Export Permission and Prices

[Freda Frostbite]

Thanks, Dot, I will try that when I am back inworld. (Currently taking a break from virtual worlds.)

Another question: Any clue why items I got from other grids won't let me use them anywhere but Kitely? Do I need to move those to my suitcase as well?

[Tevah Solal]

Hi Kayaker,

Items from Kitely Market are tracked while in Kitely, if an item has any component from Kitely Market that is no-Export it will become no-Export as well (until the no-Export component is removed). How the user acquired that item is irrelevant, it's the exportability of the components that make up the item that define its exportability.

Most grids outside Kitely don't have any export-control system so nothing prevents people from taking any item with them when they hypergrid teleport from those places to other grids. Some grids use an OpenSim-based Export permission which is incompatible with the Kitely export control system. I don't know how they handle content that is brought from outside their grid that doesn't have their own version of the Export permission enabled. I'm not aware of any other grid that uses the Copy+Transfer method for Hypergrid content exportability control.

[Tevah Solal]

Hi Freda,

Any item which you wish to be able to use while hypergrid traveling needs to be either worn and/or in your My Suitcase folder. That's default OpenSim behavior.

[Danko Whitfield]

A lot of makers of virtual goods base their price on the amount of work or cost involved with producing the item. On the surface, that makes sense. But it actually misses the point completely. It's not about what it is worth to the creator or seller, it's about what it is worth to the buyer.

You can be a great creator but that doesn't mean you know anything about business or marketing.

In the case of Export perms, it's not a question of how much the creator is "giving up." It is only - and always - a question of how much value the buyer is going to get out of the item and therefore, how much they are willing to pay.

Remember, in OpenSim, people have done without for a long time. Because of this a few may be chomping at the bit to buy but for most - they have done without it for this long, so if you charge too much, it is very easy for them to keep waiting for a better deal. Or go without forever. Heck, these folks are OpenSimmers - if they REALLY wanted that thing and it wasn't available for free, they would have learned to make it by now.

So if you want to sell to them - make it good, make it convenient and make it reasonably cheap. And remember this - you are not actually selling a product in virtual worlds, you are selling a service.

If you don't think that's fair - don't sell it. You won't be missed.

Don't get hung up on the "They can take it anywhere and use it all over the Metaverse. That's worth money." It might be but that's not what they're buying.

In January, I wrote:
"Just because you’re granting them the right to go anywhere in the free Metaverse with their purchase doesn’t mean they’re going to go everywhere with it."
http://journeymetaverse.wordpress.com/2 ... d-it-cost/

Although I used to be willing to pay a 100% mark-up, I'm not sure about that anymore. Why should I pay an export fee at all? What did I do to deserve that?

And with HG prevalent now, what sense does an Export perm markup make really? It's a cover charge. A "convenience fee." Don't those convenience fees have a bad name?

[Talla Adam]

As you posted your comment above to your blog and G+, Danko I guess I have to respond here too with what I said on Opensim Virtual @ G+...

Interesting post, Danko but in my opinion it misses some important points regarding export perms. The seller is taking a greater risk by allowing their product to be freely used anywhere (I note you dismiss this as a lame excuse for the higher pricing). But the product could be changed and offered for sale illegally in a closed grid like Second Life and the creator would then have to discover this and file a DCMA to get it taken down. Now that takes time to do which is time that they could spend making new quality products. Further more, if they suspect someone is using a product they have no license for the vendor has to check records to be sure before they confront the user and they may have to inform a number of the bigger grid owners to deal with it effectively or, possibly, take legal action that could cost a lot of money. I think this risk factor justifies a slightly higher price which I for one am willing to pay so I can have quality goods with a license and no worries.

As far as I can see it is no different from Insurance companies charging high premiums for young drivers since a lot of them, boy racers particularly, are crazy drivers and they do cause a lot of accidents.

If we want to see more people frequenting the hypergated grids then we need quality products with license to use them anywhere and it is a pittance that the vendors add to the price anyway from what I have seen. In fact I have seen far higher prices in Second Life even without license to use the product anywhere.

I also reject your argument about Opensimmers not wanting to pay for stuff. I just don't believe that and the sales on Kitely market I'm sure can prove it. In fact I had a long talk with a new merchant who came from Inworldz to start listing her skin products on Kitely with export license and she told me she was already doing very well and she does well at Inworldz too so its a win win for her. And, you know what? She was advised not to go to Kitely that she would not do well but she ignore that and is glad she did. And, moreover, her skins are, like, $3 which is about 750 Lindens. That is fantastic value for a quality full perm & export product!

There is another thing you said about Opensimmers wanting everything for free because they are use to it, and if it isn't free then they make it. That is so wrong, Danko. I am capable of making pretty much anything and textures and scripting but I can't do it all. There is just not enough hours in a day so I am willing to spend some money and I will go on doing that more so to encourage more vendors to create for the open grids because people they will want the better quality clothes, skins and hair especially now mesh is becoming so prevalent in SL. I was delighted to buy mesh products for my avatar yesterday!

There is plenty of free stuff in the open grids for those who don't want to spend money. Plenty of it good quality and quite a lot not so good. You can get Linda Kelly stuff everywhere but who wants everything to look like Linda Kellyville? None-the-less I applaud the freebie creators but, unlike Second Life, the open Metaverse belongs to us all and a lot of us want the best of both - both free and paid for with export license, even if it does cost a tiny bit more.

[Shaun Emerald]

If it cost "a tiny bit more" for exportable items, that might be one thing. But I know of a creator who doubles or triples the non-exportable price, for his exportable versions. That's a hell of a markup. I buy them because the quality is excellent, no one else makes stuff as well (IMHO) as he does, and I want them. But paying $15 for something, when the non-export version is $5, for example, is a bit more than "a tiny bit more". I really don't understand why I have to pay a tax because of what someone else *might* do wrong.

