• Joe CJoe C, over 6 years ago

    $1,300 to $27.

    How is this even possible? As a business, how does this thrive? I'm not really in the market for this, but even if I was I'd be concerned over the unfair treatment of the creators behind these products, how are they being compensated?

    Kind of like if a supermarket offered 10kg of rice for $0.50, I would be concerned as to what kind of atrocities took place along the supply chain.

    Just my $0.02.

    3 points
    • Collis Ta'eed, over 6 years ago

      Hey Joe! It's a great question!

      The answer is in distribution, and it hinges on how well you think your work is going to sell otherwise.

      You mentioned a great comparison of a bag of rice. I agree, when you get things at weirdly cheap prices, it should make you question how its achieved. One key difference however is that physical products have a set of fixed costs associated with the production of each and every one. Digital items once created cost zero to replicate over and over again. This cost of goods creates some slightly different economics for creators.

      So two use cases where adding your work into a bundle can make good sense are:

      (1) You don't have a lot of distribution. Your work isn't making lots of sales where its currently selling, and while in theory thousands of people are now going to get a copy, they probably weren't going to buy it otherwise anyhow. So the cannibalization of your existing sales potential is pretty limited.

      (2) You have a brand / distribution, but the thing your selling has already plateaued. So maybe it's already had a pretty good run and you think most people who are prepared to pay full price have already paid it. So a bundle represents an opportunity to monetize people who again weren't otherwise going to buy.

      Envato Bundles often sell in the 10,000 copies range, so it's quite a spike. If each person is paying $20-30, the overall revenue is not insignificant, even when split amongst a pool of creators. But it does all rest on the fact that most of those people never would have bought all, or maybe even any of, the items in isolation. But taken together the value proposition for those buyers makes more sense.

      5 points