A Failed Experiment

I know that a lot of people have been watching Adamant’s recent shift to an “app-pricing” model, where everything we released in PDF was priced at $1.99.

Well, I’m not going to bury the lede here: The experiment was a failure. I don’t believe that the model is a sustainable one in this market.


As I reported earlier, the experiment started strongly. Actual dollar income was up more than 200% in both January and February (223% in January, 218% in February). Adamant was making twice as much money as we had at the same period last year. On the surface, that’s great news — and seemed to indicate that we were on the right track. More money = better model, after all.

Unfortunately, the situation wasn’t that simple. March took a nose-dive (more on that in a minute), and while wondering aloud on Twitter about the data I was getting, John Rogers asked if I was cross-referencing with release frequency data.

They say that the devil is in the details. Well, that’s where this particular devil was lurking. The missing piece that I wasn’t seeing.

Yes, January and February were up, making twice as much as we’d done last year. Last year, however, we had barely released any product during that period –a THRILLING TALES adventure in January, and a THRILLING TALES serial video in February. The adventure, which moved OK, was priced at $5.00. The video, which didn’t move that well (to the point where I haven’t bothered to finish releasing the series) was only priced at $2.00.

In January and February of this year, Adamant released 2 products for ICONS — our hottest line, whose releases (whether through Adamant or via Adamant’s licensees) are always in the top 20 “hot products” lists), AND a release for PATHFINDER, and a THRILLING TALES adventure. All priced at $1.99.

In other words — we released twice as much product. The 200+% began to look more like a function of release, than pricing. (And that’s not even taking into account the popularity of the ICONS titles).

I said earlier that March took a nose-dive. Traditionally, the first week of March is when we participate in the “GM’s Day” sale — and for the past few years, the overwhelming response to that sale (where we would drop our prices down to $1.00 from their regular levels) would earn Adamant as much in one week as we normally make in more than three months of regular sales. That one week has been enough to make March our second-highest sales period of year, behind only the week following Thanksgiving (when we run our Black Friday/Adamant Anniversary sale).

This year? In order to be listed as a GM’s Day participant, we had to actually run a sale — even from the $1.99 app-pricing which we now occupied. So everything was priced at $1.49 — 25% off. We participated, as we do every year, with dozens of other publishers.

The result? That week made barely 20% of last year’s take.

My stomach sank. I began to suspect that having our regular pricing at $1.99 had made the Event Sale largely meaningless. We had, essentially, cut our own throats. No March windfall.

The rest of the month? We released two hot ICONS adventures, and an adventure for MARS. Last March, we had only released one installment of the video series for THRILLING TALES, priced at $2.00, to disappointing sales. Yet even with that — the non-sale weeks for March 2011 were only 35% higher than the non-sale weeks for March 2010. Three times as many releases, and only a 35% increase in income.

It’s become pretty obvious to me that the app-pricing model doesn’t really work for us — perhaps the consumer pool is too small in this market to drive the kind of numbers where it would work. Perhaps Adamant’s audience base is fairly static, and we’d move roughly the same number of units regardless of our pricing. Who knows. The number of units moved in a month by ICONS adventures under the app-pricing model weren’t massively higher, on average, than the number of units that ICONS products would move in a month under the old pricing. It was higher, yes — but not as much as you’d expect.

The only inescapable fact is that the increases we were seeing were explainable by increased releases over the similar period, not by pricing. And even worse, by engaging in this experiment during the month of March, we made a huge mistake — completely taking the wind out of the sales of our second-best sales period of year, completely removing a much-needed cash influx. Even worse, it’s entirely possible that we could’ve have moved similar unit numbers, at the old pricing… which means that for every sale, we were essentially leaving an average of $3.00 on the table.

None of this is certain. I’ve got data — sales, income, release, etc., but it’s far from conclusive. I can only play my gut here. I’ve got bills to pay and freelancers who need payment as well, though, so I can’t really afford to extend this further than I’ve already done.

