high prices.  The thing is:  no one knows what the new shape is yet, that will take time to sort out.   It's even more complicated because as this is a very new market, and is likely to lose a lot of people over time, the shape of that curve is going to be continually changing for a while.

The amount to which developers change their prices in search of that equilibrium will be based on a combination of factors including their own tolerance for risk, their ability to absorb possible lost revenue, and their personal predictions on where the curve is headed.   At this point no one is "wrong", but the people who find it first will end up making a bit more money in the short term than those who follow the herd to it.

You are technically correct

[kaosfere 3,115]

18 minutes ago, ErichB said:

You are technically correct

"The best kind of correct."    😁

[Akila 39]

On 9/21/2020 at 5:26 AM, Mir // Flightbeam said:

The vast majority of MSFS users are casual players, and not AVSIM members. Most of them have no skills in piloting or knowing anything about aviation. That particular market thinks $15 for a mega airport, which takes around 1 year to develop, is too much to pay. 

 

do you feel that the quantity of sales in MSFS was significantly higher than previous Sim platforms? i am intrigued

[Chock 17,769]

On 9/21/2020 at 3:26 AM, Mir // Flightbeam said:

The vast majority of MSFS users are casual players, and not AVSIM members. Most of them have no skills in piloting or knowing anything about aviation. That particular market thinks $15 for a mega airport, which takes around 1 year to develop, is too much to pay. 

 

Not sure how you could know any of that about the vat majority of users without being psychic. That's just a guess, and whilst it's probably a reasonably good guess, you don't know it for sure at this point.

However, for anyone who actually is like that, they would probably not care about what jetway is at what ramp stand, and what taxiway is where and whether the lights are in the right place etc. So they'd probably think 50 pence is too much for an airport they 'have already got'. The default scenery, after all, does have a runway, and that's really all you need to land or take off, especially if you start on the runway and end the flight after you've managed to land on the runway or crashed. And chances are there'll be a freebie improvement anyway, or if not they could make one themselves with Dev Mode.

People who just want to fly around a bit will probably think starting up, loading, taxying out, taxying in and doing shutdowns etc is for nerds. Nothing wrong with that - to most people it is for nerds - not everyone likes the technical stuff. Some people just wanna kick the tires and light the fires, so what they'll be interested in, is an F-35 or an F-22 etc, which you can start with Control+E and which costs no more than a tenner. You might just possibly sell them an aircraft carrier scenery, maybe, but there's no way they're gonna buy an airport unless messing around with the sim triggers them into getting as hooked as people on Avsim are.