360 Marketing: You think you know, but you have no idea.

[bapenguin]

John Porcaro is a member of the Microsoft Marketing team in charge of the XBox 360. Recently Microsoft and his team have been receiving a lot of flak for the mass marketing that is taking place with the XBox 360. Why are they receiving flak? Why market something that's so damn hard to get?

When designing a product with a multi-year cycle, with hopes to expand market share against a strong competitor, you need to do things that may seem crazy to existing customers. You already know that a lot of our marketing isn’t for YOU. And honestly, it isn’t necessarily for NOW. To make something a “cultural icon” can take years. That’s what we’re hoping to do.

It's a pretty interesting read. A lot of times we take things for granted, and we don't really understand the broader picture. We tend to focus on the now, and the effect of now instead of the long term goals.

The full article is found here (http://www.johnporcaro.com/2005/11/xbox_360_market.html).

I understand what Microsoft wants to do, but if you look at it from a broader picture and what Shaded is asking, does it really matter? Like the author says, these few months are going to be a blip on the radar, so does it really hurt MS to wait till late January or so when stock is high to start the marketing campaign? Ya know, maybe start it with a bang at the Super Bowl?

[WastelandDan]

I don't think it's necessary to start advertising heavily this early on. You have to figure that with the scarcity all the people that have the system right now are extreme hardcore fans and the advertising really isn't geared toward them. They've already taken the bait and been reeled in.

Also though it's personally irritating to me because I'm still waiting for my preorder to come in and I haven't gotten my Box yet. Stop mocking me!!

[JediSanf]

I don't think it's necessary to start advertising heavily this early on. You have to figure that with the scarcity all the people that have the system right now are extreme hardcore fans and the advertising really isn't geared toward them. They've already taken the bait and been reeled in.


Yea, but E3 was our bait. I think this is bait for Joe Couch-Potato.

[WastelandDan]

that's true. The biggest reason to advertise this early with the scarcity going on is to make them want it and then unable to get it. While this may make some people just say screw the whole thing, it may work the other way and make them want it even more.

[Reanimated]

I don't care as long as we get a Halo 3 + 360 price drop marketing blitz next fall. :D

[bobbler]

I'm sure MS is very pleased with AEG.

Hi guys!

[MaiXu]

The gamer in me hates Microsoft for conceding to shit like partnering with MTV or giving their system away to douchebag celebrities. I also hate their forced shortages just to get on CNN.

The business man in me knows what MS is doing, and can't help but be impressed: they're saturating the market with demand and slowly doling out supply. The mindshare they are attempting to create with the 360 is huge; they want Xbox to be synonymous with gaming. When moms across the world get pissed off at their kids for playing so many games, MS's goal is to have that mom scream "turn of that damn Xbox." They are already there: ads are everywhere, overt and covert. You think that 360 ad that was "banned" from TV was really banned? Or did MS make it with the express intent of hyping a banned commercial that will then go on to reach more people *because* it was banned? There's some really brilliant marketing going on here, and every blogpost (this on included) clamoring for a 360 is keeping that name out there, seeding our brains with lusty desire for their box.

And then the thinking man in me knows that this is all hype, and only fools buy new hardware on launch day, especially without a killer app.

ZING!

[Kelegacy]

MS has done a good job of getting their name mentioned on every fucking news portal. The other day The Today Show and the morning show on CBS both metioned it in a way that was obviously planted as an advertisement. I was like "what the heck?"

[Heretic Machine]

Bleh... banned commercials... You want to see a banned commercial? Here my friends, this is a banned commercial: http://www.thefleshfarm.com/fridaythe13th/fridaybanned.html

[Reanimated]

MS has done a good job of getting their name mentioned on every fucking news portal. The other day The Today Show and the morning show on CBS both metioned it in a way that was obviously planted as an advertisement. I was like "what the heck?"



Good Morning America named it the #1 hottest gift to give this Christmas. :D

Bill wins again.

