Perspective of living as an indie dev in my country

Published February 11, 2019 Imported
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Game development is a really nice job, at least when you’re an indie, not a cog in an AAA crunching machine. You can sit in the comfort of your home and have no expenses for commuting, office rental and eating out, at least that’s how i imagine it to be. But the real question is – can you earn a living wage by doing it?

You can read a lot on indie game developer hardships these days. Things are looking quite grim – Steam is not showing too much love for indies, some are afraid the subscription models will start to be a to-go model in selling video games, accessible game engines are making games easier to produce and that makes for a stiffer competition – it’s really hard for your game to be discovered. I’ve seen too many good games with lousy sales numbers because nobody know that they actually existed. A lot of devs are wondering is it really worth it anymore? Is it possible to live by making good games with niche market or do you need to strike gold with new Nuclear Throne or Minecraft? We’ll leave aside the marketing part of the story – you all know it, start as early as possible and build a community, preferably with your own brand if you released games before.

And now, let’s delve into the cold, dark world of numbers. For this analysis, i will be using some Numbeo statistics. According to them, cost of living for a single person in capital of Serbia is around $500 (without rent, which is around $200 for a small flat). It may be a bit hard too look at those numbers objectively, but i don’t know how i would survive with a salary of $500. Realistically, you need $100 for bills regardless of the flat size (if you want flat cable internet, cable TV and a cell phone subscription. Heating, electricity, water and garbage disposal have to be paid) so you’re left with $400, which is enough for you to eat (strictly at home) and maybe spend $50 on leisure. Forget about savings, driving a car and going out.

When i take my family in consideration, the math is following, to live relatively comfortably and maybe spare a few dimes on the side, you need about $2,000 for a three member family (for easier calculation, let’s presume that your SO has no income). That amounts to $24,000 a year. If you are selling your game for $10, Steam takes 30% and you are left with $7. Now, you probably think “Wow, only 2 grand to live comfortably with a family? What is this dreamland you’re living in?” and yes, Serbia IS a cheap country compared to most of the European countries and that is all fine, but my country has no tax treaty with US and it makes a lot of impact compared to other more expensive-to-live-in countries that have tax treaty with US. So, i have to give another 30% in taxes to the US. So, i’m left with meager $4.90 if i’m lucky to sell the game at full price.

But that’s not the end of taxation, i have to pay some taxes in my country too. If i earn up to $23,000, i don’t pay any income taxes, but from $23,000 to $45,000 i pay 10%, and over that i pay 15%. Let’s say i managed to earn more than those $23,000 a year and i have to pay 10% of income tax.  That means i need to have a net profit of $27,000 to earn a nice living wage for me and my family. To make a net profit of $27,000 i need to sell around 5,500 copies of the game at full price. That’s quite a number.

Now, according to this article, the average game on Steam will sell about 2.000 copies and make $12.500 in revenue in its first month. The average game will make $30.000 in its first year. I’m not quite sure what do they mean by “make”, but i guess it’s the revenue. So if you’re from around here and make an average game, you’ll be left with around $15.000, which is around $1250. A fine salary that most of the people living here dream of (average is around $350-$400) and it’s ok if you’re living alone and have no family to support.

But, lest we forget the cost of making the game itself. Unless you are a multitalented person that knows how to program, draw in 2D, model in 3D, rig and animate, design sound and make music, you need to spend some money to pay someone who does any of those better than you and has the time to do it. Until now, i spent around $4,000 on Rick Henderson. Sure, there’s some stuff like assets which are one in a lifetime expenditure and some of the art made will be left unused, but i need even more to finish the game (reason why i’m making an IndieGoGo campaign), so if all went perfect from the start, i think i would need minimum $5,000 to make a game of this caliber. So let’s readjust the figures. I no longer need $27,000 but $32,000 net profit so i have some money to invest in the next game, and that translates into 6,500 copies of the game at full price.

How did the others do?

How some of the similar games fared on Steam? I will use the data from the big Steam leak from last July in this one, so some data may be a bit off, but not too much i presume. Taken into account will only be some games of a newer date, since older once basically guaranteed sales once they were on Steam.

Super Hydorah – This fantastic game sold only 2,073 copies. It was already selling for a year when data leaked, so i presume it didn’t sell many more after that. But the price was a bit high i must say, €20. If it did sell 2k copies at that price, that’s cool, especially considering it’s a one man game.

Starr Mazer DSP – Still in early acces, but sold a nifty 5,500 copies for 10 bucks a pop. Nice, but their press kit says three of them are making the game, and paid artist is doing graphics.

