Value-informed pricing for virtual digital products: Evidence from Chinese MMORPG industry

Abstract

Value-informed pricing strategy, which focuses on determining the price level of products based on consumer value perception, is especially suitable to be applied in digital products rather than industrial ones. By carrying out 65 in-depth interviews with people involved in the Chinese Massively Multiplayer Online Role-Playing Game (MMORPG) industry, this article explores the process through which a value-informed pricing strategy is applied to determine the price level of virtual in-game accessories—exploring pricing preference through interacting with game players, swaying pricing alternatives through managing the competitive environment, and manipulating value perception through shaping the virtual marketplace. Furthermore, this article constructs a theoretical framework of value-informed pricing, including the above process, and deciphers the linkage mechanism between different segments. The findings not only enrich the theory of value-informed pricing under the application context of virtual digital products but also have implications for the practitioners in the MMORPG industry.