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Q&A: EEDAR's Zatkin On The Importance Of Downloadable Content

How much does downloadable content affect retail sales of games? According to a new EEDAR report, games with it sell 129% more than those without. Gamasutra talked to CEO Geoffrey Zatkin, discussing the advantages of the virtual storefront, and why Micros
How much does downloadable content affect retail sales of games? According to new research by Electronic Entertainment Design and Research (EEDAR), more than you might expect. The firm has found that on the Xbox 360, the console with the most tightly integrated downloadable content campaigns, games with additional content sell 129 percent more than those without. In looking at all three current-gen consoles, EEDAR studied trends both in additional downloadable content for retail games, and wholly original new game downloads. For the latter, the Xbox 360 dominates as well, with 77 percent of new downloadables available exclusively on the Xbox 360. The Wii, though, takes the lead in sheer numbers, with 51 percent of all downloadable games, and in time to market, with 95 titles released in the console's first seven months, compared to PS3's 29 and the Xbox 360's 21. The PlayStation 3 has the lowest average content price, at $6.17, compared to the Wii's $6.69 and the Xbox 360's $7.53. DLC's Sway While these downloadable titles certainly give publishers a steady stable of re-purposed catalog titles and smaller-budget games to help stabilize revenue during development of larger efforts, downloadable content to extend the life of a title, according to EEDAR, plays a large part in its overall success. Gamasutra talked to EEDAR president and COO Geoffrey Zatkin to learn more about just what types of content best added purchase appeal to games. According to Zatkin, as direct sales numbers of downloadable content are still held tightly confidential by the publishers, the firm has had to extrapolate trends related to titles and the types of content the games have made available. "One facet of this study analyzes how each type of downloadable content influences the sales and critical reception of retail game titles," said Zatkin, adding, "Genre plays a large factor in this. Types of downloadable content that correlate with higher sales for sports genre games do not necessarily have the same impact on RPG genre games." Instead, EEDAR has found specific kinds of content per genre that appear to have positive correlations with better sales, such as "cheats and unlocks" with action games, "macro content" such as new race tracks with racing games, commentary, concept art, and real-world video for sports games, and, across all genres, downloadable advertisements such as trailers and demos. What Not To Forget In fact, says Zatkin, "The biggest 'don’t miss' downloadable content is, hands down, downloadable advertisements." The study found that games with both a downloadable demo and trailer generate 69 percent more sales, and 62 percent and 72 percent more sales with either a demo or trailer alone, respectively. "Another 'don’t miss' form of downloadable content," Zatkin adds, "is downloadable expansions. Games with downloadable expansions sell, on average, five times more copies, and you are marketing directly to a customer that already has your product." Thus far, though, only the Xbox 360 has implemented expansions, with games like Oblivion and Crackdown. The Untapped Power Of The Gamerpic? Apart from content directly related to the game, EEDAR also looked at ancillary content like Themes and Gamerpics, which Zatkin says makes up "roughly 50 percent of all available downloadable content for the Xbox 360. 58 percent of all Xbox 360 retail games offer Themes and 53 percent offer Gamerpics." "Our research found that different genres put more emphasis on having downloadable Theme content available," he continued. "The sports genre has embraced it wholeheartedly -- 64 percent of all downloadable Theme content comes from sports games." While Zatkin admitted that there wasn't enough evidence yet to say whether this more decorative content impacted on retail sales, "we can say that Themes and Gamerpics are one of the fastest and most cost effective ways for developers and publishers to add incremental long-tail revenue to their titles, compared to other downloadable content types." Microsoft And EA: Masters Of DLC Asked who best seemed to grasp the potential of downloadable content, Zatkin pointed to both Electronic Arts and Microsoft themselves, but for different reasons. "EA, as a publisher, has more downloadable content than any other publisher by far," he said. "33 percent of all downloadable content for seventh generation consoles is found in EA games." On the other hand, "Microsoft has been good about giving their games a wide diversity of content. One Microsoft game that we at EEDAR thought was clever was Kameo: Elements of Power. It has Achievements that can only be obtained after you download free content associated with the game. This is Microsoft bringing you to their storefront and possibly encouraging you to buy something else." Fair Trade By far the most contentious angle, for consumers, at least, is downloadable content's pricing. We asked Zatkin if, across all consoles and since the practice began, if he'd begun to see a "fair price" emerge. "We have noticed a standardization of pricing among the different types of content," he said, "though the prices are firming up not only around content types but also for each genre of games. For example, a map pack in genre X may sell for twice as much as a map pack in genre Y." As the group compiled its report, Zatkin said certain patterns began to appear, showing that, for example, "unlocks" -- the ability to purchase something that would normally have to be earned in-game -- "have an average price of $2.40 for racing games, but sell at $2.85 for sports games." What Place For Retail? Asked if he thought, with ever widening options for publishers, developers, and consumers to take part in a purely digital marketplace, retailers should start to worry, Zatkin said that while consoles are "rapidly creating a formidable long-tail environment on their virtual storefront," they're not quite ready to replace retail. Though they do have the advantage of catering to niche markets that can't be served as well in traditional retail markets, Zatkin said, download times and especially the limits of storage capacity on the consoles "are the real barriers preventing downloadable games from replacing retail anytime soon." "We at EEDAR believe that console storefronts will remain a powerful complement to retail stores for quite some time," he concluded, "but at this point in time won’t replace them directly. Provided that the consoles can sufficiently support the necessary emulation, we see console storefronts continuing to amass large selections of older games which can be quickly downloaded and enjoyed."

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