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What justifies skin cost being so high?

GROMMI·4/27/2014, 4:02:40 AM·1 votes·626 views

[EDIT: I managed to post this in the completely wrong section. If a moderator could please fix this for me, that would be fantastic.]

Dear Riot,

I've been a very big supporter of your game for years. At first, I thought I would never like this style of game - (I hated DotA in WC3) - But over time, I grew to really love this game, and it is now my favorite game. I have over 1,500 normal games played, and I can only imagine how many ranked I have. I've only made it to Platinum (Plat 1 last season, Plat 5 now) so I'm not too experienced with the game.

But my question doesn't have to do with mechanics. Instead, I wanted to ask -

***What justifies skins being so expensive? ***

I understand that when a business creates a product, they often overprice it for profit and ingredient cost compensation. But, with the brilliant business model Riot has going on, there is little to none ingredient cost. By this I mean, were I to sell fruitcakes, I would have to pay for the materials to create the fruitcake, whereas with Riot it seems like the only possible cost is the labor involved in the creation of the skin.

Now this I COULD understand,** if...**

The skin had to be recreated each time someone desired it, like a work of art. But, in your brilliant business model - It does not have to be recreated! Whatever time goes into creating this skin is the best type of investment.

It's like creating a blog website with interesting blogs. Once you put in effort to create one blog, that blog can generate viewers for however long you keep it up. You don't have to recreate the blog every time someone wants to read it.

So, if I created a skin, for example, and it took me three months...

After those three months, it is pure profit. The skin is digitally replicated and costs nothing for players to 'purchase' or 'download' into their client.

When I first played this game, I never saw myself capable of paying 10$ for a skin. I don't feel like it's worthy of 10$. But, I love Riot, and so I support their game by paying 5$-10$ for RP, which I can then use to purchase their skins.

So, my question is,

I'd like to know why skins are so expensive. It seems to me that these type of digital merchandise could easily be sold for 2$ a piece, and legendaries 10$ max. Is it simply because players WILL buy at this price?

Or is there a lot behind the scenes I'm missing?

I'm not angry -- I love this company, and want it to be successful. So, by all means - Please keep it up. LCS is fascinating and I love having an Esports scene along with my own playing game.

I would just like to be educated.

P.S.: Is it possible (from someone smarter than me in business economics) to generate more profit by lowering the price on skins? I know I'd be more skins if I felt like they were a better price.

11 Comments

2dsystem4/28/2014, 4:56:31 AM2 votes

Skins are their primary source of income, the money they make on skins doesnt necessarily cover the cost of just the skin, but rather it goes towards a pool of money which is Riots gross income, and they take that, and use it to pay employess, upkeep, etc.

MackleDoge4/27/2014, 4:15:02 AM1 votes

The way it works is that their is basically a price point where they get maximum profit. If the price is too high they get more money per purchase but less purchases so it ends up being less profit. If the price is too low then they make less money per purchase but don't get enough purchases so they end up not getting as much profit. As far as Riot is specifically concerned, I'm actually inclined to believe that they could charge more for skins then they do and make a larger profit, but they try to price skins in the appropriate range as best they can as they compare to previous skins, so it doesn't make the community feel as if they are constantly having to pay more and more for new skins.

LouisLeGros4/27/2014, 6:36:42 AM1 votes

The whales pay for it instead of demanding for more value for their money.

The number of people who have spent thousands on his game is scary and it seems like they make it not worth it for Riot to let more people enjoy skins and buy RP at a lower price. They are also kind of stuck at current price points because if they decreased prices to go for the higher volume of sales model they'd have a lot people raging at them and demanding refunds.

GROMMI4/27/2014, 7:14:45 PM1 votes

I like the discussion going on here. But I'd still like to know behind the scenes information :<

GROMMI4/30/2014, 5:26:44 PM1 votes

Aw, I guess my argument was a bit flawed, huh? Bummer. :p