When corporate greed takes over:Shady Pricing Strategies of EA
"EA Sports:It's Not in the Game"
1999 - 2009 were practically the golden years of EA. Almost every franchise they had were releasing with quality one after another (Need For Speed, 007, Battlefield, Medal of Honor, Command & Conquer, BLACK, Dead Space,and even the sports games were better than their competition). From 2010 onward EA’s consistent anti-consumer business practices has created much controversy and drawn fans ire,leading up to the launch of Star Wars Battlefront II on November 17.
The phalanx and halo combination of IGN's corporate media pandering and EA's capitalistic industrialism is a match made in industry-monopoly heaven.This article looks at the dubious consumer practices adopted by EA over the past decade.
Preorders
3-4 weeks before a game is launched EA markets preorders heavily. Preorders usually accompany some unlocked content such as different skins for the main character or maybe a gun as in the case of Battlefront 2 which otherwise can only be unlocked by playing the missions. Appart from preorders EA also offers various editions its games such as standard edition and deluxe editions.In Fifa 2018 EA sports offered 3 editions.The prices for these editions vary from $60 to $90.
Micro-transactions
Ea also relies heavily on microtransactions,which is a considerable concern in the gaming community.EA treats games such as Battlefront 2 and Battlefield series like a long tail mobile F2P MMO - get the game out there and then charge most for people that don’t want to spend the time grinding.These in-game transactions usually start from $2 and can go up to $90.
Lootboxes
Lootbox sales drive significant revenue for EA. Loot boxes are virtual in-game items that can be bought with real-life money by registering your bank account details to your gaming platform of choice.Purchasing loot boxes will reward a player with a random in-game content, which can range from cosmetic-only content, like new outfits for a player's character, to game-changing content like more powerful weapons and items.
Day-One DLC
Gamers buy games to experience the whole game,to have fun and to enjoy the complete game.On the top of paying $60 for a full game, EA games charge $10-$15 for extra downloadable content.which sometimes apparently contains true ending.The CEO of EA was brazen enough to proudly exclaim how successful their day-1 DLC for Mass effect 3 was.EA managed to turn $60 product into a $80 purchase. The excuse has become rampant in the industry that people want more content sooner, which means more disc locked content and more day one DLC.
Forced Multiplayer in games for Broader appeal
EA has been criticized many times for forcing multiplayer in single player story driven games such as Dead Space 3 and Mass Effect 3&4.Multiplayer games often charge a subscription fee in addition to an initial registration fee if it exists in that particular game.
Rehashing Ips to increase profit
Games such as Need for Speed and Battlefield series have been best sellers for EA for a number of years.But in last 4-5 years, EA has made each of these games come out so frequently that the tag EA could easily be replaced with Activision.Though this strategy was successful in the past but in the recent years, EA has received a lot of bad rep for showing no innovation in their racing and war games.The fall of Medal of Honor franchise is the epitome of failure of such strategy.The last addition of the medal of honor series was a complete disaster and made enormous losses for EA.
Overblown Marketing
EA spends on marketing like there is no tomorrow.Around 60-75% budget is focused on marketing.For games, marketing pays for commercials,online ads,giveaways,promotional events and lots more.It also pays for DLC charity events,anti/pro-gay movements to sway from bad PR.Looking at EA’s current growth rate, it is clear such strategy is not working anymore.EA should take a cue from the promotional strategies of gaming companies such as Rockstar,Valve and CD Project Red and just focus more on gameplay along with features that gamers would love to play,rather than spending three-quarters of a billion dollars on ridiculous,insulting PR stunts and trolls.
Reaction from customers
EA was voted worst company in America in 2012 and 2013. Though EA did improve its practices afterward but in the last couple of years, EA reverted to old shady practices. EA's new "Star Wars Battlefront II" was so unpopular that apparently one the game developer got death threats.The EA’s official response which defended the loot box system earned more than 250,000 negative points in just 18 hrs on Reddit.EA’s stock price also fell by 3% amidst all the controversy.
Conclusion
The main point of the article is that it’s become more apparent now than ever that EA is in it for the money, and yes they are a business so they have to be, but it’s one thing to want profit and another to clearly rip-off fans to their face. It's clear that many gamers like me are afraid that if we are complacent with EA and allow these shady practices then other games developers will follow in their path and focus more on micro-transactions than creating good games. But the backlash shown by gamers in the last couple of years, it’s clear that this is not what fans want, and many will be voting with wallet, not just voice.
McKinsey & Company | Gold Medalist @ IIM Rohtak
7 年Nice read.. Well articulated
Manager at KPMG India
7 年Insightful
Google | Ex-Flipkart | Ex-Amazon | Ex-Swiggy | IIM Rohtak | Growth | Analytics | Marketing and Strategy Major
7 年This has been discussed around the gaming universe quite a bit. Insightful article. Well written!
ICICI Bank, Ex-HDFC bank&TCS. IIM Rohtak&GMRIT alumnus
7 年Great work pratik..... The article depicts your love and knowledge of games