There’s an old saying that goes: “When you find yourself in a hole, Stop Digging.” So that’s where I’m at right now. Everything seems to be pointing me at the conclusion that this model just doesn’t work for us. Maybe it’s just not for Adamant — but my hunch right now is that it’s market-wide. I think tabletop games may be too small of a niche for the model to work as intended. Again, that’s just a hunch — I can’t afford to keep up the experiment to prove it one way or another.

Maybe I’m wrong, and another company will make a go of it, and it will work for them. But it won’t be Adamant.

As of today, our prices will be returning to their usual levels.

Thanks for reading.

53 Replies to “A Failed Experiment”

  1. Thanks for all the info on this throughout the experiment. I’ve no doubt Adamant will recover to pre-experiment levels. I know we’ve all gained from this information.

  2. Sorry to hear it didn’t work out, but it is refreshing to see a publisher be so forthcoming with information.

  3. FWIW, while there are a lot of mass-market apps in the $0.00-1.99 range, the top end of the app pricing range these days is well above the standard price range for an RPG supplement in PDF.

  4. Hm.

    Well, we’ve only been following your lead for 3 months, but March wasn’t a disaster for us.

    Our first full month at app pricing was Vigilance Press’ best month ever, 40% higher than our best month, actually.

    March was our second full month, and it was our 3rd best month ever.

    As you say though, it’s impossible to tell WHY. We released a lot of strong stuff that month, so maybe we’d have had great months regardless.

  5. @Chuck– Yes, I think you should look at the release frequency of that first month, vs your previous best month. Not only number of products released, but the relative “hotness” of what was released. I think the key might be there.

  6. Oh yeah, I agree there are MANY reasons that could account for that.

    I had just released USHER Dossiers, for example, which I suspect would have sold really well no matter how it was priced.

  7. Certainly the game audience is a shallower pool, but I’m curious to see how you think this bleeds over into other categories, be it fiction, comics, film, etc.

    — c.

  8. Sorry to hear it, amigo. I do appreciate the information and the honesty, however. And I hope the number of sales continues or increases now that you’ve restored your pricing to its previous level.

  9. The only way to learn is to try new things, and it was a bold experiment. You and the industry overall have a better idea of how this kind of pricing does and doesn’t work with ebook RPGs.

    I think companies like Apple just have a greater volume of product to make up the cost.

  10. I’m curious to see how you think this bleeds over into other categories

    Not sure yet. I suspect that comics may be in the same boat — a small, relatively static consumer base. But fiction and film? I’m pretty sure there’s wider reach there, which leads me to the gut reaction that it would probably work in those fields. There’s certainly anecdotal evidence to support that opinion.

  11. Really? That’s a shame because your products have been dominating the top 20 spots at RPGNow for awhile now.

  12. @Gareth and it’s my recollection, in fact, that ICONS stuff was very strong on the top sales lists before the app pricing model went into effect, as well.

  13. Thank you, Gareth, for taking the chance on this experiment and for sharing your findings with us, throughout. I’m sorry to hear that it didn’t work out for you, and that you had a steep price to pay to undertake the experiment yourself. I hope you’ve attracted some new exposure and new customers through this experiment, though.

    I admit, I wondered if the app-pricing model would endure past the point when you had saturated your audience—when the fixed-depth customer base had bought everything they wanted for $1.99. I was curious if new products would come out fast enough and be adopted fast enough for the $1.99 price-point to pay for the new books.

    Regardless, you’ve made us all better informed by taking it upon yourself to explore a jungle that a lot of people were just pointing at and sweating over. Thank you.

  14. Sorry to hear about it Gareth. I was hoping the new model would be sustainable.

  15. I wouldn’t be surprised either Gareth – ICONS is a good game. :)

    If I were you though I would consider at some point lowering the core rules for ICONS to 9.95 or some such so it continues to stay at the top of the rules light supers competition (BASH! is 9.99 now, for example). There’s a lot of copies of ICONS out there now after prices were lowered to $1.99, $1.49 and $1, and you want to keep the entry point to the game affordable when those folks see how cool the game is and talk their friends into playing.

    Anyhow, it was a good idea, and nothing ventured, nothing gained. Sorry to hear it didn’t work out.

