How do developers/publishers determine the price of games or their micro transactions if there is a theoretical ‘infinite’ supply of it, once created?
In: Economics
Even though the cost of supply doesn’t really depend on how much you sell, the demand is elastic, it changes based on the price you set. People probably won’t buy your in-game points for $100, that’s too high. But they might $1 over 100 times if they play regularly. The developer will look at market research and try to collect data from players to see what works best and makes the most money in the long run.
A lot of prices are demand-driven, by the way, even with a more substantive product. For example, think of something like Nike shoes: the manufacturing cost per shoe is tiny compared to the price. Nike’s business strategy is all about marketing so people are willing to pay a lot.
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