By Noah Lyons
Bringing in a whopping one and a half million dollars a day, Clash of Clans is left as the top grossing ios game of 2014. As a 4.5 star rated game on both android and apple devices, Clash of Clans is bringing in over 100,000 downloads per day, but why? Because the game was made to be super addictive, and indeed it is. People devote hours and hours into this game per day and some even spend their actual money on the game. Upgrading can take up to two weeks to complete and the people who are impatient can go about and spend their money to buy gems. Gems range in prices from $4.99 all the way to $99.99. The price of gems has inflated though, going from the original $49.99 for 14000 to $99.99 over a period of time. Supercell stated that of the millions of people who play Clash of Clans, only about 10% have ever spent any money on the game. That 10% are youtubers or the top ranked players of the game.
There was a test done that shows that it would cost a total of $6620 US dollars to fully max a base with all troops and defenses while using gems and the thing that really blows my mind is that there are people who actually do this. Supercell has sucked players into believing that gemming is the way to go, because without it Clash of Clans can take months and years to fully max a base. Supercell makes just shy of one billion dollars per year and that is from Clash alone, they have multiple popular games out that are also quite popular. The supply of gems you are capable of getting for free is low, because the only way of getting them other than paying for them is cutting down trees and rocks or completing achievements that aren’t easy to complete. One of the main reasons gems are such an importance to the community is for the builders, which go in this order. Builder 1 is free, Builder 2 is 250 gems, Builder 3 is 500 gems, Builder 4 is 1000 gems and the 5th is 2500 gems. Builders are a necessity to the game, because without them the progression from town hall 1 to town hall 10 could be 10 times longer. 
In my opinion, spending money on the game is not worth it, but as a sucker who fell into supercells trap I can’t say anything because I have spent around $25 on the game. The purchase seemed worth in the heat of the moment because I wanted my 3rd builder and needed to max out my walls, but looking back on it I realized that it wasn’t worth it because I could have spent that money on something else, such as food.
This is really interesting to think about. I knew that games had in-app purchases like this one, but I did not know that people spent that much money on those games. Personally, I don’t like to spend money on purchases within apps because I don’t play games very often anyways. I think it’s interesting that companies can make an app and get a steady profit on it for a long time. Because instead of just paying a one-time fee to buy certain games, the games are made to be addictive enough to make people want to spend money instead of waiting for things. The way they can profit on peoples’ impatience is incredible.
ReplyDeleteDo you think that the world today would be different than if no one would've created clash of clans? You said that the price of the game has inflated, why do you think this happened? What if the creators made the game cost money, do you think that the creators would make more or less money? I think that they would make less money because there is already in app purchases and if they make the app cost money, some people would not want to pay for it and never know what they are missing.
ReplyDeleteThis blog post is something I can relate to in terms of economics. I found it quite interesting that Supercell makes so much money on a daily basis. It would have been great if you provided further background information on the game for those who don't play the game.
ReplyDeleteI also found it interesting that the app has been inflating in price. Since some people are extremely competitive, they can profit off of those people.
DeleteI don't think I've ever really thought about how the prices for in-app purchases inflates so quickly. I have noticed that when you buy things in apps, the prices are always different. Sometimes even the low amounts of cash seem like a good investment because it's not that much money anyways. But if a lot of people think like that, it's a really easy way to make a lot of money. Especially in competitive games where people are always trying to be the best, spending a few dollars to advance their placement doesn't seem like a waste.
ReplyDeleteI have only played this game once and found it addicting. A few of my friends have played it too and couldn't stop. When I noticed how popular it became, I took a step back and noticed how addictive it is and how many people don't pay attention to others. I didn't realize that the prices kept inflating, especially with the more popular it becomes. I don't get why do many people pay so much for certain things throughout the game. If it costs that much, I would've thought that more people would have stopped playing it and saved more money for other objects. This game is kind of like real life. Where people pay for certain objects and keep on doing it, no matter the cost and time it takes.
