Hello everyone, and welcome back to Insider Trading, my own corner of the Internet dedicated to discussing the financials of Magic: The Gathering. In last week’s column, I tackled the issue of Mythic Rares in Magic. This week, I’m going to explore some of the value Upper Deck Entertainment has added to packs of the World of Warcraft TCG, how this relates to Magic, and how Wizards could adopt some of these ideas to increase the value of their product.
To start at the beginning, what do I mean by added value? As it stands, a Magic Booster pack typically has sixteen cards – a Rare, three Uncommons, eleven Commons, and a Tip/Trick or Token card. The Tip/Trick/Token card is value added – previously, Magic packs had fifteen cards, and the T/T/T card was a bonus to any player buying a pack. There was no additional cost to the player, so the existence of a Tip/Trick/Token card added value to the player. Other examples of Added Value in Magic are the Timeshifted card in Time Spiral (essentially doubling up the rare count per pack) and foil cards (which take the place of a Common under current printing rules).
Why do Wizards of the Coast put foils or Timeshifted cards (or the Tip/Trick/Token card) in packs? It increases the value a customer is getting when they open a pack of cards. Let’s say that you value Commons/Uncommons at $0.01 each, and rares at $0.20 each (the price we charge here at StarCityGames.com for bulk cards). If you get really unlucky, you could open a pack of cards (which has an MSRP of $3.99) and end up with fifteen bulkish cards that are worth $0.34. On the opposite extreme, you might open a pack of Morningtide, and end up with a Mutavault, a foil Mutavault, the three best uncommons in the set (Obsidian Battle-Axe, Bramblewood Paragon, Oona’s Blackguard, just to throw three out there), and fifteen playable commons, and end up with something worth on the upwards of $150+.
To note on this further, some have said that a pack ‘loses value’ as soon as it is opened. This can be the case for some sets (Fallen Empires, in its heyday, was a prime example of this – and a lesson to Wizards of the Coast to put some good cards in the Rare slots of a set), but it is not a universal rule. There have been several sets in recent memory where the value of the rares in a set, combined with good Uncommons, Commons, and foils outpaces the price of a sealed box of a product – and this usually leads to an increase in the selling price of that set/box (see Future Sight for a prime example of this). I know this to be true because I have done the cost/value breakdown of several sets over the past few years, and have had thousands of boxes opened because the average value of a pack far outpaces the cost of that pack, sealed. (Again, not always the case, but not uncommon.)
Let’s take a look at that Tip/Trick/Token slot for Magic. I don’t think that most players assign a value to the Trip and Trick cards. They are valuable to newer players, or as a rules reference, but outside of the most hardcore collector, they are essentially fodder. Contrast these to the token cards – now here is something with value! Tokens can be played with, tokens have a precedent for having value (they have proven viable to multiple companies as a salable product with a tangible pricing structure), and tokens are popular. Each time you open a token in a pack of Magic cards, you have something that people assign some value to. We usually assign a $0.25 price tag to a Booster Pack token, unless it’s one of the short-printed tokens. They sell extremely well at this price, so I can say with confidence that the addition of Token cards to Booster Packs has added value to those Booster Packs.
The World of Warcraft Trading Card Game (or WoW: TCG) has adopted a number of measures to their product that has added a tremendous amount of value to their booster packs. In fact, I would go so far as to suggest that the value added items in their packs may exceed the value of the WoW: TCG game cards themselves! To understand this, you don’t need to know a single thing about the WoW: TCG game – so I will explain where the value added to the WOW: TCG booster packs comes from.
Point Cards
Each pack of the WoW: TCG comes with a 100-Point UDE point card. This card has a 10 digit alpha-numeric code that can be entered in at the UDE Points Store and redeemed for rewards items. These items range from 100 to 25,000 points to redeem (1 card to 250 cards), and include desktop wallpapers, promo cards, tokens, playmats, and items usable in the WoW MMORPG (such as trinkets that make Fireworks appears in game, or an Ogre Magi disguise). We sell the Ogre Magi trinket for $99.99 (and I notice it is out of stock, so I’ll have to take care of that tomorrow when I get to work!), making the value that these point cards add to a pack around $0.40 minimum.
