Are you hoping for a hit?

It IS like that on steam, it's just called Early Access.

I'm pretty sure Unity will have a store at some point. I know they will because I said so!

 

Probably depends on how popular it was. How many assets are there in comparison to how many games there are on Steam?

 

Good point, I'm guessing there are less assets than games. Though less customers too.

Although, a single person can have make more assets than games in a year. Maybe the key is making a lot of whatever you do.

Soo.... put games on early access ... and keep them there forever? So that's the secret!

 

Most indie devs would be satisfied making enough money to live on so they can continue making games, but the game market is hit driven. To have any chance of making money, you almost need to try for a indie level hit. By hit, that would mean decent pre-launch buzz and significant day one sales. If you don't have that, Steam automatically buries your game to prevent it from being shown. After the initial launch, Steam's algorithms automatically decide what to do with your game.

 

You still need to apply to the costs the amount of time you spent * by an hourly rate, as well as any software licensing costs, server hosting fees. Github etc.

All these in total represent the true cost of the product's development.

 

That's only if you assume you would/could have been making said money in those lost hours which doesn't apply for everyone

 

Nope, development costs are development costs. Got nothing to do with whether you 'could have been making money' or not.

What defines if I could have been making money? Must the hours be between 9-5 on a weekday? What if I'm self employed, which hours could I have been making money, if I sometimes work weekends? There is no hard metric for could/would have been making money.

A better metric is to apply an hourly cost to each hour worked on the project. If you ever go for investment, you have something tangible to work with.

 

What I want to make is a game that I am proud of, a game that I enjoy playing myself. Ideally, at least a small group of players enjoy the game, look forward to further developments, and support my work enough to keep me motivated to keep creating for something more than myself.

I'd like expand a small niche of games (not even sure what the genre is called, nature games? As far as I know, the only similar game is Wolf Quest) and make it a little more popular, and donate profits to a relevant wildlife charity.

 

Surely this comes down to opportunity cost? If I'm putting in an hour each day whilst chilling on the couch I could hardly call that a cost

 

I see your point but 40K sales is pretty much 500K $, yes is not a 20M hit but you could work from that point with such a relax that while won´t retire you could do games in such a relaxed mood that would almost be no effort but joy. But for me a total hit would be from 1-2M and UP and well, while I hope it to happen, I would be fullfilled with 0.5M "hit".

 

Only if these costs actually exist in a project would I agree, but again each person WILL have a different cost value to their project.

The real hard part is deciding how much to charge for your product?

Should a developer go with cheap and hope for large volume or costly and hope for a small dedicated niche (that's actually a good question for a new thread)?

The truth is the real costs and price value should be decided upon before one line of code is written. How much money are you going to spend to produce the game and how much monetary value do you feel it is worth to the consumer?

Do you budget 500 bucks or 50,000 dollars?

Is your game value $5.99 or is it $59.99?

Those are the questions we should be asking ourselves.

 

For indie games, US$59.99 is too much for the market. The US$59.99 price point is reserved for big budget AAA titles. Small indie games need to try for somewhere between US$0.99 and US$19.99. Larger indie projects can find success at the US$19.99 to US$29.99 range.

 

When you're working on your own project, your hourly rate is zero dollars per hour. Because you aren't paying yourself. There is no lost opportunity cost because you consciously choose not to utilize the opportunity.

To estimate how much you need to recoup via sales, you need to use your expenses for the duration of development. And it makes sense to to keep those low. Basically - apartment cost, server cost, software number, food cost at the point where you don't starve to death.

However, if this target number divided by number of copies you want to sell results in a very high pricepoint ($60 for an indie infinite runner), people will pan the game, and will refuse to buy it. In which case developer still is going to end in red.

So the correct idea woudl be (probably) to decide pricepoint, and then calculate required number of copies to sell to recoup expenses. Then attempt to reach that number.