ReplyDeleteI think this is definitely an interesting topic to tie to economics,and I like your points on how it relates. Also, I like how you provided background on the game and in-app purchases but maybe you could have gone more in depth on the economical aspect of some of your points such as inflation, target consumers and that sort of thing. Overall, I like the connections you had to the business part of this popular game that relates to probably a lot of people.
ReplyDeleteIt’s reasons like this that I want to make games! I knew that games and apps like this were big, but I had no idea that they brought in this kind of money daily, let alone annually. Raising the prices over time is as genius as it is aggravating. Any competitive gamer with this app is bound to pay whatever prices are thrown at them just to move ahead of others and it’s that competition that’s sending Supercell skyrocketing. Is there any way you can compare this to other apps? Are there apps that make more money that this, or have in the past? It would be really cool to see just how big this game is. Who knows, it might be worth a (free) download!
ReplyDeleteMr. Lyons do you view the money people are spending on clash of clans to be a problem? If so how do we solve it. Or is it just a persons personal choice to spend enormous amounts of money on this game. Do you think clash of clans would see an increase or decrease in profit if they started charging a subscription based monthly fee to play the game?
ReplyDeleteI too can relate to the gamers who spend money on Clash Of Clans as I have spent a fair share on gems and other resources to try and level up quickly.But making gems a key player in the game making it easier to advance but at a cost is amazing because Supercell is making a huge profit daily on just an app that is just a time filler that is now global phenomenon
ReplyDeletePart of the reason that Clash of Clans is able to inflate its prices so dramatically is because there is virtually no prominent competition to it. Sure, there are clones of CoC but no other game is at the same magnitude or complexity. For example, if Pepsi attempted to raise its prices by a whole dollar per 12 pack, then not many people would buy it and would choose Coke instead. If other companies were able to increase their prices by as much as Supercell did, then they would have relatively no success.
ReplyDeleteGreat subject to write about, since it is increasingly popular throughout the globe. I haven't played the game before, but I've seen multiple commercials and advertisements for it. Even though I haven't played it, I can totally relate to having an addicting game. When Candy Crush was at the peak of its time, I was completely addicted and obsessed. I would even have dreams about playing it, that's how bad it was. I spent money to get the next round of levels, as it was required to continue playing the game. Games like these make bank because we all love to play them and when we're addicted we spend money that could be more beneficial towards other things like you said. Overall, great post that is totally relateable to anyone who loves to play games on their electronic devices.
ReplyDeleteThe way Supercell traps people into spending money on Clash of Clans in brilliant. They get people addicted to the game and let them get decently far before upgrading starts taking a lot of time. Gems become more scarce after the initial few achievements and that makes time, the most valuable resource in the game, scare. This leads to trade-offs of money for time making Supercell a very successful business.
ReplyDeleteI knew that Supercell was making money somehow, but I never believed that they could make a significant amount of money on in app purchases. I think it is interesting how a game that is downloaded for free can earn a company so much money, especially how only 10% of people buy the in app purchases. Another thing to add could be how the game has been popularized and how supercell has been able to market their app. You could talk about how they have been able to air commercials and how they put advertisements on websites. Also how advertisement has helped them gain more customers. I think the psychology of in app purchases to a free game is very interesting, especially because of competition between customers to be better at the game, some people are willing to spend real world money to just be better at a game than other people.
ReplyDeleteThe idea of inflating the prices of gems by an increase of $50 seems interesting and unreasonable. You would think that consumers would outrage and stop playing the game but the need of supply and demand comes into play. Supercell realized that they had so many customers and these customers needed gems. The demand was so high, so Supercell was able to increase the price without having any negative tradeoffs. Just imagine how much money they are producing with their new game that has been produced, "Boom Beach".
ReplyDeleteFrom my little knowledge of the game I would agree with the statement that it is addicting. From an economist point of view it is a great way to bring in money, much like you said people are inpatient when it comes to video games and are willing to, in the moment, spend however much to get to the next round. This game is set up to take your money for you. Through using competition to get you hooked on the game and then limited amounts of gems and other supplies, you almost have to spend the money to keep moving forward. In your post you talked about inflation and how the prices have gone up for gems and other stuff. One reason why they do that is once you are hooked on the game you are willing to spend more money to keep building your clan. If a gem was five bucks on level one and people are willing to pay that, then on level 25 people feel they need to pay the money so the company can usually get $25 or more for gems. All in all, people are willing to spend the money on clash of clans because they have revolved their lives around it and became addicted.