  16. Please don’t write it off too soon. The disasters and political unrest in March made it a very bad month for retail overall, not just in the games market, but in all entertainment markets.

  17. @Stephanie — I wouldn’t call a full quarter of business as “too soon.” And the situation in March was only the impetus for me to take a closer look at what was really happening in January and February, not the straw that broke the camel’s back.

  18. I really appreciate the fact that you made the effort to give us some great deals. I was very happy to pick up a number of titles @ the $1.99 price point. However, when it comes down to it, I’d rather pay more money to ensure that you are able to sustain your business and keep providing us top notch stuff. Keep up the good work!

  19. I would be surprised if the price change has a large effect on sales. As an example, I purchased all ICONS stuff before the price change and will continue to do so after. If someone is a fan of the game, they will continue to do so. I doubt $5 versus $2 is going to have an affect on future sales.

    I did purchase some of the M&M Link things that I would not have otherwise purchased, but I did that more out of idle curiosity. I won’t likely be purchasing them in the future. Not because they are too expensive, but because they do not have enough value for me, someone who does not play or run M&M. This will likely be the case for people who made some curiosity purchases of a game, but decided that it was not of interest to them. Of course, the fact that the core book was on sale for $2 for so long likely exposed the game to many people who would not have otherwise purchased it. That can only be a good thing for creating new players.

  20. Sad to see that the response to app pricing hasn’t been what you expected (and what I expected, for that matter). I still believe the principle is sound, but your analysis above, that the scale only works outside a niche consumer base, sounds convincing.

    It was an extremely worthy experiment. Hopefully the March income hit doesn’t cause too many problems downstream.

  21. Thanks for sharing Gareth. Pricing is a tricky and relies on so many factors. I am now looking at pricing pdf’s in the $3-$8 range in order to make it worthwhile for me. But that’s the important part, isn’t it – each of us has different needs in terms of profit margins and overall sales etc. I don’t have to pay freelancers, but I also have a very low turn over of product. Good luck with whatever your next step is.

  22. It was brave of you to try something innovative from a market standpoint like App pricing. Sorry it didn’t work for you guys. There is a very limited pool of paying RPG fans out there (as you’ve said yourself). When you look at paying RPG fans it gets even smaller. I could see how putting your quality product on the market at 1.99 a pop would potentially reach the stingier GM’s and fringe players but you are draining your limited potential customer base way way faster than you could ever replenish the quality product offered by the cheap-fast-good rule (I can’t see you guys ever stooping so low as to begin putting out drivel just to have something new to sell).

    I know that I personally would throw down $5 to buy just about anything interesting in pdf (as long as it wasn’t just 8 pages with 4 pages of adds inside). For meatier product I have no problem paying $10-$15 per pdf. However, that may still sit below your ideal sales point. I guess what I am trying to say is that for blokes like me…don’t let us walk off with your pdf’s for birdseed when we’ve got a few silvers to toss around (but thanks for the experiment all the same).

    We want your family to eat, drink and be merry so that you can keep writing cool stuff! Here’s hoping for a sunny quarter for you guys.

  23. I’m really impressed with the candid honesty displayed in informing the public about your pricing experiment, I’ll be sure to check out Adamant Entertainment.

  24. haha! Well – that’s irony perhaps?

    After following your lead Gareth and that of Amazon’s $2.99 sweet spot pricing for self publishing – we dropped out prices to $2.99 on 3/31 – of course our catalog is FAR smaller, so our goals are different (moving units vs. total revenue; the former being a higher priority since we are still growing our audience). There’s a great article on this issue over in the fiction publishing side of things here: http://goo.gl/dJXwl perhaps you saw that.

    I wonder if you just need to play around with your peak price – as opposed to just bagging the whole thing and returning to the old price points. There is definitely a relationship between price/total revenue/units sold – but it’s probably something that needs to be worked out for each product line.

    thanks for posting.

  25. Thanks very much for your thoughts and openness on this mate. It definitely gives a lot of food for thought for those of us who are considering breaking into the industry.