[abso]

It's all about viral marketing. Sure, supply is low, but chances are you have a friend that has one, or will have one by the holidays. Then there are the store kiosks where if you can't play, you can at least watch someone else. You play it at a friends house, or at a store kiosk, and you talk about your experience with others. You become the advertisement. By additionally saturating the market with tv and magazine advertisements, you get to the people that might not know someone with a 360 or have a store with a kiosk nearby. You also build the hype surrounding the machine, which increases demand. If you look at what MS is attempting to do, that is, to have a system in each home as a media center, it is imperative that people know about the system. Because of the gap until the launch of the PS3, demand for the 360 needs to be really high. Frankly, it's a great marketing campaign.

From the comments I have read about customers saying it was a 'bad launch' I can only conclude that these people are unable to separate the developer and manufacturer from the retailers. There is no doubt that there was very high initial demand for the 360. However, disappointed customers have more to do with the distribution method of the retail chain they went to. Places like Walmart, Target, Best Buy, Circuit City, etc. don't take pre-orders or reserves. It was first come, first serve. Second, the individual stores knew exactly how many units they had at launch. They could have just given the first x people in line a ticket saying you got one, come into the store and look around... Instead they chose to keep everyone outside in a line, with hopes that a product would be in stock. Those types of situations tarnish the launch, not a marketing campaign.

[nonchalance]

A quick break:
If you're in marketing, or advertising?
Kill yourself.
Do it now.

Seriously. I'm not kidding. You are fucking the world, and you are fucking us.
Kill yourself. It's your last chance to save your fucking soul.

Paraphrased from Bill Hicks.

[TrackZero]

that's true. The biggest reason to advertise this early with the scarcity going on is to make them want it and then unable to get it. While this may make some people just say screw the whole thing, it may work the other way and make them want it even more.

Exactly. It's also far more effective on youth, which makes sense given that they're trying for holiday sales right now. It's also about being in the public eye as early as possible, so people know you're out there and the "thing" to get, even if they don't plan to purchase the system right away.

[Montolio]

And then the thinking man in me knows that this is all hype, and only fools buy new hardware on launch day, especially without a killer app.

ZING!

I love my new foolish hardware and all the non-killer apps that came with it mmmwwwhhhaaahahaha! Sadly my new copy of PoP:TTT doesn't run on it but I I kept my Xbox around for just that reason.

Oh, I could be wrong on this, but if you purchase marketplace points...do it via the Xbox 360 interface. I picked up a 1600 point card at Best Buy for $25 but later discovered that you could get 2000 points for $20 via Live - damn it heh. You can use these things to change your gamertag (800 points) while maintaining your friends list, rep, etc. to purchasing the full version of a sweet ass Arcade title like Geometry Wars Evolved (400 points). Seems like I learn something new about this thing everyday.

Knock on wood...I've still had no problems with mine.

[Mason]

The business man in me knows what MS is doing, and can't help but be impressed: they're saturating the market with demand and slowly doling out supply. The mindshare they are attempting to create with the 360 is huge; they want Xbox to be synonymous with gaming. When moms across the world get pissed off at their kids for playing so many games, MS's goal is to have that mom scream "turn of that damn Xbox." They are already there: ads are everywhere, overt and covert. You think that 360 ad that was "banned" from TV was really banned? Or did MS make it with the express intent of hyping a banned commercial that will then go on to reach more people *because* it was banned? There's some really brilliant marketing going on here, and every blogpost (this on included) clamoring for a 360 is keeping that name out there, seeding our brains with lusty desire for their box.

Whoa, no way, Microsoft made a product and then is trying to sell it?!?! With advertising?!?! I'm more mad right now than I've ever been in my whole life!

The "banned" commercial was really banned in the UK. If you heard otherwise, blame inaccurate blogs and not MS. Given that they're showing the commercial on American TV, I'm pretty sure that MS isn't trying to convince people that it was banned in the US.

I don't get these limp-wristed attempts at cynical navel-gazing. Virtually everything you own was selected due to similar advertising and branding. Your impression of products has always been bought and sold. There's a whole industry dedicated to the practice, perhaps you've heard of it.

