Bandcamp Embraces Pirate Googlers, Turns Them Into Customers

from the it's-not-so-hard-to-compete dept

A common complaint from the legacy movie and music industries is that when people Google things like "watch movies online," unauthorized sources rank higher than legitimate ones (for some crazy reason, it seems like people prefer comprehensive libraries of unrestricted links over stale selections of geoblocked videos). Moreover, they complain about autocomplete terms like "torrent," completely missing the fact that those are caused by people searching that exact thing, not the other way around.

So it's great to see the people at Bandcamp doing the exact opposite and celebrating the prevalence of those dirty pirate keywords. They looked at their own analytics and noticed a lot of sales being generated by search terms that would send your average RIAA lobbyist running to Congress:

For example, just this morning someone paid $10 for an album after Googling "lelia broussard torrent." A bit later, a fan plunked down $17 after searching for "murder by death, skeletons in the closet, mediafire." Then a $15 sale came in from the search "maimouna youssef the blooming hulkshare." Then a fan made a $12 purchase after clicking a link on music torrent tracker What.CD. Then someone spent $10 after following a link on The Pirate Bay, next to the plea "They sell their album as a download on their website. You can even choose your format (mp3, ogg, flac, etc). Cmon, support this awesome band!"

That last part is another example of how Mike described Louis CK's recent experiment: be polite, be awesome and be human. CK's video was also available on the Pirate Bay, and as someone here pointed out, it spurred several users to comment with links and encourage people to buy, while others offered explanations for their decision to use the torrent. Though there can be no doubt that in both cases some "hardcore" pirates just didn't give a damn, there are far more people who just want to be polite, awesome and human and support the artists who do the same.

Bandcamp recognizes that people who search for torrents and file locker links are, at the core, just fans looking to get some new music. By focusing on serving those fans, they don't need to worry about illegitimate sources -- after all, in most cases they already provide a superior option:

We see these sales as proof that Bandcamp can effectively compete with filesharing and other free distribution platforms by a) giving fans a clear, easy way to directly support the artist, and b) offering them a better user experience. Our favorite recent example of this was an $8 sale that started with the search “milosh flac -torrent.” So here was a fan looking for a Milosh record, wanted a high quality flac, but didn’t want to have to sift through a bunch of torrent sites. And that led them right to Bandcamp, and right to putting money in the artist’s pocket. Beautiful.

Beautiful indeed. When you tear down walls instead of constantly building new ones you can actually turn search terms like "torrent" to your advantage, rather than resorting to SEO-by-lawsuit. Bandcamp is yet more proof that you can "compete with free," if you give people an attractive alternative.

Filed Under: competing with free, infringement, piracy, search
Companies: bandcamp

Cee Lo Green: Making Millions Even If His Albums Don't Sell

from the how-it's-done dept

A whole bunch of you have been sending in the recent NY Times article that details how singer Cee Lo Green is making $20 million this year, even as the sales of his album have been considered just so-so, based on traditional industry metrics. The article is really much more about Primary Wave Music, a music publisher/management firm that seems to totally get the economics of the music business today -- that by selling the scarce they can make a hell of a lot more money than just by selling music.

We've actually talked about Primary Wave's work in the past, in some of the things they've done to help Mariah Carey make money. And the story with Cee Lo is pretty similar: focus on selling the things you can't pirate, the real scarcities. And we're not talking (as our critics always insist) about tangible goods like t-shirts, but selling the person. Primary Wave may be positioned as publishing and management, but it's real business is marketing.

When Primary Wave took over Cee Lo’s management, shortly before the release of “The Lady Killer,” he still had a relatively low profile as a solo artist. But the company seized on the early viral success of “Forget You” to make Cee Lo a ubiquitous face.