ReplyDeleteThis is an interesting idea because i never really thought about the fact that people are spending their real money on fake things, and that seems like a pretty good businesses model to me. But it is interesting to ask why people gain so much utility from buying things in a game that doesn't benefit the person themselves. If the lowest amount you can spend on gems is now five dollars at a time, I wonder if their profit has gone up from when you could spend 99 cents on a few gems. It would be interesting to see if this video game market would be price elastic or price inelastic.
ReplyDeleteThis is a really interesting topic to bring up. I am impressed with all the facts you added to enhance your point of the absurd amount of actual money that is being spent on a game. It can seem as little as $5.00 off of your iTunes balance, but before you know it, you're racking up the amount of money you have spent, that you cannot get back. To me this seems like the amount of money I spent of Webkinz in elementary school, or silly bandz. Neither really had a purpose, but people spent so much money of little plastic bracelets and $15.00 stuffed animals. You couldn't have just one pet either, you had like 20 or more. These are good ways to bring in a lot of money relatively quickly and easily, it seems. Supercell has done a good job pulling users into buying gems and such in an economic sense, but realistically people are spending too much money on a simple video game.
ReplyDeleteMaybe a fun solution to the rising price of gems could be a player-to-player black market. If only players of Clash of Clans could buy gems at their current price, hold them in inventory and then resell them to other players when the price of gems increases. If this happened, the black market seller could resell their gems for less than the official market price, while still making a profit. Of course, the game would never allow this sort of transaction, but it would benefit those who don’t want to break the bank buying gems.
ReplyDeletePeople are spending money on this hand held game, yet people also spend money on consoles and then purchase games for those consoles, and even purchase similar in-game purchases for those games. I know plenty of people that spend the same amount of time on Clash of Clans as someone who has their own console and have spent relatively less! I don't think there's any issue with SuperCell making money just as any other game developing company would, whether it's for a phone or a system.
ReplyDeletePeople are spending money on this hand held game, yet people also spend money on consoles and then purchase games for those consoles, and even purchase similar in-game purchases for those games. I know plenty of people that spend the same amount of time on Clash of Clans as someone who has their own console and have spent relatively less! I don't think there's any issue with SuperCell making money just as any other game developing company would, whether it's for a phone or a system.
ReplyDeleteIt’s interesting to hear the amount of money Supercell is making off this game. I would have expected a free game to make very little money, however clash of clans does a tremendous job hooking the customers and making them want more. It’s sad to think people spend that much on a game that could be free when there's people starving in the world. With that being said I understand how addicting the game is and know people that have been pressured into buying gems.
ReplyDeleteI once played the game and I was addicted to it. I also spent money on the game it was around $5 to $10 for a second builder. The game creator does this knowing that to play this game you need more builders and that most people would way the opportunity costs of buying a second or third builder and choose to buy them. I disagree with you when you say that it is a waste of money. In sense of does the game benefit you in life when you spend the money no, but in the game yes. This is a pay to win game were if you are will to spend the money you can be good or win the game. You even proved this when you said that it cost $6628 to max out your base. Pay to win is common in mobile games because most app developers know that in the heat of the moment most people would choose to spend money on the game to get the next level or upgrade. This to me is what ruins mobile games or at least makes them less fun you usually need to pay extra money to advance in a game.
ReplyDeleteAs someone that plays Clash of Clans I understand how frustrating it can be to wait for a defense building to upgrade making one want to spend money on gems. But every time I get to that point of wanting to spend gems I have to convince myself that my money can be spent elsewhere for example on food, a nice hot chicken quesadilla. The Clash of Clan creators were very smart while making this game in the fact that they make people wait a week for upgrades knowing full well that people don't have the patience to wait that long which forces them to buy gems. Players don't think that $5 can't hurt. But when you spend $5 once a week or once a month it adds up and you don't realize how much you've spent.
