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strategic development
     presentation
    microsoft Xbox



   Phillip T. Lee, Jonathan Nausner

             03-dec-2003
THE PRODUCT




Introduced in November 2001
The Competition




   Sony Playstation 2       Nintendo GameCube

Introduced October 2000   Introduced November 2001
The product

      Microsoft XBox                    Sony Playstation 2                      Nintendo GameCube


800

600

400

200

  0
          CPU      Graphics CPU          Memory          Polygons/sec Memory BW



                 Qualitated Graph – Source: http://www.videogamemovies.net/specs.shtml
The product



                        Microsoft XBox                   Sony Playstation 2                 Nintendo
                                                                                            GameCube
     Hard Drive                    yes                               no                        no

      Controller                     4                                 2                       4

           DVD               upgradable                              yes                       no

      Broadband                enabled                         upgradable                      no

    Networking                     yes                               no                        no

Dolby Digital 5.1                  yes                               no                        no




                    Qualitated Graph – Source: http://www.videogamemovies.net/specs.shtml
The MARKET


XBox                         PS2                 GC




             20%                  21%




                      59%


        Source: The Edmonton Journal, May 2003
The MARKET

                     market size

                         2002:
        $5.5 billion Video Console Software
        $4.3 billion Video Console Hardware

Since 2000 bigger than U.S. total Box Office Revenues.
  Expected market growth

                         $49.9 billion in 2001
                                   to
                         $85.7 billion in 2006

                        (all gaming products)
        Source: Interactive Digital Software Assoc.-Bear Stearns, Informa Media Group
The MARKET



               Best product.

           Equal offer of games.

         Two years in the market.

$ 2+ Billion spent on marketing/advertising.

              ...and still Nr.2.



               Source: www.epinions.com
our research



• Internet

• Special Interest Magazines

• One-to-one Interviews

• Internet Forums

• 2 Focus Groups

• Natural Habitat Interviews (LAN-Party)
our research


• Internet Forums
our research


• LAN-Party
Target audience
Demographics: Lifestyle “Play Video Games”




              Single Males
              Aged 18-24

    Graduated Highschool

            Some College



       Source: SRDS Lifestyle Market Analyst 2003
Meet Ben.



                  22 years old                 Plays video games but
                                               doesn’t really consider
       A social guy who likes                  himself a hardcore gamer
  to hang out with his friends
                                               He still likes to play sports
      Loves music and movies                   and go out

    First gaming console was a                 He isn’t easily impressed
Nintendo and if he would buy                   by commercials trying to
all of the gaming consoles but                 reach his generation,
      has to settle for just one               he knows if the ad is phony
  (the best one in his opinion)
insight




People Play video games
   for entertainment.



         Duh.
insight


   “A good video game is like a good book:
   You don’t want to turn the machine off
    until you have reached the last level.”



a Good video game lets
 you immerse yourself
  in the experience.
http://www.youtube.com/watch?v=6Bqq38WZctA
         Playstation Ad “Double Life” – TBWA London
Nintendo Brand Ad
Nintendo Software Ad
strategy?

	     Playstation and Nintendo

TO CONVINCE
	    people, aged 18-34

TO USE
	    their console system

INSTEAD OF
	    not playing games

BECAUSE
	    they give you a break
	    from everyday life
http://www.youtube.com/watch?v=mLPj8cgDOVk
       XBox Ad “Champagne” – Bartle Bogle Hegarty London
strategy?

	     XBox

TRIES TO CONVINCE
	     people, aged 18-34

TO USE
	    their console system

INSTEAD OF
	    not playing games

BECAUSE
	    you should play more
	    to have more fun.
play more?


But I already have a Playstation II.
What makes the

     xbox

 outstanding?
problems of the xbox


• playstation ii was out first.

• people do not know what
  the XBox can do.
	   They know the technical features but not all understand
	   how they improve the gaming experience.

• Games
	   XBox did not have enough good games in the first year.
	   SOLVED.

• controller
	   The original controller was too big and unergonomic.
	   SOLVED.
strengths of the xbox


• Best hardware
	   Potential

• Xbox live
	   Best online gaming service available

• systemlink
	   XBox is the only system that can be used in a network

• games
	   Halo. Producers develop with the XBox in mind.
insight




     it is not important
   how good a system is
  in numbers and specs
    but what it can do
for the game experience.
a new campaign


The new campaign – created by brand agency Landor – – 
stresses:

• Games
	   No brand ads but game ads
	   with a brand messages.

• online and network ability


New Slogan:

IT’S GOOD TO PLAY TOGETHER.
BOOORING.
You just broke Rule Number One
 of video console advertising:




      NEVER
      NEVER
 NEVER BORE THEM.
and you missed the spot:



Why is it good to
play together?

 IT IS MORE FUN!
recommendation
Convince
To buy
instead of
because



more potential
      =
   more fun
because



more players
      =
  more fun
Tone


  Be better than
     just good.

    Be Exciting.

   Be Boastful.