But wait, that’s not all that Upper Deck has done with these point cards! As of the third WoW: TCG set, UDE started putting crafting items on each point card. For instance, look at the Cobra Scales point card. Certain combinations of crafting UDE point cards can be sent in to Upper Deck to redeem for tournament playable cards (available only through redemption) such as the Cobrascale Hood. The Cobrascale Hood takes 8 Primal Air cards, 8 Primal Shadow cards, 3 Heavy Knothide Leather cards, 5 Cobra Scales cards, and 1 Primal Nether. You can redeem the point codes on the cards (for the rewards from the points store, above), and then send in the “redeemed” cards for the Trade Skill item (in this case, the Cobrascale Hood). The Hood itself sells for $22.50, and takes 25 cards to make, but this is (to date) the most valuable crafted card. On average, crafted items take around 25 cards, and go for around $10 on the secondary market. At the $10 price, that puts the value of a UDE point card (for crafting redemption0 at $0.40. Combined with the 100 Points for the UDE point store, this adds a value of $0.80 to a Booster Pack of the WoW: TCG, not accounting at all for the actual game cards in the pack yet!
Loot Cards
The big money makers out of the WoW TCG aren’t the point cards. They aren’t even the Rares, or the Epics (which are identical to the new Mythic Rares in Magic in frequency appearing). They are the Loot Cards – cards with a scratch-off code that can be redeemed for cosmetic upgrades in the World of Warcraft MMORPG. They range in price from Papa Hummel’s Old Fashioned Pet Biscuit (Loot Card) at $4.99 to Spectral Tiger (Loot Card) at $1199.99 (not only is that not a typo, but that is the low end of what this card is currently selling for).
Each WoW TCG set has three Loot Cards – currently they are an ultra-common Loot Card (appearing 1-2 times per box), an Uncommon Loot Card (appearing once every 3-4 boxes) and a Rare Loot Card (appearing once per case – and a case of the WoW TCG is 12 boxes, and each box is 24 packs, versus the 36 pack, 6-box cases for Magic). Many dealers have opened up tons of the WoW TCG just to get at loot cards to sell to the WoW MMORPG players. They then redeem the UDE point cards for more MMORPG items, and offload the Rares/Epics (depressing their price to some degree) just as an afterthought.
The newest WoW TCG set is Hunt for Illidan. The common Loot Card is The Footsteps of Illidan, and it runs for $4.99. The Uncommon Loot Card is Disco Inferno!, and it runs for $44.99. The Rare Loot Card is Ethereal Plunderer, and it fetches $299.99. A case of World of Warcraft contains 288 booster packs, so if you opened a case, you would end up with, on average, 12 Footsteps of Illidan ($60), 3 Disco Inferno! ($135), 1 Ethereal Plunderer ($300), and 288 Point Cards ($230.40) for a total of $725.40 in value. We sell Hunt for Illidan Booster Cases for $900, meaning that the value added to these packs, not counting any of the game cards themselves, is worth close to the retail price of the WoW TCG box! And yes, we’ve had to raise the price on this Booster Box several times since release, and we’ve opened a pretty good number of boxes for singles ourselves (we keep sealed boxes on hand as there is less labor cost involved in selling sealed product then opening and having to sort a ton of singles).
Magic Value Added
Part of the value added for the WoW TCG comes from the popularity of the WoW MMORPG – there are millions (tens of millions) of WOW MMORPG players, and enough of them have an interest in the loot and point cards from the TCG to keep the value of these cards high. If suddenly the WoW MMORPG would take a huge nosedive tomorrow, the value of these loot and point cards would similarly plummet – but that is not likely to happen. But how does this relate to Magic?
