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The 4Ps of Marketing

By Joseph Lieberman | Published Jul 02 2014 05:52 AM in Business and Law
Peer Reviewed by (Dave Hunt, Gaiiden, jbadams)

marketing product price place promotion

A preface for this article is that the game market changes extremely quickly. While the foundation of this article is the 4Ps of marketing and those will never be out of date, the specifics may change fairly rapidly. The original article published to GameDev.net focused on a lot of things that were very specific to the downloadable market. Instead I will focus this more on the marketing principals; so it won’t be out of date by the time you read it.

The most common mistake people make is assuming that if you make it, they will download it. If you create a game, the publishers will find you. If you make the game, the players will find you. That when you are done pounding the code and graphics into the software you have but to sit and watch the money roll in…

Wake up! It doesn't work that way anywhere in the world. If you are not spending at least 25% of the time it took you to create the game marketing it, you are doing something wrong. There are a million things to be done, but before you do any of them you have to learn a little bit about what marketing is, keeping these key concepts in mind for each and every decision you make.

The foundation of all marketing, where it all begins, is referred to as the 4Ps. They are Product, Price, Place, and Promotion. In this article I will go over the 4Ps in the broadest sense and try to relate it to game specific items. If there is a specific problem with your product that needs overcoming, such as designing a package, I suggest picking up some more detailed texts on each of the 4Ps individually.

Note:  
This article was originally part of a series published on GameDev.net back in 2004. It was revised by the original author in 2008 and included in the book Business and Production: A GameDev.net Collection, which is one of 4 books collecting both popular GameDev.net articles and new original content in print format.


Product


In video games, product is probably the thing coders and developers think about most. It is a good thing, because in gaming, product IS the most important factor. I know, we all remember some really BAD products which had good marketing and turned out to make a bundle, but those are the exceptions, not the rules. It is far easier to market a good product than a bad one, and I doubt any indie developer has the assets to market a bad product. The two key words in product are want and need. You have to make sure you are giving customers both, and those two things are not always the same!

Ok so I can’t tell you how to make a good product… well, not in a few paragraphs anyway. Long story short here is make the game good, but there are some items in Product that impact your sales that we can talk about in this small space.

Design of a demo product is one. A key concept, for instance, is making your product accessible to a wide audience. This means compatible with as many systems as you can. Try to design the game and the demo to not require any reading and preferably any help files. You only have a limited amount of time to show your new client your game, you don't want to squander that time having them read help files. That said, if the game is complex enough that some help file type reading needs to be done make sure you force them to read and understand. Remember: The customer wants to instantly play but needs to learn the basic controls!

A very common question concerning the product is what is the best way to make a demo?

There are 3 basic demo types:

Time Limited
Pro: Gives the user a taste of what the full version is like. Most portals require a 60 minute demo..
Con: It is very hard to time the demo to end where the person is hungry for more.

Feature Limited
Pro: Easy to dangle the additional features right in front of the user.
Con: Some people may not buy because they didn't experience a feature they wanted, or didn't know a feature was there that should have been dangled better.

Episodic
Pro: Easy to end the plot or game at a cliff-hanger. Giving away an episode can count as having a “free” game to use to promote your site.
Con: Could give too much of your game away. People may be content playing only your demo and never upgrading.

There is no right answer when it comes down to it. Every demo type has been used successfully by some people. The key to designing a good demo is that the demo ends right when the person is really getting into it. I like to use this motto: Give the customers all that they need and a taste of what they want and then leave them hanging.

I point out the irony that time limited to me is the least effective demo type but the one used by most portals. Why? Uniformity. If every demo was different, portals worry it would confuse users and they frankly don’t trust you to do a good job making it any other way. Still, it shouldn’t stop you from trying to get them to use what model you think suits your game best.

Product also refers to what is sometimes called the 5th P – Package. You’d only use that in retail marketing, as online stuff really has no package. Here we are focusing on online goods, so no box and no package, When you go into retail know this: A good box sells games!

Price


Possibly the most complicated process in any industry, Price is a huge factor in the success of your product. A key concept of price is that price is not the same as value. The main concern you should have is to deliver your product so that its value is greater than its price, otherwise people won't buy it. In this section I am going to touch on four different concepts of price. There are many more, but these are some of the biggest.

Prestige Pricing is a term that basically says, "A more expensive product IS a higher quality product." 9 out of 10 people will tell you, when faced with two identical products; the one with the higher price tag is the higher quality product. Prestige price refers to this effect; a 20 dollar game is a better game than a 10 dollar game. A higher price does raise the value of the product, but not necessarily equal to the increase in price. Sometimes it is possible to use a discount to give a product the volume of a lower cost without loss of prestige.

Penetration Pricing is the price strategy that says a lower price will generate more volume. More volume means more market share. More market share means more future sales. A 10 dollar game generates more sales than a 20 dollar game, but maybe not more profit. Penetration is best used with a product that has strong viral capacity. That is, the more people who buy the game create more potential for future people to buy the game. Read that line as many times as it takes to sink in. In penetration pricing you are often sacrificing profit per unit in order to generate more sales for your next product or for this product at a much later date.

