October 7, 2009

The Aftermath of the Goozex Exchange

Erik Kubik Says Following the latest Goozex Exchange I had a few concerns. So I turned to Mark Nebesky who works for Goozex. I had few questions about the sale. I wanted to know how it went overall and what determined the games and movies selection. This is what he had to say over email.

How did the sale go? Did you guys run out of anything? Did more people buy stuff this time around?

The sale was what we expected in terms of volume. There was demand at those higher price points for new games, but not as much as in the previous exchange programs we ran where the price points were only about 70% less. In terms of data collecting, it was a success. We know a lot more about purchasing rate, title selection and more specific data for our pricing sensitivity analysis. Our goal was to not sell out of any items or to get more people to exchange points for new games and movies. Rather, our goal is to provide an opportunity for members to exchange their points for items and extend the value of our currency beyond game trading. We would not consider the program a success if we "sold out" of items because we want to make a long-term service out of the exchange and not a one-hour event.With the program in beta and our first few days of data collected we are now in a better position to fine tune the program. Members should expect to see more games come onto the marketplace and possibly price revisions. Again, we're looking to create a long-term service that members can use at any time of the year.

How did you guys decide on the prices and the selection?

Pricing and item selection is the important combination for the Exchange program to work. You can kind of map out a matrix where Goozex would be in trouble if we offered super high demand games at low cost or on the other end of the spectrum, no demand games at high cost. Our objective is to find the sweet spot in the middle that allows us to maintain the Exchange program as a long-term service for members. The pricing decision was based on previous sensitivity analysis data that we collected. The game selection was done on what items that we termed having "medium" demand.

Finally from here on out are Goozex users going to see a sale every month around the same time?

The concept of having an Exchange sale every month is not the direction we are heading. Our goal is to have the Exchange program run 365 days of the year and is open to all eligible users at any time.

My thoughts, I am glad the Goozex Exchange was a success. I am also happy that Goozex is seeking the middle ground for the cost of games, although the initial selection was rather poor. Ghostbusters? Fight Night Round 4? A Bug’s Life?

But since the Exchange went live, a few games and DVDs have been added. There’s a James Bond Collection, Monsters vs Aliens, Tru Blood season 1 Cross Edge for the ps3, Dirt 2, Halo ODST, as well as several others. As for the pricing, it still seems a little high for some of the games and some of the DVDs. But the program is in BETA and I am sure things are still being worked on. I do like the idea of it running 365 days a year instead of for a few days a month.