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Sales-Age EGS 2020 in numbers - 3 free games for each dollar of revenue

michaelius

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Someone at Epic must have posted those by mistake since their results are absolutely hilarious

They gave away 749 millions of games for free to generate 265 millions of revenue from third party games. That's revenue of single 60 usd console game that sold slightly more than 4 million of copies.

And that's revenue - Epic actually makes 12% of that (minus processing fees at least in those cases when they aren't asking customers to cover them)


Another interesting thing is their third party revenue barely increased compared to 2019 in a year where everyone was locked in homes and everything gaming related exploded.


Will be interesting where go from it since both forcing people by buying exclusivity and giving away hundreds of games for free failed to bring actual paying customers to the shop.
 
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Your logic is broken.

They gave away 103 games which were claimed 749M+ times.

It doesn't mean "it costed them" $60 x 749M 🤣

You have to remember that many of those games were a small indie titles where Epic made an agreement with publisher/developer to put in store for free for limited time.

I would bet most of those deals must have been fairly small in value, possibly around $500k

Which means Epic spend around $50M to fund free games in the store...
 

Graciaus

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Their numbers are horrible especially in a pandemic year. Gained 50 million users and had barely any growth in sales. People are taking the free games and nothing else. I have no idea what their strategy is.
 
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Chukhopops

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Loss leaders, looking to cut into that market isn't cheap
Agreed on this, if you are entering the game and you need to get to a successful storefront you will need to invest massively and lose money for years, there’s simply no other way and that’s what Epic is doing with all their money at the moment.

But then, once you have a digital storefront with active users you are going to be golden for a very long time. Steam has one, Sony has one, Apple has one, etc.
 

Sean Mirrsen

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But then, once you have a digital storefront with active users you are going to be golden for a very long time. Steam has one, Sony has one, Apple has one, etc.
You have to have a storefront people actually want to buy games from, and use on a regular basis. That's not what they have, and they won't have it until they do what they should have done from the get-go, i.e. make their store at least *somewhat* customer-facing. The people they give out free games to, are not customers.

EGS is the epitome of a "data driven" store. They look to increase their user numbers, because they consider free game claimers valid users and potential customers, and it improves the look of their data.

Whereas a successful store would have been "data informed", and would actually care for whether a user actually so much as looks at spending any money, if the store has any chance of retaining any given user and visitor. Converting a user into a customer takes a lot more than just freebies and coupons.
 

Sentenza

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Not bad considering it's against a juggernaut (steam) wuth a hardcore fanbase.
By what metric?
They are literally giving away one free game for every half dollar of gross revenues they are getting on third party sales.

And that's before taking into account that their share of these revenues is actually just the 12% of the total amount.

There are single releases on Steam in 2020 that netted more money.
 
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Sentenza

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It's always hilarious when people act as if Epic was the plucky underdog fighting against the giant evil monopoly, given that they are a corporate entity almost twice the net worth of Valve.

It's also worth stressing that if Steam wasn't already around as the bigger fish in the pond, somewhat legitimating them, everything about Epic's strategy for their store could probably be described as "anti-competitive practices", starting with a textbook case of predatory pricing:

 
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Gamezone

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So the avrage custemor spent less than $2 on EGS during last year. High increase in users do to free games, but barely more revenue. My only conclusion is that people use this store to pick up free games and not much else. How long can Epic keep this up!
 

Sentenza

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So the avrage custemor spent less than $2 on EGS during last year.
Yeah, two dollars per customer spent, two free copies of games gifted for each dollar spent and their share of the "total spent" is more or less a 12% of that amount (meaning barely north of 30 millions).
In other words they are operating at a net loss.
There was an user on reddit that pointed how basically Steam made more money out of Fall Guys than EGS out of their entire line up of third party software:

Now, I know that this is just approximate "napkin math", but even assuming minor discrepancies it paints a dire picture for their service.
When you put the numbers in perspective it's borderline hilarious, really.
 
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Gamezone

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Yeah, two dollars per customer spent, two free copies of games gifted for each dollar spent and their share of the "total spent" is more or less a 12% of that amount (meaning barely north of 30 millions).
In other words they are operating at a net loss.
There was an user on reddit that pointed how basically Steam made more money out of Fall Guys than EGS out of their entire line up of third party software:

Now, I know that this is just approximate "napkin math", but even assuming minor discrepancies it paints a dire picture for their service.
When you put the numbers in perspective it's borderline hilarious, really.

Kinda bad for Epic. Remember that many countries are in lockdown, and people are desperate for gaming at this point. These numbers would be even worse otherwise.
 
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Sentenza

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Kinda bad for Epic. Remember that many countries are in lockdown, and people are desperate for gaming at this point.
Case in point: Steam registered a massive growth in 2020 and an even larger increase in average spending.

And normally you'd think that being the biggest store around they should be the ones struggling the most to register a noticeable expansion.
 

Kadayi

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Yeah, two dollars per customer spent, two free copies of games gifted for each dollar spent and their share of the "total spent" is more or less a 12% of that amount (meaning barely north of 30 millions).
In other words they are operating at a net loss.
There was an user on reddit that pointed how basically Steam made more money out of Fall Guys than EGS out of their entire line up of third party software:

Now, I know that this is just approximate "napkin math", but even assuming minor discrepancies it paints a dire picture for their service.
When you put the numbers in perspective it's borderline hilarious, really.

To be fair the Steam figures not quite right as they are going off outdated information. It's not a flat 30% on Steam these days versus a sliding scale. Valves cut drops to 25% after $10 million in revenue and 20% after $50 million in revenue. So it would be 3 million for the first 10 (30%). 10 million of the next 40 (25%), then 18 million on the next 90+ (20%), so around 31 million, and yeah, that's just for one game.
 
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Gamezone

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With these numbers I can't imagine publishers and developers to be selling lots of games on EGS. I wonder how much they pay big publishers like Ubisoft to get them into their exclusivity deal for so long.