Monday, April 26, 2010

Marketing Strategy - Part 1: Gaming Strategy

Microsoft's strong push into the mobile gaming market:

Microsoft has decided to integrate a whole new gaming experience for the Windows Phone 7.  Microsoft decided to make gaming a priority with the new phone by making it a major hub in the interface.  Microsoft has taken note of the success of Apple in mobile gaming.  The mobile gaming market is a major market that Microsoft would like to increase their share in, and expand it as Apple has done.

Windows Phone 7 - Games Hub

Microsoft will offer users the ability to purchase and play games with their Windows Marketplace for Mobile.  This provides similar service to the already successful App store for the iPhone.  Apple’s success in the mobile gaming market is too large to ignore.  The iPhone and iPod Touch game revenue grew from $115 million in 2008 to $500 million in 2009.

Mobile Gaming Software Market Share

As you can see, in only a few years, Apple has already grown to be the #2 player in mobile gaming.  Microsoft’s strategy is to establish itself as a major player in this market. The reason behind is that the mobile gaming market in the US has grown from 20% to 25% of the overall gaming marketplace and will likely increase even further in the future.

A big strategy for Microsoft is to observe what is working and to expand upon it.  They are doing this by allowing their games to work across multiple platforms: Windows Mobile 7, X-box 360, Zune, XP, Vista, Java-based phones, and Windows 7.  This allows the gamer to play their purchased games on multiple platforms and in some instances play multiplayer games over these platforms with friends on X-Box Live.  This is further explained below.

Microsoft has a major advantage in the gaming marketplace because of the already large and successful X-Box Live.  Their marketing strategy needs to focus on the aspects of the Windows Mobile 7 experience that cannot be recreated with other phones.  Apple and Blackberry can’t easily develop an X-Box Live like service.  They also both don’t have other platforms that offer the interoperability that Windows 7, Xbox 360, and Windows Mobile 7 do.  I would suggest a campaign similar to Apple’s gaming commercials that highlighted the ease of use and fun of the device, but hone in on situations that show these unique aspects of the phone.


Expanding on X-Box Live and Other Gaming Features:

As of January 2010, Microsoft announced that they have sold 39 million consoles, and have about 20 million customers of X-box live.  Microsoft has initiated their “Live Everywhere” strategy by taking the success of X-Box Live from the console and bringing it to their phone.  By doing this, it opens up Windows Mobile 7 to interact and play games with the already established 20 million X-Box Live customers.

This Live Anywhere allows users to game over multiple platforms.  A user can be playing a game on his computer and continue where he left off on his phone or X-Box 360.  The user can also play multiplayer games against X-Box live customers.  He can play against his friends that are home on the X-Box 360 while he is out with his phone.  For those that are playing asynchronous games such as Scrabble or Chess, the gamer-on-the-go’s phone will be notified when his opponent makes a move.  Other interesting notification features are the “Live Tiles” which are interactive icon displays in the phone that casually alert the user that he may have friend requests or other gaming actions on the user’s Live account.

The X-Box Live hub in the phones display will show the user’s customized avatar.  The X-Box live avatar is a personalized cartoon figure designed by the user.  Once the user enters the hub, the phone is automatically synchronized with the users account for account information such as purchased and installed games.  The hub will beautifully display the available games and also recommended new games for the user to try.  Again, the hub is a horizontal display that allows the user to pan across and access more information that is displayed immediately in front of them.

The interesting part of Microsoft’s strategy is that it is encouraging their current X-Box Live clientele to upgrade to a Windows Mobile 7 smart phone so that they can get the most out of their X-Box Live gaming experience.  They are also encouraging non-gamers that purchase the phone, and see how robust, fun, and easy to use X-Box Live is.  This will encourage phone users, who decide to subscribe to X-Box Live, to consider Windows operating systems and also X-Box 360 to continue their gaming on either platform.


References:

CNet, "iPhone stealing game market share from Sony, Nintendo", Mar 22, 2010, http://news.cnet.com/8301-13579_3-10470102-37.html
BNet, "Apple Didn't Take Video Game Market Share; the iPhone Expanded It", Mar 23, 2010, http://industry.bnet.com/technology/10006357/apple-didnt-take-video-game-market-share-the-iphone-expanded-it/
CNet, "Microsoft hits redial in phone effort (Q&A)", Feb 15, 2010, http://news.cnet.com/8301-13860_3-10452710-56.html