I Told Ya (Price Reduction)

[Rentahamster]

I'd like to get back to the discussion about the elasticity of demand for this service. For me personally, the price is fine, and I'm 75% sure I'd be okay with it, but I feel like I'm more of the exception than the rule.

From my totally non-scientific analysis, I still think it's too much to ask since it's still hard enough as it is trying to get people to play the game when it's free. I'm preparing for a huge population drop, but we'll see. Hopefully 1.20 is good enough to bring folks back.

[Betelgeuzah]

From my totally non-scientific analysis, I still think it's too much to ask since it's still hard enough as it is trying to get people to play the game when it's free. I'm preparing for a huge population drop, but we'll see. Hopefully 1.20 is good enough to bring folks back.

Too much to ask from what perspective?

Free service is no longer sustainable. What they're doing here is breaking even for keeping the service up.

[Rentahamster]

Too much to ask from what perspective?

Free service is no longer sustainable. What they're doing here is breaking even for keeping the service up.

That's not the point.

The point from the original thread is about the way in which total revenue can possibly be increased through a price reduction since more people will have crossed the threshold to wanting to pay.

I still think the equilibrium point for optimal revenue is still a little lower than $9.99, but hey.

[Betelgeuzah]

That's not the point.

The point from the original thread is about the way in which total revenue can possibly be increased through a price reduction since more people will have crossed the threshold to wanting to pay.

I still think the equilibrium point for optimal revenue is still a little lower than $9.99, but hey.

Even 9.99 means 25% more people would have to pay for the service as opposed from 12.99 fee.

Even that sounds far-fetched, much more-so when you keep lowering the fee. I think they are going to be on the losing end here to meet the customers at half-way (I guess for PR purposes). I don't think this reduction will result in 25% more subscribers than with a full price.

[Rentahamster]

I don't think this reduction will result in 25% more subscribers than with a full price.

That's because it's still probably too high for most people. There is a greater threshold for customer acceptability at a lower price point. You won't get the numbers you desire until you cross that threshold, and I don't think -25% will reach that threshold.

This isn't a linear relationship.

[Betelgeuzah]

That's because it's still probably too high for most people. There is a greater threshold for customer acceptability at a lower price point. You won't get the numbers you desire until you cross that threshold, and I don't think -25% will reach that threshold.

This isn't a linear relationship.

Yeah this isn't a linear relationship, but you're saying that they would get double the subscription numbers which they would need to get if they halved the fee. I don't believe that for one second. 6 dollars versus 13 is not so big of a deal for so many people, even if it was merely a principle.

They would have more subs, definitely, but not double. Hell no.

[Rentahamster]

Yeah this isn't a linear relationship, but you're saying that they would get double the subscription numbers which they would need to get if they halved the fee.

I didn't give numbers that specific.

All I'm saying is that there is a some amount of revenue they will get with their current plan of 10 bucks a month, and that it's possible that they could get more revenue at a plan that is less than 10 bucks a month.