The Psychology Behind Steam’s Summer Sale

Summer is here! Time to pump up your video game backlog until it’s bloated, gurgling, and making vaguely taunting motions from over in the corner. In other words, the Steam Summer Sale has begun. I just bought Hotline Miami, Fez, and The Swapper for like 14 cents1 while typing that.

Like last time, Steam is offering discounted digital downloads in the form of daily sales that change every 24 hours, plus “flash deals” that change every 8 hours. And there are community choice deals where users vote on which of three titles should get its price slashed next. But this time there’s something new: Steam is tying its summer sale in with its trading card system. For every $10 you spend, you get a random card2 from a limited edition set of 10 created just for the event. Collect all 10 of those cards and you can perform some digital origami to turn them into a special badge.3

summer_cards

Let me be clear: I love Valve, I love Steam, and I especially love Steam sales. But I thought it would be interesting to highlight a few of the ways that the these events nudge us towards making more purchases than we may intend to.

Artificial Scarcity

The research is pretty clear that “available for a limited time” is a super effective sales pitch because we value things more that have limited availability. Psychologist Stephen Worchel illustrated this with a study involving cookies unlike those that Steam’s website deals in.4 Posing as a consumer products survey, the experimenters offered subjects a chocolate chip cookie from one of two jars. One of the jars had many cookies in it. The other had only a few. People reported the cookies from the mostly empty jars as more delicious, more desirable, and more expensive. This despite that the cookies in both jars WERE THE SAME COOKIES.

flash_sales

Despite delivering games that are no more than streams of infinitely available 1s and 0s, Steam capitalizes on the scarcity effect because the bias applies to opportunities as well as physical goods. All the Steam deals are time limited and feature prominent countdowns. If you’re thinking of buying a game, you have no idea if it will come up again before the sale is over, so you’re more likely to grab it rather than lose your shot. And maybe for a slightly higher price than you would otherwise.

Psychological Reactance

This one is related to the scarcity effect, but worth addressing separately. Not only do we tend to value scarce things more highly, we often see them as better than more readily available alternatives. This is a kind of boomerang effect in response to perceived lost choice, a phenomenon psychologists have given the needlessly complicated name of “psychological reactance.” In one study of the effect, a group of psychologists studied Florida housewives’ reactions to the banning of laundry detergents containing environmentally unfriendly phosphates.5 Not only did those facing such loss of choice buy more of the product (both more than they did before learning about the upcoming ban and relative to a control group) they rated the phosphate-laden soaps as much more effective than the government mandated alternative.

times_up

Face it: you could spend the same money you’re spending on Steam games in any number of ways. You could buy other games, even if they are fewer in number. But psychological reactance might be making you think that you’ll get more total enjoyment out of the ones that will soon be unavailable.

The Endowed Progress Effect

It’s human nature to not want to leave something undone once we start it. It nags at our minds every time we’re reminded of it and checking the last thing off or filling in the final progress makes us feel a little better. It’s why so many of us have trouble moving on the main quest in a meaty RPG game when there are so many subquests left unchecked. In one experiment,6 researchers gave car wash customers a card that let them earn a wash if they collected enough stamps. Half the customers got a blank “Buy 8, get 1 free” card. The rest got a “Buy 10, get 1 free” card, but with two complimentary stamps to get them started. Thus, both groups needed to buy 8 to get 1 free. But those who got the “Buy 10, get 1 free” card with the 2 starter stamps tended to come back more often and to wait less time between purchases.

card_progress

Steam uses this quirk of human nature with its Summer Getaway trading cards by giving you one random card out of the set of 10 for every $10 you spend.7 Adding a game to your cart displays a progress bar showing how much more you need to spend to get your next card. Just showing that you’ve begun progress towards that goal is enough to create some mental tension over not having yet reached it, and some people are likely to toss in just one more cheap game to get them over that hump. It’s also clever of Steam to show you the progress before you check out so that you have one more reason to complete the transaction.

Of course, once you get the card, the effect happens again because you’ve now started checking off what you’ve collected from the 10 card set needed to craft the Summer Getaway Badge. So double whammy. That’s out of a three whammy set. Get just one more whammy to craft the “I Got Whammied!” badge.