So long as the marketing is done in good faith, it's an idiotic thing to complain about. I mean yeah, nerdy gamers can probably rattle off the XBox 360's specs while dozing off, but a large percentage of the population will hear about it primarily through marketing. And not marketing to those folks is crazy, as if you don't your competitor will.

So channel your disaffected angst at some real targets, or argue against the whole capitalist system. But ranting against a multinational corporation like MS for selling out by having an ad event on MTV? They sold out in 1975, at their founding, no different than any other corporation.

[*Legion*]

A quick break:
If you're in marketing, or advertising?
Kill yourself.
Do it now.

Seriously. I'm not kidding. You are fucking the world, and you are fucking us.
Kill yourself. It's your last chance to save your fucking soul.

They should follow your example and become drama queens instead.

Paraphrased from Bill Hicks.

Unoriginal drama queens.

[nonchalance]

They should follow your example and become drama queens instead.



Unoriginal drama queens.

Meh.
I'm just sick of everybody selling stuff to me all the time.
I know, this is Western Civilisation, and if I don't like it blah blah blah, but it's really irritating.

[Suicidal ShiZuru]

This is ***/Bill Gates, the masters of fucking people and businesses in the ass with a spiked club sans lube.

[Dirty Harry]

They should follow your example and become drama queens instead.



Unoriginal drama queens.
FUCK YOU,

BILL HICKS IS ANOTHER DEAD AMERICAN HERO.

[rein]

FUCK YOU,

BILL HICKS IS ANOTHER DEAD AMERICAN HERO.
:confused:

[doyama]

Although gamers are quite pissed off about the shortages you have to realize that any company is not pandering to YOU. YOU are irrelevant. YOU do not make a difference. YOU are not the center of the god damn universe to them. Whine and bitch all you want but in the end only inventors and shareholders matter. So how does Microsoft's marketing actually make sense?

1) Maximize buzz going into the lanch date. Inventors might be inclined to buy MS stock in advance of the launch. If the launch is successful the stock price will surely increase creating value to the investor. Thus you must maximize buzz, headspace and awareness of the product.

2) Hedge your bets. MS knew going in there were going to be shortages. Their suppliers are creating pre-orders and so MS generally know how many units are going to be needed. Its not enough. What to do? Create EXPECTATION in the marketplace for it. Why? So invenstors are not blind-sided by shortages, which might cause them to dump MS stock. Instead play the shortages as a PR for investors "Look so many people want our stuff we can't produce it fast enough". BUY ratings for MS stock start to look interesting.

So from that perspecitve MS did what it was supposed to do and did it well. Indeed looking at the stock price for November, leading up to the launch the stock price increased from $24 in Oct to $28 today. A 16% jump, not too shabby!

And the reality is shortages are a fact of life. No big launch ever went through without shortages. They simply exist because you can't possibly ramp up production to accomodate the immense demand on the first day. Inventory is expensive and no one likes having that stuff lying around. MS needs to launch in Nov so that its end of year summaries look good. Since its fiscal year works on the calendar year. So they launched in Nov to basically create a great year-end line item on their annual report. Also I think they prolly wanted to blow their advertising budget this year because next year it will be competing with Vista. You want to spread out marketing efforts for even separate products so people don't get confused (believe me they can!). This was the year of the Xbox360, I think next year you'll see an equally great push to get Vista in people's minds.

I suspect Sony is launching the PS3 in spring so that they can dump all the development cost expenses into their 2005 year, which ends in March (which is also why games in Japan are almost never released in the Christmas season, mostly because its not year end and well its also more of a couples holiday :P). Then in Q1 plow thru with the PS3 launch and start the year with a bang.

[ElPresidente]

I can see a few people in here DON'T do marketing. :P

Put simply people, brand building should be started as early as possible. Brand is developed through a number of means, one of which is repetition of positive brand image. It develops awareness. You don't market for the sale you want to make today. You market for the sale you want to make tomorrow. If MS waited until they had adequate stock to meet demand they would be starting marketing late and would actually have slower sales than starting their marketing early on.

