Massive introductory discounts discussion

[daverowland]

This topic was imported from the Typophile platform

Following on from this Twitter conversation https://twitter.com/typographica/status/307302297250168832

There's obviously a lot of feeling about the recent trend of launching fonts with 80-90% discounts. Some foundries say it cheapens fonts, and some are forced to emulate the offers in order to be noticed. As a marketing technique, it really works well in the short term as it pushes the new fonts quickly up the sales charts, but after the sale's ended, how long do they stick around?

The sales charts at MyFonts are based solely on dollar value, so a font family at $5 has to sell ten times as many as one at $50 to reach the same chart position. I had an idea for weighting the charts in favour of more realistically priced fonts:

Font Family X - standard price $200, 90% intro offer = $20 each family
Font Family Y - standard price $200, 50% intro offer = $100 each family
Font Family Z - standard price $200, 0% intro offer = $200 each family

As it stands, to reach the same position, X needs to sell five times as many as Y, which needs to sell twice as much as Z.
If the sales charts mechanism was changed such that the dollar value received was also affected by the offer price, say by taking half the offer percentage off the resulting price (only for working out chart position), the prices of each font above (in terms of how the chart sees them) would be:

Font Family X - standard price $200, 90% intro offer = $20 each family . minus 45% = $11
Font Family Y - standard price $200, 50% intro offer = $100 each family . minus 25% = $75
Font Family Z - standard price $200, 0% intro offer = $200 each family . minus 0% = $200

Clearly, the more heavily discounted fonts now need to sell even more in relation to non discounted fonts to reach the same position in the chart. There is still a marketing advantage to putting your fonts on offer, but the more ridiculous offers would not be as effective as they are now.

What do think? Is this fair? I'm undecided, but I think the system as it is now is starting to force foundries making decent fonts to discount heavily in order to keep up with not-so-decent fonts. If it continues, it won't be long before every new release is 99% off for a month then never sells again after that. If a new system could be shown to give more long term sales, that can only be a good thing.

[hrant]

So your plan is to convince MyFonts to change their ranking policy? To prevent foundries from harming their brand out of desperation for a good ranking? What's in it for MyFonts? Maybe they like it this way?

BTW, I'm not sure that a brand is damaged because of discounting. Jeremy Tankard has a very strong brand, but he discounts up to 95% (if only for one day). After all, the best way to build a brand is to get people to use your stuff.

hhp

[daverowland]

Fair points. As I said, I'm undecided. I wouldn't ask MyFonts to change anything; they've been good to me! It was just an idea. I'm not really concerned about cheapening my brand by putting things on offer. If I was overly concerned with my 'brand' I'd have ditched a load of fonts by now. I guess I just feel for newer foundries whose only way of gaining exposure is to underprice. I have a feeling this pricing model may just be a trend that is unsustainable in the long run. I hope so anyway.
My worry is that customers may stop buying any fonts at full price, knowing that vastly discounted fonts are never far away. Hopefully though, this may cause foundries to make ever more interesting and different fonts, as big discounts cease to be a factor in separating their fonts from others', because virtually all fonts are hugely discounted.
BTW, I don't wish to come across like I'm saying all fonts with big discounts are bad, or that big discounts are inherently a bad thing. I just wanted to carry on the discussion where participants could use more than 140 characters!

[Ralf H.]

the system as it is now is starting to force foundries making decent fonts to discount heavily

No one is forced to anything. Those are “market penetration” offers. They are supposed to reach an audience which has over 100.000 fonts to choose from and hundreds of new Twitter messages every day. So for a short period of time you make a loud offer people can't resist and by this you spread the word. That's it.
Those fonts don't sell because they are in the bestseller list, but because of the offer itself, which is such a good deal that people start to spread the news and that creates the snowball effect. So I don't think it's caused by the list or it's calculation.

If it continues, it won't be long before every new release is 99% off for a month …

Certainly, that will happen for some fonts.

… then never sells again after that.

