The Psychology of Video Games

Why did Activision take an already expensive game and release an even MORE expensive version without adding a whole lot to it? And what does it have to do with “Ozark wild mushrooms served with a brandy demi glaze?” I’ve got an idea. Let me share it with you.

As you may know, DJ Hero, a relatively new rhythm game from Activision and FreeStyleGames, includes its own controller in the form of a fake plastic turntable. Many gamers thought that the initial price tag of $120 was high, but were outright boggled by the $200 –TWO HUNDRED DOLLAR!– list price on the special “Renegade” collector’s edition that only had a few paltry perks relative to the base model. Why would Activision take an already expensive game and put out an even MORE expensive version?¹

$200? Ehh....

They’re stupid? Nope. According to one recent press release, DJ Hero was 2009′s highest grossing new video game IP. So something worked.² At the very least, the Renegade Edition pricing is an example of what economists call “price targeting” and what author Tim Harford likens to getting turkeys to vote in favor of thanksgiving.³ In essence, Activision is putting the Renegade Edition out there so that people who are cavalier about price self-identify themselves and allow themselves to be sold basically the same product for more money. It’s the same trick restaurants use to find patrons willing to pay more for food when they charge an extra $.80 for a slice of cheese on your burger when it really only costs them a few cents.

But I don’t think that’s the whole story. I think there’s something called “the contrast effect” at work, and I think Eminim and Jay-Z would be appalled.

You may remember the contrast effect from my discussion how the cover art for Borderlands might have gotten approved. Basically it’s a cognitive bias that kicks in when focusing on the magnitude of one bit of information affects your perception of another piece of information. Like a colored tie appearing brighter when it’s contrasted against a white shirt. Here’s an extremely simple example where the same color of gray looks lighter or darker depending on the background it’s contrasted against:

Which circle is lighter? Trick question! They're the same.

This is why I think the Renegade Edition of DJ Hero was put out there: to activate the contrast effect and to make the regular, $120 edition look cheaper in comparison. Man, $200 for a video game? Forget that. I’m gonna be a the smart shopper and only buy the $120 version. What restraint I have! Quick! Somebody congratulate me!

This kind of thing is done to you EVERYWHERE around you, as the following quote from a New York Times story on the science of restaurant menu writing illustrates:

Some restaurants use what researchers call decoys. For example, they may place a really expensive item at the top of the menu, so that other dishes look more reasonably priced; research shows that diners tend to order neither the most nor least expensive items, drifting toward the middle. Or restaurants might play up a profitable dish by using more appetizing adjectives and placing it next to a less profitable dish with less description so the contrast entices the diner to order the profitable dish.”

Those “Ozark wild mushrooms served with a brandy demi glaze” may be the most expensive side dish listed, but the restaurant only listed them first so that the cheaper mashed potatoes, which have a higher profit margin, look more appealing.

If you’re like me, you see attempts at the anchoring effect everywhere once you know about it. Now that you know about it, think back on the last time you saw a regular version of a game advertised next to the collector’s edition. Does the regular one seem so cheap now?

1. DJ Hero Renegade photo credit: j.reed on Flickr.com [↩]
2. But as Joystiq points out, that’s not the same as “most profitable” [↩]
3. Harford, T. (2006). The Undercover Economist. Oxford: University Press. [↩]

What do basketball free throws, Modern Warfare 2, and murdering 11 people in a row have in common? Read on to find out.

In psychology, there’s a phenomenon called “the hot hand fallacy” (a.k.a., “the gambler’s fallacy” or “the hot streak fallacy” or “the clustering illusion”). The seminal work on this kink in the human mind was done by thee guys named Gilovich, Vallone, and Tversky and published in a 1985 edition of the journal Cognitive Psychology.¹ These fellows weren’t much into online shooters, but they had noticed something about basketball. Specifically, a belief among fans and players in the “hot hand” phenomenon, which dictates that a player’s success in sinking one basket is determined in part by his making the previous shot –success feeds on success and creates a type of momentum or streak.

The problem, though, was that when the researchers studied records of the Boston Celtics and Philadelphia ’76ers making shots, they found that the idea of a hot hand was a fallacy. In fact, if anything, a player’s success on a previous shot slightly predicted the failure of a subsequent shot, perhaps because overconfident players were taking riskier chances. So the idea of a hot hand was all in your hot head.

What does this have to do with video games without “NBA” in the title? Enter Modern Warfare 2 (MW2), Infinity Ward’s military first person shooter. The multiplayer side of MW2 has a feature called “kill streaks” that, as far as a player motivation tool goes, is fairly reminiscent of the hot hand phenomenon. In short, killing a certain number of opponents in a row without dying yourself rewards you with powerful perks like dropping supply crates, calling in heavily armed gunships, or at the extreme end bringing down a nuclear strike to cut the match off at the knees.

This guy is just one kill away from his killstreak bonus. Unfortunately the guy behind him beat him to it.

To be sure, some players get lots of kill streaks because they are tiny, radiant gods of destruction whose skills at the game put every last member of the Boston Celtics to shame (who prefer Halo 3, after all). But skill aside, does the kill streak system in MW2 work in the sense that it gives players some momentum that propels them towards otherwise unreachable acts of virtual carnage? Is a player who has 10 kills in a row any more likely to get the 11th one needed to unlock a kill streak reward than he is to get the first kill?

Nope, says the science of psychology and basic probability theory. It’s all in their head because splash damage and javelin glitch abuse aside, each shot is basically an independent event. For any given player, any perception of kills clustering together more than usual is just a product the human brain’s tendency to see patterns where there are none –a phenomenon called “apophenia” by psychologists trying to win at Scrabble.

In fact, I’d wager that MW2 players are less likely to get those capstone kills than they are to get the first few in a streak. Interestingly, Microsoft, Activision, Infinity Ward, or someone else connected with the game probably has the data to directly test this kind of thing –they track everything these days. It’s be really neat to recreate Gilovich, Vallone, and Tversky’s 1985 study of basketball shots using data from Modern Warfare 2 to see if someone is more likely to kill or be killed as they approach the killstreak payoffs. Heck, somebody get me the data and I’ll do the analyses myself!

1. Gilovich, T, Vallone, R, & Tversky, A. (1985). The Hot Hand in Basketball: On the Misperception of Random Sequences. Cognitive Psychology 17, 295-314 [↩]