You might think them foolish but have a bit of humility and realise that Microsoft is a company through prudent (and might say ruthless) business strategies has become a multi-billion dollar concern. Some might say they know what they are doing when it comes to marketing. ;)

[MaiXu]

Whoa, no way, Microsoft made a product and then is trying to sell it?!?! With advertising?!?! I'm more mad right now than I've ever been in my whole life!

If you're fine with Microsoft treating the gamers that make thier system a success like shit, that's fine with me. I'd rather see actual gamers enjoying the 360, and not publicity stunts. But I guess I'm just old-fashioned.

The "banned" commercial was really banned in the UK. If you heard otherwise, blame inaccurate blogs and not MS. Given that they're showing the commercial on American TV, I'm pretty sure that MS isn't trying to convince people that it was banned in the US.

I'm sure MS is really trying to cool the buzz on their machine by going out of their way to clarify that the commerical wasn't banned. As it stands, it's making its way around the internet as "the banned 360 commercial," and plenty of people are seeing it. MS won't do much to stop that.

I don't get these limp-wristed attempts at cynical navel-gazing. Virtually everything you own was selected due to similar advertising and branding. Your impression of products has always been bought and sold. There's a whole industry dedicated to the practice, perhaps you've heard of it.

Did you read the second paragraph of my post? We're all (painfully) aware of the marketing involved here, of the brand MS is trying to create. What I take issue with is their zeal for creating the brand before delivering the product. I know that the scarcity of 360s goes part-in-parcel with the brand image as the cool new thing, but there's plenty of people out there now, wanting a 360 and willing to pay for one, that are getting fucked for the sake of MS's brand.

So long as the marketing is done in good faith, it's an idiotic thing to complain about. I mean yeah, nerdy gamers can probably rattle off the XBox 360's specs while dozing off, but a large percentage of the population will hear about it primarily through marketing. And not marketing to those folks is crazy, as if you don't your competitor will.

First of all, please don't ever associate "marketing" with "good faith." Their job is to make you think you need/want something you do not need. Besides, my argument the entire time has been that MS's marketing hasn't[I] been "in good faith." They've deliberatly staggered shipments to create false buzz for the major new networks. Advertising a product most can't get their hands on is aggravating. Again, we know this to be all part of MS's master plan for world domination, but it still sucks to be left out in the cold so the 360 can make CNN.

So channel your disaffected angst at some real targets, or argue against the whole capitalist system. But ranting against a multinational corporation like MS for selling out by having an ad event on MTV? They sold out in 1975, at their founding, no different than any other corporation.

EvAv is not the place for a anarcho-communist rant, and I think only a fool pretends that MS isn't one of those soulless corporations that control the world. But what do you want people to do, sit back and take it? Be treated like the chattle-consumer MS views them as?

Anyway, it's late, and I don't know if I made any sense in this rant. Good night.

[Zeal]

I think the limited release of systems was based on the fact that Microsoft really didn't have any games worth a crap. They're gonna wait till they have some big games before marketing the system heavily.

[ElPresidente]

Big games? Regardless of what you think of the titles, Perfect Dark 0 and Project Gotham Racing 3 are big games for the system. Multiformat titles like NFS:MW and Call of Duty 2 will also be highly wanted by a lot of consumers.

Even if you don't think much of the games the fact is that these titles have high profiles in the eyes of the consumers.

The shortage is due to an attempted three continent launch. Its a big order to fill. There are no evil machinations behind the whole thing.

[Zeal]

The shortage is actually a calculated marketing tactic, but ok.

[TRiLoGY]

The shortage is actually a calculated marketing tactic, but ok.

I would have to agree with you..

[Rommel]

X? X?! You're not seeing the big picture!

[Atorak]

On a related note, has anyone seen any of the 2nd round of XBox 360s trickling into stores near you?

I haven't seen any yet.

[Heretic Machine]

What we know:

1. There is a shortage.
2. There is marketing.
3. People want the 360.
4. People like to speculate.

[drakkarim]

there is no "broader picture" the bottom/final answer/goal is always SELL LARGE QUANTITIES, everything else is 'details'.

and "culture" is marketing for "sheep that will keep paying for the same crap over and over".