  26. Thanks for your honesty in all of this experiment, it has been very refreshing.

    I must admit, I used to tend to only buy Adamant PDFs during sales when the pricing was a couple of dollars, at that point they were impulse purchases and I could make them without the prospect of actually getting any use out of them.

    With the return to the previous pricing model I will likely wait for sales again – unless I actually start playing the games and “need” the materials earlier.

    For reference I have bought the following despite not actually getting around to reading them yet:

    Hot Pursuit: The Definitive D20 Guide to Chases
    Hot Pursuit: On Foot
    Buccaneers & Bokor Issue 01
    Buccaneers & Bokor Issue 02
    Buccaneers & Bokor Issue 03
    Buccaneers & Bokor Issue 04
    Buccaneers & Bokor Issue 05
    Buccaneers & Bokor Issue 06
    Buccaneers & Bokor Issue 07
    Corsair: The Definitive D20 Guide to Ships
    Narrative Combat
    Fantasy Occupations
    Random Fantasy Adventure Generator
    Expert Feats
    Scourge of the Rat-Men
    Venture 4th: Monster Maker
    Gangs of Freeport
    Blood of Freeport
    Tome of Secrets
    Fell Beasts Volume 1
    Fell Beasts Volume 2
    Fell Beasts Volume 3
    MARS
    Full Colour Map of Mars
    Rebels of Mars
    The Sons of Tara – a Mars One-Sheet

    I have also purchased, and actually read (though no plans to actually play yet) the following:

    Thrilling Tales 2nd Edition (Savage Worlds)
    Thrilling Tales 2e: The Radio Marauders
    Thrilling Tales 2e: The Malay Coins
    Thrilling Tales 2e: The Valley of Mystery
    Thrilling Tales 2e: Lights, Camera, Murder

    So, without the low pricing (either GM Day sales or the app pricing model) likely none of the above would have been purchased by myself.

    So I think the key is the sales – those who want the material “right now” will pay the higher price, while those who wouldn’t otherwise purchase them can wait for the sales.

    BTW the reason I have read the Thrilling Tales stuff is likely the formatting, the two column large print means I can read them comfortably on my mobile phone, if Icons were the same I would likely be reading those as well.

  27. I want to join in the many messages of appreciation for the openness and transparency with which you have reported this marketing project, and hope that you didn’t bail out too late. Any failed experiment has a price tag attached and I hope that your operations have enough reserves to be able to absorb this cost without negative impact in the long term. I regard the attempt as a noble one, and the reporting as a service to the entire gaming industry for which you should be lauded.

    Best wishes.

  28. I’m curious to see how you think this bleeds over into other categories

    I worked for a big box retailer for a little over two years selling digital files of sheet music. What I experienced there resonates what I see everywhere else, that sales are affected by a) how badly people want the product and b) availability rather than price. If someone wants to buy a product and the price point is already low (e.g. within $10) they will pay to get it.

    Tobias Buckell posted a graph of his experiments selling an anthology with different price points, and every graph he posted looks almost exactly to what I experienced in retail.

    http://www.tobiasbuckell.com/2011/04/01/a-year-of-selling-tides-from-the-new-worlds/

    DriveThruComics.com offers comics at different price points as well, but in that industry the model is changing because the demand is also changing. If you have a series of comics, you can price at 99 cents or even give away single issues for free, because people want to read the entire story. So there the value is not in the single issue, but in the collected trade, which is not priced at 99 cents. Here the single issue becomes the marketing tool for the larger product because digital allows them to do that more cost effectively than if they were to print them.

    The issue with pricing is not that initial rush, but sustainability. If you have a handful buying your product every day on the “long tail” side, then you’ll make more money at regular prices that you could occasionally discount than you would if you went to ninety-nine cents. In my experiences, the volume after the initial spike doesn’t really change.

    Thanks for posting this!

  29. Gareth, this is why I respect you. You tried something, explained why, gave details as the experiment was underway, and when it went wrong you stepped up and admitted it.

    Thumbs up.

  30. ICONS is hot, and you should charge a fair price for the product. App pricing may still be a good way of boosting sales on older items in your catalog.

