Friday, 15 January 2016

Appealing to Whom?

There's a couple of things to think about when you're bringing something to market, and that (1) cost, and (2) value. 

The cost of something is pretty straightforward. It's the price tag that will be on the raw materials, the labour, and the organization required to apply the labour to the raw materials all the way up, down, and across the supply chain required to put a product in the sweaty hands of its end-users. Ideally, of course, you want the cost of everything it takes to get that product to the end-user to be less than the money that doing that returns back through the supply chain. Cost is pretty straightforward, and it's typically what people discuss when they want to talk about producing stuff. A movie could cost $100 million dollars to make, and return a gross of $101 million dollars. That movie cost $100 million to make, and it cost $101 million for consumers to consume it. There's $1 million dollars profit. 

That $1 million dollars of profit is not the value of the film. As a return on investment it's less than 1%, and most of us want to make more than 1%, especially if we can get our hands on $300 million dollars. It could be worse, obviously, but people don't invest in order to break even (and that emphasis on increasing funds is why the return on investment is typically equivalent to the risk). Put another way, I don't think we would find too many people who would make a movie instead of just sticking that cash in an investment product and skipping all the work even though making film is how they get paid. That's why films tend to net negative income, despite often grossing far more than they cost to make. Hence the value of a product is something of a function of the cost and the priority of that profit. Put another way, the value of a product is how much of a cost someone is willing to bear compared to other options and their associated costs. In other words, revealed preference is a good way of judging something's value. If people will buy your product at a cost that makes producing that product worth your while, it's valuable. The math connecting the end-nodes of a production network, from the supplier to the demand, is something of a hash of game theory and network theory. 

So what? Well, not everyone will find the same value in the same product. But you don't have to sell a single product to suit everyone, just one that will appeal to enough people that it's valuable for its retail cost. It's not as easy as it sounds, because there's a surprising amount of variety in what people want, even in what can otherwise be described as 'niches.' Elsewhere on this blog I've gone to some effort to argue that some of this variety is objectively bad, as in some tastes and valuations are bad, as in should be judged as morally bad. No, liking certain games isn't as bad as enjoying drowning puppies, for example, but the fact is that people err in their valuations just as they err in everything else. So sometimes good products fail to get traction, and bad products do. There's certainly something to be said for the old saw of "location, location, location" to remind us that people can't make appropriate valuations without access, and while they can err even in the best circumstances, they can also do their best in bad circumstances. One can, it seems, like bad stuff because one has never had access to good stuff, being in the wrong time or place or lack of funds, or like bad stuff because one makes an error of judgement. I've certainly made a few errors of judgement in the past, and I played games like Battletech because there was nothing better (and perhaps because I was simply unaware of nothing better). Whether it's omission or commission, bad stuff happens. 

There's a reason why producers often do market research, because they want to make decisions with the comfort of knowing how to best connect to consumers. People who are already comfortable making their decisions don't do market research, because they don't need the epistemological reassurance that marketers sell. Whether you're depending on a marketing department, or simply going by your gut, as a producer you're making a judgement about how to best make that connection with consumers. In this case I think it's again important to point out that one's knowledge of the market, the supply chain, and so on, may still be prone to error, and one's decisions regarding perfectly accurate information may err, and one can even get lucky by making decisions that pay off despite it being grossly inaccurate. The value of the decision is revealed, rather than predicated on any method, and may seem good at first and then go bad, or seem bad and eventually turn out for the best. It's important to thing of value as being something empirical rather than normative, so that all you can do is track it rather than presume it's carved in stone. 

If you're sacrificing timing for some notion of quality, then that attempt to create a product based entirely on its appeal being greater than the additional cost of a late release may not pay off. Indeed, advice from game design gurus is typically to get something to market, anything, rather than carefully sanding the edges off of a product in order to maximize its appeal. There is, it is held, something to be said for satisficing appeal rather than attempting to maximize it. Satisficing has the benefit of being less risky, both in terms of requiring less precisely accurate information. Everyone wants to do the best job they can, or at least it's a shibboleth of our motivational age, but I think the reason so many people typically feel that they can do a better job than the people actually producing things is that they could, without the constraints that the people actually producing things are actually under. 

One of those constraints, that producers big and small face, is that the tastes of the designer(s) might not reflect those of the consumers. The tastes of focus groups and test audiences might not reflect the tastes of the consumers. And while everyone in the production chain may have excellent taste, but it might be wasted as the audience moves on while the production takes place, and what was fashionable and tasteful changes, or is satisfied by a better organized production (or simply one willing to take a smaller market share in order to get market share before it was pulled out from underneath them). 

Now, there's nothing wrong with designing a game to appeal strictly to the designer (it's a hobby of mine, after all), and likewise there's nothing wrong with designing a game to appeal to consumers (it's a job for some people, after all), but doing these things badly is, by the definitions given and explained above, bad because there is no value in it. For those inclined to take this to be circular, please read my blog posts on short-cutting through self-referential reasoning, and the Liar Paradox. 

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