Phil Spencer: Putting AAA games in Game Pass leads to a significant increase in sales

Oct 25, 2017
5,533
Utah, USA
#1
I noticed this in the new interview.

Interviewer: Do you think developers are ready yet to really get on board and bring big AAA games to Game Pass day one like Forza Horizon 4 did?
Phil Spencer: I can say it’s been very healthy for our games. We’ve done it now with Sea of Thieves, State of Decay, Forza... you’re seeing more games that are getting announced like mid-tier and smaller games that are looking for ways to get established. Your big AAA games, those games are trying to run their own business model.
Phil Spencer: What I will say is when you put a game like Forza Horizon 4 which I can’t stop playing on Game Pass, you instantly have more players of the game which is actually leading to a lot more sales of the game. Some people don’t believe that but when State of Decay 2 launched, you saw if you looked at the NPD you saw this game selling really well the month it launched in the US: “People said well isn’t everyone just going to subscribe for $10 and go play this thing?” But no, gamers find things to play based on what everyone else is playing. What’s number 1 on Mixer, what’s number 1 on Twitch, what are my friends playing, what are people saying on Discord, etc.


So when these games hit something like the Game Pass with all of these players, it instantly raises the awareness/word of mouth. I think we will eventually get there (third party AAA games day one) but you know creators have to make their own business decisions. It’s an option for creators and I think it’s a good option, but that’s up to them and they make their own decisions.

https://youtu.be/Z5y0OvZgcIs
 
Oct 25, 2017
5,454
#3
Yeah, State of Decay alone feels like proof of this. I think it surpised everyone with how well it performed.
 
Oct 27, 2017
1,180
#5
Doesn't really seem like he is saying much. Kind of a redirect on the third party front because he talks small and mid-tier games, but doesn't give an outlook of what is to come from third party AAA games.
 
Oct 28, 2017
3,632
Belgium
#6
I didn't expect this to happen but yes, it seems the charts prove that Spencer's right about this. I'm curious if this is true for EA as well.
 
Oct 25, 2017
5,660
#7
EA was noting that people who get EA Access tend to spend twice as much money on the game post launch, and are also more likely to buy their new games using the 10% discount when they find out they like the series.
 

Sangetsu-II

Banned
Member
Oct 26, 2017
1,376
#8
But what happens to the games after a month of NPD Phil? Disappears from the top 20.

I guess it helps frontload sales.
 
Oct 25, 2017
3,390
#9
So many forum posters think they know more then multi billion dollar corps who have all the data and are content providers themselves. It's quite silly.

And I'm happy to see Phil speaking about 3rd parties, it feels (if we look at the data) we'll be seeing the likes of Ubi and other bigger Pubs perhaps joining MS with Day 1 release, its only a matter of time. Imo Capacom/Ubi will be the first to jump in.
 
Oct 30, 2017
3,268
#11
I just dont get it.

I love game pass but its making me and at least 10 people i know NOT buy the microsoft exclusives. Why would we?
 
Nov 16, 2017
476
#12
It may be true but in my opinion is early to say.
Let's wait and see how Gears of War performs...and not only on its launch, let's see how it's legs will be compared to other entries .
It would be easier to know if this is true if MS provided real numbers too.
 
OP
OP
Rychu
Oct 25, 2017
5,533
Utah, USA
#14
I just dont get it.

I love game pass but its making me and at least 10 people i know NOT buy the microsoft exclusives. Why would we?
I think it’s something like:

Example 1: Person could buy Game Pass, play game, person streams on YouTube/Twitch/Mixer on the game and their viewers like the gameplay so they buy the game.

Example 2: Friend has Game Pass and plays game, friend really likes the game and tells all of their friends about the game and posts it on social media, all of the friends and followers of this person now want to play the game and end up buying it.

Not everyone wants to pay for a subscription service and some people want to buy their games outright.
 
Nov 2, 2017
2,519
#16
I just dont get it.

I love game pass but its making me and at least 10 people i know NOT buy the microsoft exclusives. Why would we?
But people see you and 10 others playing these games and then go "I might buy that". People see streamers playing the game - via gamepass - and go "looks good I might buy that".

It is a viral marketing effect I think. More people play the games so more people buy them.
 
OP
OP
Rychu
Oct 25, 2017
5,533
Utah, USA
#17
It may be true but in my opinion is early to say.
Let's wait and see how Gears of War performs...and not only on its launch, let's see how it's legs will be compared to other entries .
It would be easier to know if this is true if MS provided real numbers too.
At X018, Microsoft said there are millions of recurring Game Pass subscribers. Might not be exact numbers but before we didn’t have any estimate on how many subscribers there were, now we know there’s at least 2 million.
 
