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I thought I'd be interesting to see what people think based on the recent Ork pricing rumours. I'd also be curious to see what people would do from the company production end - if you could control prices, how would you price them, keeping in mind you want to make maximum long term profit?

Supply/demand seems a good (if rather traditional) one to me. Of course it has to allow a profit, or GW go under.

Demand for indivudual models can be manipulated by the game rules for the model, so 'in game value'and how 'many you are allowed' would feed into that. Costs of production probably affects supply, but bear in mind that GW have a lot of costs not directly covered in cost of production - like having brick and mortar shops, staff etc.

I'm actually fine with pricing "bands", where boxes of similar numbers of models go for similar prices. I'm also fine with paying a bit more for more detailed models (e.g., characters). I'm less fine with the pricing currently associated with GW's price tiers, but more because it creates a HUGE barrier to entry for new players, with overall negative effects on the hobby.

Is this a trick question? It has to be "Combination/other", because there's no way to account for demand with only one of those factors considered. As for what combination, it would likewise have to be "all," because they all affect how much demand there will be for a model/model set.

Posted By Zoned on 10/19/2007 12:47 PM

You need to clean up your poll. None of them have anything to do with free enterprise.

 

You especially missed the only one that counts.

"As much as the market will bear"

Only slightly on topic, buy personally I'd like to see some sort of DIY battleforce/battalion box.

If they ensured there was a good selection of plastics for each army, at least 1 troop and a 2 or 3 other slots covered then thye could allow us customers to make our own battleforces -  choose  4 plastics 'box sets' for an army, min 1 troop, max 1 vehicle/heavy and get that at the normal battleforce cost. saves customers a similar amount as now but allows them to get what they want.

e.g. I'm currently wanting a gaunt horde and a couple more fexes, (the apoc deal is to many). A diy battleforce with 3 gaunt boxes and a fex would be nice.

On the tau force I could switch the kroot and fish for another suit and a hammer head. Even firewariors and 4 suits would still save me some money.

They could even stop doing all the battleforces etc they do now and just stock some generic boxes to put your 4 choices in, that might save on inventory/packaging costs as well as shelf space.

I'm disappointed with GW pricing strategies/reasoning.

Armies in the game are so inconsistantly priced, that there really is no set price range for the hobby. A Saim Han Eldar army I would like to run is in the price range of $1200, which I argue is above the value I would get out of the models. You can also create a Skaven clan Eshin army out of a $40 box set of night runners, which seems almost unfair to the players of all other forces. There needs to be consistancy.

GW needs to consider the value customers get out of playing their game, and price accordingly. I am not saying this should be applied on a model by model basis (which is what they are currently doing). What I'm talking about is establishing the value most players assign to being able to play the game with:
a rather unflexible list - $300
a somewhat flexible list - $400
a wide selection of one faction - $600
This is considering the standard point values played. As a new player, those prices probably wouldnt be a barrier to entry, and as an existing player another $200 to flush out my faction would be tempting. Prices also fall more into line with competition from WM, etc.

GW needs to develop a budget, and create rules/model ranges that allow you to play that particular style and still stay within the budget. They charge over $40 for a Dreadnought, and make the dreadnought rules ineffectual for its impact in the game.

Problems:
GW doesn't include special weapons as part of box set sprues, which increases production costs and hammers the players' wallets.
Some forces would need to be revamped, or production methods changed to be based around making each army fit the price category. Just because one force is more elite, don't just charge more - give more extras and customization options in their kits.
GW wants to charge for rules by selling a rulebook, and also wants to charge for development costs on a model basis - they need to reign in their spending.

GW is competing with themselves. Producing a new sculpt for an existing model is no less expensive than creating a new sculpt for a new model. You won't sell as many of a model if some players are willing to keep the last edition version, and you also have unsold inventories to deal with. With an existing product line, model remakes should be reserved for real accomplishments, like the new Eldar DA and Wraithlord - you can sell those models to players that already own them, if you plan it right, they can be competatively priced at a value so people see a reason to rebuy models for a new look.

I'd expect GW to lose money when they produce ugly models, or go over production costs. Business works like that, they should lose money.  Producing models in quantities and with qualities that gamers desire should be the objective. It makes sense to sell a 3pack of falcons. It doesn't make sense to sell a 5pack of chaos marines (the value you get out of that box is lower than what you put in). 