ReplyDeleteWhat a genius idea on a video game company’s part. We see it all the time, where people spend physical money on digital items, simply because the game is so addicting that they cannot help themselves but to pay for an upgrade. Consider how anyone fifteen years ago would look at such a concept. Now consider fifteen years in the future, looking back at the time when you spent a good chunk of money on digital items or upgrades in an app that you likely have forgotten about. Was it really worth it in hindsight? These are the things that Americans need to consider today. There are so many valuable opportunity costs that are given up for something that will not matter in a few years time. Impulsive buying can seem like such a justified action at the time, but one must consider the impact on their bank account that they are actually having, and the true value of the item that they are purchasing, whether it be a pointless possession or a digital game upgrade. This is a fantastic topic that many don’t consider today, and I love the evidence that you used to prove the severity of the issue.
ReplyDeleteAlthough it seems pretty crazy to spend money on games for your phone but thats just shows how much technology is increasing. Like said in a few of these comments, ten years ago people would spend hundreds on consoles and games to go with that console. Now days, the phones are just the new, mobile console, that has plenty of other capabilities. I have played the game and it definitely sucked me in, but I never spent real money on it, even though at times it felt like I needed to to proceed. That seems to be how the economy makes money, by selling something for cheap or even free, but then giving people options to spend money to make them better or even the best out there.
ReplyDeleteAlthough it seems pretty crazy to spend money on games for your phone but thats just shows how much technology is increasing. Like said in a few of these comments, ten years ago people would spend hundreds on consoles and games to go with that console. Now days, the phones are just the new, mobile console, that has plenty of other capabilities. I have played the game and it definitely sucked me in, but I never spent real money on it, even though at times it felt like I needed to to proceed. That seems to be how the economy makes money, by selling something for cheap or even free, but then giving people options to spend money to make them better or even the best out there.
ReplyDeleteMore and more of these 'freemium' games are showing up on the ios and Android markets. The games are made to be addictive and then the game purposely cuts you off from playing with ridiculously long times. The temptation to spend money on these games is great, especially to those with lots of money and not a whole lot of patience. I have almost purchased gems in the past but I have never actually spent real money on Clash of Clans. However, I did receive a Google playstore gift card for $10 and I had nothing else to spend it on so I bought gems. Although I had nothing else to spend that gift card on I felt stupid paying for something in a game.
ReplyDeleteIt is crazy that people would spend so much of their money on a phone fgme that does not even contribute to the real world. The things that these people could be spending their money on is way more important than the game, they could be buy food or paying off their monthly bills but instead they play a game then complain about how they don’t have money for anything else. I feel that this is bringing down the economy because people are spending money on a pointless game rather than on food or their homes and families.
ReplyDeleteIt is pretty crazy to think that a game can be so addicting that it can cause people to spend their own money. I feel like most people get so impatient that their only idea to fix their craving of speeding up time by spending. This topic is similar to really anything else that exists today. People go to crazy extremes to basically speed up time in todays world. With the increasing technology in todays world and the human population becoming more and more impatient, it is not surprising that binge spending is considerable rising at a very quick pace. .
ReplyDeleteIt is pretty crazy to think that a game can be so addicting that it can cause people to spend their own money. I feel like most people get so impatient that their only idea to fix their craving of speeding up time by spending. This topic is similar to really anything else that exists today. People go to crazy extremes to basically speed up time in todays world. With the increasing technology in todays world and the human population becoming more and more impatient, it is not surprising that binge spending is considerable rising at a very quick pace. .
ReplyDeleteI'd never actually thought this in-depth before about this topic, glad you brought it to the surface. Clash of Clans is amid the tons of different games of this "genre", the ones that require you to wait on things to be built or upgraded. It seems like a rip off for all of them, because no matter how much you know you shouldn't spend money on the game, you're bound to spend at least some money if you're really into that game. When you first download the app, you're thinking, "I can't believe this app was free." Going into the game you then realize why it was free; the hours of waiting for buildings to be built, storage and mines to be upgraded, and warriors to be trained. The constant waiting on the game is what tempts you to pay for what you really shouldn't. My sister downloaded an app similar to this one time, and promised me she'd only spend 1$ on her app. I typed in my card number, trusting her to erase it after the 1$ purchase, and she actually ended up spending over 100$ of my trip money. Companies who make these types of games just reel in the money, while the opportunity cost is yours to suffer.
