Wargaming Price Gouging

[The_Chiv]

When it comes to digital goods it is a bit difficult place a value on an item. The basic concept for determining the value of a digital item tends to fall under the tried and true ideology of "It is worth how much someone will pay for it."

 

The reason I bring this up is because today it was shown that the cost for the new Napoli in NA and EU is vastly different to that in RUSSIA. How much? 50% reduction.

 

iEarlGrey posted a lovely video about this topic and frankly it has made me a bit disgusted at the practice. 

 

On Eu the base price is 98.36EU

On Na the base price is 139.80 dollars

On CIS the base price is 5492 p

 

Now if I convert each currency to USD and compare what you will see is pretty shocking

 

EU=118.46

NA= 139.80

CIS= 75.02

 

So WG makes everyone else pay more, But Russians get a massive discount. I never thought I would see the concept of Russian bias extend to the actual economics of this game. 

 

 

[Karasu_Browarszky]

Well, this is nothing new. It's been the same for years. The reasoning is that the cost is relative to the lower earnings in Russia, as opposed to EU.

 

 

Russia (monthly)

 

https://www.statista.com/statistics/1010660/russia-average-monthly-nominal-wage/

 

Germany (annual)

 

https://www.statista.com/statistics/416207/average-annual-wages-germany-y-on-y-in-euros/

 

That's about 50 000 rubles a month (about 575 euros)  vs. 3500 euros per month.

[Aragathor]

Well, for me the cost of Napoli was some coal I had lying around. So eh?

It's not like I'm spending real money on the game. WG has managed to drive away whales like me from spending real cash, so sucks to be them.

[The_Chiv]

2 minutes ago, Karasu_Hidesuke said:

Well, this is nothing new. It's been the same for years. The reasoning is that the cost is relative to the lower earnings in Russia, as opposed to EU.

For a physical good this economic practice holds up due to the cost of shipping, customs, fees, etc. However... Digital goods do not suffer this sort of thing to such an extent. Sure there is the occasional thing with Blizzard charging a bit more for EU stuff but that amount is never more then 15%. In wargamings case their is a 86% increase between CIS and NA, and between CIS and EU it is 57% increase. 

[The_Chiv]

5 minutes ago, Aragathor said:

Well, for me the cost of Napoli was some coal I had lying around. So eh?

It's not like I'm spending real money on the game. WG has managed to drive away whales like me from spending real cash, so sucks to be them.

Oh I know I would not spend cash money on it either, but what about other ships. And does this pricing scale happen across the board or is it for this one ship.

 

[Karasu_Browarszky]

2 minutes ago, The_Chiv said:

For a physical good this economic practice holds up due to the cost of shipping, customs, fees, etc. However... Digital goods do not suffer this sort of thing to such an extent. Sure there is the occasional thing with Blizzard charging a bit more for EU stuff but that amount is never more then 15%. In wargamings case their is a 86% increase between CIS and NA, and between CIS and EU it is 57% increase. 

 

It is not just Wargaming, mind you. Other online games are doing the same thing. See the math and the disparity in earnings levels?

[lovelacebeer]

Im actually curious if I ask one of my friends in Russia or say Thailand to buy a gift for me on WOWs would they pay the EU or their respective national price. 

[The_Chiv]

2 minutes ago, Karasu_Hidesuke said:

 

It is not just Wargaming, mind you. Other online games are doing the same thing. See the math and the disparity in earnings levels?

I ask cause in Warthunder they do not do this, and I can think of at least 4 others that do not do this either and even more that the cost different tends to be less then 10%.

[Ocsimano18]

This is not a product but a service. You charge as much as you can, in the given market. It would be foolish for them to rise the prices in Russia and lose revenue, or lower the prices in NA and lose revenue. Also the additional costs, like marketing, customer service, community building are much cheaper in Russia, because of the Russian wages and office is cheaper than those in the US or in Europe. Why would the Russians cover the wage of European employeés?

[Karasu_Browarszky]

7 minutes ago, The_Chiv said:

I ask cause in Warthunder they do not do this, and I can think of at least 4 others that do not do this either and even more that the cost different tends to be less then 10%.

 

Let me put it this way. Napoli special offer is 114.97 euros in the EU shop. Are you tempted?

 

Let's do the rough math here, you'd like it to cost the same 114,97 euros in the RU shop. Relative to the Russian wages, this would be like having it cost 690,00 euros here. Tempted?

[fumtu]

10 minutes ago, lovelacebeer said:

Im actually curious if I ask one of my friends in Russia or say Thailand to buy a gift for me on WOWs would they pay the EU or their respective national price. 

 

He would have to pay EU price as he would need to use his EU account to buy you a gift on EU server

[lovelacebeer]

8 hours ago, fumtu said:

 

He would have to pay EU price as he would need to use his EU account to buy you a gift on EU server

 

Yeh makes sense, thanks.

