PS4 marketing project - Playstation 4 case study PDF

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Playstation 4 case study ...

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5th April 2019

Marketing Principles (MKTG1199)

Marketing Plan for Nintendo Switch

Submitted by: Name Sim Zong Qing Marcus Jaxon Teo Emmanuel Joseph Velarde Yandoc Kunaseelan S/O Letchumanan Aloysius Austin

Student ID S3772733 S3771831 S3772927 S3772268 S3771750

Class / Group: LF02 / 12 Prepared for: Dr. Chin Choo Ong Date of Submission: 5th April 2019

Table of Contents 1.

Company Mission.....................................................................................................................1

2.

Company Objectives................................................................................................................1

3.

Situational Analysis.................................................................................................................2 3.1

Market Overview................................................................................................................2

3.2

Market Size and Potential...............................................................................................2

3.3

Market Structure................................................................................................................3

3.4

Market Trends....................................................................................................................3

3.5

External Environment......................................................................................................4

4.

Competitor Analysis.................................................................................................................5 4.1

Sony PlayStation (PS4)....................................................................................................5

4.2

Microsoft Xbox One..........................................................................................................6

5.

SWOT Analysis for Nintendo Switch....................................................................................7 5.1

Strengths............................................................................................................................8

5.2

Weaknesses.......................................................................................................................8

5.3

Opportunities.....................................................................................................................9

5.4

Threats...............................................................................................................................10

6.

Buyer Behaviour.....................................................................................................................10 6.1

Social Factors..................................................................................................................10

6.2

Personal Factors.............................................................................................................10

6.3

Psychological Factors...................................................................................................11

7.

Target Market...........................................................................................................................12 7.1

Market Segmentation.....................................................................................................12

7.2

Market Targeting & Profiling........................................................................................13

7.3

Positioning.......................................................................................................................14

8.

Internal Analysis.....................................................................................................................16 8.1

Product Performance.....................................................................................................16

8.2

Current Marketing Strategy..........................................................................................16

9.

Marketing Objectives.............................................................................................................17

10.

Marketing Strategy.............................................................................................................18

10.1

Product..............................................................................................................................18

10.2

Price...................................................................................................................................21

10.3

Place...................................................................................................................................22

10.3.1

Distribution Strategy..................................................................................................22

10.3.2

Channel Design...........................................................................................................22

10.3.3

Location of Intermediaries........................................................................................24

10.4

Promotion.........................................................................................................................25

10.4.1

Promotional Mix..........................................................................................................26

10.4.2

Estimated Cost of Promotion...................................................................................28

10.4.3

Media Calendar............................................................................................................30

11.

Conclusion...........................................................................................................................31

References.......................................................................................................................................32

MARKETING PLAN FOR NINTENDO SWITCH

1.

Company Mission

Nintendo is dedicated and committed in producing and marketing the highest quality products and services. We believe in treating every customer and employee with the utmost respect, attention and consideration in order to enhance our products and services (Nintendo, 2019).

2.

Company Objectives

Nintendo’s current objective is to attain the dominant market share of the game console market. The goal of the next 12 months is to sell 40% more consoles than the previous year, and to enhance the Nintendo experience through unique and remarkable products. Ultimately, to achieve our purpose of “bringing smiles to people’s

faces”

(Nintendo,

2019).

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MARKETING PLAN FOR NINTENDO SWITCH

3.

Situational Analysis

3.1

Market Overview

Nintendo operates in the gaming console market amongst competitors like Microsoft’s Xbox One and Sony’s PlayStation 4 (PS4). Besides being in the gaming hardware market, they are also in the software market through production of their own games such as Mario Kart 8 (Nintendo, 2019).

3.2

Market Size and Potential

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The global market size for console gaming is generally increasing with a high of $42 million in 2018. Nintendo has the potential for continuous growth through targeting a more diversified market as well as improvements in products and services.

