With the new Kitely Market about to open to customers on other grids and other online markets for virtual worlds appearing, I’ve been thinking about the cost of buying the right to take my purchase from one grid to another.
So far, the items that have interested me on Kitely Market are priced anywhere from twice to quadruple the regular price when the Export permission is turned on.
I suppose the sellers are trying to figure out the market for this themselves, just as we buyers are trying to figure it. Just what is the appropriate mark-up for an item you can play with in more than one virtual world?
I can see a seller looking at it like this, “I’m giving my customer the opportunity to use this product in any world that allows it to be delivered or imported. They can use it over and over again in numerous VWs. That means they’re getting a lot of use out of it. So I should charge several times the regular price for that privilege.”
Seems like a reasonable argument. At first.
But I’m the buyer and I’m looking at the prices and I’m thinking, “Hey, I’m only using this item in the world I bought it in and one other. How many worlds do you think I live in? Yeah, I could use it everywhere but that’s not going to happen. I’m using it in this world and that one. That’s it. Maybe if one of those worlds goes out of business I’ll move the item to a new world but two at a time is all I can possibly do. How much are you going to charge me for that? How much is that privilege really worth to me?”
I think two worlds is going to be most people’s limit. Okay, so maybe a few customers might use an item in three different worlds at once…but seriously, how many of your customers are going to do more than that? Just because you’re granting them the right to go anywhere in the free Metaverse with their purchase doesn’t mean they’re going to go everywhere with it.
I suppose the “right” price is whatever the market will bear. And you can probably charge higher prices now than you will be able to later when there is more competition and choice.
As a buyer, I’m thinking double the regular price is going to be my limit. I have already paid more than that for a couple basic items that I desperately need in two worlds. And I might buy a couple more items in that same vein and pay over my limit a couple more times. But that will be the extent of that. I’m not going to go over double the price on anything else. If I can’t find it for that price or less, I’ll do without.
The market price will sort itself out and change as demand and supply (choice) increase. But we buyers have just as much power to affect the market right now as do the sellers.
So I have set my limit. And I have already limited the exceptions I will make.
Should be interesting
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It will definitely be interesting how this all works out over time, and I agree it will sort itself out over time also. I do buy Kitely items, some marked for export, just to see how it will all work when it is enabled, mostly. There are lots of people whose entertainment [and business] budgets will allow them to spend considerable amounts of money, much more than I ever would, so I expect to see some creators do very well with this, especially in the beginning.
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I wouldn’t pay quadruple the cost for export permissions especially given that the world I spend most of my time in doesn’t even have an economy. What pay an outrageous amount of money for something to use in a world I don’t sell things in? I don’t think so. I’d rather try to create things myself and deal with my lesser attempts than to pay an outrageous amount for something created in a different world just so I can take it with me to the world I spend most of my time in.
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Danko —
I agree with you. Double the price for multi-world access — that seems reasonable, and your thinking makes a lot of sense.
It would be nice if Kitely also had a “site license” option. This is where a company buys the product, then uses it all over their company grid. So, say, if they buy a T-shirt, they hand out copies of it to all their employees. Of if they buy an office building, they put up as many copies of it as they need. This would be all on one grid, the company or school grid, and the company or school wouldn’t be reselling it to anyone else. The amount of use any particular piece of content will get is unknown, of course — it depends on the size of the school or company, and whether it’s a popular item or not with the employees. I think a four-fold price increase would be a appropriate there.
Finally, I’d also like to see a “reseller” option. Say I want to sell your shirt in my store. Paying you a commission is a lot of bookkeeping (though that is, of course, the preferred way to do things). If I’m a tiny little boutique store, I might not have the infrastructure to set up a way to keep track of commissions. … Here, a reseller license could be anything from 10 times to 100 times the cost of the base item, depending on how popular the product is. But a commission-based approach is a way better way to handle things. It would be really cool if Kitely had a way for resellers to put up vending machines in their stores for Kitely items, so that the local store operator would get a commission on each sale, but the bulk of the purchase price went to the original creator. Shopping on a marketplace is nice, but it can get overwhelming. There’s something to be said for walking into a nice, cozy little store, where all the content is hand-picked by the store owner and everything looks really nice and put together.
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The actual cost matters to me, and how valuable the thing is to me. Non-exportable versions have zero value to me so their prices have no meaning. I have a limit on how much I am willing to pay for most all virtual items, and they must be exportable. Once the price gets above a few dollars, I start thinking a lot harder about doing without that item, about what the money could be buying in real life. I have paid more, when the products were exceptional, efficiently made, and useful anywhere. If an exportable version costs 10x the non-exportable version, yet the non-exportable version is only 25 cents (so the exportable version costs 2 and a half dollars), and I absolutely love the thing, I would certainly buy it. Basically, to me, whether something is 2x, 4x, or 10x the non-exportable price isn’t a consideration at all. It’s how much I pay and how valuable the thing is to me.
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Maria, the “reseller” option has always been available hasn’t it? In SL, and in Kitely too, the merchant decides by way of their defined user license whether the product can be resold, and if so, under what conditions (like “only as part of another build” or something). They will set their product to CMT+E, and state the conditions of reselling.
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I still have to deal with the new G vs M vs Adult ratings @Kitely on my skins before they go anywhere, but today at least, I’m leaning toward charging less, not more than i have been. a) reduces the motivation for hackers to steal my textures and resell b) I might make up for it in volume. maybe. Yup, should be interesting 🙂
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As a merchant, I have to say that all virtual items sold on SL or other grids are terribly underpriced so consumers tend to feel entitled and balk at something that took 40 hours to make and costs less than a cup of coffee to enjoy. If I am taking on the extra risk by allowing people to export my blood and tears, I have to charge for that risk. If one person decides to steal it and sell it on other grids, I lose the potential for that product. That can equate to hundreds if not thousands lost.
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Let’s think about what would be involved if an individual decided to “steal it and sell it on other grids”. First, there would need to be a working marketplace in each of the grids in question (how many are currently in place?). Given that, the putative thief would need an account on each of those grids, upload the stolen content to each grid, then set it for sale on each grid’s marketplace. But how many potential customers are there on each grid? At most a few hundred; it’s more likely to be in the tens. So the “hundreds if not thousands lost” seems a bit unlikely.
Later this year Kitely Market will be able to deliver to multiple grids. It’s so much easier to set up shop just once than multiple times. Merchants currently on Kitely Market, as early adopters, have more of a chance of making a profit from their items across multiple grids than any putative thief.
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I am selling on Kitely. I was responding to the price increase the OP was talking about for allowing the export permission. The risk I speak of is once my product is out there, it’s beyond my control. So let’s say the person brings my product into SL and just gives it away as a freebie. Huge potential loss for me. So no, it’s not an exaggeration at all. We are actually speaking in the hundreds to the thousands of dollars for each product. Therefore, I have to price accordingly in order to take on that risk. As should everyone.
I’m not at all talking Kitely down or the export permission. I’m excited about it. I’m just explaining to everyone why merchants will likely (and should) charge quite a bit more for export perms.
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