    Thanks for doing the experiment, and posting your experience with it!

  31. The closest thing I have seen to the PDF market is comics. I know that several comic producing companies have considered the DVD approach where there is a launch window (1 week) where the product is on sale and then the prices move up to their “normal” prices. Although these products have a wide versus a niche market, there is the possibility to doing the same thing in the PDF / eBook market. Set a retail price that is more than the price YOU think you need to sustain you business then take some percentage, let’s say 10%, off the price for the first week it is released. Try that and see how you market responds.

    If you have looked at volumes do you have the ability to see if it is a fixed number across all releases? Meaning, if you sold 2,000 copies of ICONS and close to 2,000 copies of each supplement then you can make the case that your niche is very fixed. It there is huge variability regardless of when it was released then you might have enough data to support the DVD model. It is just a thought.

    I appreciate your honesty and the work you have put into the product line. Thanks for Creating a great game!

  32. Mark, I can’t speak for Gareth, but to my mind, Video Games are a better model for TT RPGs than movies.

    In other words, I think starting at full price, to get the truly dedicated, then lowering the price over time, is more the way to go.

  33. You are right. That does make more sense from a business owner perspective. It reverses the direction I was looking at and give you the power to review sales numbers and make a decision on when to lower the price or if you even need to.

  34. Mark, one thing to consider, is that when a movie hits DVD, that’s already the second bite at the apple.

    The “premium” way to see the movie has already come and gone in the theater.

    So I think we need to consider that DVDs start cheap because they’re going after that large market segment who already passed on the movie once.

    Comics is similar, in the way that many people “wait for the trade”.

    In RPGs, and computer games, there really is no “change of venue”. You’re releasing the game, and then the only two things you have to entice people to buy are its quality and its price.

  35. I agree. I had not considered that the DVD is actually for second run people and not first run early adopters. People are paying the premium to see it at the theater while the DVD purchases are for those people who REALLY like the movie or for the people who for various reasons could not make the investment in the first run. I guess the sign of success would be when you have bumps in sales on the “initial release” and then another bump in sales on the “second release”.

    The one thing I can add is that all the supplements I have purchased have all been worth the money. While ICONS is easy to play off the cuff it has been nice to have all the other materials to keep the wheels turning in my home game.

  36. Gareth,
    Thank you so much for this information. When we (Victory RPG) released our first ICONS-comp product I was concerned that our $4.99 price would put us out of the ICONS market as you and Vigilance were putting out such great stuff at $1-$2. Our book did extremely well though at $4.99 and left me in a quandry.

    Do we strip down our state-by-state books and include just 1-2 states with 2-4 bad guys for $2 or stick with 10-12 bad guys from 5-6 states at $5?

    Ultimately I think there are two sets of customers. The folks who PLAY and will buy stuff under $10 and the curious readers that buy under $2 and read it like a comic. I suspect a $2 start price grabs everyone but over the long haul will actually produce less revenue than a higher start price and a 6-12 month slashed price to grab the curious / wish list crowd.

    The other factor is are you giving customers too many choices? If we have the Enemies of Vermont and Enemies of NY as two books I suspect we’d see less revenue than combining the two at a higher price. Especially in a niche market like this.

    Of course my experiences may differ from other larger publishers.

    Best of luck on your new pricing.

  37. We covered this issue a few times on pulpgamer.com, I’ll definitely update the next time we record.

    I definitely think there’s something going on here in the difference between the “back catalog” and the newest stuff. I tend to search back catalogs for purchases when I get some new idea for a campaign. Like, I want to do a pirate game so I go digging around in pirate crap. Whereas something new, if I’ve heard good things about it from people who’ve played it, I go and check it out.

  38. My purchases of gaming PDF’s are currently based on the circumstance of being essentially destitute. But I think a good pricing model is like the one for Savage Worlds, keep the core rule book low in price so anyone can get started in the game and then use pricing based on page count and quality for all supplemental books. People are willing to pay good money if they know they won’t be disappointed in the product. Also, a 6 page book should cost less than a 300 page tome.

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