On the way back from work I was thinking about it, and I think I'm gonna try and do an in depth market analysis. I'll be back with a wall of text and pretty graphs and such
What if they sold the games together as a package, It would have more sales and then some due to the fact that people are not going to buy both but now they are forced to. Huge Huge profits right there with a simple idea. Called it the Bnet package.
First, people are not interested in getting all three games together. Personally, I have no interest in getting WotLK, so therefore, buying the 'Bnet package' is totally a waste of money. I am sure most of the gaming population feels the same way. The general population is not wililng to spend $130+ in one purchase for three games, of which they will only play one at a time.
Also, by introducing WotLK into the package, it means its basically discriminating non-WoW players because only WoW players will benefit from this package (if the combined price is lower than what it would cost for all three games to be sold separately). Non-WoW players will be forced to pay extra money for a game that they would not play. This 'Bnet package' caters to only a small market segment; WoW players who are interested in playing SC2 and D3 and are willing to drop $130+ upfront. And that is SMALL. If Blizzard forces consumers to pay for product features that they will not use, Blizzard's market share will only be to those who either are hardcore gamers or are wealthy.
Another reason is the fact that if they were to sell all three games together, it would only be logical to cut costs of the retail price. True, Blizzard would save a little bit of money by reduced packaging costs, less shipping per unit costs due to decreased volume, and etc. But, that strategy is not viable for a release. The demand will be high for the games, so why reduce profits per game when Blizzard releases the titles? Blizzard will be able to sell the games at $50-60 per game with the same effort as selling the games at $40 per game in a combined package. That is to say if consumers were willing to pay $130+ in one purchase. Which most likely they are not.
And lastly, would you pay for the 'Bnet package'? Are you a WoW player who is also interested in playing SC2 and D3, and willing to pay $130+ upfront?
EDIT: If it IS like the Orange Box, then I would not recommend it either. The Orange Box works because all the games that comes in it all cater to the same market segment: FPS gamers. However, this 'Bnet package' has components of multiple game genres. The amount of money that Blizzard will put into advertising, promotion, publicity, packaging, etc. will not be reimbursed by the sales that they will make from this package, as the percentage interested in this package would be, I would guess, around 1-2% of the gaming population. The majority of Blizzard's sales will come from selling and advertising to the general population. Blizzard, as a company, is looking for ROI, and focusing to a small market segment surely isn't.
I now laugh at you in your stupidity, now that Diablo 3 has been announced as anticipated.
How am I stupid? The topic of discussion was having the release dates of all three games near the same time period, not the fact that there will be three games to be released. It doesn't matter if there are three titles announced, what was proposed by the OP was the fact that the games would be released near the same time.
Quote from "Mud" »
Its not really an epic fail, money now is worth more than money later due to investing. Also, Blizzard could very well want to break some world records. And, not only monopolize the gaming industry for good.
True, Blizzard could very well profit from doing such a thing. But this method is very risky, as how is Blizzard supposed to predict how many copies they should order, as this move hasn't really been made before. Will people buy more than one copy? Or will people buy just one copy? And what percentage of the population will buy which copies? Too many variables to factor into a decision like this. If Blizzard orders too much or too less, they will not gain as much revenue as with a conservative choice. But suppose they are able to calculate the number. This method could prove very profitable. But what happens if it doesn't? Just a waste of money lying in stores waiting to be bought. Although the loss of money would not be significantly greater than the other method. If Blizzard is willing to lose money this way, it is going against it's company policy and cheating Vivendi's supporters and stockholders, as Blizzard is not trying to maximize profits as a company shoudl do. But again, with great risks come great profits. The question is, is Blizzard willing to gamble its capital on an method like this? I'm pretty conservative when it comes to my marketing ideas, and I'd say Blizzard shouldn't.
As for the monopoly part. It's highly improbable. Blizzard only releases titles every like 4-5 years I would guess. Blizzard might hold a high market share if and when all three games are released, but this market share will not hold out for the next 4-5 years when Blizzard releases its next titles. People will be looking for new games to play, but Blizzard won't have any to offer, so therefore, no monopoly.
I am just looking from the standpoint of the majority of people who will buy the games. There will be people, like you stated, that will be able and willing to buy more than one title. However, the majority of people will only buy one game. You for instance, might buy more than one title. However, 70% of the gaming population will only buy one. If this happens, Blizzard will be losing money due to an overstock. As for the statement about these overstocks will eventually be sold out, that is true. However, how long will this process take, and is this the best way to maximize profits? The best way to maximize profits is to sell what you expect as you stated. But with three titles being released at one time, how do you calculate that? As no other company has done so before, you don't have data to research. Will there be a substantial number of consumers who will opt to buy all three titles, or will there be significantly less? It would be hard to calculate such a risky move, as Blizzard could find themselves in a shortage situation or on the opposite end.