His over-the-top performances at half a dozen award shows -- performing with the Jim Henson Company puppets at the Grammys, playing a piano that spun 360 degrees above the crowd at the Billboard awards -- proved highly successful. His television campaign for the year has also included “Saturday Night Live,” an appearance on the NBC comedy-drama “Parenthood” and his own talk show on the cable channel Fuse (“Talking to Strangers”).

Primary Wave also booked numerous commercial endorsements for Cee Lo, in traditional TV spots like a 7Up commercial that has been running since October, as well as a Web video series for Absolut Vodka and personal appearances for Duracell and Pretzel M&M’s.

And, no, this doesn't just mean complete selling out (I can already hear the critics...), but finding campaigns that match Cee Lo's personality. They note they've turned down a ton of deals that didn't fit.

Either way, it looks like Cee Lo is earning a ton of money from all of this: commercials, sponsorships, TV appearances and (of course) tons of live performances. The article notes that actual direct music sales are the smallest slice of the pie.

But the key point here is that these and many other opportunities are much more wide open to artists today, and it helps if their music is more widely known. That is, artists like Cee Lo, with the help of companies like Primal Wave, are recognizing that if you use the infinite goods -- such as the music -- to make the scarce goods (like Cee Lo himself or his endorsement) much more valuable, you can make a lot more money than ever before. And when you look at the overall market that way, you realize that there's lots more money to be made in the music industry today than ever before. The only part of the industry that's hurting is the part that was based on selling plastic discs, which has become obsolete. Everything else is booming.

Filed Under: branding, business models, cee lo green, marketing, scarcities
Companies: primary wave music

Louis CK: Over $1 Million In Sales In Just 12 Days For DRM-Free Download

from the polite,-awesome-and-human dept

As you probably recall, comedian Louis CK kicked off a brilliant little experiment in getting people to buy his latest comedy special, by being polite, awesome and human. He offered up a direct-to-fan offering, with no DRM, from his own site for $5, and he did so while being totally open about the process and his thinking, which only endeared him to more people. After four days, he had brought in over $500k, and twelve days in, he's surpassed $1 million, and he's got the screenshot from PayPal to prove it: Once again, his writeup shows that this has been quite a success, as he admits that he's never had a million dollars suddenly dumped on him like this. Also, again, his writeup reinforces what worked about this in the first place, the fact that he's being polite, awesome and human:

So it's been about 12 days since the thing started and yesterday we hit the crazy number. One million dollars. That's a lot of money. Really too much money. I've never had a million dollars all of a sudden. and since we're all sharing this experience and since it's really your money, I wanted to let you know what I'm doing with it. People are paying attention to what's going on with this thing. So I guess I want to set an example of what you can do if you all of a sudden have a million dollars that people just gave to you directly because you told jokes.

He then explains what he's doing with the million dollars. $250,000 will go to pay off expenses related to the website. Another $250,000 is going to his staff and the people who helped work on the show. As he says "I'm giving them a big fat bonus." Then he's taking $280,000 and giving it away to a list of charities:

• The Fistula Foundation
• The Pablove Foundation
• charity: water
• Kiva
• Green Chimneys

What's interesting is he notes that he learned about some of these via recommendations people made to him via Twitter -- once again, showing that he's reaching out and connecting with fans.

Finally, he's keeping the rest for himself:

That leaves me with 220k for myself. Some of that will pay my rent and will care for my childen. The rest I will do terrible, horrible things with and none of that is any of your business. In any case, to me, 220k is enough out of a million.

I never viewed money as being "my money" I always saw it as "The money" It's a resource. if it pools up around me then it needs to be flushed back out into the system.