[Pururut]

27 minutes ago, The_Chiv said:

So WG makes everyone else pay more, But Russians get a massive discount. I never thought I would see the concept of Russian bias extend to the actual economics of this game. 

 

I suppose you dont use Steam. Countries with volatile economies and weak currencies usually get the same product for cheaper. There is no supply in digital goods so only demand matters. Your average Russian citizen simply wont be willing to pay the same amount of money that their European, American and Japanese counterparts are going to give. A developer have two options; either dont sell its product or sell it for less and sometimes much less but still generate revenue. 

 

Personally I think it is fair. The reasoning behind is purely historical and political so I wont deliberate but it is good that those with lesser means can afford the same services that those with more can even if rarely. 

[The_Chiv]

6 minutes ago, Ocsimano18 said:

This is not a product but a service. You charge as much as you can, in the given market. It would be foolish for them to rise the prices in Russia and lose revenue, or lower the prices in NA and lose revenue. Also the additional costs, like marketing, customer service, community building are much cheaper in Russia, because of the Russian wages and office is cheaper than those in the US or in Europe. Why would the Russians cover the wage of European employeés?

You have a valid point to an extent. However. They are already losing revenue by pricing their products too high in NA. If the price was closer to say what the EU had then they would infact have more sales. thus more profit. There is 0 profit from 0 sales.

[Karasu_Browarszky]

1 minute ago, The_Chiv said:

You have a valid point to an extent. However. They are already losing revenue by pricing their products too high in NA. If the price was closer to say what the EU had then they would infact have more sales. thus more profit. There is 0 profit from 0 sales.

 

Now that is a valid argument, can't disagree with that one.

[MannequinSkywalker]

The price of a ship should be standard. Treating the players in other servers stupid enough to pay more is a discrimination. Trying to take more money out of same product from countries with better economies is like those scamming call centers located mostly in Asia or fake virus pop up scammers.  It is scamming. I hope no one in EU server buys anything from WG (but ofc there are many speshul people that will).

[The_Chiv]

2 minutes ago, Pururut said:

 

I suppose you dont use Steam. Countries with volatile economies and weak currencies usually get the same product for cheaper. There is no supply in digital goods so only demand matters. Your average Russian citizen simply wont be willing to pay the same amount of money that their European, American and Japanese counterparts are going to give. A developer have two options; either dont sell its product or sell it for less and sometimes much less but still generate revenue. 

 

Personally I think it is fair. The reasoning behind is purely historical and political so I wont deliberate but it is good that those with lesser means can afford the same services that those with more can even if rarely. 

The flaw in this logic is to imply that all in a region have greater means then all in another region. The NA while a wealthy region due to Canada and US still encompasses many other areas where that wealth is no where to be found. Even in Canada and NA the wealth disparity is pretty noticeable. 

[Ocsimano18]

Just now, MannequinSkywalker said:

The price of a ship should be standard. Treating the players in other servers stupid enough to pay more is a discrimination. Trying to take more money out of same product from countries with better economies is like those scamming call centers located mostly in Asia or fake virus pop up scammers.  It is scamming. I hope no one in EU server buys anything from WG (but ofc there are many speshul people that will).

Me not getting a Swiss level of salary, is also a discrimination.

[Pandafaust]

3 minutes ago, The_Chiv said:

You have a valid point to an extent. However. They are already losing revenue by pricing their products too high in NA. If the price was closer to say what the EU had then they would infact have more sales. thus more profit. There is 0 profit from 0 sales.

Presumably their sales and marketing department disagree with you on that one.  It's a pretty standard practice both in physical and digital goods, and is the whole reason that CD key selling sites exist.

[Karasu_Browarszky]

Just now, The_Chiv said:

The flaw in this logic is to imply that all in a region have greater means then all in another region. The NA while a wealthy region due to Canada and US still encompasses many other areas where that wealth is no where to be found. Even in Canada and NA the wealth disparity is pretty noticeable. 

 

Same in the EU. There is disparity between Germany and some of the less-well-to-do members of the EU, same as there are different income segments in each country.

[MannequinSkywalker]

Just now, Karasu_Hidesuke said:

 

Same in the EU. There is disparity between Germany and some of the less-well-to-do members of the EU, same as there are different income segments in each country.

Depends on the taxes of the physical goods. We are talking about digital goods, not same.

[The_Chiv]

1 minute ago, Ocsimano18 said:

Me not getting a Swiss level of salary, is also a discrimination.

Hell im in NA and I would kill for that.

[The_Chiv]

Just now, MannequinSkywalker said:

Depends on the taxes of the physical goods. We are talking about digital goods, not same.

^^^^^^^^^^^^^^

[hellhound666]

...

[Karasu_Browarszky]

1 minute ago, MannequinSkywalker said:

Depends on the taxes of the physical goods. We are talking about digital goods, not same.

 

Only the price the end user pays matters here, relative to the average income earned in the market. You can't compare digital goods vs physical goods, because the markets as well as costs and pricing are completely different. It's not like WG or anyone else is selling digital goods at a loss.