Sales Testing $600 vs $1000

[Arakash]

Recently i did some testing to see the effect of price on the sales of vehicles in Gearcity.

The main question i was looking at:
Do you see a increase in sales volume, perhaps a significant one when you lower prices?
The reason i wanted to know this was i believe it was suggested at some point on the forums you could increase your price without having a significant effect on sales.

Preface:
I don't have an enormous amount of time to do this at the moment, so ive only got testing from two different price points and i haven't repeated it yet. I also had a lot of bad luck with bugs and had to do the final part of the testing on 1.11 instead of 1.10.
So you should consider the information very rough estimations, but i think they are still interesting for discussing the topic.

Ill start by summarizing what i think ive found out, if you want to see the procedure, limits and raw data, skip to the testing section.

Basic conditions: (again look at the bottom of the thread for more details.)

• I used a sedan for every test, selling in 1901 from Feb - December in London only.
  
• For reference, the Per capita at this point is around 380-390, population is 6.32mil
  
• (Note: Competitor activity is reported, but is probably not reliable at the moment due to bugs)
  

Results/Summary

• Sedan Selling at $1000 in London - 2.6x per capita
  Average sales were ~ 376 vehicles per month. Lowest was 220 and highest was 506.
  Combined Competitor activity was never beyond 150 units total per month, but on average around 40-70.
  
  
• Sedan Selling at $600 in London - 1.55x per capita
  Average sales were ~ 995 vehicles per month. Lowest was 661 and highest was 1503
  Combined Competitor activity reached 200 towards the end, but was on average 100-130
  

Thoughts/conclusions based on this:

You should consider this a (very) rough estimation, but it looks like the drop in prices from 2.5x($1000) to 1.5x($600) per capita in 1901 gave roughly 3x the sales.

So answering the question asked right at the start of the test, in controlled conditions it seems we get significant increases in sales volume when you decrease price. We can also assume that the reverse, that in controlled conditions you get decreased sales with a higher price, is also true.

Ive suspected for a while that because of the way income distribution works in Gearcity, if you have a lower price you will be able to sell vehicles to a much larger percentage of the population. (i.e. people with lower income who could not afford the vehicle before can afford it at a lower price)
That said, i assume a lower price will also attract more people from the demographics higher priced vehicles sell to as well. (i.e. more rich people might also buy if you lower the price)

Regardless of the mechanics involved, reducing the price has quite the effect on sales by the look of it.
Selling at low price and high volume is something to think about when you design your next vehicle.



Testing Procedure:

To limit the number of other factors that can influence sales, ive tried to sell the same vehicle, under the same conditions in separate saves, in 1901. Without doing this there is so many things effecting sales its hard to tell anything with any amount of certainty.

Just for clarification, i had to edit my money in the first game turn in order to not go bankrupt while testing sales. This should have no effect on the actual sales numbers.

In detail:

Code:

- I start a new game on normal for every vehicle price i want to test.
- Im testing sales only in the year 1901 (February to December to be specific)
- I don't use any marketing.
- I only sell vehicles in London - Maximum Branch size
- I overproduce vehicles, a surplus is always available so im not limited by production numbers
- I record competitor activity, incase it is having a large effect on sales
Vehicle design choices: (the same for every game)
Note: Unless otherwise stated, no sliders are touched at all during design
- Sedan
- 2 gear "Generic" gearbox (midrange i thought)
- 2 Stroke gas
- Demographics - Male(women cant even vote yet in 1900) - Upper Middle (the vehicle is never going to be at or below Per capita, so middle or lower seems pointless.)

Here are screenshots of each of the vehicles in 1901. You can see that while their names are different, they appear identical.
http://i.imgur.com/0qxkNux.png
http://i.imgur.com/DrNde4Q.png

Sales Data:
Ill post the raw data in code tags below this (its large).

Code:

Raw monthly sales
$1000 vehicle  Feb - December 1901
220
506
262
358
395
331
346
489
470
514
246

$600 vehicle Feb - December 1901
838
799
1222
871
960
1257
1503
772
825
661
1247

Detailed sales information:
Note: M2 = February, M3 = March etc.
Note: Competitor activity is noted in order to eliminate another variable, so their names aren't listed but they are consistent across all months of the save. You also shouldn't consider them overly reliable due to possible bugs.