He also notes that he's a little uncomfortable with all the news this is making and he plans to stay quiet for a bit. Again, this highlights a few key points:

• Being polite and sounding human can be incredibly powerful. It's amazing how simple this seems, but so many things are first run through so many layers of PR people and publicists and the like that it's still pretty rare to see someone famous come across as being human. It's entirely possible that Louis is running all this through PR people and publicists before it's going live, but if so, they're doing a good job in making sure it really sounds like it's directly from Louis. If I had to guess, I'd say that's because it actually is directly from Louis. From everything I've seen, heard and read about him, this really does match his persona.
• Fans don't resent content creators for getting a ton of money. We keep hearing entertainment industry bigwigs and copyright maximalists insist that people claim that the reason they infringe is because content creators "have too much money already." But as we've seen with Louis, nearly everyone who's taken part in this is positively thrilled with his success. I haven't seen anyone complaining that he made too much money at all. Do some people complain about rich stars? Sure, but if you're polite, awesome and human, and actually connect with your fans, they want you to succeed.
• Having a charitable component is kinda cool. Yes, in this case it's after-the-fact, but it's still cool. We've shown in the past that pay-what-you-want works better with a charitable component, and I'd guess it's because it fits with the reasons that people are willing to buy in the first place.

This is a pretty huge success and shows what can be done by going direct-to-fan, while really connecting with those fans. Meanwhile, over at Step2, we're discussing why this worked, and whether or not "polite, awesome and human" are really the key three components. Feel free to weigh in...

Filed Under: awesome, business models, human, louis ck, polite

Louis CK's 'Experiment' Brings In 110k Sales, $550k Gross, Over $200k Net... In Four Days

from the nice-work-if-you-can-get-it dept

So that was fast. Yesterday we wrote about comedian Louis CK's experiment in direct to fan sales, offering up his latest comedy special for a simple, convenient $5 download with no DRM (and also being human and polite in talking about it). All we've been hearing since the sale went up on Saturday was about how everyone's buying it, and it appears plenty of people were curious how it was going. Louis has put up a statement explaining all of the results in pretty great detail. However, before we get to the numbers, he makes a really good point at the beginning. He points out that originally he had no plan to share the results, and that it's natural to try to hoard such information. But somewhere along the way, he realized something really important: people aren't just interested in buying his work, they're buying because they're interested in the experiment as well:

It's been 4 days. A lot of people are asking me how it's going. I've been hesitant to share the actual figures, because there's power in exclusive ownership of information. What I didn't expect when I started this was that people would not only take part in this experiment, they would be invested in it and it would be important to them. It's been amazing to see people in large numbers advocating this idea. So I think it's only fair that you get to know the results. Also, it's just really cool and fun and I'm dying to tell everybody. I told my Mom, I told three friends, and that wasn't nearly enough. So here it is.

This reminds me of Andy Richard's thoughts on transparency, and how that helps connect fans even closer. It's all something of a virtuous circle, it seems. Do cool experiments, be awesome, be polite... and be transparent. And people will want to support you.

On to the numbers. I love the fact that Louis didn't just reveal the topline revenue, but walked through the expenses as well:

First of all, this was a premium video production, shot with six cameras over two performances at the Beacon Theater, which is a high-priced elite Manhattan venue. I directed this video myself and the production of the video cost around $170,000. (This was largely paid for by the tickets bought by the audiences at both shows). The material in the video was developed over months on the road and has never been seen on my show (LOUIE) or on any other special. The risks were thus: every new generation of material I create is my income, it's like a farmer's annual crop. The time and effort on my part was far more than if I'd done it with a big company. If I'd done it with a big company, I would have a guarantee of a sizable fee, as opposed to this way, where I'm actually investing my own money.

The development of the website, which needed to be a very robust, reliable and carefully constructed website, was around $32,000. We worked for a number of weeks poring over the site to make sure every detail would give buyers a simple, optimal and humane experience for buying the video. I edited the video around the clock for the weeks between the show and the launch.

For what it's worth, Louis is pretty famous in comedy circles for his ability to come out with an entirely new "hour" of (amazing, brilliant, hysterical) content each year -- and once he's put that into a special or a video or an album, he never performs that stuff again. Lots of other comics will reuse old material or it takes them a lot longer to develop an hour of material, but as he explains here, he views it almost as if he's a farmer and this is his crop. So it definitely was a risk to do things this way, but certainly a calculated and not a particularly crazy risk.