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MARKETING PLAN FOR NINTENDO SWITCH

3.3

Market Structure

Nintendo operates in an oligopolistic environment alongside competitors like Sony and Microsoft. In 2018, Sony’s PS4 took control of the market with $18 million units sold, with the Nintendo Switch not far behind at $17.05 million. Microsoft’s Xbox One however, lagged almost 3 times of its competitors at $6.96 million.

3.4

Market Trends

According to Infocomm Media Development Authority (2017), Singapore’s gaming industry has seen a good growth. This reflects a positive outlook with the introduction of new Nintendo products for consumers.

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3.5

External Environment

1.

Demographic Influences

According to Population Reference Bureau (2018), there will be a 16% increase in people aged 65 or older by mid-century. This would lead to a decrease in the target group for the Nintendo Switch. Hence, the company would have to explore ways to retain and attract the younger demographics in order to stay relevant to the market.

2.

Economic Influences

According to Channel News Asia (2018), the median gross monthly income of Singaporeans increased 3.5% annually from 2013 to 2018. An increase income would lead to higher purchasing power thus, more consumers would have the ability to purchase the Nintendo Switch.

3.

Technological Influences

Data from the Singapore Business Review (2018) states that there are currently 4.3 million active mobile social consumers in Singapore. With the increase access to

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MARKETING PLAN FOR NINTENDO SWITCH

technology and social networks, social media and online marketing would be very highly effective.

4.

Sociocultural Influences

Singapore’s gaming industry is seen to be gaining noticeable momentum (Golden Equator Capital, 2017). Also, Singapore’s e-commerce scene is predicted to rise to US$8,639 million by 2023 (Statista, 2019). Thus, increasing gamers would lead to greater opportunities for the Nintendo Switch to be marketed in Singapore through ecommerce.

4.

Competitor Analysis

4.1

Sony PlayStation (PS4)

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MARKETING PLAN FOR NINTENDO SWITCH

4.2

Microsoft Xbox One

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MARKETING PLAN FOR NINTENDO SWITCH

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MARKETING PLAN FOR NINTENDO SWITCH

5.

SWOT Analysis for Nintendo Switch

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MARKETING PLAN FOR NINTENDO SWITCH

5.1

Strengths

1.

Quality of Games

Nintendo is home to many notable characters such as Mario and Pokemon. Hence, Nintendo introduced games like Pokemon Let’s Go! Pikachu and Super Smash Bros Ultimate which are exclusive to the Nintendo Switch. These games are huge titles and popular amongst gamers across the world which gave consumers another reason to buy the console thus boosting sales significantly.

2.

Family Friendly

Nintendo is known as the family friendly game publisher as their games cater to people of all ages. The Nintendo Switch has an intuitive game system that encourages multiplayer gameplay anytime anywhere. It can support up to 4 people simultaneously as compared to past consoles such as the Nintendo 3DS which is a single player console. The Nintendo Switch is also advertised as a family friendly product as it promotes family bonding.

5.2

Weaknesses

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1.

High Price Point

The Nintendo Switch is priced at $409 and is considered high for a handheld game console. Additionally, consumers would have to purchases games and accessories in order to maximise the console’s potential. “Singaporeans are cutting back on their spending in a number of categories in their bid to manage household expenses better and allocate their discretionary spending towards categories which they value” (Nielsen, 2015). In other words, Singaporeans are getting more price sensitive and thrifty therefore, it can be quite challenging when it comes to purchasing such a high cost product.

2.

Small Storage Space

Competitor game consoles have huge storage spaces since they introduced digital copies of their games. For the Nintendo Switch, gamers are given the option to own digital copies of the games by downloading it from the Nintendo eShop. However, it only comes with a 32GB storage space which is barely enough for consumers. Some games like Mario Kart 8 takes about 7GB of space which leads to lesser space for other games.

5.3

Opportunities

1.

Third-Party Software

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The Nintendo eShop was launched together with the Nintendo Switch and serves as a platform for consumers to purchase games and download additional content. By allowing third party software developers to put their content on the eShop, it can greatly benefit Nintendo. For example, Nintendo can look to collaborate with video streaming platforms like Netflix and HBO Go which allows consumers to watch their favourite shows on the same device.

2.