This only applies if your game is the only source of your income. If the developer has primary work that keeps him or her fed, then the making of the game is a hobby that devours money rather than generating it. In this case development costs either do not apply (because they were wasted from other money sources), or the only cost of the development is server costs or prices for services like github, and even that is doubtful.

 

Opportunity cost is specifically the cost of lost opportunities as a result of a choice, though. So, if you could have been earning $40/hr and you instead choose to stay home and work on your own stuff then the opportunity cost of that choice is $40/hr. (Edit: To clarify, it's $40 for every hour you could have earned $40, not for every hour you put in.)

Whether you call it "opportunity cost" or something else, it's still a thing worth considering.

That's for a "break even" recoupment on outgoings only. It doesn't account for the difference in net position compared to taking other courses of action.

If you have a job where you're earning $40/hr, and you decide to leave or reduce your hours and make games, then your net position hasn't been recouped until you've made $40 back for every hour of paid work you didn't do as a result.

If I'm earning a $70k salary, and I leave that job and make a game for a year, and that game makes me $50k, then I have lost $20k compared to if I'd just stayed at that job. To some people that'd be worth it, of course, because money isn't everything. But if you're thinking about the money, then that $20k, or whatever the figure may be, is definitely a cost or a risk worthy of consideration.

 

My reasoning is that if you haven't been earning that amount, then you couldn't have been earning it. Because you made a choice that resulted in you not getting that amount.

It is also unknown what you could 've been earning if you utilized the opportunity, because we can't travel into alternative timelines and check. Maybe if you decided to take that contract you would've been hit by a bus and ended up in red due to medical cost. Maybe your client would turn out to be a fraud.

The "lost opportunity" thing is a wishful thinking used to justify placing a random pricetag by cherry-picking the scenario you prefer.

The way I see it the amount you could've earned is either 0 (because you earned nothing), or NaN (because you don't know how things would go).

0 is easier to use.

I believe my reasoning is correct, though it may be unusual.

Basically:

I disagree with this kind of reasoning, because you don't really know how things would've gone if you made another choice. Maybe if say ten years ago you picked another path you would've been a billionaire by now. Would that justify trying to recoup lost billions through an indie projects as "lost opportunity cost"? The reasoning is not very different.

 

This is actually a good strategy. If you find an audience to cater to, you'll have a fanbase that likes the stuff you are doing. You can build on that, nurture it and grow it. If they loved your first game, you already have an audience for your next, if you consider staying within the same genre (which you probably should, if you want to create a sustainable business).

 

I'd say a hit is being able to make game 2 without worrying about cost (within reason, ofc).

40k also depends on pricing, cost etc. How much was spent (and lost/gained)? I'd love to see some numbers on stuff like this.

 

Hit? I don't even aim for sales these days. I'm a pure hobbyist, I just do it for fun. I'm a much better engineer then I am a game developer, so going full time into games is a bad idea.

I almost fell off my chair when someone actually paid for Pond Wars on itch. I'm not sure what I would do if I accidentally made a hit game.

 

The thing is "opportunity cost" is a well defined thing in economics. It is basically the cost of the choices not taken or the lost opportunities, @angrypenguin's outline is exactly correct. You may have a point about thinking about lost opportunities but when someone says "opportunity cost" they mean exactly the calculation that angrypenguin offered.

 

No Man's Sky is a prime example of a indie title demanding triple A prices, they asked $59.99 right out of the gate and yet their game was most definitely not a triple A title worthy of such a price.

Now i'm fine with an indie title demanding that IF the price point is accurate for the project. If a small 3-5 man team actually created something to the scale and quality of say Resident Evil 7 or Alien: Isolation, than they can ask for that; but 90% of indie titles probably max out at $19.99 with most being more closer to $9.99-$14.99 and a small 8-9% being able to go as high as say $29.99 and the rare 1-2% that can demand $49.99.