Okay, let's jump down to the bottom line:

The show went on sale at noon on Saturday, December 10th. 12 hours later, we had over 50,000 purchases and had earned $250,000, breaking even on the cost of production and website. As of Today, we've sold over 110,000 copies for a total of over $500,000. Minus some money for PayPal charges etc, I have a profit around $200,000 (after taxes $75.58). This is less than I would have been paid by a large company to simply perform the show and let them sell it to you, but they would have charged you about $20 for the video. They would have given you an encrypted and regionally restricted video of limited value, and they would have owned your private information for their own use. They would have withheld international availability indefinitely. This way, you only paid $5, you can use the video any way you want, and you can watch it in Dublin, whatever the city is in Belgium, or Dubai. I got paid nice, and I still own the video (as do you). You never have to join anything, and you never have to hear from us again.

I'd actually argue that he did much better than he explains as his net here -- because he already admitted that the cost of production was paid for by tickets sold to those shows. So by not counting profits until he's covered the cost of production, he seems to be doubling the revenue needed to cover production. This makes the results even better than what he suggests.

And while he says that the $200k (which, again, I think miscalculates the actual bottom line) is "less" than he would have been paid if he'd simply sold the show, there are a few other mitigating factors, beyond what he lists above. He focuses on how it would be worse for the fans. But I'll take it a step further and suggest that going that path would have been worse for Louis as well. First, this isn't done yet. While there's definitely a huge spike in sales at the beginning, and it will only go down from there, I wouldn't be surprised to see a decently long tail of support here. Second, and more importantly, this whole experiment -- including the transparency here -- likely has both widened his fan base considerably (even though it was already quite large) and, more importantly, deepened their loyalty to him.

In other words, it may not make as much now, but chances are this pays off even greater sums down the road. Many of the people who found out about this and bought the download are likely now to be more interested in watching his TV show, seeing him live or purchasing future specials that he releases like this (or in new, even more creative, ways). In other words, by doing this kind of experiment, by being polite, awesome and human... and then being transparent about this, it's likely that his earning power from these efforts only grows. That's pretty cool.

Two final thoughts on this, as responses to a couple of the common arguments we hear from folks who can't get their minds past the traditional business model. First up, we always hear claims that "people won't buy stuff if they can get it illegally for free." It would seem that iTunes, Netflix and many other examples have long proven that false, but here's another example.

Second, just last week, we discussed the claim by some that people who pirate do so because they claim that "all artists are rich." I still have never heard that argument used by people who download unauthorized content, though I guess it's entirely possible that some have made such a ridiculous argument. But I actually think Louis CK's success here (not unlike Trent Reznor's success with various business model experiments) shows how off-base that is. By any imaginable standard, Louis is doing okay for himself. But, nearly every comment I've read from folks who paid their $5 (like myself) to happily download and support Louis, is that they're all freaking thrilled beyond belief that he's brought in this much cash from this experiment.

I'm sure there may be some resentful jerks out there, but as Louis himself noted, the people who chose to buy are invested in this experiment and want it to succeed. No one begrudges Louis the money he's making from all of this because we all feel he's earned it. And it's not that he earned it by locking it up, screaming about "pirates" and using a legal sledge hammer to attack fans -- but he's earned it by being polite, by being awesome and by being human. It's a lesson a lot of other content creators still need to learn.

Filed Under: awesome, business models, human, louis ck, polite

Humble Indie Bundle Well On Its Way To Break Sales Record

from the meek-shall-inherit-the-earth dept

A new Humble Indie Bundle is upon us. Once again, the guys who popularized the "pay what you want" model have brought it back with a whole new treasure trove of DRM-free, cross-platform PC games. This time, they have brought a number of heavy weights including Super Meat Boy and Cave Story+. While the games themselves are awesome, what makes this bundle so amazing is that it is already well on its way to breaking the sales record of the third bundle. Announced via twitter, the Humble Guys proclaimed, "We just hit 100,000 sales and $500,000 in a tiny bit over four hours!" The previous sales record was the third Humble Indie Bundle which brought in a total of $2,167,519.10 and sold 372,346 bundles. If this bundle can sell 100,000 in 4 hours, breaking that record should be a snap.