Commitment and Consistency

We don’t like to appear inconsistent. Once we make a commitment or state a preference, some amount of mental inertia sets in and we feel pressure to keep our behaviors in line with our thoughts. In his book Influence: Science and Practice8 Robert Cialdini describes a trip to a introductory class on “transcendental meditation” that he and a friend attended on a lark. When the instructors offered to teach an advanced course on how to perform such wonders as floating and walking through walls, Cialdini’s friend tore into them and exposed their claims as impossible flimflam. Amazingly, many people in the audience who listened to him still proceeded to plunk down $75 for the advanced course because they had taken the time to attend and thus signal a belief in what was being sold. To back out then would send the wrong signal, they thought.

wishlist

So, with that in mind, ever notice how Steam will e-mail you when something from your wish list goes on sale, including during the big sales events? I throw stuff on there all the time to keep track of what I want to buy during sales, and when I get a notification I feel like a commitment is being called in. Steam even has a “Friend Activity” page where you can see what other people have added to their wishlist.

Steam also banks on your commitment when you vote on Community Choice polls, assuming you don’t already own the game you vote for. Actively involving yourself, hoping for a certain outcome, and forming an intention means that you’re more likely to buy if your choice wins. And having your choice actually win feels like a reward –like you won a little contest– so you’re more likely to associate good feelings with that game.

Random Reward Schedules

One of the first topics covered in a Psychology 101 class is likely to be reward and punishment schedules. If your goal is to get people to adopt and then repeat behaviors, giving them rewards is key but the scheduling of those rewards can have a big impact. If you give someone a food pellet every tenth time they press a lever, that’s a fixed interval schedule.9 But randomly give or withhold a pellet after each lever press, that’s called a random or variable reward schedule, and it’s generally the most effective way to get people to keep slapping that lever.

steam_sale

Seeing a game you want show up as a Daily or Flash Deal on the Steam Summer Sale is like getting a food pellet. It’s a reward you get for checking the storefront. In fact, checking Steam at 12 noon every day to see what the new batch of deals are is my very favorite thing about the event –second only to checking back every 8 hours or so for the handful of Flash deals. And let’s not forget seeing what Community Choice games won the last round of votes. While I’m sure Valve has the slate of deals worked out ahead of time, the selection of games seems random to us. And Steam spaces things out masterfully, making sure that you come back to the site throughout the day to see if you’re going to get a reward in the form of a great deal.

So there you go: five psychological hooks to the Steam Summer Sale –or any of its sales for that matter. As I said, I love these events and get a lot out of them. You should buy stuff you want during them, because HEY VIDEOGAMES! But a little knowledge means that you can come at them more on your own terms.

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Footnotes:

1. Rounding down.
2. A virtual trading card, it should be noted. Not physical.
3. Which is good for experience points towards earning higher Steam account levels, which …you know what? It’s too complicated to get into right now.
4. Worchel, S., Lee, J., & Adewole, A. (1975). Effects of supply and demand on rating of object value.Journal of Personality and Social Psychology, 32, 906-914.
5. Mazis, M. B., Settle, R., & Leslie, D. (1975). Antipollution measures and psychological reactance theory: A field experiment. Journal of Marketing Research, 10 654-666.
6. Nunes, J. & Dreze, X. (2006). The Endowed Progress Effect: How Artificial Advancement Increases Effort. Journal of Consumer Research, 32 442-52.
7. You can also buy cards directly from other users in the Community Marketplace for a lot less, but most customers won’t know that. And even if they do, Valve is still making money off those transactions.
8. Cialdini, R. (2009). Influence: Science and Practice. Boston: Pearson Press.
9. Essentially. I won’t dice hairs over the finer points.

64 thoughts on “The Psychology Behind Steam’s Summer Sale

  1. By the way, here’s my haul so far:

    Fez,
    Hotline Miami,
    Kerbal Space Program
    Penny Arcade’s On the Rain-Slick Precipice of Darkness 3 and 4
    The Swapper
    To the Moon

    More to come, I’m sure.