 

I'm sort of secretly hoping for a hit but mainly I'm trying to focus on just making something and releasing it and then just watching and seeing how it does... to let the "reality" of the situation determine how well it does rather than trying to get into speculation or anticipation or thinking that I know ahead of time it will do well. In that sense, I am just sort of doing an "experiment" to find out, for myself, by seeing what actually happens, where I stand in terms of the "am I successful or not" rankings. So time will tell. We'll see. If it sucks, then I can hopefully improve. If it does well off the bat, great. Just even sticking with it enough to get something done and push it out there to test the waters, "not knowing" if it will do well or not, is kind of a battle of trust.

 

All that's relative to how much each person wants something, and how much they want to spend. Some people will spend hundreds of bucks in IAPS for mobile games. Others think $5 is too expensive even for a game they like.



And the other side of the spectrum

 

Wouldn't be surprised if they are one and the same.

 

Yes, but you shouldn't price your game (or items) based on what you "think" the consumer is willing to spend on your game or in game items. Your price point should be based on your own internal structure (budget, business model, etc.).

So whether it is a flat rate model or IAP model you should still base the value on your own internal value.

It gets more complicated with IAP models though. First you must decide on how many packages you will offer and what is included in those packages; plus how much value you feel they are worth to buy them.

What is Package A,B,C,D,E worth within the game, how much game play does it affect for the user and the community? Is Package A worth $0.99, $1.99, $2.99, $5.99, $9.99, $14.99, $19.99, $24.99, $49.99 or $99.99? Than decide on B, C, D and finally E.

 

Lol. I would be incredibly surprised if they were.

 

Yep, same here!

 

At one point I did, I had the enthusiasm and passion to undertake a large project full on and hope it would hit hard. I understood it would take years and I understood it would take a decent investment, what I believe I didn't understand is what happens at the end game and / or if I wanted to do deal with it.

I suppose it's a bit like researching reliability records for cars, you might be fine and it might be better if you just ignore it and get what you want.. Although I did research and after reading horror stories from other indies I can't deny it put me off, I suppose I'm a little naive in some areas.. Don't get me wrong in any customer based roll you'll get the odd shirtyness and angry remarks but damn...!

After that I did start asking myself what I'm doing this for? The original plan was just to make enough money to cover costs to make a follow up.. I don't really care about money, although factoring in market saturation / chances of success and all the crap that comes with it you do start to re-evaluate..

Also you can't be a perfectionist whilst looking up at skyscrapers, in smaller teams it's a matter of getting the game together as four minutes of gameplay can equal a weeks worth of work. Something I struggle with..

I am going to finish the game, just for my own musings if nothing else and I will distribute it to a select few who I promised would get it.. Although I recon I can do without Steam and all the rest, plus I like messing about and find it far more enjoyable than pressuring myself to release something.

Hobbies for me at least never seem to translate into a decent business proposition, when it becomes too much like work personally it makes sense to me to earn the most amount of money with the least amount of potential issues.

 

How do you quantify if a game is "worthy" or not?

 

That's a common argument and a good one for some things but here it's just abused to create a point that might not be valid in other scenarios but does not progress the conversation.

First thing I would say is "personal preference"
Then I might argue that it's about content.
Then the counter is procedural content.
Then what? I mean where is it leading?

 

I assume you're talking to me? You didn't use a reply so I'm not sure.

Initially I took that statement I quoted and another and from there attempted to show that it was illogical. However I felt too much like I was knocking down a strawman so I asked the question to clarify.

The other statement was:

I suppose I should be asking for clarification on this point. I think I disagree with this, but without clearly knowing what is meant by "budget" and "business model" I can't justifiably argue a point I feel is important.

 

Well obviously it's leading to a grand truth of some sort ... that's how it always ends right?

 

I'll concede this is more personal opinion than a industry measurement, but I do tend to review games to each other in the same genre and their price tag if at all possible.