[Ozwell Wayfarer]

As I am guessing Shaun is referring to me, I guess I should give my perspective on the issue. I know people have a tenancy to take these things personally, so before I start, please understand that this is not aimed at anyone, its just my honest perspective as a merchant. I have met you all as individuals in-world or in correspondence and I like and respect you all. Now, That said.....

Firstly, its always hard deciding what price something should be. You are always trying to find a balance between affordability and a fair price for your work. Everyone knows it takes a long time to make things and I have more time on my hands than most I guess. Anyone in my friends list can attest I am here ALL the time. In a good month, I take about 300-400USD in SL AND Kitely together. A bad month can be below 200USD sometimes. I don't know about living standards in the US, but when you convert that to Euro, its not even enough to pay for a months grocery's. That is party because the market is so small. You can only go with the "McDonalds Model" if you have a billion customers wanting what you have to sell. Sadly, I dont go to bed every night on a huge pile of money.

My pricing for Copy-Mod items is roughly the same as SL (see caveat later). In SL, it is normal for "Full Perm" items to be roughly double or more the price of C/M. Plus, you must also take into account that Kitely takes a higher MP cut than Linden Labs does (20% vs 5% respectively). Now, I understand why Kitely does that, and I believe Linden will be looking at doing that with their new world to offer land at more affordable prices. I am all in favor of that. But I also dont think its fair for the merchant to swallow all of that operational cost. My general rule is 50/50. So Kitely prices often are 10% higher than in SL.

I also expand a lot of sets over their SL counterparts. Lots of my sets contain large numbers of parts. So when you work it out, your paying something like 0.20-0.50 USD per component, even at export prices. Even where there is NOT a load of components, like my trees. You get at minimum 2 (often more) models, in at least 2-3 texture variations. So even without the texture variations, is 7.50 per tree such a huge amount to ask for something you will likely get a lot of usage out of? That you can even take with you to future worlds because its made of mesh? I don't think so. Some of my sets contain 4 or even 6 trees. Is 3.75 (15/4) still not cheap enough? Or 2.50? This isn't taking into account the texture variations.

Take my new Crooked Pathway set. 27 pieces, 4 texture variations. 6USD export. Thats 0.22USD per part.
Or the Rustic House pack 39 pieces, 4 stone textures. 16 USD export. Thats 0.41USD per component
Thats BEFORE the 20% MP fee is applied too.

Also for what it is worth, I have advocated elsewhere for the ability to offer discounts to individuals. A sort of "trusted customer" status. The fear of course is your item is going to be purchased at a cheap price then splurged all over the metaverse. When I have returning customers or people that make large purchases I would really love the ability to give them better prices on future purchases.

And Finally, the part I have to try to say with the most tact...and will therefore probably fail miserably...hell I'll just say it......people have been buying.

People will ultimately vote with their wallets and by all indications they are willing to spend money on quality items. Ultimately its all up to you as individuals. If you want creators to come and be interested in setting up shop in a small and ultimately limited market, then spend the money. If you dont, then stick with the freebies. I wish I could come round to your house and force you at gunpoint to buy my stuff, I truly do I like to travel . But not only is that highly illegal, its also massively impractical. Nobody is forcing you to buy their stuff. If you don't like the price, don't buy it. You do this in real life all the time. Why should this basic rule of commerce not extend into the virtual world as well?

[Ozwell Wayfarer]

Also, an interesting question I would like to pose...

By request, I have been working on a set of exportable Medieval/Tudor Walls. Some may know I used to sell a non-export version by Zellest Fall, but people want Export, so I am taking the time (60+hours and counting) to make an export version for Kitely. The set will likely have close to 80 pieces, with about a dozen textures included.

Realistically, I would expect 3-5 people to buy it in the near future, and to maybe sell one or two dozen in the products lifetime. 30+ if I am lucky.

What would people say is a fair price to ask for that? Dont be shy honest answers please.

[Marstol Nitely]

Not all merchants are motivated to sell or create by the same things. For some it's their bread and butter, for others more of a hobby, for others it might be something else. Some merchants can command a higher price because of their skill in creating products, others may not be at that point. Customers don't all have the same the same tastes, needs or resources. IMO individual merchants should decide what they want to charge and each customer should decide what they are able and willing to pay.

[Ozwell Wayfarer]

Hi Ozwell,

I just want to give some context to the Kitely Market sales commission. While it's true that Second Life marketplace only charges a 5% sales commission you have to remember that you're not getting 95% of the money the buyer actually spent. Sales in Second Life Marketplace are in L$, which have a cost overhead for buyers and sellers (3.5%): https://secondlife.com/corporate/pricing.php.

In addition, people who buy using USD in Second Life Marketplace get an exchange rate that is:

generally between ten (10) and fifteen (15) percent percent greater than what a user would pay, were the user to make that same purchase with L$ already purchased on the LindeX

Finally, there is a Seller Cash-out Fee in Second Life Marketplace:

You may "cash-out" your SL Marketplace balance by transferring your USD "credit balance" into your PayPal account, through the "Process" link on your Account Summary page.

When you do so, we will charge you two percent (2%) of the total that is cashed out, up to a maximum of one dollar ($1.00) per cash-out.

See: https://marketplace.secondlife.com/listing_guidelines

When you consider that Kitely acts as a middleman and absorbs the merchant PayPal fees for the buyer to Kitely Market transaction you'll see that our fees are actually quite competitive. Especially when viewed in comparison to most marketplaces nowadays (various app stores and digital content marketplaces) that charge at least a 30% sales commission.