Perhaps this success is attributable to this being the holiday season and the addition of the Red Cross instead of the EFF as one of the supported charities. Or maybe in some strange way this success is a result of my 1000th tweet being a promotion of the Humble Indie Bundle. Most likely, this success is a result of a group of dedicated game developers connecting with their fans and giving them a reason to buy. That is true success. While the "pay what you want" model won't work for everyone, all developers can learn from the attitude and effort these developers put into selling their games.

Filed Under: business models, humble indie bundle, video games

Louis CK: Connecting With Fans & Giving Them A Reason To Buy By Being Polite, Awesome & Human

from the simple-as-that dept

A little over two years ago, we wrote about how (the absolutely incredibly brilliant) comedian Louis CK had gotten some news by asking politely for some fans to take down a video from a file sharing site, noting that it was new material he was working on, and he wasn't ready for it to be seen widely yet. The request worked. Louis himself stopped by our comments to provide some more detail. Throughout the entire situation, he did what he does, and what makes people like him: just be himself -- and be thankful and appreciative, while explaining his reasoning. In that case, he noted that he wasn't against file sharing, it's just that he didn't want this work out in the world yet. He even said that once the same work is released officially on a DVD or special, he'd be fine with the original clips going back up on file sharing sites. He was also quite clear that he didn't demand anyone take down any content, he just asked politely.

Given that attitude (and given plenty of other things he's done recently) it came as little surprise that he's released his latest "live" video directly himself off his own website, for $5 via Paypal, and is offering it with no DRM or anything like that. There are download and streaming limits, which I assume are to avoid bandwidth issues. There are a few ways he might have been able to deal with the bandwidth to offer more downloads or streams, but on the whole, he appears to be doing everything he can to make the process as simple and convenient as possible. He even put up a short note about file sharing on the page:

To those who might wish to "torrent" this video: look, I don't really get the whole "torrent" thing. I don't know enough about it to judge either way. But I'd just like you to consider this: I made this video extremely easy to use against well-informed advice. I was told that it would be easier to torrent the way I made it, but I chose to do it this way anyway, because I want it to be easy for people to watch and enjoy this video in any way they want without "corporate" restrictions.

Please bear in mind that I am not a company or a corporation. I'm just some guy. I paid for the production and posting of this video with my own money. I would like to be able to post more material to the fans in this way, which makes it cheaper for the buyer and more pleasant for me. So, please help me keep this being a good idea. I can't stop you from torrenting; all I can do is politely ask you to pay your five little dollars, enjoy the video, and let other people find it in the same way.

Once again, as he did a couple years ago, it's a polite and friendly request, not a demand or any sort of threat or anger. On top of that he explains his reasoning. In both cases, he comes across as being human, which all too often doesn't happen with stars.

To market this release, he hit the perfect target audience for this thing, doing a Reddit IAmA discussion (basically a Q&A for those unfamiliar with Reddit). Once again, throughout that discussion he was... incredibly human, and he answered a ton of questions. Not surprisingly, it's a really fun and interesting read.

Sometimes, when we talk about business models built around CwF+RtB (Connecting with Fans plus a Reason to Buy), people seem to falsely assume that means you absolutely have to give away all your content for free. We've said time and time again that that's simply not the case at all. If you can really connect with fans, and then make it convenient and reasonable for them to support you, they will do so (as I did). And that's exactly what Louis has done here.

