Valuation of Participation in Social Gaming

This study examines the value of the time that a user spends to participate in a social game. We focus on how a massive multiplayer online role-playing game (MMORPG) vendor can establish prices to encourage participation and retain its players. We estimate value through an application of the hedonic...

Full description

Saved in:
Bibliographic Details
Main Authors: KIM, Kwansoo, YOO, Byungjoon, KAUFFMAN, Robert J.
Format: text
Language:English
Published: Institutional Knowledge at Singapore Management University 2013
Subjects:
Online Access:https://ink.library.smu.edu.sg/sis_research/2106
https://ink.library.smu.edu.sg/context/sis_research/article/3105/viewcontent/Valuation_of_Participation_in_Social_Gaming_afv.pdf
Tags: Add Tag
No Tags, Be the first to tag this record!
Institution: Singapore Management University
Language: English
id sg-smu-ink.sis_research-3105
record_format dspace
spelling sg-smu-ink.sis_research-31052020-03-27T02:30:07Z Valuation of Participation in Social Gaming KIM, Kwansoo YOO, Byungjoon KAUFFMAN, Robert J. This study examines the value of the time that a user spends to participate in a social game. We focus on how a massive multiplayer online role-playing game (MMORPG) vendor can establish prices to encourage participation and retain its players. We estimate value through an application of the hedonic pricing model and analyze a data set for an MMORPG in Korea. The results permit us to estimate the value of game-playing time in monetary terms. Based on our empirical results, we propose an economic model and conduct numerical simulation to show how a game vendor can apply differential pricing in this context. This enables us to design a pricing scheme to maximize a game vendor’s profit. Our study affirms the long-standing finding that building network effects associated with other game players’ participation is a critical source of benefits for the vendor. Going beyond this, we also find it is appropriate to use differential pricing, by subsidizing a participant’s game play initially and then charging more aggressively to extract the available consumer surplus over the player’s life cycle in the game, in order to reinforce a vendor’s ability to maintain a healthy number of game participants. 2013-01-01T08:00:00Z text application/pdf https://ink.library.smu.edu.sg/sis_research/2106 info:doi/10.2753/JEC1086-4415180201 https://ink.library.smu.edu.sg/context/sis_research/article/3105/viewcontent/Valuation_of_Participation_in_Social_Gaming_afv.pdf http://creativecommons.org/licenses/by-nc-nd/4.0/ Research Collection School Of Computing and Information Systems eng Institutional Knowledge at Singapore Management University Customer valuation econometrics field study hedonic pricing hedonic value MMORPGs online games role-playing games social gaming Computer Sciences E-Commerce
institution Singapore Management University
building SMU Libraries
continent Asia
country Singapore
Singapore
content_provider SMU Libraries
collection InK@SMU
language English
topic Customer valuation
econometrics
field study
hedonic pricing
hedonic value
MMORPGs
online games
role-playing games
social gaming
Computer Sciences
E-Commerce
spellingShingle Customer valuation
econometrics
field study
hedonic pricing
hedonic value
MMORPGs
online games
role-playing games
social gaming
Computer Sciences
E-Commerce
KIM, Kwansoo
YOO, Byungjoon
KAUFFMAN, Robert J.
Valuation of Participation in Social Gaming
description This study examines the value of the time that a user spends to participate in a social game. We focus on how a massive multiplayer online role-playing game (MMORPG) vendor can establish prices to encourage participation and retain its players. We estimate value through an application of the hedonic pricing model and analyze a data set for an MMORPG in Korea. The results permit us to estimate the value of game-playing time in monetary terms. Based on our empirical results, we propose an economic model and conduct numerical simulation to show how a game vendor can apply differential pricing in this context. This enables us to design a pricing scheme to maximize a game vendor’s profit. Our study affirms the long-standing finding that building network effects associated with other game players’ participation is a critical source of benefits for the vendor. Going beyond this, we also find it is appropriate to use differential pricing, by subsidizing a participant’s game play initially and then charging more aggressively to extract the available consumer surplus over the player’s life cycle in the game, in order to reinforce a vendor’s ability to maintain a healthy number of game participants.
format text
author KIM, Kwansoo
YOO, Byungjoon
KAUFFMAN, Robert J.
author_facet KIM, Kwansoo
YOO, Byungjoon
KAUFFMAN, Robert J.
author_sort KIM, Kwansoo
title Valuation of Participation in Social Gaming
title_short Valuation of Participation in Social Gaming
title_full Valuation of Participation in Social Gaming
title_fullStr Valuation of Participation in Social Gaming
title_full_unstemmed Valuation of Participation in Social Gaming
title_sort valuation of participation in social gaming
publisher Institutional Knowledge at Singapore Management University
publishDate 2013
url https://ink.library.smu.edu.sg/sis_research/2106
https://ink.library.smu.edu.sg/context/sis_research/article/3105/viewcontent/Valuation_of_Participation_in_Social_Gaming_afv.pdf
_version_ 1770571787049893888