I've stopped playing GW. I like the game, I think its a cool way to spend an afternoon on a weekend. If they had their pricing strategies in check, I'd play again. Problem is the armies I think are cool are ridiculously priced: Mech/bike eldar: $1200+, Unliving Idol Beast of Chaos: $800+, etc. Thats without variety. I don't think 600 would be outrageous for the actual product they have produced, and more competative companies such as Privateer Press have shown that its possible. 

Price to build and number in army.

Ah, apologies for my simplistic approach, in retrospect the poll is poorly worded. It should have gone along the line of "what should influence the price of models the most?" Clearly, it is never solely one factor or another but a combination. The "combination" option in the poll is for tough choices that were close to 50/50.

To jfrazell: I'm not an advanced student of economics. When you say "As much as the market will bear," do you mean GW should price their products as high as possible while still making accounting profit?

Posted By Zoned on 10/20/2007 6:30 PM
To jfrazell: I'm not an advanced student of economics. When you say "As much as the market will bear," do you mean GW should price their products as high as possible while still making accounting profit?

I suspect he means the point on the supply and demand curve where maximum profit is obtained.

Posted By Zoned on 10/20/2007 6:30 PM
Ah, apologies for my simplistic approach, in retrospect the poll is poorly worded. It should have gone along the line of "what should influence the price of models the most?" Clearly, it is never solely one factor or another but a combination. The "combination" option in the poll is for tough choices that were close to 50/50.

To jfrazell: I'm not an advanced student of economics. When you say "As much as the market will bear," do you mean GW should price their products as high as possible while still making accounting profit?

     I think the rub is the word "should". What does that mean. Why does what I think they should be priced matter? The only logical choice is the most they can get and still sell models. I mean, if you asked me, or any one of you I'm sure, the correct answer is low enough so I can buy all the models I want and not have to think about it. But that just isnt the way the ball bounces.

Posted By Keldrin on 10/19/2007 2:56 PM

I'm disappointed with GW pricing strategies/reasoning.

Armies in the game are so inconsistantly priced, that there really is no set price range for the hobby. A Saim Han Eldar army I would like to run is in the price range of $1200, which I argue is above the value I would get out of the models. You can also create a Skaven clan Eshin army out of a $40 box set of night runners, which seems almost unfair to the players of all other forces. There needs to be consistancy.

GW needs to consider the value customers get out of playing their game, and price accordingly. I am not saying this should be applied on a model by model basis (which is what they are currently doing). What I'm talking about is establishing the value most players assign to being able to play the game with:
a rather unflexible list - $300
a somewhat flexible list - $400
a wide selection of one faction - $600
This is considering the standard point values played. As a new player, those prices probably wouldnt be a barrier to entry, and as an existing player another $200 to flush out my faction would be tempting. Prices also fall more into line with competition from WM, etc.

GW needs to develop a budget, and create rules/model ranges that allow you to play that particular style and still stay within the budget. They charge over $40 for a Dreadnought, and make the dreadnought rules ineffectual for its impact in the game.

Problems:
GW doesn't include special weapons as part of box set sprues, which increases production costs and hammers the players' wallets.
Some forces would need to be revamped, or production methods changed to be based around making each army fit the price category. Just because one force is more elite, don't just charge more - give more extras and customization options in their kits.
GW wants to charge for rules by selling a rulebook, and also wants to charge for development costs on a model basis - they need to reign in their spending.

GW is competing with themselves. Producing a new sculpt for an existing model is no less expensive than creating a new sculpt for a new model. You won't sell as many of a model if some players are willing to keep the last edition version, and you also have unsold inventories to deal with. With an existing product line, model remakes should be reserved for real accomplishments, like the new Eldar DA and Wraithlord - you can sell those models to players that already own them, if you plan it right, they can be competatively priced at a value so people see a reason to rebuy models for a new look.

I'd expect GW to lose money when they produce ugly models, or go over production costs. Business works like that, they should lose money.  Producing models in quantities and with qualities that gamers desire should be the objective. It makes sense to sell a 3pack of falcons. It doesn't make sense to sell a 5pack of chaos marines (the value you get out of that box is lower than what you put in). 

I've stopped playing GW. I like the game, I think its a cool way to spend an afternoon on a weekend. If they had their pricing strategies in check, I'd play again. Problem is the armies I think are cool are ridiculously priced: Mech/bike eldar: $1200+, Unliving Idol Beast of Chaos: $800+, etc. Thats without variety. I don't think 600 would be outrageous for the actual product they have produced, and more competative companies such as Privateer Press have shown that its possible. 