Drifting Lands – Not really your usual shmup, but fits the genre. 8,275 copies for €18,99. Also, at least two guys work there, but probably more, so it’s not much of a success.

Steel Rain – We’re getting into five figure sale numbers. A whopping 10,440 sold games, full price €9,99, but there’s almost two digit number of people in their studio, so i’m not sure how successfull this was.

Monolith – 10,880 copies sold by three guys. Price – €7,99. Great success if you ask me. I suppose they sold a decent number of copies since then too.

Super Galaxy Squadron EX Turbo – 25,940 at €8,19. I suppose a lot of those copies sold at a discount, and as far as i can see they happen pretty often. Now it’s on sale at €2,99 so i guess that’s closer to median sales price. There’s a lot of them there, so i can’t even presume how many of them took part into making the game actually (and reaping the profits).

Sky Mercenaries – Made by PolarityFlow, team that also made Steel Rain. 30k+ copies, regular sales price €9,99, pretty good.

Steredenn – These guys kicked ass. 50k+ copies made by only two of them plus musicians and a pixel artist which probably had their fixed cut. At €12,99, hell, even at half the price, this game made a small fortune for them.

One game it’s like to point out to is Star Saviors, game that sells for €0,99 and has sold 300k+ copies. I haven’t played it but it’s not my cup of tea regarding rendered graphics, though i must say it looks like it feels good to play and makes me wonder of the pricing policy and what is right to do.

I didn’t take into account games like Ikaruga, Mushihimesama and Crimzon Clover, they’re quite specific and have their own audience. Bear in mind all these developers live in countries which are more expensive to live in than in my country, but also have tax treaties with the US to some extent.

Summa summarum

When i take all things into account, i didn’t move my point of view too far. I still believe that you need to have a top notch product (compared to few years ago, where you could be cool if you have a contagious game with maybe not so good graphics) to even scratch the surface. You need to start marketing your product as soon as possible, build a community and be involved if you want to have a crack at selling your game in a decent number of copies that will enable you to live nice until you launch your next game.


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Comments

Awoken

Great post.  I think there are many of us who linger here on GameDev who are interested in being in the know.  @evanofsky made a parkour game back in 2014/2015 and released it on steam.  I remember thinking at the time that it was a professional looking game.  He put a lot of work into it. Then he posted his first day sales, that or first week.  I think if I remember correctly he had managed to sell 4 copies.  

One of the things that I think is worth while mentioning in the article you sourced, it also said that 82% of games sold on steam the creators won't make a meaningful return on their investment ( investment being both time and money ).  He also states that the 1,200 copies figure applies only once you've removed all the rubbish being sold.  So if you were to include rubbish then that figure drops even further.  That and I'd be more interested in knowing the median as opposed to the average.  I'd bet the median for all games sold on steam is around 50.  And I'd love that figure to be much much higher.

But yeah, I certainly don't think someone can just make a game and then throw it up on steam and make decent coin regardless of how good it is unless its epic and catches fire, or dumb luck.

Here in lies the necessity of learning your target audience and connecting with and enticing before the big release.  And even then you may only marginally increase your odds if its a good game.  Which is why I kinda am always griping about game-play and a game being fun, because if it's not and nobody else get's what you were going for while creating it it'll become history within days.

Mind you I'm just starting to really think about this because I'm one of those candidates who's wondering if there is a target audience for what I'm making and whether I can connect with them. 

February 11, 2019 09:03 PM
Rutin

One of the major problems with indie developers is the lack of marketing dollars. Out of the several businesses I run, if I didn't spend a dime marketing I wouldn't have any sales... period! Overtime you'll build a following and word of mouth will help, but either way you still have to put money towards a marketing budget months prior to release and during release. You can have the best product, or service but if nobody knows about it then it means nothing. When you're trying to sell your game on steam you have to deal with the overflowing submissions on there on a global scale, and the exposure isn't going to happen without putting money towards it. It's a hard truth for many because a lot of indies don't have financial backing to push their marketing in order to generate exposure, but unless you have good connections for endorsements and a lot of "luck", your game will flop majority of the time if you just release it on steam and hope for the best.

If anyone is looking at doing this as a business and make games commercially, then you 'must' treat it like any other business. You have incurred costs to produce your product, and you have even more costs you need to up-front for the marketing to generate exposure in order to bring the product to your target audience.

