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Alex Thurman

English 355: TR 2:10-3:25

Woldruff

6 December 2014

The Sale of a Lifetime

In our consumer culture, buyers are constantly bombarded by discounts and deals to the

point that they are convinced that not investing in the advertised product would mean losing

money and a valuable opportunity. This is exemplified by the grand success of the Steam

Seasonal Sales. The Steam Store is an online venue developed and operated by the Valve

Corporation where users can browse, review, and purchase video games for their PCs. Every

Fall, Winter, Spring, and Summer, Valve orchestrates a massive series of discounts, events, and

contests that becomes the focus of the online PC gaming community for the length of the sale.

During the sales, special discounts called Daily Deals, Flash Sales, and Community’s Choice

rotate and change every few hours, which creates a sense of urgency for the buyers. Also,

because of the nature of the products being purchased, Valve and the respective game developers

make almost pure profit despite the average discounts being anywhere between 50% to 75% off

thousands of games. Through inventive and insightful planning, Valve has earned a borderline

monopoly on the online PC gaming market. The Valve Corporation has developed the Steam

Store to be a successful entity that has an established ethos with its customers, methodically

designs its sales, and launches its sales at opportune times.

Valve was founded in 1996 by Gabe Newell and Mike Harrington ("Valve Corporation").

After releasing several successful games, Valve released Steam in 2003 originally as a way to

update and support their games ("Steam (software)"). Valve continued developing Steam and

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began advertising and selling computer games online. Once Steam began to grow in popularity,

Valve created a community where users could collaborate and connect through Steam. The

signature Steam Seasonal Sales evolved from these features and became the primary reason and

ethos for users to join and remain loyal to Steam and Valve. Valve’s treatment of its customers

and users is what sets it apart from its competitors. Despite the discounts of the sales, Valve and

the developers make a profit due to the nature of the market. The fact that the product is

completely digital eliminates manufacturing and distributing cost. The only cost for Valve is

maintaining their servers that manage and sustain Steam, while the developers pay for

development, advertising, and publishing, which they have likely already paid for by the time

their game is on Steam. The Seasonal Sales are undoubtedly profitable for Valve and game

developers while still benefitting gamers.

The Seasonal Sales account for much of Steam’s success. The individual products have a

timer attached that shows when those games will no longer be on sale for that price. If the users

see exactly how much time is left on the specific sale, then the “limited-time offer” has a greater

effect. The Flash Sales and Daily Deals are both example of this in action. These sales have a

very short time limit, and therefore sell more games. Also, attached to each game’s picture is the

original price, the sale price, and the percentage marked down. This encourages purchases that

have higher original prices and markdown percentage but lower sale prices. If a game’s original

price is higher, then the user will see the product is more valued. The sale price shows how much

the user will pay for the product, which the user wants to be as low as possible to save the most

money. The higher percentages are better because they reveal that the given sale is a better deal

relative to other games. If a game’s percentage markdown is low, the game is less appealing

because the percentage price tells that this particular sale is not as good of a deal compared to the

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other sales. These small depictions have a significant effect on whether a user will purchase the

game or not. However, David Reibstein, a marketing professor at Wharton School, University of

Pennsylvania, stated when discussing online stores and sellers that “The customers who come for

the low prices are just as likely to go to another site the next time around if it happens to offer

low prices.” With this in mind, Steam’s success cannot be only attributed to low prices. Reibstein

continued by saying, “It is still necessary to follow through with on-time delivery of goods and

services and to provide good customer support services when needed.” Therefore, Valve must

establish their Kairos and ethos in order to build and maintain their audience.

The Steam Seasonal Sales occur once every season with the Summer and Winter sales

being the grandest. Each sale lasts anywhere between one to two weeks. There are other sales

that occur throughout the year as well, such as the Halloween and 4th of July Sales. However,

these Holiday Sales tend to be shorter and minor, but achieve the same goals as the Seasonal

Sales. The timing and Kairos of the sales is deliberate and calculated. The Winter sale occurs

when Steam’s competitors are having their own sales and special offers. Having the Winter sale

during a time when its competitors’ prices are at their lowest allows for Steam to retain its

targeted audience. Furthermore, the Summer sale occurs when a large portion of Steam’s

audience, many of which are students, have free time. During the Summer, schools are out, so

students have much more time to play video games. Also, there are few holidays during the

Summer, so users are not distracted by having spending time with family and friends.

Additionally, Steam plans its largest sales during opposite times of the year. This allows the

users to accumulate money to spend and anticipation for the sales.

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The price-cuts of the sales can be divided into four categories: Everyday Discounts, Daily

Deals, Flash Sales, and Community’s Choice. Everyday Discounts last during the entire sale and

are on average the least valuable deals of the entire sale, but these discounts are an excellent

fallback if other sale opportunities are missed. The Daily Deals are chosen by Valve and consist

of a collection of games marked down for twenty-four hours. These deals are the most reliable of

the discounts because they last a relatively long time and the selection of games is large, about

twenty-four different games. An example is show below of the Daily Deals. The delivery is

simple and easy to follow. All of the Daily Deals for that day are shown with their original and

discounted prices. Also, the percentage marked down is the largest and most noticeable number.

This format encourages purchases from buyer who are looking for the most reliable discount in

the Steam Store.