If you are asking for 60 bucks for your game, than I have some expectations on the game play, the game features, the entertainment value and overall quality for such a high price tag and I will have to compare it to other games that demand a similar price. For me at least, NMS did not live up to the asking price.

 

So it sounds to me like you're saying the customer--or the expectations of the customer--should have some say in the price of the game (at least if the dev wants to make money on it).

 

Just wanted to say thanks everyone for the comments so far. Interesting to read everyone's perspective on this.

It seems to me that you would enjoy the book "The Drunkard's Walk: How Randomness Rules Our Lives". I highly recommend it.

 

Always neat to see a recommendation for a book you bought a few weeks ago. Still need to read it though.

 

You're right, an "opportunity cost" metric is useless if you're basing it on made up, random, or baseless numbers. And given that the numbers are all estimates you're right that they should be taken with a grain of salt.

Still, the concept of opportunity cost is well worth taking into account for a lot of decision making, like "should I leave my job to make an indie game instead?" even if it's based on estimates rather than answers from a crystal ball nobody has.

I also agree that it shouldn't be used to justify "price tags". Those should be based on value generated, not costs incurred. If your value doesn't significantly outgrow your costs then you don't have a valid business in the first place.

Does this mean that you don't do any project planning, because any decision making based on estimates, even well educated ones, are necessarily invalid? Every task has "NaN" duration (because it's obviously not 0)?

 

Was writing a more detailed post but lost the energy so I cut it down to this basic level and all I have is this.

Budget = How much money did you use/spend to produce the project.
Business Model = How do you intend to make money in both the short term and long term, plus your initial investment (budget) back.

These two things I feel should be decided on before you begin production, because I feel they do influence each other to a strong degree.

However, you should not be influence by what you feel a consumer is willing to pay, or at the very least only be influenced at the abstract level. Consumers will always pay less for more, and you do not want to undersell (or oversell) the product and there by allowing youself to be priced right out of the market/industry.

 

This.

I know last year exactly how much money I made every year for the last five years doing chemical engineering. There is a pretty good bet I will make a very similar amount of money this year doing chemical engineering. That's a good, solid, evidence based baseline for me to work from. Walking away from engineering would be a measurable, and very real, opportunity cost.

If you have no track record doing anything else, then measuring the opportunity cost is more problematic. But guessing at a forty hour a week entry level position isn't a bad start.

Finances aren't the only thing that goes into decisions about game making. But you are crazy if you ignore the money side.

 

Is this similar to how you knew they were planning on bringing full engine features to Unity 5?

 

It will definitely be interesting to see who tries to take a chunk of the Steam empire. I think GOG and Origin have had the best luck so far. I guess madewith.unity is that start of this effort, so we'll just have to wait and see if it gets anywhere. It has been running for two years already so who knows.

 

I suppose that if any big company right now is in a position to challenge PC markets like steam, and even mobile markets like Google Play and the iOS app store...

It is Unity!

And well.... Unreal I suppose is... sorta also reeling in a lot of indies and has a big group of AAA's linked to them these days... maybe they could do it too...

So yes, it should be interesting to see how things go, and what UT brings to the table.

 

Itch.io seems to be catching on. It's even ranked better than Origin in the United States according to Alexa.

https://www.alexa.com/siteinfo/steampowered.com - 205 Global, 154 US
https://www.alexa.com/siteinfo/gog.com - 1,838 Global, 1,477 US
https://www.alexa.com/siteinfo/origin.com - 3,086 Global, 3,254 US
https://www.alexa.com/siteinfo/itch.io - 3,661 Global, 1,836 US

 

I looked through Itch.io - and I didn't see anything I could recognize that is also on steam... or any store really.

Is there an exclusivity agreement with them of some kind? Or is it just that most developers/publishers seem to prefer one platform or the other, and not both?

 

Wow.

There's a big, big gap between Steam and everything else.

Also very, very interesting how itch has such an enormous difference between the US and the rest of the world, especially in comparison to the fairly miniscule differences for the others. Does itch not support languages other than English or something?