February 11, 2019 09:16 PM
Spidi

Thanks for the insight, great write-up!
Living in a neighboring country and the circumstances and expenses are somewhat close to yours. Thankfully Hungary has a tax treaty with the US, but income taxes here are CRAZY, so I kind of understand your view.
There is one thing you could look into and think about:
The "dreaded" publisher.
I know it sounds crazy as you are preparing for a full-blown campaign and planning to self-publish, but if you sign on with a publisher (for e.g.: one from the EU or the US) if I'm not mistaken together you could keep 70% of each sold Steam unit and by giving them an approx 30% cut you would get the same amount of money per unit (or maybe even more depending on their cut) + they could help you out a lot with pr and marketing (and much more) increasing your chances of reaching a big enough audience to recoup your investment and make a profit.
Of course this is a difficult topic and choosing / pitching-to a publisher is not an easy decision / task, plus if your campaign succeeds you probably won't need much help with the release :)
Just thought I throw in this idea as food for thought.
Good luck with the game, it looks awesome + keep the cool posts coming ;)

February 11, 2019 09:19 PM
FatPugStudio
10 hours ago, Awoken said:

Great post.  I think there are many of us who linger here on GameDev who are interested in being in the know.  @evanofsky made a parkour game back in 2014/2015 and released it on steam.  I remember thinking at the time that it was a professional looking game.  He put a lot of work into it. Then he posted his first day sales, that or first week.  I think if I remember correctly he had managed to sell 4 copies.  

One of the things that I think is worth while mentioning in the article you sourced, it also said that 82% of games sold on steam the creators won't make a meaningful return on their investment ( investment being both time and money ).  He also states that the 1,200 copies figure applies only once you've removed all the rubbish being sold.  So if you were to include rubbish then that figure drops even further.  That and I'd be more interested in knowing the median as opposed to the average.  I'd bet the median for all games sold on steam is around 50.  And I'd love that figure to be much much higher.

But yeah, I certainly don't think someone can just make a game and then throw it up on steam and make decent coin regardless of how good it is unless its epic and catches fire, or dumb luck.

Here in lies the necessity of learning your target audience and connecting with and enticing before the big release.  And even then you may only marginally increase your odds if its a good game.  Which is why I kinda am always griping about game-play and a game being fun, because if it's not and nobody else get's what you were going for while creating it it'll become history within days.

Mind you I'm just starting to really think about this because I'm one of those candidates who's wondering if there is a target audience for what I'm making and whether I can connect with them. 

World is a big place, if you are persistent i believe you can find audience for pretty much everything. Grid Sage Games (Cogmind) is really an inspiration for such a model. He funded himself by selling the game via his website to a specific audience. As for those 82% that don't make a meaningful return, i can't think of anything else than a poor or none marketing. Just BAM "hey i released the game, check it out". Sorry, it's nice, but that ain't gonna cut it.

10 hours ago, Rutin said:

One of the major problems with indie developers is the lack of marketing dollars. Out of the several businesses I run, if I didn't spend a dime marketing I wouldn't have any sales... period! Overtime you'll build a following and word of mouth will help, but either way you still have to put money towards a marketing budget months prior to release and during release. You can have the best product, or service but if nobody knows about it then it means nothing. When you're trying to sell your game on steam you have to deal with the overflowing submissions on there on a global scale, and the exposure isn't going to happen without putting money towards it. It's a hard truth for many because a lot of indies don't have financial backing to push their marketing in order to generate exposure, but unless you have good connections for endorsements and a lot of "luck", your game will flop majority of the time if you just release it on steam and hope for the best.

If anyone is looking at doing this as a business and make games commercially, then you 'must' treat it like any other business. You have incurred costs to produce your product, and you have even more costs you need to up-front for the marketing to generate exposure in order to bring the product to your target audience.

I agree, but i still stand by the opinion that no marketing dollar can replace a community that has been made throughout the development and i believe it's the best way of marketing for indies regarding the cost to value relationship.

February 12, 2019 07:26 AM
Rutin
11 minutes ago, FatPugStudio said:

I agree, but i still stand by the opinion that no marketing dollar can replace a community that has been made throughout the development and i believe it's the best way of marketing for indies regarding the cost to value relationship.

I've never once discounted building a community during development. In fact it's a highly recommended thing to do for anyone releasing a game and something I advise people to do all the time. That being said, if you put no marketing dollars you're going to limit your total exposure which will in turn limit your total sales assuming you have something marketable to begin with.