This figure is an example of the Daily Deals during the 2014 Summer Sale taken from “The Passing of Another Steam Summer Sale.”

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The Flash Sales last eight hours each and are the lowest price the given games will reach

for the entire sale. Like the Daily Deals, the Flash Sales are chosen by Valve but contain four to

six games. Because these sales last for such a short time period, users are even more compelled

to purchase these items.

The Community’s Choice is changed every twenty-four hours alongside the Daily Deals

and the selection is voted on by the community. Users have a twelve hour period to vote on one

of two sets of four games chosen by Valve. This discount allows for the users to interact with

Valve in a way that boosts the user’s involvement in the sale as well as give the users an

opportunity they are unlikely to have when purchasing from Valve’s competitors.

Below is an example of the Flash Sales and Community’s Choice. Both have the same

basic display as the Daily Deals. However, there is a live timer for each of these discounts. The

timer is a form of arrangement that adds the sense of urgency that is prevalent in the Steam

Sales.

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The Seasonal Sales have three major characteristic that influence users to purchase the

digital products on the Steam Store. The most direct way the Seasonal Sales encourage purchases

is the monetary discounts. The second method is the limited time offer. The final and most subtle

technique is the convenience of digital purchases. These aspects function together to create an

influence over their targeted audience to encourage purchases.

By offering the same product but at a lower cost, customers are more likely to purchase

said product to save money. This is a clear establishment of Steam’s logos. The audience has an

obvious motive for purchasing the product, which is the reduced cost.

While the financial benefits of the Seasonal Sales are simple, the limited-time offers of

Sales consist of multiple parts: the full length of the sale and the limited-time offers. The Sale

itself lasts for one or two weeks and provides thousands of opportunities, but the best options

come from the Daily Deals and Flash Sales. This is the Steam Sale’s Kairos for their audience.

The users are encourage to “buy now for this limited time offer.” Because the Daily Deals and

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Flash Sales are the best offers and stay the shortest amount of time, shoppers are goaded into

buying these games on impulse. This phenomenon causes people who would not normally

purchase these products to become instant buyers.

The convenience of the digital market facilitates this impulse purchases during the

Seasonal Sales. The Steam Store saves the user’s information which makes purchases quick and

easy. Furthermore, the users can buy their games from anywhere and anytime using a computer

or smartphone. Unlike shopping at a retail store, the digital market allows for the users to

instantly buy their products with almost no effort. This shows Valve’s awareness of their

audience. By knowing what their audience wants and how they want it, Valve can reinforce their

argument for why their users should buy their products. On the whole, these three traits (the

financial value, limited time offer, and digital convenience) of the Seasonal Sales mesh together

in an efficient way that helps Valve build ethos through save Steam’s customers’ money and

time and boost the revenue and reputation of game developers.

The Steam Seasonal Sales have three primary purposes. By creating the tradition of

Seasonal Sales, Valve has secured their ethos and Kairos. Steam users can expect the Seasonal

Sales and eagerly anticipate the opportunity to purchase numerous products at a reduced price.

The users know when the Sales will be coming, so they will postpone their purchases in order to

save money which ensures the loyalty of Steam customers. The Seasonal Sales and Steam’s

quality content are the primary reasons that users stay devoted to Steam. Steam users also

benefits from the Seasonal Sales because they can get their favorite games quickly and easily

through a virtual store at a much lower price than retail.

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Valve’s ethos is an essential part of maintaining their audience. Valve, as a game

developer, puts much more time and effort into all of their games. In most cases, Valve has

continued updating and adding new content to their games, even several years after the initial

release. Valve applies this standard to Steam as well by continuously adding new content. Since

the inception of Steam, Valve has added the Steam Community, Steam Cloud, Steam Workshop,

Steam Greenlight, and Big Picture Mode. All of these were done at no additional charge to the

users, therefore Steam’s users benefit from simply being a costumers, which encourages loyalty.

Valve won the hearts and minds of their customers with integrity, ingenuity, and benevolence,

and have become extremely profitable for it. “Google made an average $350,000 in profits per

employee in 2010… Valve sees profits of around $87.5 million at least” (Chiang). By doing well

by their audience and users, Valve has become extremely successful of establishing both their

logos and ethos.

Valve’s Steam Seasonal Sales accomplish its goals by understanding its audience and

establishing Kairos, logos, and ethos. The structure and delivery of the sales help to

communicate Valve’s argument as to why the users should make purchases.

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Works Cited

Chiang, Oliver. "Valve And Steam Worth Billions." Forbes. Forbes Magazine, 15 Feb. 2011. Web. 21

Oct. 2014.

Reibstein, David. "What Attracts Customers to Online Stores, and What Keeps Them Coming Back?"

Journal of the Academy of Marketing Science 30.4 (202): 465-73. Print.

"Steam (software)." Wikipedia. Wikimedia Foundation, 23 Oct. 2011. Web. 21 Oct. 2014.

Steam Summer Getaway Sale Flash Sales Include Torchlight 2. 2014. By Brenna Hillier.

The Passing of Another Steam Summer Sale. 2014. By Wilhelm Arcturus.

"Valve Corporation." Wikipedia. Wikimedia Foundation, 9 Sept. 2012. Web. 21 Oct. 2014.