Yesterday, Randy Buehler announced that the Gleemax.com website was going to be shut down in September, in favor of Wizards of the Coast focusing on Magic Online v3.0 and the Dungeons & Dragons Insider program (you can see the announcement here). Gleemax was Wizard’s attempt to make an enhanced Myspace/Friendster for gamers, but it did not work out as intended. From Randy’s announcement:
“It remains clear that gamers are moving online and if we’re going to preserve everything that is special about Wizards of the Coast – and the hobby gamer culture in general – then we have to move online too.”
And:
“The correct strategy at this point is clear: we need to focus. We’re not going to abandon the vision, but we are going to put large chunks of it on the backburner until we prove that we can succeed at the most important pieces. Those pieces are Magic Online and D&D Insider.
“Magic Online “V3″ is up and running, but it took us a long time to get here and it’s by no means perfect. We have a lot of ideas about what we can do now to make the game better and we’ll be devoting significant resources in future months and years to doing precisely that.”
There has been a lot said about Magic Online 3.0, and while it is not as bad as some make it out to be, it is not as good as it should have been given both the huge earnings potential it has for Wizards of the Coast, and the amount of time it took to get from 2.0 to 3.0. I am in favor of any internal decision by Wizards of the Coast to push Magic Online in a better direction, because as more people play Magic Online, more people get into Magic in general (remember, not everyone playing MTGO has ever played the physical game!), and this can only be good for the game in the long run (which ties into the big acquisitions push that Wizards of the Coast has for MTG this year).
The Upper Deck Point and Loot cards have been integral to the success of that card game, and the ideas behind them are sound – out-of-game cards inserted in packs which add value to the pack being opened. Could Magic adopt a similar program to add value to their packs? The answer is a resounding yes! While Magic Online is nowhere near as popular as the WoW MMORPG, the Magic TCG is extremely more popular than the WoW TCG. Why not push both product lines at once by instituting a points card program to the Magic TCG to boost the value added to an opened pack?
Even if Wizards did not want to offer physical items as part of a points program (and believe me, there are tons of items they could offer – promotional cards, playmats, T-shirts, deck boxes, card sleeves, dice, tokens, backpacks, basically anything Magic branded), there are lots of alternative items that would have value for redemption exclusively on Magic Online – unique avatars, wallpapers, promotional versions of preexisting cards (for instance, the ability to upgrade an Time Spiral Pendelhaven to an FNM version, which is not otherwise available on Magic Online), promotional cards period (just outright buying an FNM version of an MTGO card using WOTC points), entrance into events with enhanced prizes, special trophies, Vanguard cards – the sky is the limit! Heck, you could maybe buy the ability to turn a White-Bordered card Black-Bordered for 100 points, or vise-versa. A points program tied directly into Magic Online would server multiple purposes:
– It would add value to a Booster Pack of Magic.
– It would encourage people who play physical Magic to try Magic Online (if even at the most basic level that every pack you opened would have a card in it that pushed you towards Magic Online).
– It would encourage Magic Online players to buy physical product (even if only at the level of buying point cards on the secondary market, but likely at the booster pack level, if they ended up enjoying the game).
Could Wizards implement this idea? Easily! Every booster pack already has a Tip/Trick or Token card (and every Tournament pack has a Pro Card). It would be easy to print a 10-digit alphanumeric code on the reverse side of each of these cards (so as not to detract from the token/pro player side of the card), and Wizards could implement an online redemption website that ties into MTG 2.0 with minimal cost beyond development – and since we’re talking redemption only for online items, the cost for the items being redeemed is also negligible to Wizards of the Coast, but these items would have value to players – increasing the value added to a Booster Pack of Magic, at a very low cost to Wizards of the Coast. It would also, as mentioned above, encourage players to utilize the Magic Online program.
So in conclusion, there are ideas from the WOW TCG that Wizards should consider in order to bolster their own product line – while Magic is a more successful game by far than WOW (the TCG), Upper Deck has come up with some really innovative ideas to push their product, and they are ideas that Wizards could implement in their own way to improve value of a Magic Booster Pack, and to help push Magic Online.
Next Week: The Aftermath of U.S. Nationals – What was Hot and what was Cold?