   Kick some ass.

 do not worry about
the feelings of the
  other consoles.
 you are in another
      league.
Think of:




   vs.
Think of:




   vs.
Think of:




   vs.
Have fun.
promotional idea

bundle xbox with free halo
and a 2-month-trial of
xbox live
	




• Bundle all the strengths of XBox

“Halo is an awesome game, but paying $ 300 [for the console
and the game] to own only one game is just too much.”

• Promote upcoming Halo 2
billboard
Thank you.
XBox

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XBox

  • 1. strategic development presentation microsoft Xbox Phillip T. Lee, Jonathan Nausner 03-dec-2003
  • 2.
  • 4. The Competition Sony Playstation 2 Nintendo GameCube Introduced October 2000 Introduced November 2001
  • 5. The product Microsoft XBox Sony Playstation 2 Nintendo GameCube 800 600 400 200 0 CPU Graphics CPU Memory Polygons/sec Memory BW Qualitated Graph – Source: http://www.videogamemovies.net/specs.shtml
  • 6. The product Microsoft XBox Sony Playstation 2 Nintendo GameCube Hard Drive yes no no Controller 4 2 4 DVD upgradable yes no Broadband enabled upgradable no Networking yes no no Dolby Digital 5.1 yes no no Qualitated Graph – Source: http://www.videogamemovies.net/specs.shtml
  • 7. The MARKET XBox PS2 GC 20% 21% 59% Source: The Edmonton Journal, May 2003
  • 8. The MARKET market size 2002: $5.5 billion Video Console Software $4.3 billion Video Console Hardware Since 2000 bigger than U.S. total Box Office Revenues. Expected market growth $49.9 billion in 2001 to $85.7 billion in 2006 (all gaming products) Source: Interactive Digital Software Assoc.-Bear Stearns, Informa Media Group
  • 9. The MARKET Best product. Equal offer of games. Two years in the market. $ 2+ Billion spent on marketing/advertising. ...and still Nr.2. Source: www.epinions.com
  • 10. our research • Internet • Special Interest Magazines • One-to-one Interviews • Internet Forums • 2 Focus Groups • Natural Habitat Interviews (LAN-Party)
  • 13. Target audience Demographics: Lifestyle “Play Video Games” Single Males Aged 18-24 Graduated Highschool Some College Source: SRDS Lifestyle Market Analyst 2003
  • 14. Meet Ben. 22 years old Plays video games but doesn’t really consider A social guy who likes himself a hardcore gamer to hang out with his friends He still likes to play sports Loves music and movies and go out First gaming console was a He isn’t easily impressed Nintendo and if he would buy by commercials trying to all of the gaming consoles but reach his generation, has to settle for just one he knows if the ad is phony (the best one in his opinion)
  • 15. insight People Play video games for entertainment. Duh.
  • 16. insight “A good video game is like a good book: You don’t want to turn the machine off until you have reached the last level.” a Good video game lets you immerse yourself in the experience.
  • 17. http://www.youtube.com/watch?v=6Bqq38WZctA Playstation Ad “Double Life” – TBWA London
  • 20. strategy? Playstation and Nintendo TO CONVINCE people, aged 18-34 TO USE their console system INSTEAD OF not playing games BECAUSE they give you a break from everyday life
  • 21. http://www.youtube.com/watch?v=mLPj8cgDOVk XBox Ad “Champagne” – Bartle Bogle Hegarty London
  • 22. strategy? XBox TRIES TO CONVINCE people, aged 18-34 TO USE their console system INSTEAD OF not playing games BECAUSE you should play more to have more fun.
  • 23. play more? But I already have a Playstation II.
  • 24. What makes the xbox outstanding?
  • 25. problems of the xbox • playstation ii was out first. • people do not know what the XBox can do. They know the technical features but not all understand how they improve the gaming experience. • Games XBox did not have enough good games in the first year. SOLVED. • controller The original controller was too big and unergonomic. SOLVED.
  • 26. strengths of the xbox • Best hardware Potential • Xbox live Best online gaming service available • systemlink XBox is the only system that can be used in a network • games Halo. Producers develop with the XBox in mind.
  • 27. insight it is not important how good a system is in numbers and specs but what it can do for the game experience.
  • 28. a new campaign The new campaign – created by brand agency Landor – –  stresses: • Games No brand ads but game ads with a brand messages. • online and network ability New Slogan: IT’S GOOD TO PLAY TOGETHER.
  • 29.
  • 30.
  • 32. You just broke Rule Number One of video console advertising: NEVER NEVER NEVER BORE THEM.
  • 33. and you missed the spot: Why is it good to play together? IT IS MORE FUN!
  • 39. because more players = more fun
  • 40. Tone Be better than just good. Be Exciting. Be Boastful. Kick some ass. do not worry about the feelings of the other consoles. you are in another league.
  • 41. Think of: vs.
  • 42. Think of: vs.
  • 43. Think of: vs.
  • 45. promotional idea bundle xbox with free halo and a 2-month-trial of xbox live • Bundle all the strengths of XBox “Halo is an awesome game, but paying $ 300 [for the console and the game] to own only one game is just too much.” • Promote upcoming Halo 2