T1- Sedan for $1000

1901
M2
My Company - 220
Sedan Competitor 1 - $1028 - 71

M3
My Company - 506
Sedan Competitor 1 - $1028 - 66

M4
My Company - 262
Sedan Competitor 1 - $1028 - 31

M5
My Company - 358
Sedan Competitor 1 - $1028 - 37

M6
My Company - 395
Sedan Competitor 1 - $1182 - 39

M7
My Company - 331
Sedan Competitor 1 - $1182 - 90

M8
My Company - 346
Sedan Competitor 1 - $1182 - 101

M9
My Company - 489
Sedan Competitor 1 - $1359 - 114

M10
My Company - 470
Sedan Competitor 1 - $1359 - 0

M11
My Company - 514
Sedan Competitor 1 - $1359 - 1

M12
My Company - 246
Sedan Competitor 1 - $1563 - 4


T2 - Sedan for $600

M2
My Company - 838
Compact Competitor 1 - $785 - 12
Phaeton Competitor 1 - $2257 - 13

M3
My Company - 799
Compact Competitor 1 - $785 - 13
Phaeton Competitor 1 - $2257 - 13

M4
My Company - 1222
Compact Competitor 1 - $785 - 91
Phaeton Competitor 1 - $2257 - 19

M5
My Company - 871
Compact Competitor 1 - $785 - 91
Phaeton Competitor 1 - $2257 - 37

M6
My Company - 960
Compact Competitor 1 - $903 - 90
Phaeton Competitor 1 - $2257 - 26

M7
My Company - 1257
Compact Competitor 1 - $903 - 13
Compact Competitor(bellesez) 2 - $348 - 21  # Wow he must be loosing a ton of money
Phaeton Competitor 1 - $2257 - 24
            
M8
My Company - 1503
Compact Competitor 1 - $903 - 21
Compact Competitor 2 - $348 - 19
Phaeton Competitor 1 - $2257 - 47

M9
My Company - 772
Compact Competitor 1 - $903 - 21
Compact Competitor 2 - $348 - 19
Phaeton Competitor 1 - $2257 - 47

M10   (1.10 ---> 1.11)
My Company - 825
Compact Competitor 1  - $903 - 12
Compact Competitor 2 - $348 - 112
Phaeton Competitor 1 - $2257 - 24

M11
My Company - 661
Compact Competitor 1  - $903 - 10
Compact Competitor 2 - $348 - 174
Phaeton Competitor 1 - $2257 - 28

M12
My Company - 1247
Compact Competitor 1  - $903 - 11
Compact Competitor 2 - $348 - 172
Phaeton Competitor 1 - $2257 - 26

Ive got two folders full of saves for each month, for further information on the models and further comparisons/proofs/evidence if needed.
I can also provide any other charts or information if people would like them.

[Laurent Tommy Flanagann]

Yay, that's great, thanks for sharing!

As a matter of facts, I would require you to tell us more about your margin profits. That is, did you have better results (well, let's say more money) using the highest price or the lowest?

I could have made the maths, but still, I wonder what strategy is the best to win easy money, let's say for those who do not know how to edit starting money...

Anyway, again, thanks for testing and for sharing, much appreciated!

[Arakash]

Yay, that's great, thanks for sharing!

As a matter of facts, I would require you to tell us more about your margin profits. That is, did you have better results (well, let's say more money) using the highest price or the lowest?

I could have made the maths, but still, I wonder what strategy is the best to win easy money, let's say for those who do not know how to edit starting money...

Anyway, again, thanks for testing and for sharing, much appreciated!

Thanks, i don't mind at all.
I was interested to see the effects of this kind of test myself.

Edit: I wrote some reasoning for the test, but i decided to put it in the first post instead.

On the profits thing
Sorry, but I don't think this test can answer your question about which strategy is more profitable.

Unfortunately, this test was really only narrowly designed to show differences in the volume of sales with different prices in controlled circumstances.
I payed no attention to how much the design of the test would cost, i was only trying to limit as many variables as possible(which is quite hard). I list many of the most costly of these at the end of the post.

Unsurprisingly, these controlled conditions with no concern of profit/cost meant i lost hundreds of thousands over the year of my test. (which is the reason i had to edit in the first place)
I don't think that invalidates the test because it was only ever designed to show the differences in sales volume with a change in price. It was not in any way trying to control/test profits, afaik they don't effect the volume of sales at different prices.

So i think profits at different prices probably needs another entire test to itself with its own controlled variables.

Code:

Some examples of controlled variables that lost me a ton of money in both games:
- I made an unoptimised and fairly expensive vehicle(no slider movement) that could easily be redesigned by any player and in different save games.
- I spent most of the game producing the maximum number of vehicles, with thousands in reserve. (so my sales would never be limited by not having enough vehicles)
- Max branch size(and factory size as well), while simple to implement in tests, cost a fortune. You really need 1500-2000 units selling in London to even make the expenses for that feasible. With 300 units sold it was way too big a branch.
- Marketing is another example, its mad to use none in a real game, you would at the very least max newspapers and edit it frequently to make sure it stays at max. You would get much higher sales and make more money in the process.