MyFonts is just a retailer. It's up to the foundry to keep the sales up and there are many different strategies to achieve this. A bestseller list is just that. It shows what sells. It can't weigh anything to support “quality fonts”.
Maybe they could start an “Editor’s choice” section where quality fonts are suggested, but I don't think we need to blame the calculation of the bestseller list for how foundries set up their pricing.

[Anthony Noel]

Hi Dave,

Take a look at MyFonts' best sellers list, instead of the Hot New Fonts list. I might be wrong, but nothing on the best sellers list is currently on an introductory sale, but there's plenty on there that were. That would seem to indicate that the penetration idea works, and that sales are sustained afterwards by a font's higher visibility. There's also fonts on there that were promoted by other methods, such as free weights (which remain free, by the way – no restrictions there).

Anthony

[Bert Vanderveen]

imo: The intent of introduction offers like these is to get the fonts in the market in a fair volume. My reasoning is that a lot of designers (maybe not to sure about their knowledge in this field) are wont to go for what is used by their ‘well-known’ contemporaries.

Mr Buivenga’s fonts are exemplars: they have become very popular, clearly because they have been used in high profile material.

[jandorp]

As Ralf notes, it was the foundries, not MyFonts, that developed the concept of extreme introductory discounts. Probably the first full family sold at a breath-taking introductory price on MyFonts was HVD’s Pluto in mid-2011; it has remained a seller at full price. But I wouldn’t be surprised if Hannes was inspired by the high-profile introduction of Axel (a Spiekermann production) two years earlier by FontShop Germany at less than €/$ 20 for a four-weight family.
While typohiles (including some of us at MyFonts) may have mixed feelings about the trend, it does have its positive aspects. Typically, non-pro and semi-pro customers have always bought single weights, even when volume discounts on larger (text) families were substantial. Thanks to the family-at-the-price-of-one-weight craze, average users have become familiar with the idea of buying an entire type family, which to many always seems to have looked like a rather extravagant and unnecessary kind of purchase. So while some argue that low prices teach people a wrong thing (fonts can be cheap) it might also teach them something good: fonts don’t necessarily come one at a time.

[hrant]

Jan, good points. One thing though: foundries might have figured out the trick themselves, but MyFonts probably created the environment that made it a good idea.

BTW here's a cool experiment somebody should try: simultaneously release multiple essentially identical versions of the same typeface, giving each a different discounting strategy (and choosing neutral names so that doesn't throw off the results) then watch how they perform for a year.

hhp

[russellm]

BTW here's a cool experiment
This has been done in cheese stores in France. I identical cheeses were sold under different brands and at different prices. People tended to prefer the more expensive 'brand', apparently assuming high price equals higher quality. I think I read about it in Ogilvy on Ogilvy.

[dberlowgone]

BTW!!! Here's a cool experiment someone in the font industry should try! Make frozen lasagna out of beef, horse, rat, road kill and sawdust, labeling and packaging each identically, but making the beef the cheapest, the sawdust the most expensive, etc., and see which one gets caught by the Food Police first!

I'd bet on the rat or the road kill.

[hrant]

That would only fly in the UK. ;-)

Russell, we might end up proving that fonts aren't cheese and Hemet isn't Paris...

hhp

[metalfoot]

As an end-user of fonts who is not a graphic designer or typographer by trade, I must admit I am more likely to buy a font at a low introductory price of $20-$50 than $200-300. It just doesn't make sense for my budget, given I have no means by which to charge out the price of fonts, to spend more than that for me. That's just speaking for me and my limited budget. This is why I openly admit to owning WordPerfect and CorelDraw as much for the font libraries which come with the software license as for the software itself.

[Nick Cooke]

Some users are prepared to pay for quality. For many years Stella Artois used the slogan 'Reassuringly Expensive'.

[russellm]

fonts aren't cheese
You sure that's always true?
Regardless, people are always people. No matter where we go... There we are.