February 12, 2019 07:40 AM
FatPugStudio
10 hours ago, Spidi said:

Thanks for the insight, great write-up!
Living in a neighboring country and the circumstances and expenses are somewhat close to yours. Thankfully Hungary has a tax treaty with the US, but income taxes here are CRAZY, so I kind of understand your view.
There is one thing you could look into and think about:
The "dreaded" publisher.
I know it sounds crazy as you are preparing for a full-blown campaign and planning to self-publish, but if you sign on with a publisher (for e.g.: one from the EU or the US) if I'm not mistaken together you could keep 70% of each sold Steam unit and by giving them an approx 30% cut you would get the same amount of money per unit (or maybe even more depending on their cut) + they could help you out a lot with pr and marketing (and much more) increasing your chances of reaching a big enough audience to recoup your investment and make a profit.
Of course this is a difficult topic and choosing / pitching-to a publisher is not an easy decision / task, plus if your campaign succeeds you probably won't need much help with the release :)
Just thought I throw in this idea as food for thought.
Good luck with the game, it looks awesome + keep the cool posts coming ;)

Oh no, i don't find the publishers dreaded and i would gladly give my game to a publisher (and i will need to so they can handle the royalties for folks whose music i'm using for the game), but besides the legal stuff and possibly cutting down on taxes, i'm not quite sure what else can do, it's like it's been kept in the dark. I suppose they can provide additional funding, press coverage and...that's where the list of things i know about publishers end :|

10 minutes ago, Rutin said:

I've never once discounted building a community during development. In fact it's a highly recommended thing to do for anyone releasing a game and something I advise people to do all the time. That being said, if you put no marketing dollars you're going to limit your total exposure which will in turn limit your total sales assuming you have something marketable to begin with.

What form of marketing do you recommend with the best ROI solution for indies?

February 12, 2019 07:50 AM
Rutin
1 minute ago, FatPugStudio said:

What form of marketing do you recommend with the best ROI solution for indies?

What is your budget?

February 12, 2019 07:52 AM
FatPugStudio
Just now, Rutin said:

What is your budget?

Let's say $500-$1000

February 12, 2019 07:54 AM
Rutin
19 minutes ago, FatPugStudio said:

Let's say $500-$1000

I have no idea how you could test the market and run enough campaigns to get enough data to push a good campaign with that budget. Not to mention preparing your marketing materials, promos, and getting your PR done properly. I've spent that in a day marketing a past app project I had for a client. I wouldn't market an indie game (smaller scale) unless I was prepared to dish out a minimum of $20,000 (which is still considered pretty low), assuming I can take care of some of the tasks myself otherwise it would go up to hire additional help.

I'm not too sure what you can do for $1000 and under as I've found hundreds of dollars can get eaten up very fast in marketing costs.

It's not uncommon for marketing costs to exceed development costs.

 

February 12, 2019 08:11 AM
FatPugStudio
1 minute ago, Rutin said:

I have no idea how you could test the market and run enough campaigns to get enough data to push a good campaign with that budget. Not to mention preparing your marketing materials, promos, and getting your PR done properly. I've spent that in a day marketing a past app project I had for a client. I wouldn't market an indie game unless I was prepared to dish out a minimum of $20,000 (which is still considered pretty low), assuming I can take care of some of the tasks myself otherwise it would go up to hire additional help.

I'm not too sure what you can do for $1000 and under as I've found hundreds of dollars can get eaten up very fast in marketing costs.

It's not uncommon for marketing costs to exceed development costs.

 

Whoa, five figure amount for marketing is hardly considered indie in my opinion. Anyway, good to know what i can expect when it comes to paid marketing, thanks :)

February 12, 2019 08:27 AM
Rutin
10 minutes ago, FatPugStudio said:

Whoa, five figure amount for marketing is hardly considered indie in my opinion. Anyway, good to know what i can expect when it comes to paid marketing, thanks :)

People are spending a lot more than that. If you have someone experienced enough you can cut the costs to market.

https://www.gamasutra.com/blogs/JustinCarroll/20170327/294552/The_Realistic_Guide_to_Pricing_Indie_Game_Marketing.php

February 12, 2019 08:37 AM
FatPugStudio
25 minutes ago, Rutin said:

People are spending a lot more than that. If you have someone experienced enough you can cut the costs to market.

https://www.gamasutra.com/blogs/JustinCarroll/20170327/294552/The_Realistic_Guide_to_Pricing_Indie_Game_Marketing.php

Insightful article, thanks for that one. I guess it translates to my country too, you only need to cut one zero, since the average value of indie game developer's hour here can't be more than $9. Actually, that's mid to high tier manager salary here. That should give you an insight on my point of view on marketing costs :)

February 12, 2019 09:16 AM
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