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Loss-leading is for losers. I mean, it works if you are a large entity with super-deep pockets and a long horizon before you need to make your money back. For s
by jblow 14y ago
Loss-leading is for losers. I mean, it works if you are a large entity with super-deep pockets and a long horizon before you need to make your money back. For small developers it is death.
The first dot-com bubble was all about user-acquisition and loss-leading. Look where that ended up.
- jonnathanson 14y agoPerhaps "loss leading" was the wrong term on my part. A more accurate description for what I was trying to get at would be expecting to break even or turn a small profit on the first game, then converting that game's base to a higher-margin second game. That being said, I don't think loss leading, in and of itself, is out of the question for a small developer. There are periods of time during which dropping your price to free can drive a significant boost in trial. This is a valid promotional strategy, assuming it's used sparingly and strategically enough that it doesn't piss off the userbase who paid for the game.