Thursday, June 21, 2007

Pokemon DS Games Raise All Pokemon Prices

Pokemon Diamond and Pearl were released April 22nd for the Nintendo DS and prices for all the older Pokemon portable games shot through the roof in anticipation. Apparently, the slogan “gotta catch’em all” refers to the games as well as pokemon themselves.

graph pokemon game prices
The graph above shows the average price of all portable pokemon games on a seven day moving average vs. the price for all video games during that same time. The data starts in early February, almost three months before the DS games were released, and goes until the end of June 2007.

The blue section shows the prices stay relatively even with the overall video game index initially. From the end of February until Pokemon Diamond and Pearl were released on April 22nd (the yellow section) prices start rising and don’t follow the same trends as the rest of video game prices. For the next month after the release prices fall back into the overall trend and steadily decline at roughly the same pace as the index prices. Starting in the green section though, prices for Pokemon games start increasing again and are nearly 50 percent higher than other video games at that point and 23 percent higher than when they started back in February.

What accounts for these big differences in prices and the three separate price increases? Generally, people want to collect all 493 pokemon, which requires them to buy the older games as well as the new one. Or, they enjoy the new ones so much they want to play the older games, too. Whatever the reason, people seem to really increase their buying at three separate times shown on the graph below.

graph of pokemon game prices
The first increase is about two months before the new DS games release and prices increase about 20 percent in 30 days. The second increase is shorter and not as big, about 11 percent in two weeks. The third price spike starts the day kids get out of school for the summer, May 25, the Friday before Memorial Day. Parents start buying games for their kids once they are out of school and have more time to play. What better way to entertain your kids all summer than a collection quest that requires you to beat at least three different games?

The time between the three price spikes are generally decreasing about the same as the overall video game market. Showing that supply and demand for pokemon games and all video game are about the same during these time periods.

I plan to continue looking at pricing trends for other old games after the new ones come out to see if this same phenomenon occurs. Does it happen to Spiderman 1 and 2 when the third game came out? What about Final Fantasy X and X-2 when Final Fantasy XII came out? I’m guessing all games show a spike to some degree when a new one in the series arrives, but by how much? Back to the data I go to find out.

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mndrix said...

Great article. I would have thought that the new Pokémon release would have depressed Pokémon prices below the market level as potential purchasers saved their money in anticipation. I further suspected that after the release date, prices for older Pokémon games would have decline faster than the index. Thanks for the good analysis. I'd really like to see a comparison of prices related to other game releases.

Anonymous said...

Without knowing how many units sold at what price, how do we know that people are buying them at the increased price? Seems more like retailers trying to cash in on the franchise, but if you don't know if people are buying them at the higher prices, its pure speculation to say that the consumer wants them more and is willing to pay more for them. (With the exception of Ebay, where the price is determined through a negotiated process.) All it indicates is that retailers *hope* that consumers will buy at a higher price during a related release.

Assuming that price is automatically determined by supply and demand is only OK in high-school economics. You even go so far as to call higher prices "increased buying." Maybe I'm missing something somewhere, but this seems like pretty fast and loose reasoning.

JJ Hendricks said...

If you would read the source data blog, my second post on this site you would see that all the sources for the data are sites were the prices are determined dynamically. Amazon, Ebay, Half, and JJGames all are priced based upon supply and demand not simply expected higher prices by the suppliers.

The prices are what has actually sold to customers. Please read the other blog posts for more details about how the prices are determined and where they come from.

Anonymous said...

I read the other posts and I don't see where it says that the prices are based on the prices of units sold, as opposed to the prices advertised. Since you have claimed this to be so in your comment to this post, I have to ask: does Amazon really release volume and price data on games sold? And then you say you determine the prices using a secret recipe? Doesn't give me a lot of confidence in the data. Sorry to be anonymous, but I don't have a blogger ID. Michael

JJ Hendricks said...

No Amazon does not directly provide units sold and prices sold. You are correct. But you can get an approximation of this.

Let's say you go to Amazon and find the lowest available price for X game. It is $10 today. You go back tomorrow and the lowest priced item available is now $11. Either the $10 item was sold, or it was removed by the seller or price was raised by the seller. Since people list on Amazon to sell their items we can assume for the vast majority of cases the item sold. So we can say on that day the price was $10 because someone listed at that price and bought at that price.

What if instead the price is $9 the next day? Either the seller lowered their price or a new seller came in with a lower price. We don't know if they $10 item sold, but we do know that seller's think their items are worth less money. So we can say the price went down.

Maybe buyers are only willing to pay $7. So that $9 item will stay at this price and never get sold and my price would stay the same, but eventually someone comes along at a lower price or the seller lowers it themselves until the price gets closer together and reaches an equilibrium. Because of this we can approximate the lowest price available on Amazon as the "market" price for that item on Amazon because items should be in a state of equalibrium with supply and demand.

My prices are not exactly Amazon's lowest price. But this is an example of how the Amazon price could be used as an approximation for the sale price.

Dylan said...

Interesting article. I'm guessing that games like the FFX/X-2 example you gave would have an increase of some description, but perhaps not as dramatic.

Are there any other series with backwards collectible objects etc in them? It'd be interesting to see if this trend does indeed stretch past Pokemon, or if it only occurs in this series since it's such a popular thing.

JJ Hendricks said...

I can't think of any game series where you can collect items from previous versions and transfer them over, besides Pokemon.

If anyone knows of any let me know so I can try to analyze their data.

Anonymous said...

On ps1, the sequels Suikoden 2 and Monster Rancher 2 utilized the save data of the original games. I don't know if the ps2 installments of those series have continued the trend, as I've lost interest since then...

I do know there are some episodic RPGs, like the .hack series on ps2, that are intended to be played in sequence, using the same save data through the run of the series. .hack and .hack//G.U. might the best ones to analyze.

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