Electronic Sports (Esports)

Esports is the world of competitive video gaming. It is a multimillion-dollar industry where professional gamers face off against others to prove they are the best. Nintendo has the potential to host eSports tournaments to better connect with their consumers as well as another form of revenue.

5.4

Threats

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1.

Threat of Substitutes

In Singapore, eSports for computer and mobile games has gained momentum and are slowly being recognised. When professional gamers play the games while streaming on YouTube or Twitch, it helps to advertise the games, making eSports a huge influence on consumers. This becomes a threat to both handheld and console gaming as consumers start directing their attention towards online and mobile gaming.

2.

New Technology from Competitors

The Nintendo Switch is a hybrid console system. With advancing technologies, it would not be long until Sony and Microsoft introduce new console systems to entice consumers. This would then be an immediate threat for Nintendo.

6.

Buyer Behaviour

6.1

Social Factors

1.

Groups and Social Network

Factors such as social media sites, buzz marketing, word of mouth and opinion leaders affect consumer behaviour greatly in the case of the Nintendo Switch. For instance, a positive product review from a well-known tech Youtuber could easily influence consumers into buying the product. In turn, these consumers could then influence others through word of mouth.

6.2

Personal Factors

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1.

Occupation

The Nintendo Switch is mainly targeted at consumers aging from 21 to 30 years old. This segment consists of students and people who are generally independent, earning a part-time/full-time income. In turn, having more disposable income to afford the product. Therefore, more emphasis should be placed on targeting these consumers.

2.

Lifestyle

The lifestyle of a person greatly affects consumer behaviour, where consumers who purchase the product are generally positive with owning a Nintendo Switch as a form of entertainment. Therefore, it is crucial to capture the attention of such consumers.

6.3

Psychological Factors

Due to its relatively high price, the Nintendo Switch is considered a high involvement product. As a result of perceived brand differences, most consumers would start comparing variables such as price and benefits before making a purchase. On the other hand, vicarious learning might also take place, where consumers might purchase the product to feel a sense of belonging, in order to meet its social needs.

Ultimately, the aim is to reduce any post-purchase dissonance and the Nintendo Switch in this case, has generally done well due to its significant product differences compared to its competitors.

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7.

Target Market

7.1

Market Segmentation

DEMOGRAPHIC

PRE-TEENS

TEENAGERS

YOUNG ADULTS

ADULTS

AGE

10 - 16

17 - 20

21 - 30

Above 30

INCOME

Dependent on allowance

May or may not have source of income

May or may not have source of

Selfdependent

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OCCUPATION

given by parents

depending on individuals

income depending on individuals

on source of income

Students studying in Primary and Secondary schools

Students studying in Secondary schools, Polytechnics/Junior Colleges

Students studying in Universities with part-time jobs

Adults working fulltime jobs in various occupations

Working part-time jobs

Started full-time job

Some are full-time National Servicemen (NSF) PSYCHOGRAPHIC

PRE-TEENS

TEENAGERS

YOUNG ADULTS

ADULTS

ATTITUDE

Considers product as “cool” and “fun” as it is a hightech gaming console

Tend to be under peer pressure to own the product due to peers owning one

Considers product as a viable form of entertainment

Uses product as a form of relaxation and stress reliever

LIFESTYLE

Living at home with parents

Living at home with parents

Living at home with parents

Self-sufficient with their own home

Studying in school

Studying in school

Balancing between parttime/full-time job and studies

Currently in National Service

Stable in a full-time job

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BEHAVIOURAL

PRE-TEENS

TEENAGERS

YOUNG ADULTS

ADULTS

BENEFITS

Looking “cool” to their peers

Looking “cool” to their peers

Entertainment and competitive gaming

Relaxation and leisure

USAGE

1 - 2 hours a day

4 - 8 hours a day

4 - 5 hours a day

1 - 2 hours a day

USER STATUS

Potential Users

Regular Users

Regular Users

Potential Users

INFLUENCES

Influence parents to purchase through television or online advertisements

Influenced through peers, online or television advertisements

Influenced through peers and media mar...