  2. I know Valve has employed a psychologist for a while now, as I tracked down this article to confirm. http://venturebeat.com/2013/05/05/valves-experimental-psychologist-discusses-sweat-detection-and-eye-tracking-for-games/ I wonder if they have any similar input into arranging and scheduling these sales.

    I wonder if this trading card idea is partially a response to more aggressive sales from outlets like Amazon, Green Man Gaming, and Gamersgate. Steam’s summer sale hasn’t been the cheapest place to buy every game like in past years.

    • Possibly. It’s a competitive advantage of sorts. Amazon and most of the other digital distribution vendors don’t have the community built in that Steam does.

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  4. I will post a the link to this on my site , it`s a very good article and very relevant points about the psychology behind the event. It`s easy to fall pray to the hooks you mention but also they can be avoided to a degree by people who are more selective like crafting the badges for only the game they realy like and sell the rest of the cards, others will not buy the games if they know it`s not the lowest price :D

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  7. It is very interesting to see what the highest purchased products are as well as the community votes. If you look at various forums that track game prices and are full of gamers looking for the cheapest possible price, many are very aware that steam sale prices are nowhere near the lowest compared to other stores selling the exact same steam keys.

    Also with the community votes, the majority of the time it is for the product receiving the largest discount. Even when many gamers know that same exact game will come up later in the sale for the same discount or more, most of the people still vote for it even compared to games that may not ever get discounted that far for the rest of the sale. I.E. one game is 75% but will be on sale another one or two times throughout the sale will beat out another two games that might only be 50% off but will never hit that price for the rest of the sale and have never been that low before anywhere.

    Its just interesting seeing the differing mindsets between the two ‘classes’ of people, the casual purchaser and gamer vs. those who know the market. With the cards its another thing, the vast majority of those who watch the game market sell off all of their cards, its easy free money that can also be used to offset a sale price that while maybe not the lowest is close enough for them when included with free money.

    • Yeah, there is probably a class of people who just enjoy the meta game with the voting and the cards and all that. I’ve been sucked into it a little, but not that much.

    • I don’t think you’re necessarily true about some community choices that don’t win not appearing elsewhere in the sale for the same discount.

      As far as I know, every single one of the Community Choice options has gone on either a flash or a daily deal at the same markdown at some point in Steam’s previous sales, and this looks to be holding true this time too.

      Also it is unsafe to assume that because people are voting for a larger discount this means they are “casual” buyers or gamers.

      • It happened multiple times this season, 4-5, that there were games who’s only major discount appeared as a community vote and they lost to games who were on sale many other times. Those games never got that possible discount point through the entire sale. Off the top of my head, expeditions, incredipede, kentucky route zero, there were a few others.

        The casual buyers comment was made because people who vote for things that are or will obviously be on sale multiple times at the same discount have to be casual to not notice that the things they are voting for have or will be on sale again

  8. The trading card mechanism, as described here, seems to be the exact same “Konpu Gacha” mechanism that was legally banned in Japanese social games last year in accordance to pre-existing consumer protection laws.

    The banned mechanism consists on combining 1) A *random* reward on purchase + 2) An extra reward for completing the set of primary rewards.

    • Just read your blog on konpu gacha so I had a question. You say the konpu part is the completion aspect where the player has the urge/incentive to complete a full set. In japan did the players have the option of coordinating with each other to complete these? Im just wondering if steam’s would be considered the same since every user cannot actually complete any set themselves. They must rely on trading with others or purchasing their missing pieces from others.

      • Just wanted to point out that, through personal experience, completion of the Summer Getaway card set via purchases and voting without trading or buying from the marketplace is entirely possible. So even without purchasing games voting 3 times will get you a card for little effort.

        Seems you are referring to the individual game’s badge collections since those actually offer 4 cards of their respective collections from game time, then gives booster packs (containing 3 more random cards) for continued play over a period. Yet do not require any further monetary exchanges beyond purchase of the original game.

        So IMHO Steam’s cards would not be the same as kompu gacha as their is no gambling involved.