[hrant]

One of the best lines from "The Adventures of Buckaroo Banzai Across the 8th Dimension!".

hhp

[Chris Dean]

I can see two sides:

1. A desperate, last ditch attempt to sell a luxury item during times of economic collapse.

…or…

2. A natural evolution of an existing market which is still trying to figure itself out, post-internet (and all that other fancy computer stuff).

Look at iTunes. Who would have thought selling a song for a dollar would have brought the record industry to it’s knees? I’m not a musician, but thanks to iTunes, I think its significantly easier to get your music out there. Friends of mine can do this today, who would not have been able to do so a decade ago. Regardless of talent or financial means.

[hrant]

BTW is it true that most massive discounts only happen upon launch, and then almost never again?

the record industry to it’s knees?

?
http://www.bbc.co.uk/news/technology-21601602

hhp

[Ralf H.]

1. A desperate, last ditch attempt to sell a luxury item during times of economic collapse.
2. A natural evolution of an existing market which is still trying to figure itself out, post-internet (and all that other fancy computer stuff).

3. The growth of a market into a new field.
As Jan already mentioned: MyFonts opened up a new market. If you look at MyFonts’ homepage you clearly see, that those offers are not meant for the same kind of people font licenses were sold 15 years ago. The design studios buying the 500–1000 Dollar packages are still very important, but there is now a huge market of individuals who are willing to spent 20 to 50 bucks for a font. And with deep family discounts they might even purchase licenses for those.
I don't see anything bad about it. Especially as long as those are only introductory offers. After the first 45 days, a quality typeface will still be a quality typeface available for regular prices.

[hrant]

Ralf, don't you think there might be an image problem? Do you think foundries that don't do heavy discounting are making a mistake?

hhp

[JamesM]

And many designers feel pressure to keep costs down. If you're a big agency with big clients, the cost of fonts might be a drop in the bucket, but for freelancers and small agencies working on lower budget projects, adding $500 (or whatever) to your invoice for new fonts can be a bigger deal.

[aluminum]

hrant, iTunes brought the industry "to it's knees" in the sense that iTunes was a major interrupter of the traditional distribution and retail model...and in that sense, was somewhat of a 'great equalizer' in that everyone had an equal opportunity for 'shelf space'.

I don't think MyFonts is quite as extreme, but for a large part of this industry, it appears to be mimic that.

[Ralf H.]

Ralf, don't you think there might be an image problem?

So far I don’t see any negative effects for the foundries who do it.

Do you think foundries that don't do heavy discounting are making a mistake?

No. Every foundry needs to find its market and the appropriate strategies. We can't go all for the same people who only go for these sale prices. If we do that, it would stop working. In the same way as we shouln’t do it all like Exljbris or TEFF is doing it.

[John Hudson]

If I were licensing retail fonts through a major distributor like MyFonts, I would be inclined to try a kind of Reverse Dutch Auction release pricing. A Dutch auction involves a gradually reducing price for a limited commodity (classically, flowers). A reverse Dutch auction seems to me a good model for an unlimited, digital product, for which the price gradually increases over time. So begin with a massively deep discount for, say, a week, and then start incrementally increasing it up to the full retail price. The latter could either be a fixed amount comparable to other fonts, or simply at whatever level the particular font continues to sell an average of X licenses per week. Just an idea. I've no idea how well it would work in practice, so don't blame me if you try it and end up unhappy with the results. If you do try it, please let us know how it goes.

[hrant]

OK Ralf (and of course anybody else) let me ask it this way: What's a good reason a foundry would not offer steep discounts?

John: Do you think that would work better as an official/predictable/explicit pattern, or would it better to keep people guessing?

hhp

[1996type]

Here's why people, including me, fear these huge discounts: they might create a market where nothing but extremely cheap or discounted fonts sell well. This market obviously isn't there yet, but the fear for it is.

Here's a thought I had recently. Let's say this movement continues, and 'normally' priced fonts don't sell well anymore, somewhere in the future. Could we not simply conclude that due to the large amount of quality fonts, foundries have to compete more, and the market equilibrium has shifted? End of the golden days for font designers? Perhaps it's been a bubble that's about to burst.