I don't think anyone doubts that the film will end up being available from unauthorized sources. It may already be available that way. Hell, I'd bet that Louis himself expected it to show up for free pretty quickly. But the point is that the people who still "pirate" the video really don't matter. Those people were never going to pay anyway. What Louis has done, this way, is give tons of people (including plenty who normally don't pay for content) a really good reason to buy: which is by being polite, awesome and human. Compare that to so many who are rude, mediocre and programmed.

He seems to recognize this directly in some of his comments, where he notes that he went to The Pirate Bay for the first time the day before the release, and tried to think about what to do:

I don't know yet if I'll do it again. It hasn't run it's course. But I AM SO HAPPY I DID IT. Just so fun and it has been massively gratifying to share the positive of it with so many people who have written and expressed their feelings.

The day before I posted the video I went on pirate bay, which i had never visited and i read the guy's thign where he posts letters from media co's and artists and then his nasty and kind of hilariously chest beating responses. I thought "jesus. This guy is a piece of work. I would NEVER tangle assholes with this guy." and then I thought about it. What do I say to these people? To hope they don't make me regret putting it out there naked like this? So I wrote that little "to torrent" letter, just being a guy saying "dude. please?" it's the best I can do. If it doesn't work, well.

I've talked a few times now about reasons to buy, but the more and more we see success stories, I tend to think the simple list I have above is really a key point. Being polite, awesome and human takes you a hell of a long way towards both being able to connect... and giving people a reason to buy.

Filed Under: awesome, business models, human, louis ck, polite

The Book World Is Changing: Mark Cuban Creates A Best Seller Out Of Some Blog Posts

from the catch-up-with-the-times dept

A few folks have sent over this great interview with Mark Cuban discussing the fact that he has a best selling book on his hands, one that was put together quickly, mostly from old blog posts, sold as a $2.99 ebook online, with Mark handling most of the promotion himself. There are a bunch of things in the interview, but what comes across loud and clear is just how obsolete the old way of publishing is these days. In an era where it still takes years for books to come out, and almost a year between an author handing in their final version and publication, Cuban tells a very different story:

Of all your business ventures, the profit margin for this book is unmatched. Much of the book already had appeared as blog posts, and the production, promotion and distribution costs were negligible ...

Yes. That is what made this approach so appealing. I didn't have to spend a ton of time writing and editing, and Scott Waxman at Diversion Books was very accommodating in allowing me to make edits, literally up to hours before the book was released.

More importantly, I didn't have to commit to doing a book tour and a rigorous interview schedule because I controlled all the economics. I try to always be a good business partner. If a publisher had made a big investment in me, I would have felt immensely obligated to make sure they made money.

Instead, I can work to my schedule and work almost exclusively from my phone and laptop to do all the promotional work.

Before anyone says anything, we're certainly not saying that just anyone can do what Mark did. Given his fame, success, reputation and following, all of that played into the level of success here. And he's willing to admit that. But that doesn't mean that there aren't key lessons here for the publishing industry. The idea of being able to produce smaller books, much more quickly is really quite appealing. And the legacy publishers still just aren't getting it.

Filed Under: blogs, business models, ebooks, mark cuban, publishing, timeline

The Value Is In The Relationship, Not The MP3 File

from the some-data-on-pay-what-you-want dept

We've written a few times now about the band Uniform Motion, who has been extremely transparent with their latest release, such as explaining how much they make from different streaming platforms. Andy Richard, from the band, has also been quite active over on our Step 2 platform, and recently shared the results of a survey the band did of fans after they experimented with "pay what you want," including his own analysis of what the results mean. Here's just a snippet:

5. What made you decide to download the music?

I wanted to sample the music before buying a CD/Vinyl: 28%

I wanted to sample the music before paying for the MP3’s.: 22%

I wanted to own the music but couldn’t afford to pay for it: 22%

I don’t really know. I just clicked the buttons!: 19%

I wanted to own the music but I don’t think music is worth paying for: 4%

I wanted to write a review about your music: 3%

6. Do you have any idea how many times you have listened to our album(s)?

More than 5 times: 45%

2-5 times: 30%

More than 50 times: 15%

Once: 7%

I have no idea: 3%

I didn’t even get past the first couple of songs, you guys suck! 0% (thankfully!)