I think Corvettes are cool....I wouldn't say they areridiculously priced, but they are too expensive for me. I just accept that I can't afford one, and either will be happy with my lil ford, or save up and get a better job so I can afford one. That's how life works.

You are asking for the company to make an unrealistic judgment call on pricing. If it costs them 5 bucks to make a jetbike, and they sell it for 10, to make a small profit, but YOU say that the value of the models ( to you) is only 4 dollars....do you expect them to say, oh yes, thats what we should price them then?

And your comparison to PP prices and GW prices doesn't work....I've looked at both, and posted comparisons. PP ends up, model for model, except for certain character models, to be alot more expensive.

Hate to say it, but some people need to realize that....well....not everyone is born equal, and will have equal access to all things. Not everyone will be able to afford GW games. Just like not everyone will be able to afford a Corvette. Getting angry at GW because of that is wasted energy. I'm sure GW has its target audience...And as a niche business, it doesn't necessarily mean that audience is a broad one.

 

Furthermore that is the reason right there that I run mostly infantry instead of mechanized Eldar, at least right now. Its the price. Sure, I would like it if I could pick up wave serpents at 10 per, but that isnt really reasonable.

>>You are asking for the company to make an unrealistic judgment call on pricing. If it costs them 5 bucks to make a jetbike, and they sell it for 10, to make a small profit, but YOU say that the value of the models ( to you) is only 4 dollars....do you expect them to say, oh yes, thats what we should price them then?

The company doesn't have to make a profit on each model or box sold. It is a valid strategy to price introductory boxes as loss leaders -- that is they cost more to make than their price -- the idea is that after buying the intro product users will go on to buy profitable extras. This is the way the videogames and razor industries work.

Another part of GW's job is to make sure players *do* think a jetbike is worth $10 not $4. This is difficult as some players appreciate the modelling and others the combat effectiveness. There is no accounting for aesthetic judgement, but you could expect the more powerful units are more expensive, rubbish units that are expensive (Tau Space Pope) sell less well.

Certain models can be mode more expensive because they are semi-compulsory. For example, the Tau Commander is a standard battlesuit with an extra pack of metal parts. Since it is compulsory to have a battlesuited commander as your Tau HQ, many players will choose the Commander set (£15) in preference to the standard suit (£12.)

Posted By Kilkrazy on 10/22/2007 5:27 AM
>>You are asking for the company to make an unrealistic judgment call on pricing. If it costs them 5 bucks to make a jetbike, and they sell it for 10, to make a small profit, but YOU say that the value of the models ( to you) is only 4 dollars....do you expect them to say, oh yes, thats what we should price them then?

The company doesn't have to make a profit on each model or box sold. It is a valid strategy to price introductory boxes as loss leaders -- that is they cost more to make than their price -- the idea is that after buying the intro product users will go on to buy profitable extras. This is the way the videogames and razor industries work.

I hadn't thought about that....I wonder if that is how GW is doing the box sets..are they giving you the razor to sell you razor blades essentially? For that matter, does anyone know what it costs to produce a model? I imagine that is complicated because once you have the original already made and have the molds and what not set up I imagine it is very cheap, it is that initial cost that I am sure is great, particularly for plastics.

I think the boxed sets (Battle for Macragge) are quite expensive given the content. So I don't believe the razor balde theory in this case. It is a valid strategy though.

The production cost of a model is very difficult to calculate. It's not just the 3p of plastic, 2p of packaging and 5p of electricity, it's also how much should be allocated from the £5,000,000 per year of executive pension fund contributions.

In general metal figures are cheaper to set up but more expensive to produce individually because of the moulding techniques and materials.

The setup costs on plastic are high but the cost per unit is low.

Ok, a follow up question. Is it fair that armies that need more models to play pay a higher price than armies that need fewer models? For example, the Space Marine 10 man squad box costs $45 Canadian. I get ~165pts for $45. The current 10 man Guardian box is the same price, and averages out to ~100pts.

On one hand, the Eldar player will probably have to shell out more money to play the same size game.
On the other hand, at the same size game, the Eldar player literally has more models (they paid more, but they have more product to show for it.)

I know that the Eldar could easily take Dire Avengers and that would be closer to how many points the Space Marines gets, but that's not the point. If I like Guardians, or I like Ork Shoota boyz, I'm going to have to pay more to play. Is that fair? Or is fair subjective?

