Up until now, the Xbox 360 gaming console has sold over 76 million units since its launch in 2005. This device is entirely dedicated to gaming with no other auxiliary uses. In 2013, Microsoft decided to target a larger market as well as demographic. Statistics show that over 96% of Americans own television sets. However, only 49% own gaming consoles. For this reason, Microsoft decided to unveil a new upgrade of the console that integrates with the living room. The new console got named as the Xbox One. This device can surf the web, play games, stream movies and review TV series simultaneously.
Most gamers usually fall between the ages of 10 to 35 years. This statistic presents a young demographic. The majority of the population in this age bracket also happens to enjoy other forms of multimedia more than any other demographic. Regarding the sexes, most gamers are male; but with the added features such as the capability to stream movies and TV series, the device is sure to find a place in the heart of the females. One mistake, however, that the company made was focusing too much on the multimedia bit of the device. As such, they tend to forget about the gaming community.
The repercussion of this move saw its rival Sony with their playstation4 scoop a larger chunk of the market. They stuck to the main purpose of the console, which was gaming. As a response to this, Microsoft is now unveiling an upgrade to the Xbox One which goes by the name Xbox One S. the new device is smaller, more compact and more powerful. It comes with more and larger storage options as well. Consumers now have the choice between the 500GB variant and the 2TB variant. Additional features include 4k technology that enables the streaming of ultra-HD video as well as blue ray technology. Gamers can stream their games to other devices such as smartphones and PCs. This move shows that the company wants to include all segments of its target market while keeping the focus on the primary purpose.
A marketing mix is a tool that helps the consumer understand what a good or service can deliver. It mainly involves the guidelines on how to plan for success in the offering of the product. The marketing mix converges into the 4ps of marketing. They include price, product, promotion, and place.
Price
The pricing of goods forms one of the most important aspects of marketing. An outstanding product which is poorly prices is bound for complete failure. In fact, a major reason for product failure is usually inappropriate pricing as opposed to low quality. In 2013, Microsoft released Xbox One and approximately at the same time, its rival Sony released the PlayStation 4. As aforementioned, Sony focused exclusively on gaming and did not add any extras onto the console. For this reason, the PlayStation 4 sold at a much lower price compared to the Xbox One. The gaming quality of the two consoles was more or less similar and as such PlayStation 4TM attained more sales than the Xbox One. Microsoft learned from this mistake and made a new, more compact and cheaper console that places more focus on gamers. For around $254, gamers can now get their hands on a dazzling Xbox One S. This pricing will make the device more competitive and holds a bigger promise for the company.
Product
While marketing, a business must ensure that the given product or service stimulates the desired demand. Customers will only get drawn to goods and services they want. If a product turns out to boost their desire, the price can also get increases accordingly and vice versa. The Xbox One S with is small size, enhanced features and more storage space is very handy for both casual and core gamers. It perfectly fits in the living room and combined with its ample storage space; users can host numerous collections of games and multimedia.
Promotion
Most often promotion gets confused with marketing. Though closely related, promotion is just but the communication bit of the marketing exercise. Promotion involves adverts, both digital and print, sales promotions, special offers and public relations. Microsoft has done quite well with marketing this product. There have been a lot of adverts through TV commercials and print material. During televised games, the Xbox one S gets advertised on ad boards within stadiums and also during the commercial breaks.
Place
This aspect focuses on how the product will get to the consumer. Distribution plays a significant role in the success of a product. The Xbox One S is available through online dealers as well as in electronic stores across America and Europe. Microsoft also allows the sale of the console through independent dealers. Therefore, most stores can stock hence more availability.
PESTLE Analysis
Political- The primary markets that Microsoft targets with its gaming console are North America, Europe, and East Asia. Most of these states are politically stable and have governments that support free trade. Therefore, Microsoft has an easy time selling its products across different countries.
Economic- Most countries in which Microsoft targets its product are first world counters. The economic climates within these countries are relatively favorable. Most states exhibit high per-capita income as well as the standard of living. For this reason, the new Xbox one S is very affordable for most people. Added with its new exciting features, the device sells like hot cakes.
Social- Nowadays, gaming is becoming a social experience, as well as entertainment. With the advent of online gaming, more console manufacturers are integrating online features into the devices. Xbox one S can connect to the internet via cable. This feature enables the users to log into the web and play remotely with other gamers. More people are now viewing such activities as a new form of interaction.
Technological- in the modern world, technology is rapidly evolving, and the gaming industry has not lagged behind. Online gaming is fast becoming a mainstream method of playing. For this reason, Microsoft has slowly integrated cloud as part of its gaming strategy. In the future, companies will host their games online, and the need for consoles will diminish. Xbox one S provides a hybrid between the two that allows for both online and offline tasks.
Legal- Different countries have different laws and regulations on products and services. Microsoft abides by all international standards that regulate the sale of electronic equipment. This undertaking keeps them safe from falling into lawsuits resulting from breaches of the rules.
Environment- This factor is critical in marketing yet most companies overlook. Consoles consume much more energy than computers or TV sets. An Xbox 360 or a PlayStation 3 uses over 25 times the power a laptop requires to stream a movie and 60 times that of an Apple TV. The Xbox One S however, has significantly improved its energy efficiency. Microsoft has used the most cutting edge technology to improve performance while consuming less power (Campbell 1).
Recommendations
Cloud and mobile devices need enhanced integration into the platform. Statistics show that mobile gaming will soon overtake the console regarding popularity (Scimeca 2).
Microsoft should also venture out into other markets such as Latin and South America. These areas have huge gaming communities, and this market needs to get tapped.
More aggressive promotion techniques need to get employed by Microsoft to generate more sales. Such include extra packages the likes of free games and complementary accessories.
Works Cited
Campbell, Colin. "Why Today's Consoles Are Terrible for the Environment, but Tomorrow's Will Be So Much Better." Polygon. N.p., 3 Oct. 2013. Web. 10 Aug. 2016. <http://www.polygon.com/2013/10/3/4767660/games-consoles-are-bad-for-the-environment-but-they-are-improving>.
Scimeca, Dennis. "The Unstoppable Rise of Mobile Gaming." N.p., 1 Mar. 2015. Web. 10 Aug. 2016. <http://kernelmag.dailydot.com/issue-sections/headline-story/11996/rise-of-mobile-gaming/>.