        • Yeah, Kotaku (I think) made the comment that it would cost you $100 to complete the set. Given that you can get them from crafting badges –any badges– and from voting on the community deal that’s not quite true. And definitely not true given that last I checked the cards were going for about 19 cents each in the marketplace.

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  10. I have been wondering if the improved Steam community and the community marketplace has had an effect on sales. I wasn’t planning on buying anything this year but managed to sell a TF2 hat for $35. Now I have been able to “guiltlessly” buy games for my friends and trading cards for myself.

    Also, I wonder if the stronger social connection between the community and Facebook has made an impact. People constantly talking about the sale thus leading more and more people to look into it.

    Mini virtual economies. Such fun.

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  12. I feel there’s actually a 6th factor that I’ve noticed in myself as well as the prevalence of them across gaming journalism sites. This is the Confirmation Bias. I’ve found myself looking to ign and kotaku for confirmation that a deal is good under their daily Steam Sale articles/videos. I’ve noticed that I use these videos/articles as additional validation that a deal is worth while even if I’ve completed the game on another platform. Deus Ex for $3 dollars is really good but what is really killing me is that everyone is saying that it’s an amazing deal.

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  23. Artificial scarcity, we need to review that idea.

    The games have got to be sold for a price, because the people who made them want their money back, want profits and want to keep making games. Valve also has and wants to profit.

    So, can the prices be low all year round? Given how publishers sell at multiple retailers, the market’s perception of a game’s worth, new releases, and a whole bunch of other things… is it as simple as radically slashing the prices because it’s digital distribution?

    That’s not even considering long term effect for the store that each sale has, bringing new customers, etc. For an instance, the reason why recent games don’t get crazy price cuts is because they’re still selling. After a while one way to get a lot of sales again is through price cuts, big discounts.

    So I don’t think it’s as simple as putting a super cheap price. They could, yeah, not saying it is impossible. I’m saying that there’s a lot more than just the lack of a physical media. Because after all, the availability may be infinite but the customers aren’t.

    In fact physical media deals with this same issue. It isn’t like they have a problem pumping out more copies of a game, and they only stop publishing a game when nobody’s buying it anymore.

    So it isn’t artificial scarcity. It is actual scarcity. It doesn’t matter in this case if the product is infinite, the scarcity is in how many available customers there are and their willingness to buy a game. Also, actual scarcity in competition. There’s only one Dishonored in the market. Those games need a price, can they keep that 20 dollar price forever? Can they release at that price? Probably, but would it benefit them? This isn’t charity after all.

    Now, does Steam carefully craft their sales to make them more interesting, absolutely. But the whole matter isn’t as simple as calling it “artificial scarcity” or “psychological reactance”.

    Just because something exists as data that can be infinitely copied that it is infinitely available. The people who make the game aren’t infinitely available and the money they want isn’t either

    • The scarcity doesn’t refer to the existence of the product itself, it refers to the scarcity of our opportunity to buy it at a deep discount.

      • Yeah I know, but that’s what I was talking about. This scarcity probably exists, it likely isn’t viable for them to sell cheap all the time.

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  26. Have you already studied the after-sale effect? I read that many games that have been on sale still keep selling a lot after the discount is gone, selling for the regular price. I never understood the logic behind this. Does the person suddenly think “damn, I just lost the opportunity to buy this game at a really cheap price. I’ll plunk down for the regular price because I don’t want to wait for the next time it’s on sale again.”??

    • I don’t have access to those data, but I have heard second hand that there is an after-sale effect. My guess is that it’s due to increased exposure. More people are playing (or seeing it be played), talking about it, sharing stuff about it, recommending it.

  27. I married a Psychologist who keeps saying, “Oooo buy that one!” I guess the professionals are not immune! Though, I have been holding true to my rule… Has to be at least 75% off and under $20. So far so good.

    • Sounds like a good system. A few simple decision rules like that are super effective at limiting purchases.

