Rock Band Video Game Selling T-Shirts Of Fake Bands

from the lotttttts-of-t-shirts dept

When critics of our analysis of the economics of infinite and scarce goods want to mock our ideas or make fun of us, they often fall back on the false claim that the business model we advocate is "give away everything and make it up by selling t-shirts." Or, rather, if they're really in a mocking mood, they usually write "llllllloooooooooooooooooootttts of t-shirts." It's quite amusing, though, of course, it shows a fundamental misunderstanding of what we mean by scarce goods.

That said, t-shirts can make up one part of the scarce goods that someone sells, though, it will almost always be a small part of it. And, there's no reason to mock the contribution that selling t-shirts can make as part of a larger business model. Reader Aaron de Oliveira points us to the interesting news that the super popular video game Rock Band is now letting players who have uploaded their own fake rock band logo order t-shirts, keychains and other merchandise from their fake band. As de Oliveira correctly notes, not only does this make some money, but it also makes the gaming experience better, connects fans more closely to the game and their own fake rock band in the game:
The company realizes it's not in the music business or in the t-shirt business. Its business model is the custom experience and it uses music (fun & free or cheap) and t-shirts to improve that experience in such a way that people are willing to pay for it.
Bingo. So go buy llllllooooooooottts of t-shirts to make it work.
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Filed Under: business models, economics, infinite goods, rock band, scarce goods, t-shirts, video games

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  1. identicon
    Twinrova, 14 Oct 2008 @ 9:43am

    Re: Excuse Me, Twinrova

    I'll reply to this comment and the one above it, given most people totally skipped my point.

    Mike specifically stated this was a jab at those who "mocked" him during his discussions of freeconomics, which is totally outside the scope of this particular blog regarding tshirts.

    I could understand the blog IF Rock Band was free or the keychains, tshirts, etc. were free, but clearly this is a case of opening a brand new business market.

    In regard to the career fair offerings (or any other public outing), "swag" is advertising and its sole purpose is to get you to look. That's a given.

    But the swag isn't free (my original debate). Sure, you could take the swag, walk away, and never look back and you can claim it's free, but ask the consumers if they enjoy paying for your free swag with overpriced goods.

    There's always a cost to "free". It may not be direct, but someone's got to pay for the swag. I can not believe some of you believe these items are free, printing is free, and delivery to said location for distribution is free.

    The consumers of the company has paid for that swag, so enjoy it for "free". You'll be paying for someone's free swag in the future.

    While I do understand this is a good thing (hey, a business has to grow!), I draw the line at how much we consumers have to pay in order to generate stuff that's not to our advantage, such as decreased costs.

    In regard to Rock Band, they're making profits on these TShirts, etc., so why doesn't the cost of the game come down for new releases? (Not the price drop often seen later)

    If a consumer looks at what's paid for swag, advertising, and other "non-related to us but to make the business grow", you'll see why I debate the "freeconomics" here.

    Think about this: Take the number of McDonald's commercials you see every day and multiply by $250,000 (the average cost of a 30 second commercial). Now, assume this commercial runs 7 days a week, 365 days a year.

    Sum it up.

    Now price a filet-o-fish sandwich.

    The ad to you was free, but to those buying a fish sandwich, that's a pricey "free" product.

    Imagine, now, what the price of that sandwich would be if McDonald's quit running ads altogether, especially given they're one of the most recognized business on the globe.

    In gaming, this is often why consoles (excluding Nintendo) sell for much less than production cost because profits are generated through software sales.

    Same concept. The cost is just different.

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