How Steam is Striking Gold with the Summer Adventure
When Steam launched the 2014 edition of the Steam Summer Sale, it came with a new wrinkle that no one saw coming. No, I’m not talking about the four packs of Community Picks. This time out, Steam introduced the Summer Adventure to the sale. While it looks like a little competition between users for prizes, it’s actually another quiet way for Valve to make a few dollars more from Steam.
If you haven’t scrolled past the Flash Sales, you may not have noticed the treasure map that denotes the Steam Summer Adventure. This is a new team competition for prizes and pride. Crafting badges using cards earns points for your team. The team that earns the most points in the day wins. If you contribute points, you earn another card. If you contribute and your team wins, you get two cards as your prize. If your team wins and you contributed, you’re also entered into a random draw in which 30 winners receive three games from their wish lists.
Apart from the bonus cards, you get your cards in the standard Steam Sale ways. For every three Community Pick votes, you earn one card. For every $10 spent during the sale, you earn one card. And on top of those, there’s always the Steam Marketplace that you can buy cards from.
In my last examination of the economics the trading card system, I noted that 15% of the price buyers pay went to Valve and the game’s developer. A quick test of mocking up cards for sale showed that Valve’s fees on the Summer Adventure cards were between 10% and 13% depending on the price of the card and rounding to the nearest cent.
While I can’t say with absolute certainty that no devs are getting a share of Steam’s fees of card purchases, it wouldn’t surprise me that Valve gets out ahead on the Summer Adventure cards because the Summer Adventure Badge is worth 10 times as many points as any other badge. The incentives are for you to focus on getting Summer Adventure cards and leave the rest of the badges behind for two weeks.
Apart from badges for TF2 or Dota 2, Valve comes out ahead if people get the Summer Adventure cards. So how does Valve create a bigger market for their own Summer Adventure cards? I can think of a few ways that Valve is trying to get people to buy into and buy the Summer Adventure.
First, there’s the prize incentives. Three free games is a pretty good incentive to try to get into a giveaway. While your chances are anywhere from 1 in 48,000 (using Saturday’s peak users of 7.2 million users divided by 5 teams and 30 winners) to 1 in 500,000 (75 million total active Steam user divided by 5 teams and 30 winners), the opportunity to win over $100 in games still seems too good to pass up. After all, people will play the lottery or enter a charity raffle with worse odds for a chance at the prizes. Even if you were to buy all the cards to craft a badge, it would likely cost you less than $4.50. It’s not too bad a value trade for some.
There’s the new buy and sell offer system that seems to be eliminating the usual undercutting that you see in the Marketplace. While most cards have the standard listing that really allows sellers to keep coming down in price to get the buyers, the new system almost eliminates the listings. From a seller’s perspective, nothing changes. It looks the same as before.
From a buyer’s perspective, buying a Summer Adventure card is very different. Similar to the sellers, buyers have to list their maximum buying price. They then get matched with the cheapest item for sale up to their maximum threshold. In theory, this doesn’t seem very different from before. In practice, rather than the sellers bringing prices down to move inventory, buyers are moving up to the sellers’ prices. As such, we haven’t seen prices fall to the sub-ten cent prices we’re used to seeing.
Buy creating a system that, intentionally or unintentionally, is keeping the prices up, Valve is able to reap the rewards in the form of higher fees from the sale of the cards.
And this is all augmented by the created scarcity of the cards. Even if there wasn’t the prizes for winning the daily points challenge and the other freebies for crafting a badge (an in-game item, an emoticon and a Steam profile background), by causing the cards to expire at the end of the sale, you’ve forced action on those cards by the end of the sale.
As holding nine cards serves no purpose, a smart user would either complete the set or sell them all for a quick buck. Either way, money flows through the Steam economy and into Valve’s pockets. Buyers give their money to Steam through the fees on cards. Sellers have to keep their money in their Steam wallets so that money has to end up in Valve’s pockets eventually.
Don’t get me wrong, I love Steam Sales. These sales are the reason you and I have massive back catalogues of games that we’ll never get to because we keep buying new games during these sales. This post is just designed to inform you of the reason Valve has added that new Summer Adventure wrinkle to the Summer Sale. There’s nothing wrong with a company trying to make money. In fact, the goal of all businesses is to make money. Hopefully you keep this in mind if someone claims that EA only has Origin to make money but Steam isn’t about the money.