Posted By Asmodai on 10/20/2007 10:57 PM

Posted By Zoned on 10/20/2007 6:30 PM
To jfrazell: I'm not an advanced student of economics. When you say "As much as the market will bear," do you mean GW should price their products as high as possible while still making accounting profit?

I suspect he means the point on the supply and demand curve where maximum profit is obtained.

Yes. There are two approaches here. The mercedes approach. Charge an obscene amount and get high margins per item, or inversely the Walmart approach-charge minimal margin for high production items.

 

In this market if I were GW it'd be the Mercedes approach, unfortunately.

Posted By Zoned on 10/22/2007 8:58 AM
Ok, a follow up question. Is it fair that armies that need more models to play pay a higher price than armies that need fewer models? For example, the Space Marine 10 man squad box costs $45 Canadian. I get ~165pts for $45. The current 10 man Guardian box is the same price, and averages out to ~100pts.

On one hand, the Eldar player will probably have to shell out more money to play the same size game.
On the other hand, at the same size game, the Eldar player literally has more models (they paid more, but they have more product to show for it.)

I know that the Eldar could easily take Dire Avengers and that would be closer to how many points the Space Marines gets, but that's not the point. If I like Guardians, or I like Ork Shoota boyz, I'm going to have to pay more to play. Is that fair? Or is fair subjective?

      Its not a different question unfortunately. No, its not fair. I know this being a horde Eldar player. If you want to play certain armies, you're just going to have to accept the fact that you're going to be paying more.

Posted By Zoned on 10/22/2007 8:58 AM
Ok, a follow up question. Is it fair that armies that need more models to play pay a higher price than armies that need fewer models? For example, the Space Marine 10 man squad box costs $45 Canadian. I get ~165pts for $45. The current 10 man Guardian box is the same price, and averages out to ~100pts.

On one hand, the Eldar player will probably have to shell out more money to play the same size game.
On the other hand, at the same size game, the Eldar player literally has more models (they paid more, but they have more product to show for it.)

I know that the Eldar could easily take Dire Avengers and that would be closer to how many points the Space Marines gets, but that's not the point. If I like Guardians, or I like Ork Shoota boyz, I'm going to have to pay more to play. Is that fair? Or is fair subjective?

In theory the expensive Eldar army has more models in it and is therefore harder to kill.

In practice it may not not work out like that due to T, A and point costs, etc, plus you shoot at squads not models in most cases.

To jfrazell: I don't know if it's an "unfortunate" thing if you take the mercedes approach. Like the market for mercedes, this hobby is a niche one. There is no point appealing to the masses since not everyone (and in actuality few,) people are into building, painting, and playing with model soldiers. Taking the high margin approach is probably the only intelligent choice. Now, whether or not GW has priced themselves too high is a different story.

Sometimes horder players have to look at it the other way around. Space Marine models are nice. But I think the Ork boyz are even cooler, and I get 6 more models in the current box! Take that!

I get a bit testy when I look at some of GW's pricing decisions. LotR: a Captain of Arnor & Standard Bearer blister will set you back $12 US for two metal figures; while an Arathorn & Halbarad blister, again, two metal figures, will cost you $20.

Are Arathorn & Halbarad more detailed, harder to sculpt, or larger? No. In fact, the command blister actually contains more pewter, due to the banner. The important difference between these two blisters is, a player will probably only need one model of either Arathorn or Halbarad in his army, while he could conceiveably use several of the command blisters. So GW is charging more for the models they will sell fewer of.

I'm sure it is the intelligent thing to do on their part, but it is costing me $8 for something that is intangible, subject to change at GW's whim.

Well, it isn't quite as arbitrary as that. Arathorn and Halbarad, if they're expected to sell in smaller quantities, will cost GW more, since they still need to spend the same amount on design and creating the molds regardless of how many sets they're producing. Still, I understand that the initial outlay on metal models is relatively low, so it probably shouldn't be 67% more expensive. . . .

...unless GW can somehow determine that Arathorn and Halbarad will be purchased 67% less than Cap and Std of Arnor if the prices were equal. But that does seem rather arbitrary, doesn't it? It's be interesting if they had some statistical data about buying tendencies.

Well, they'd have to be purchased 59.8% less, actually, and that only if the marginal cost of each set were nil.

Like I said, I'm sure it's the intelligent thing for them to do. I really hope they've got economists and marketing specialists working diligently to set the prices at the proper point on the profit/loss margin curve. Really I do.

Not some guy who says, hey, the roolz for this mini are the xXxRoxxoRxXx!!! so lets price him higher than the other minis!!!