 

But how do you reconcile this with your views on No Man's Sky? Hello Games might have done things exactly this way, and yet they missed out on players like yourself. Would you say they should not concern themselves with such players?

This may be a bad example, because there were actually a ton of people willing to pay full price for the game, implying the price was fully justified.

 

mainly, I just want to be able to make great games and for some of my goals I want to be successful enough to be able to hire people to help me make games better^^
So....I guess I would have to say, that I would be happy just doing games for a living, being self sustainable in the first place, then followed by, making enough to sustain a small team, I guess generally evolving into more and a hit, is more like a "bonus", if it happens, it would probably just speed up some of the progress towards hiring people for making better games :3
So I can hope for a hit, I don't expect it, I work towards the goal(s) I have and hope I can just keep doing that

and what a hit would be for me...hmm...I would say anything on the range between: selling enough copies to sustain development of next game(s) for a few years without much worry for future sale, to never needing to worry about money again XD


edit: secretly I also hope to affect peoples lifes with the games I'm doing

 

Believe it or not, but customers are always willing to pay more, a lot more, for more of the right kind of thing. When people price themselves out of the industry, it's almost always because they are charging a discounted price on a product that is completely uncompetitive. Contrary to popular belief, the price that people are willing to pay for something relative to its quality is so far from a linear equation that it's not even funny.

If you gave me a below average game, I bet that I could make a lot more money selling it for a ridiculously high price than I would trying to sell it for $0.50. I could make up any reason to substantiate the higher price, but the $0.50 price is just another way of saying "This is s***, stay well away".

For an average game, I'm inclined to think that selling it for an average indie price is a good way to completely bypass all your potential customers. For those who have an affinity for your game for some reason, maybe it's their niche or whatever, they will look at the price and say "ah well it's probably just an average game" when for them it probably would be above average. For those who do not have any affinity for it, they would not only be uninterested in the type of game but the price would secure a non-sale. Nobody likes average anything, they either want it (and it's special and should have a higher price) or they don't want it (it's not worth anything for them). So an average price tag is a good way of ruining the view of your product for everybody.

 

OF COURSE!

Sometimes the story behind the indie is just as good, esp if you're niche as has been pointed out. It could be your thing to be open or not?

 

Hofstadter's law, Brook's law, Murphy's law, Ninety-ninety rule....

And yes, estimates are very likely to be invalid, if software development is involved, unless it is a cookie-cutter project (like reskinning something).

Basically, you're making a bet that things will go the way you expect them to go, and if they go the way you expect it'll take estimated amount of time.
The way I see it, the reality is that there is unknown number of hidden variables you are not aware of and failed to into account. Those variables can be lethal to hte project. So, "it will take X weeks" in reality is "It will take X weeks assuming nothing happens to any member of our staff, assuming that requirements were understood correctly, assuming we will not hit an unexpected problems we were not aware of, etc". The software thing is unique. See, if you're making furniture, a chance of royal problem of epic proportions is low. Not much can happen. Maybe some of your machinery will break. In case of software and game projects you're making a one of the kind clock where billions of moving parts involved, and you're only allowed to modify a few of them. So. Some of the other parts are broken. But you don't know which ones, unless you do certain things you may or may not need to do for your current project.

I recall reading an article online about grossly underestimating how much time it took to fix a bug. In that case the initial estimation was a month, but in reality it took 8 years. That's software development for you.

Of course things become different if you're moving to a large scale with a lots of manpower. But in situation when you're a small team or a one man army developer, there is a fairly high chance that things beyond your control can mess up your project. (Does anyone remember bug reports after some of the 5.X updates?)

Either way, that's the way I see it.

 

it could be only thing I noticed, when people think of indie games affecting people, that it would be usually through story based games ^^ I try to do the effect through the setting, gameplay and choice of the world(?) I think.
And I don't really know yet, how well that's gonna work, cause people like to stick to their values