The price of the game is mostly the license (paying for the development), not making the box.
With digital games, the publisher controls the price; there is no competition. With physical copies, they have to share some of the profit with the stores, i.e. if the publisher expects that the retail price will be $60 (and is selling it for that price on their online platform), they may have to sell it to stores for $40 (I don’t know what the actual numbers are).
Stores compete with each other, so a large online store like Amazon (which has lower operating costs than others) may decide that they can still make a decent profit when reselling it for $50 instead of $60, so they sell it cheaper so people buy from them (giving them e.g. $6 of profit if their cost to sell it is $4, rather than $0 because the customer buys elsewhere).
Now, you may have noticed that the publisher could sell the digital edition for $40 and still make the same amount of money. So, why don’t they do it? I think it’s a combination of
greed/“because they can” (if people will pay $60, why charge less)
not wanting to undercut retail too much, because otherwise stores may not consider it worth putting the game on the shelf, which is advertising the game and increasing sales. This may also involve agreements between the stores and the publisher.
The price of the game is mostly the license (paying for the development), not making the box.
With digital games, the publisher controls the price; there is no competition. With physical copies, they have to share some of the profit with the stores, i.e. if the publisher expects that the retail price will be $60 (and is selling it for that price on their online platform), they may have to sell it to stores for $40 (I don’t know what the actual numbers are).
Stores compete with each other, so a large online store like Amazon (which has lower operating costs than others) may decide that they can still make a decent profit when reselling it for $50 instead of $60, so they sell it cheaper so people buy from them (giving them e.g. $6 of profit if their cost to sell it is $4, rather than $0 because the customer buys elsewhere).
Now, you may have noticed that the publisher could sell the digital edition for $40 and still make the same amount of money. So, why don’t they do it? I think it’s a combination of