As for people who will buy other games due to the delay of the Blizzard titles, Blizzard has already taken an aggressive stance towards that with their advertising strategy, i.e. this week's splash teasers. Blizzard also already has a large loyal crowd that will wait for them. People will be willing to wait months to buy Diablo 3. For example, when Starcraft 2 was announced, people went back and started playing Starcraft. The majority didn't go out and buy Red Alert or whatever. The same way with Diablo 3, I'm pretty sure people will go back to Diablo 2. I keep on repeating myself, but Blizzard has a large foothold in the market, hardcore gamers will wait and do whatever Blizzard wants them do. You don't see them rushing production of a game because people are waiting and asking for the game. Blizzard is a patient company that wants everything done to perfection. I can still remember when Starcraft 2 was announced, they explicitly said, "It will be out when it is ready." And they keep on mentioning that same sentence every time that question appears. They also release Beta's, not only to help in the development of the game, but to also keep the gamer's hype up, as new information will be leaked out, and people will want to play the game even more. The amount of gamers that will go out to play a different game when the game they are waiting for to come out should be very small.
Also, if people are buying Titan Quest instead of Diablo 3, who says they won't buy Diablo 3 also? As you have stated, people get paid every week / every two weeks, they can afford buying both games, can't they? Thus, it won't result in a loss of revenue. And if people can't buy both games, then think about people who want to buy Starcraft 2 and Diablo 3 at the same time; they're in the same boat.
Blizzard has plenty to lose. If they choose to release each game, there will be a certain amount that do not sell, because not everybody can afford to pay for all of the games they want. Therefore, there will be an overstock of games. Blizzard first must pay for the creation of the game, packaging, shipping, etc. Granted, stores that buy the game to sell will pay for most of the costs. However, say for instance, during the first week, a certain amount does not sell, due to the fact that not everybody can afford to buy all of the games they want. Therefore, stores will not order more copies because they already have stock. Thus, Blizzard loses sales due to an overstock of copies. Basically, the money that could be investing earning interest is sitting in store shelves losing money.
People will not wanting to pay for something they are not going to use right away. Do you buy a car when you are 10 because you will use it later, but you're taking the bus to school right now?
1) Diablo has not been officially announced to be the new MMO.
2) Diablo has completely different core gameplay elements- specifically being hack n' slash, as opposed to WoW's turn-based/real-time battle system (basically the same system as that of FFXII.)
3) Diablo caters to a completely different taste- the gothic, dark, deep-thinking kind, whereas WoW is a virtual cartoon of LotR (read all of the extra stuff besides the three books by Tolkien and you'll be amazed to find that he invented the "Dark Elves" and such.)
4) If they are losing money from WoW to Diablo (assuming it's a p2p MMO), then they would still be getting the money, just through another game.
1) That is true, I am just responding to the OP because he also assumed D3 was going to be released
2&3) See my second long post. I think I address the fact that whether or not they are different genres, coming from Blizzard and having a long history will make their markets conflict.
4) If they were to market the games separately, they would maximize profits because the longer the games are out but not bought, they lose money. If they released each game separately and waited for the hype to die out, optimal sales would happen.
The method of marketing all three releases within months of each other. And might I ask what concrete evidence? Blizzard has not announced release dates for any of the titles.
I, personally, do not think Blizzard needs to spend any money on publicity. It is already doing a fantastic job with the weeklong teasers on their website. And its become a viral hit, as its been seen on digg.com's front page several times. Even major gaming websites are commenting on what the mystery game could be. With this, I highly doubt that Blizzard will get a significant amount of new consumers with that strategy.
Okay, logically, what percent of the population will buy both of the games when the person knows, that they will only be playing one at a time? You don't go around buying two cars within months of each other saying 'Oh, I'll just drive this one while I'm not driving the other one." No. You can't do that. Most consumers will only buy one car and save the rest, and possibly spending the money on other things. Just like the cars, most consumers will only buy one game, save the rest of the money while they play that game and then buy the second one.
Let's look at this another way. What is Blizzard's point in selling all three games close to one another? To gain additional publicity? Blizzard is selling three sequels of franchises with long gaming histories. There is no reason to advertise the games for publicity any more than Blizzard already has. That's why you probably won't see ads flying around on the internet announcing the new titles. Why? Because a large population already knows about the releases, and therefore, advertising like that is just a waste of money. You don't see that many Mercedes commercials on TV as compared to Kia commercials. Why? Because people know that Mercedes is good. Just like that, the names of the three franchises are common names in the world of gaming, so publicity is not the goal here. The goal here, since Blizzard already has control of the market segments, is to maximize profits. And if Blizzard wants to do so, it shouldn't release the games so close to each other.
I have no problem with months apart, albiet, many months apart. But you're basing this entire discussion on release dates on BestBuy's website. Blizzard hasn't even said explicitly when they'll be releasing, as the games haven't even reached Beta testing yet. If these dates were on Blizzard's own website, I would believe you, but BestBuy is just pulling random dates out of their ass.