The Hardest Dollar concept. In online sales it is common that anyone willing to spend 1 dollar on your game would be willing to spend 10 or 20. This is saying that the hardest part of an online sale is simply getting a user to open his wallet. This is also why subscription sales work so well, as the customer’s wallet is automatically open every month; thus neutralizing the largest hurdle. It is quite possible to use this “If they’d spend 1 dollar” mentality as justification for a higher price, but it is important to note that the impact of this decreases the further from 1 dollar you get. At 30.00 it’s likely you’ll be back to your normal demand curve.

Intangible Terms of Sale is often seen in offerings outside of a pure dollar and cents value. Customer support, support from the developer, getting 25% off your next purchase. These are just a few of the intangible benefits you can tack onto your product. By offering intangible benefits you can often increase the value of the product without altering the price of the product.

Place


Luckily for all of you there are not too many place decisions to make in games. Download, CD, Retail or Online Publisher… that covers all the main ones you will encounter. Place is the distribution and where people get the product to try or buy it. Each place decision has its own benefits, pains, and odds are you can put your product in every ‘place’

Download is what I work most with, though you can offer a CD as a part of the download package from places like Swift CD. In general, getting downloads amounts to getting your game in as many places as possible. To that end you have places to submit downloadable games like shareware directories, you have places that review and cover games, and you have forums and interest groups that you should approach. Getting downloads is a tough business these days, as there is a lot of competition.

Retail is the most expensive and most difficult. You will NEED a publisher if you want to get into a retail store. In general, putting a retail title on a shelf runs anywhere between 100,000 and 200,000 dollars or more. That is just to get your title on a shelf! Usually marketing is not handled by the developer here, so most of this is out of your hands. Sadly this can also mean you are just part of long tail sales, and your individual product is just a meaningless number to them. Yep, expect to get raked over the coals in retail. These days it’s a collapsing market, but there is still money to be made there.

Nowadays the most common form of place is an online publisher. These non-exclusive houses hold most of the downloadable market. The amount you get per sale tends to range between 20% and 40% and in exchange you have access to their users. They don’t actively market your product, but the exposure you get on their site can be turned and used in your favor. It will get people looking for your product actively, so make sure there is a good way for them to use search engines to find your site so you can promote your games directly; hopefully stealing away a few users from the portals.

Promotion


Last but not least, promotion. Ask 10 people on the street what a marketing person does and all 10 will probably tell you that this is what they do. The above 3 are also what we do, but it's not what people think about. Promotion is the combination of advertising, publicity, and buzz (a subset of publicity).

Buzz is the hardest to create and the hardest to control. Most firms actually avoid trying to make buzz because of the havoc it can cause. Buzz items are typically fads, and the problem it most frequently creates is demand exceeding capacity. In the download world it is not as big a deal, thankfully. To create buzz basically you need a viral product and a huge quantity of publicity, advertising, and customer discussion over your product in a very short period of time. I’ll go on a limb and say it should be your goal to achieve as much buzz as possible, but not really the focus of your efforts.

Publicity is 'free' advertising. Reviews, Interviews, and Previews are the most common forms of this. Also included are press releases, screenshots, and link exchanges. The downside of publicity is that it usually takes a lot of time and work to get. Remember, if you build it they will NOT come. Reviewers will not bang down your door, and you have to do more than just submit your game to some unknown E-mail address. To get publicity you must be tenacious. Get people’s contact info and talk to them as frequently as you can both before and after your game is released. Even after they review it, stay in touch and keep them informed of what you’re up to. You never know when someone will write an article and mention upcoming games or ideas.

Advertising is a much easier creature; it's also much more expensive. To correctly advertise you must know your target market and your conversion rate. Conversion rates are how many sales you get for every 100 downloads. Ads must also be targeted. Target refers to what group is most likely to buy your game. Lately there has been a lot of emphasis on Google Adwords from sites, and Google is a good advertising source, but part of me thinks it's a copout from doing research and finding better deals. In recent years Google has become less and less profitable for online games due to increased competition.

The 4 (or 5) Ps are pretty much the backbone for everything else in promotion. The simple goal here is to get you to think about each of them. How does your product look and how well is the demo designed? Where will we be distributing it and are we guaranteed to get where we want to go? Who is handling the promotion of our product, what budget do we have for that person and advertising? Does that person have all the contacts in place and ready to go when the product is ready? Will we charge the standard 19.95 for this game or are we going to try something different? What intangible benefits to the sale can we add?

Think about these things and others that come to your mind, I recommend writing the question and the answer (if you have one) in a document and bringing it up once in a while to remind yourself of the focus and goals of each of these 4 items. You’ll be glad you did!



About the Author(s)


Joseph Lieberman is the founder and owner of vgsmart.com. To receive more helpful tips via e-mail, sign up for our newsletter at www.vgsmart.com.




Comments

terribly interesting for someone never heard of this (like me) - and good written; Pity is not much here about it for example about "conversion rate" or more in depth about each point


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