Research

The business models in the video games industry have changed considerably in the recent past. While people used to buy console games or CDs for their computers, many games can now be downloaded to their computers or cell phones for free. But how can a game developer earn money if the game is free?

Basically, Osterwalder/Pigneur see the “free” model as one of the most important business model patterns of the digital age. Specifically, they name three ways in which a company can generate profits despite a price of zero: multi-sided markets (Google), freemium (Skype) or bait & hook (razer & blade, printer & ink). In the video game industry, revenues are generated in particular via in-game stores where uniforms (skins), weapons or dance moves (emotes) are sold.

One publication (Schöber & Stadtmann, 2020) analyzes the Fortnite in-game store in particular in great detail. Another publication (Benti, Haß & Stadtmann, 2022) analyzes the role of price settings of in-game currencies and sales promotion strategies of the ten most successful free-to-play video games. In Benti & Stadtmann (2022), the game Animal Crossing: New Horizons is the focus of an analysis using the B|Orders in Motion Framework of the European University Viadrina.

 

Schöber, T., & Stadtmann, G. (2020). Fortnite: The Business Model Pattern Behind the Scene. Die Unternehmung, 74(4), 426-444. 10.5771-0042-059x-2020-4-426

Benti, B.S., Haß, D., & Stadtmann, G. (2022). Cognitive Biases in Free-to-play Games. Marketing Review St. Gallen, 39(4), 34-42.

Benti, B.S., & Stadtmann, G. (2022). B|Orders in motion in the video game industry: An analysis based on Animal Crossing: New Horizons. Human Behavior and Emerging Technologies, 2022(1), 4452900. 10.1155/2022/4452900