Oct 27, 2017
4,005
#18
I just dont get it.

I love game pass but its making me and at least 10 people i know NOT buy the microsoft exclusives. Why would we?
Many actually still want physical media. People rather buy the games than invest in GP.

Even if you just play all MS exclusives, (like me) it has increased profit for MS in 2018. The engagement numbers are way higher, more people downloading DLC, Micro-transactions, and just checking out other games you would't ever tried.
 
Oct 25, 2017
1,111
#19
There is probably a good amount of casual gamers who just treat the service like a demo disc or something like that. They sub for a month. Try a bunch of stuff out and then let the sub lapse. Then they go out and spend money on the stuff that they liked.
 
Oct 25, 2017
980
#20
He's not wrong, I know myself and nearly every one of my friends turn to Mixer™ to find out about the newest and hottest trending games.
 
Oct 27, 2017
503
#21
But what happens to the games after a month of NPD Phil? Disappears from the top 20.

I guess it helps frontload sales.
State of Decay 2 would of dropped off Game Pass or not.

Let's see this with one of their bigger games like for a recent example, Horizon 4.
 
Oct 27, 2017
2,431
#22
Have to admit, I've ignored GP until a friend bought me a subscription and I've used it more than expected. I still buy the games I want on the service and the discounted price makes these purchases easier to swallow.

A bit premature after releasing exactly 1 AAA game day and date with the full price version.
Three games day and date. Each one selling more than their internal projections.

Doesn't really seem like he is saying much. Kind of a redirect on the third party front because he talks small and mid-tier games, but doesn't give an outlook of what is to come from third party AAA games.
Companies don't usually speak for other companies in these kind of matters. At least if things aren't set in stone and both companies agree to the reveal.
 
Oct 30, 2017
1,083
#23
A bit premature after releasing exactly 1 AAA game day and date with the full price version.
I don't think what he says is premature at all.

Gamepass is an excellent driver for add-ons like VIP editions, DLC and season passes.

Heck, a person that uses Gamepass to demo a game that they love, would buy the game, even if they despise the service.
 
Oct 30, 2017
1,083
#25
It may be true but in my opinion is early to say.
Let's wait and see how Gears of War performs...and not only on its launch, let's see how it's legs will be compared to other entries .
It would be easier to know if this is true if MS provided real numbers too.
I am thinking that If it weren't true, MS would not persist with it.
 
Oct 30, 2017
3,268
#26
I think it’s something like:

Example 1: Person could buy Game Pass, play game, person streams on YouTube/Twitch/Mixer on the game and their viewers like the gameplay so they buy the game.

Example 2: Friend has Game Pass and plays game, friend really likes the game and tells all of their friends about the game and posts it on social media, all of the friends and followers of this person now want to play the game and end up buying it.

Not everyone wants to pay for a subscription service and some people want to buy their games outright.
But people see you and 10 others playing these games and then go "I might buy that". People see streamers playing the game - via gamepass - and go "looks good I might buy that".

It is a viral marketing effect I think. More people play the games so more people buy them.
Many actually still want physical media. People rather buy the games than invest in GP.

Even if you just play all MS exclusives, (like me) it has increased profit for MS in 2018. The engagement numbers are way higher, more people downloading DLC, Micro-transactions, and just checking out other games you would't ever tried.
Ah ok. I kind of understand.

I dont pay for gamepass at all so its the bargain of the decade for me.
 
Nov 2, 2017
2,114
#27
Game Pass increases mindshare. Mindshare drives sales. Entire reason for advertising is to increase mindshare. Game Pass has been more effective driving mindshare than Microsoft’s advertising. Not a high bar to jump over but it still proves the point.
 
OP
OP
Rychu
Oct 25, 2017
5,533
Utah, USA
#33
Forza Horizon 4 hit seventh in NPD September, no? Could be out of the top ten if anything this month.
Forza Horizon 4 was released on October 2. September 27 was early access (ultimate edition) for $100 instead of the $60 price.

September chart only went to October 5 or something like that IIRC.
 
Oct 25, 2017
167
#37
He would have access to all the figures to back that up so I can't really argue his point. It just seems a bit strange because obviously my sample size is very limited, but my brother and I love the Xbox and we buy the exclusives that come out on it, and instead of buying Horizon 4, SoD2 and Sea of Thieves like we would have, we got game pass for a month and played the games then moved on. So from the two of us they received around $20 CDN as opposed to $180-$200 CDN.
 
Nov 2, 2017
2,519
#38
Forza Horizon 4 hit seventh in NPD September, no? Could be out of the top ten if anything this month.
It was the highest dollar launch in Forza history and the biggest Xbox racing game launch in history.

