Why is Epic Giving Free Games?
Epic Games, the renowned game developer and publisher, has been offering free games to its customers through its Epic Games Store (EGS) since its launch in 2018. This has raised questions among gamers and critics alike, wondering why the company is giving away free games. In this article, we will delve into the reasons behind Epic’s generosity and explore the implications of this strategy.
Marketing Strategy
One of the primary reasons Epic Games is giving away free games is as a marketing strategy. By offering free games, Epic aims to attract more customers to its EGS and increase its market share. This is especially important for a relatively new platform, as it allows Epic to compete with established players like Steam and GOG.
Free Games as a Loss Leader
Epic’s free games strategy can be seen as a loss leader, a business tactic where a company offers a product or service at a loss to attract customers, hoping they will purchase other products or services in the future. In this case, the free games serve as a draw to attract customers to the EGS, which may then lead to sales of other games and digital products.
Building a Customer Base
By offering free games, Epic is building a customer base for its EGS. This can lead to a loyal following of customers who will return to the platform to purchase other games and digital products. Additionally, free games can serve as a gateway to other Epic products, such as Fortnite and Unreal Engine.
Competing with Steam
Steam, the largest digital distribution platform for PC games, has been a dominant force in the industry for many years. Epic’s free games strategy is a direct attempt to compete with Steam, offering customers a alternative to the Steam store. By offering free games, Epic is hoping to attract customers who may not have considered the EGS before.
How Does it Work?
Here’s a breakdown of how Epic’s free games strategy works:
- Weekly Free Games: Every week, Epic offers a new free game to its customers. These games are usually AAA titles or indie games that would normally be sold at a premium price.
- No Strings Attached: Customers can claim the free games without any strings attached, such as in-game purchases or subscriptions.
- Keep the Games: Once claimed, the free games are yours to keep, even if they are no longer available for free.
Implications
So, what are the implications of Epic’s free games strategy? Here are a few key points to consider:
- Increased Customer Acquisition: By offering free games, Epic is attracting new customers to its EGS, which can lead to increased revenue in the long run.
- Improved Customer Retention: Offering free games can lead to increased customer satisfaction and retention, as customers feel they are getting value for their money.
- Competitive Advantage: Epic’s free games strategy gives the company a competitive advantage over other digital distribution platforms, such as Steam.
- Loss of Revenue: While Epic is offering free games, it is sacrificing revenue from game sales. However, this may be a necessary step to build a loyal customer base and gain market share.
Who Owns Epic Games?
For those who are curious, Epic Games is a privately held company owned by Tim Sweeney, the company’s founder and CEO. Tencent, a Chinese technology and entertainment company, holds around 40% of Epic’s stock, while Sweeney owns more than half of the company.
Conclusion
Epic Games’ free games strategy is a bold move that aims to attract new customers and increase its market share in the digital distribution space. While it may come at a cost in terms of revenue, it is a necessary step for the company to build a loyal customer base and compete with established players like Steam. Whether or not this strategy is successful remains to be seen, but it is an interesting development in the world of digital distribution.