One thing that’s particularly interesting for us is the way sales on Fortress Geek and Starlit Citadel differ, particularly in terms of the average item ordered. On Starlit, quite a few products used to sell in the $30 – 40 range. On Fortress Geek, that price drops significantly and most products that sell are in the $12 – 25 range. So, a $20 difference.
What does that mean?
We do 5 orders a day on Fortress Geek, each at say $15 on average. Revenue = $75
We do 5 orders a day on Starlit Citadel, each at $35 range. Revenue = $175
Assuming we make 40% margin on both, gross profit fir FG – $30 and SC – $70. If our margin on SC is only 20%, the gross profit is still $35. Same number of orders, but higher revenue and even with a lower margin, we still make more gross profit.
Of course, cost of goods isn’t the only thing that counts towards gross profit, but it illustrates the point effectively. On the other hand, it’s easier (in some ways) to sell a product for $15 rather than one for $35 – but online, the difference is marginal.
Why bring this up? Well, partly because of the changing marketplace we see in board games too. We’re seeing a giant split in games, with some of the most popular games in the $10 – 20 range (Sushi Go, Love Letter, the Android: Netrunner Packs, etc.) and a gulf till we hit a lot of the more popular ‘big’ games (Imperial Assault, Mage Knight, Caverna).
Interestingly, the games in-the-middle have stalled for the most part, the one’s in the $40 – 50 range have stopped selling as often – Ticket to Ride, Dominion, Small World . There’s not been a breakout hit in that price category in the last 2 years for the most part unlike previous years, which has meant that we are often processing more orders than ever (for the smaller games) and yet not really making that much more.
It’s a weird thing, and just an artifact of the industry which has been gearing towards ‘bigger’ games or ‘micro’ games. Of course, this could change very easily with the next set of releases.