ReplyDeleteI'd never actually thought this in-depth before about this topic, glad you brought it to the surface. Clash of Clans is amid the tons of different games of this "genre", the ones that require you to wait on things to be built or upgraded. It seems like a rip off for all of them, because no matter how much you know you shouldn't spend money on the game, you're bound to spend at least some money if you're really into that game. When you first download the app, you're thinking, "I can't believe this app was free." Going into the game you then realize why it was free; the hours of waiting for buildings to be built, storage and mines to be upgraded, and warriors to be trained. The constant waiting on the game is what tempts you to pay for what you really shouldn't. My sister downloaded an app similar to this one time, and promised me she'd only spend 1$ on her app. I typed in my card number, trusting her to erase it after the 1$ purchase, and she actually ended up spending over 100$ of my trip money. Companies who make these types of games just reel in the money, while the opportunity cost is yours to suffer.
ReplyDeleteIt's kind of interesting that people spend lot of money for this small game. I didn't understand that what the game has and why people addicted to that game. I shocked few seconds that it make one and half million dollar per day and it make billion dollar per year. I request to people that do not spend money for games and you don't make any profit from that. Please spend that money to other things.
ReplyDeleteWell, as long as at the time of purchase the benefit outweighs the cost it is a good decision. Once you made the purchase you can't refer back to it. So a week later to you it may seem like a poor choice, but economically it wasn't. It's now a sunk cost and shouldn't be used anymore. Granted at the time you could have made better decisions, but it wasn't a poor one. Granted the benefits outweighed the costs. This goes to the millions who spend on it. To them it is worth it and to some they have the money to throw around. And it's a successful business for Supercell. They make it possible to play free with no pay to win, yet offer an incentive to pay.
ReplyDeleteOverall I thought this article was very interesting. I think its crazy how simple apps can make a lot of money just by making their game addictive.I knew that games like this had in app purchases but I had no clue that people spent that much money on apps. Also I didn't think that apps really made that much money.
ReplyDeleteI can very much relate to this post. I spend a lot of time playing video games, but refuse to play mobile games anymore because every single one of them nowadays is the same. Download the game for free, get you addicted playing the tutorial and constantly rewarding you, then introduce you to the in-app purchases you must make to make any progress in the game. Mobile game developers these days are designing games that get you addicted, similarly to the way you can get addicted to drugs (you can read more about it here http://www.online-psychology-degrees.org/mobile-gaming-addiction/). Then, when the game gets a large group of people hooked on the game, they're free to jack up the prices of the purchases as much as they want to make themselves more money because people are literally addicted to the game. It's sickening to me how game developers are addicting people, in some cases children, to their essentially digital drugs just to make a profit. Credit where credit's due though, sometimes you just have to admire the plan of a good villain.
ReplyDeleteI agree with your opinion. Although I have never played Clash of Clans. I played a much similar game to it. The amount of time and money I spent on trying to make my zoo more popular was exhausting. I wasted a bunch of my time and money and soon realizing that I deleted the app. I gained my opportunity costs back and realized my trade off soon had a greater effect. There is so much more time and money when you realize what you have been wasting your time and money on is a complete waste. There are so many more items or more time to be with people than spending your time and money on Clash of Clans.
ReplyDeleteClash of Clans has this an addition in-game where real money can be turned into in game currency for the user to spend. But Clash of Clans is not the only game to do this, a lot of games these days are are putting in this addition of "Pay to win" system. Many players look at this saying how its not fair for some users who spend hundreds of hours on a game to only be beat by someone who spent a small amount of money to buy the items or in game currency. Others look at it that if you have a real time job, and can't afford to spent the time to play the game you can use money to make up for this process. Each of these choices are related to "time is money," and if you don't have time, money can replace that and the other way around too. What is your opinion on "pay to win?"
ReplyDelete