PS3 surprises in Europe! Marketing success?

For my final paper, I will be discussing the different strategies employed by the three competing video game systems that released in the past year. I will be dissecting their different marketing campaigns and evaluating their overall strategies in pushing their systems and capabilities to the consumers that they are specifically targeting. Part of this breakdown will include discussion about whether or not their strategies have been successful or not.

Recently, the Sony released it’s highly touted Playstation 3, the descendant of the extremely successful Playstation 2. Compared to the other two systems, the Playstation 3 definitely has the strongest processing and hardware components. However, the Xbox and Wii have definite competitive advantages in other arenas of the gaming industry. For Sony, the release of the Playstation 3 fell greatly short of expectations in the US and Japan. According to Markio Sanchanta for the Financial Times, Sony has had record-breaking success for the release of the Playstation 3 in Europe. Howard Stringer, Sony’s chief executive has stated that Sony was close to selling 800,000 units in Europe alone. This is a turnaround performance that the Playstation 3 sorely needed after less-than-stellar launches in the US and Japan. This article definitely emphasized that Sony was having success in Europe and the CEO estimates that they should continue to sell units in Europe. The difference behind the success in the European market and the one at home was that they entered the market with much more software backing up the PS3’s strong hardware. This is definitely the strategy that Sony must employee in order to recapture market share from its competitors. Without strong support from their game manufacturers, the PS3 will not be able to convince new customers to buy their high-priced system.

Despite the success of the system in Europe, Goldman Sachs still estimates that Sony will not see any profits from the PS3 until the first or second quarter of 2008. The only strong aspect of the system in its current state is the processing capabilities that current software does not even begin to utilize. Unfortunately for them, Microsoft and Nintendo have already developed a strong niche with their systems and Sony yet has their work cut out for them. From a marketing standpoint, the additional games in the European launch provided more material to show off the PS3’s capabilities. This is the reason why there was more success in this market as opposed to the other markets. To continue this trend, Sony will continue to emphasize the strong graphics of their games and push consumers into a state of sensory overload with pure processing power. Fortunately for the PS3, Sony is reluctant to kill off any unprofitable business and will strive to continue shipping the system, even if it is at a loss. For the future, Sony should maintain a strong output of games and start to ramp up the releases of the other features, such as online support, that the system promises to utilize.

Whee goes the Wii

I realize that all my previous topics, including my term paper topic, have related to the gaming industry. My interests lie in this particular area. When confronted with the idea of innovation, the first innovative product that I thought of was the new Nintendo Wii. In other posts, I mentioned that the Wii’s specifications were the weakest of the next generation consoles that were released recently. The Sony PS3 and Microsoft Xbox 360 all have vast processing powers that dwarf the Wii’s simple abilities. However, the difference between the Wii and these systems is that the Wii has changed how games at home are being played.

The platform that the Wii’s success has been built upon is its new nunchuk and remote style control. For those that have not played a Wii yet, the controller translates movement into movement on screen. To swing a racquet while playing tennis requires the player to actually swing the controller properly. It is taking interactivity in gaming to another level. Gamers have always enjoyed playing games that mimic the actual action. Duck Hunt and other shooters incorporated gaming pistols that were aimed at the screen to imitate the action of shooting objects/villains. As technology increased, more and more interactive games hit the market. Steering wheels allowed players to “drive” their cars around simulated tracks. There are games that allow players to bob and weave while they box like Ali did. Others allow players to create complex drum patterns and compose music. The Wii brought this gaming concept in the convenience of one’s own home. Previously these technologically advanced games were only found at the arcades on expensive machinery. Now though, Nintendo allows gamers to utilize motion and interactivity to change their gaming environment.

In addition to bringing this technology to the home, the Wii has allowed different demographics to enjoy the system instead of just the adolescent gamers that are typically associated with the stereotype of gamers. The interactivity allows moms to play tennis from home; dads can golf in the rain without getting wet. Parties can watch players box against each other. This has allowed the system to cross generational barriers and engage a multitude of people in the gaming world. While the others systems available have increased graphics capabilities and have enhanced features, it is the Wii’s innovative new design that has allowed it to completely dominate the new system market. The revolution that the Wii has brought to the gaming industry will further the innovations required by their competitors for their products. Consumers now require games to be interactive as well as appealing to their senses. The next generation of games and gaming systems will take their cues from the success of Nintendo and allow for a greater degree of interactivity as well as similarity to the actual events and actions taking place in the games. Nintendo has truly allowed the industry to change and grow into a much more robust and revitalized industry that provides entertainment to so many.