7. What made you decide to pay for our music? (multiple responses ok)

(Only people who had made a purchase were asked this question)

I wanted to support the band: 100%

I wanted to own the music: 61%

I wanted to own a tangible version of the album (CD/Vinyl): 61%

The key take aways are summarized here:

People who buy music do so to SUPPORT you.

So the interaction with fans is key. In today's business, you need to 'deserve' people's support and just making good music is not quite enough.

The value is in the relationship not the MP3 file.

We keep hearing from critics that the music is the "only thing of value" that a musician really has to offer as an argument for why any business model should be solely focused on selling music. But, as we've explained over and over again, that's not accurate at all -- and Andy's summation here encapsulates what we've been trying to say for years much more simply than we've ever said it. None of this means the music doesn't matter. The music absolutely matters, and the relationship is only built if the fans like the music in the first place. But the real value isn't in the mp3 file... but in the relationship.

Filed Under: business models, culture, relationships

Free To Play Video Game Makes Over $2 Million Selling Just One Item [Update: Or Not]

from the damn dept

For whatever reason, some people falsely seem to think that part of what I argue is that no one should ever try charging money for digital goods. Nothing is further from the truth. I have said over and over and over again, the important thing is figuring out what it makes sense to charge for, and what it doesn't make sense to charge for. The problem we have is when people just assume that because they put a price on it, that's the right price. On top of that, those who charge without recognizing the potential pitfalls of charging for things in certain situations shouldn't complain when that effort fails. But if you do it right, you can absolutely charge for certain digital things -- and, in fact, many of the examples we point to of success stories involve charging for digital things.

Aaron DeOliveira points us to another fascinating example, involving the free-to-play online video game, DarkOrbit. Within the game, there's a special item, known as the 10th drone -- or the Zeus Drone -- that is highly desirable. As you might imagine, to get the 10th drone, you first have to get all 9 previous drones... and some blueprints to make the 10th drone. Apparently, this is quite involved. BigPoint, the company behind DarkOrbit, also tried another tactic: the company has run an occasional promotion, where you can buy the 10th drone for 1,000 euros (~$1,330). Here's the amazing part: apparently two thousand people paid, bringing in about 2 million euros, or $2.7 million. For a single digital item. Update: Or.... not quite. A clarification makes it clear that it did not bring in that much. People did buy, but they had to buy with in-game currency. You can sometimes buy such currency... and sometimes it's discounted. If it wasn't discounted and you had none in the game... then the cost of the drone would have been 1000 euros. As that's not likely to be the case, while the game did still sell 2000 such drones, it was clearly for less money. However, it is still an example of where people can be willing to pay if done right... just not as amazing.

But the real key here is in what they did to make this possible. First, used "free" to get lots of people in the door, connect with them, and make them totally bought into the game, such that they'd be willing to spend. Then, build up the overall "value" of such an item, and then offer it in a way that people really wanted to buy even at what many of us might consider to be an insane price. However, it's a perfect example of how if you really connect with fans, and carefully figure out what it makes sense to charge for... you can do quite well.

Filed Under: business models, darkorbit, digital items, drone, sales, virtual goods
Companies: bigpoint

Any Suggestions For Those Just Starting To Experiment With 'Free'?

from the and-pay-what-you-want dept

Over at our Step2 discussion site, musician Drew Stephenson shares the story of how he's about to start experimenting with a "pay what you want" model for his music. Through a series of events, he has a professionally produced album, where he owns all the rights (the label he was with shut down and let him do what he wants with the music). However, he's asking for some ideas/suggestions on things to do as he kicks off this experiment. Head on over and share your thoughts.

Filed Under: business models, experiments, free