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  29. I actually wrote a small tumblr post about what I am doing for this obsession. I came ready to play this time around since my first experience with the summer sale I was kind of cash poor. This time around I loaded up my wish list for quick reference and have been watching the sales since day one. Almost 30 games in with an empty steam wallet I still have other tricks. In case you are interested in the blog here: .http://tmblr.co/ZwUNVrpq6yN7

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  34. I’m not sure how much endowed progress, as applied to trading cards, spurs sales – sure, you get the reminder, but you can also get trading cards for voting for upcoming sales (1 for every three votes). I’m assuming that many steam users are taking that option, as most summer getaway trading cards are available in the community marketplace for $0.20ish with nearly 25,000 available. With this many cards available for so cheap, and the one-for-$10-in-purchases needed to get one, one can assume that they are treated as a valueless commodity by the steam community.

    That said, once the sale is over and the supply of new cards from voting dries up, it will be interesting to see if endowed progress kicks in and spurs a minor price spike in summer getaway cards in the community marketplace as folks figure “it’ll be less than a dollar to finish this set I got just by voting, and I might get a voucher”. And then if it snowballs into them trading to complete other badges for games (you can only get half the cards through play)…

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  37. I use a spreadsheet to track the money spent on Steam sales and the saved amount (compared to real market prices, not to inflated Steam numbers). So I have no surprises on the credit card invoice.

    I usually aim at titles below € 5 and set a fixed budget for the complete sale period. Stuff on the long-term wish-list has priority. So I buy stuff I actually like to have and not because it is just on sale now. I also know how much I saved by putting it onto the wish-list instead of buying it immediately (reward for postponing).

    Currently I spent about 50 % of the budget for this Summer Sale and still have stuff on the wish-list, which wasn’t on “special discount” yet. And if the budget gets exhausted before July 22, than that’s it.

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  41. I voted as often as I could on the community picks. just so I could get trading cards. but I never bought any of the picks. thought $10 for a trading card seemed pretty silly. especially when you can buy them in the market for 10c. I loaded my shopping cart on the first day of the sale, and all the items are still sitting there…

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  45. Dark Souls: Prepare to Die Edition
    Deadlight
    Deus Ex Complete
    FTL
    Gunpoint (really really worth it)
    Incredipede
    Reus
    Storm in a Teacup
    Torchlight II
    Ultratron

    I pretty much “grew out” of the sales.
    Of course I always visited the storefront to see what’s new. But no matter how many % a game was reduced, it had to adhere to my “less than 5 Euro” rule, except Dark Souls was on my wishlist quite a while and never had a sale, and Gunpoint which a good friend recommended, so I had to get it.

    Generally, except for FTL all of these games where on my wishlist anyway and I figured that I wouldn’t get them cheaper anytime soon – e.g. the Kentucky Route Zero Daily Deal still is more expensive than the Summer Sale deal.

    Once you figure out most flash sales repeat anyway and community choice stuff isn’t that much cheaper, simply buy flash sales because they are the cheapest way to get anything, and wait with anything else from your wishlist you consider buying until the last minutes of the sale.
    Like this, I “saved” (heh…..) a few bucks through the last Summer/Winter/Helloween/Spring Sales.

    For trading cards, I crafted a badge for my Steam level, and after that just sold all duplicate cards I got from voting. As my brother voted too but didn’t need the cards, I got even more out of it.

    Funny thing is, buying and selling cards (I would love to complete sets for the games I really like, HL2 and Saints Row 3 come to mind) doesn’t matter to me. Someone pumped money into the system, I “sell” something I got for free anyway*, my virtual balance with (so far) zero value for me rises, and if I buy a card it lowers.
    To me, this virtual money is just fun money to play with, as I didn’t invest into the system in this way.

    (* of course the cards are not free, I have to own the corresponding game. But since I own the games anyway and don’t buy anything specifically for card drops or invest money into TF2/DOTA2 for drops, I see them as a free addition.)

    Wonderful writing, been following this blog for a while.
    Keep it up!

    br
    Matt

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  47. I just hold off on all my game purchases now until they’re at least half off for the two or three gotta have it games of the year for me, then I use the Steam and other similar sales to flesh out my collection of AAA games that I wanted, but didn’t want to spend even $30 on. I’ll never pay close to full price for a game now.

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