The fact it landed in a crowded month and came 7th is not relevant to the absolute sales - which beat out all previous games in the same genre and platform.
 
Oct 26, 2017
4,223
#39
It makes no sense to me honestly.

Why would it increase sales if it is day 1 on GamePass? Wouldnt it increase GamePass subscriptions? It doesnt make any sense and I can't believe it until proven otherwise.
 
OP
OP
Rychu
Oct 25, 2017
5,533
Utah, USA
#41
He would have access to all the figures to back that up so I can't really argue his point. It just seems a bit strange because obviously my sample size is very limited, but my brother and I love the Xbox and we buy the exclusives that come out on it, and instead of buying Horizon 4, SoD2 and Sea of Thieves like we would have, we got game pass for a month and played the games then moved on. So from the two of us they received around $20 CDN as opposed to $180-$200 CDN.
The point is that because there are more people playing it, more people are talking about it, more people are streaming it, more people see it in others friends list when they look at what their friends are playing, etc. It’s all about virality.
 
Oct 25, 2017
8,358
#42
It may seem counterintuitive, but it makes sense. Anyone can try a free trial of Game Pass or use those $1 deals to get some, but if you still want to play after a month either you sub for more because you're into tons of games, or you just want to continue a specific game and buy that instead. Not everyone enjoys the idea of subscriptions, but using the free or so trial allows you to effectively demo the games that, nowadays, rarely get demos or very limited ones at that. Game Pass definitely allows more people to try out 70 Euros games without risking the investment of that large sum, and I can definitely see the service explode in countries where the average pay is a lot lower than, say, the USA.
 

talkTOmyHAND

Banned
Member
Aug 25, 2018
452
#43
Ok...a week. So you picked a week old game to say nuh uh Spencer is wrong about the data he sees that none of us are privy to?
So we can use SOD 2 or SOT? I don't see those games on NPD charts or UK charts or even on charts for rest of Europe. So clearly, Gamepass didn't boost sales for those games. Sorry, will not swallow what Phil is saying.
 
Oct 26, 2017
1,900
#44
It makes no sense to me honestly.

Why would it increase sales if it is day 1 on GamePass? Wouldnt it increase GamePass subscriptions? It doesnt make any sense and I can't believe it until proven otherwise.
Rocket League is probably the biggest example of this even though it didn't come to gamepass. It released for free on PS Now and blew up into the monster it is today.

No way would it be as popular as it is today if it weren't given away for free first. Building that initial player-base is everything for modern games-as-a-service-type experiences.
 
Oct 27, 2017
353
#45
Game Pass increases mindshare. Mindshare drives sales. Entire reason for advertising is to increase mindshare. Game Pass has been more effective driving mindshare than Microsoft’s advertising. Not a high bar to jump over but it still proves the point.
This, it's a really smart marketing tool. People also tend to forget that Game Pass Members also get up to 20% off ANY title in Game Pass if you want to buy it, which is likely how they're seeing greater day one numbers.
 
Oct 27, 2017
1,091
California
#46
I just dont get it.

I love game pass but its making me and at least 10 people i know NOT buy the microsoft exclusives. Why would we?
Speaking for myself, it is so I can have the games without being tied to a subscription.

But what Phil is saying is that Game Pass is itself turning out to be a form of marketing. You may not buy the gane but people who notice others playing Game Pass titles are checking out those games and in many cases are buying them.
 
Oct 27, 2017
2,414
#47
So we can use SOD 2 or SOT? I don't see those games on NPD. So clearly, Gamepass didn't boost sales for those games. Sorry, will not swallow what Phil is saying.
What were the internal projections for those games and how did that stack up to real world outcomes? Sales and/or revenue generated.
 
Oct 26, 2017
4,223
#49
Rocket League is probably the biggest example of this even though it didn't come to gamepass. It released for free on PS Now and blew up into the monster it is today.

No way would it be as popular as it is today if it weren't given away for free first.
That is a whole different situation though. Rocket League was on PS+ for 1 month, GamePass games are there forever (at least Microsoft first party ones).

If it was 1 month on PS+ and then it got out, people who didnt grab it in that specific month would obviously buy it to play with their friends that did. On GamePass, why would I buy the game instead of subscribing to the service itself ($10 vs full priced retail game)?
 
Oct 28, 2017
2,636
#50
Rocket League is probably the biggest example of this even though it didn't come to gamepass. It released for free on PS Now and blew up into the monster it is today.

No way would it be as popular as it is today if it weren't given away for free first. Building that initial player-base is everything for modern games-as-a-service-type experiences.
This.
It should work for any title though. We shall see when the other games come out.