Gaming: Steam's Summer Sale Is a Marketing Masterpiece

By Jake Barach  JUL 17, 2013 12:00 PM

Valve Corporation's computer game client is tailored to woo users and fill the company's piggy bank.

 


Steam is a website that allows people to connect, communicate, and play games with one another. Players purchase the game via the Steam store and then, using the downloadable Steam software, gain access to the game. Steam can be a computer gamer’s best friend -- and when the annual summer sale rolls around, a wallet’s worst enemy.

The 2013 Summer Getaway Sale kicked off July 11 and will run until July 22. While Valve Corporation, the company behind Steam, initially launched the free-to-download software exclusively for Windows (NASDAQ:MSFT) in 2003, it is now available on Mac OS X (NASDAQ:AAPL) and, as of this February, Linux.

Steam isn’t just a limited, online-only version of GameStop (NYSE:GME) or Best Buy (NYSE:BBY) -- the company is also behind the renowned Counter-Strike, Half-Life, Left 4 Dead, and Portal series. Valve has proven that it knows what gamers want in a game, and its sale strategy reveals that it knows what they want in a game store, too.

While Steam will knock prices down as much as 80% on certain featured items during the summer sale, deep discounts are an expected part of any notable sale. What makes the Steam sale special is the seamless way in which it combines reduced prices, limited-time offers, and user participation that plays directly into the impulsive and emotional nature of game purchases.

Many gamers have an unwritten list -- or for some, a written list -- of games to buy, worlds to enter, and journeys to complete. From classics to modern marvels, this list can cover multiple decades and genres.

While it’s easy to compile this list, it’s significantly more difficult to cross off items, especially when each item requires hours of dedicated time. Couple the time requirement with certain pricetags upwards of $50 for individual titles and it can be difficult for a gamer to justify a purchase.

Make that $50 game $15, and give the gamer 24 hours to make a decision, and it can be an entirely different situation. This is the principle at the core of Steam's sale.

Most items across the Steam store will feature some sort of price reduction, however, there are daily features that are reduced by a greater percentage. There are also flash sales for which the featured games cycle every eight hours.

Certain games, like Tetris, are timeless. They are also included in the sale, which allows for featured items to be old as well as new without users feeling as though Steam is scraping titles from the bottom of the barrel to keep the inventory going. Whether it’s a childhood favorite or a indie-developed game gaining respect among the gaming community, a reduced price and a limited time slot may allow a gamer to justify pulling the trigger on a purchase.

The entire idea of a sale is to change the way people think about a purchase. Threatening to take away a special offer after a limited time is just one way in which the Steam sale relies on upon psychology.

"While I’m sure Valve has the slate of deals worked out ahead of time, the selection of games seems random to us. And Steam spaces things out masterfully, making sure that you come back to the site throughout the day to see if you’re going to get a reward in the form of a great deal," says Jamie Madigan, Ph.D., a writer for Psychologyofgames.com, of Valve's psychological tactics.

The seasonality of this sale can also work in Steam's favor, turning that impulsive purchase into multiple purchases. Steam users know that the summer sale is the time to buy, so when games that have been sitting in the back of their minds are waved in front of them, a "now or never" situation is set into play, resulting in confirmed purchase after confirmed purchase.

Fez, for example, which was launched as an Xbox Live exclusive, recently appeared on Steam. After 48 hours of being listed as one of the summer sale’s daily features, and one of "yesterday’s daily features," Fez sold 105,000 copies via Steam, more than it sold in its first three months in the Steam store. 

While Valve selects which games to feature daily, it also hosts a community-chosen deal on a big-name product. As I write, Steam users may vote between 75% off Tomb Raider (OTCMKTS:SQNXF), 40% off The Elder Scrolls V: Skyrim, or  50% off of BioShock Infinite. Letting the majority rule on which deal is next is just another intelligent method by which Valve ensures that its highlighted deals are hits.

Video games are unique products, and the key to a smart game sale isn’t the master key to all sales, but Valve Corporation’s model is one that big companies can learn from.
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