And by 'at the same time' i mean, for example, releasing all three games in one or two quarters.
Theoretically and in most cases, releasing all three games near the same time will have no effect on revenues. However, Blizzard does not fall in this category because it is not a typical company. It hold's only three major franchises, which we have experience with. I am saying 'we' because we represent a small portion of the target market Blizzard is selling to, the Blizzard followers and hardcore gamers. However, more sales will come from casual gamers, and that is who Blizzard wants to sell to. Don't think about what you would do, think about what the general population would do, because most people reading this forum do not belong in the casual gaming category.
World of Warcraft has over 10 million subscribers, and the population has started to plateau a little bit. By announcing WotLK expansion, it'll hold these subscribers and gain more until the expansion comes out. Because of WoW's dominance, market share conflict when WotLK releases will not be that prevalent when compared to a normal game. However, D3 and SC2 are not a normal games. These franchises hasn't been seen in over 5+ years. They're like Star Wars Episode 1. You already had a bunch of good reviews and history with the previous 3 movies, so the hype for the sequel will be extremely large. Now imagine that Star Wars Episode 1 is premiering on the same night as The Lord of the Rings III (WotLK), and both movies are produced by the same company, let's say Blizzard. Now, both movies are in different genres and lore, but they both hold large amount of common knowledge with the general population, however, because of their dominance, their market share will conflict with each other, and it is not in Blizzard's interest to let both of those premiere on the same weekend. Granted, there will be a segment of the market that will go see both, that would represent us. However, the mainstream or general population will most likely not see both movies.
Now back to the games. Blizzard is an extremely large company and basically all gamers have played or heard about their games. Given the fact that Blizzard's target market is the casual gamers (for SC2 and D3... WotLK is different since it depends on a current marketing segment owned by Blizzard), it is not in Blizzard's best interest to release the games at the same time.
As for when to release the games? Blizzard's marketing team has to do research on what other games come out, what time of the year is best, and etc. And as we can see, Blizzard's marketing team is already doing a great job with the viral teasers, so we can expect a good job in final marketing.
That would be a horrible marketing strategy. What is Blizzard hoping to get with releasing all three games close to one another. I personally am waiting for both SC2 and D3, so if they release D3 at the same time as SC2/WotLK, people would have a hard time choosing which game to buy, because most people don't have enough money to drop $100 to $150 on two or three of the games. Also, if they were to buy all three games, they can't play all of them at once. Therefore, most people will just buy one game, and wait until they beat that game and buy the second game that they want. This will result in lower sales and revenues at the beginning of the release, and by the time gamers are ready to buy the second game, they'll possibly find better deals than retail, yeilding in less revenue for Blizzard. It is NOT advisable to release all three games at the same time.
Plus, where the heck did you get those street dates from? Blizzard hasn't announced a beta yet, and they've been saying the games will be out when they are ready. BUT, if those dates are correct, which i DOUBT, but SC2 and WotLK cater to different marketing segments. One is an RTS while the other one will be picked up by loyal WoW fans. Releasing those two near each other, theoretically, should not have that much impact on sales. BUT, this is BLIZZARD. A major gaming company. With releases like SC2, a highly anticipated game, WITH WotLK, an expansion pack to one of the most played games, the sales of the games will eat each other up. And that's without D3. If D3 was in the mix, it would take away from WotLK's sales as they're both catering to MMORPG players. AND, D3 has been really anticipated. EVEN lower revenues for Blizzard.
Basically. That marketing strategy = FAIL.
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On the way back from work I was thinking about it, and I think I'm gonna try and do an in depth market analysis. I'll be back with a wall of text and pretty graphs and such
First, people are not interested in getting all three games together. Personally, I have no interest in getting WotLK, so therefore, buying the 'Bnet package' is totally a waste of money. I am sure most of the gaming population feels the same way. The general population is not wililng to spend $130+ in one purchase for three games, of which they will only play one at a time.
Also, by introducing WotLK into the package, it means its basically discriminating non-WoW players because only WoW players will benefit from this package (if the combined price is lower than what it would cost for all three games to be sold separately). Non-WoW players will be forced to pay extra money for a game that they would not play. This 'Bnet package' caters to only a small market segment; WoW players who are interested in playing SC2 and D3 and are willing to drop $130+ upfront. And that is SMALL. If Blizzard forces consumers to pay for product features that they will not use, Blizzard's market share will only be to those who either are hardcore gamers or are wealthy.
Another reason is the fact that if they were to sell all three games together, it would only be logical to cut costs of the retail price. True, Blizzard would save a little bit of money by reduced packaging costs, less shipping per unit costs due to decreased volume, and etc. But, that strategy is not viable for a release. The demand will be high for the games, so why reduce profits per game when Blizzard releases the titles? Blizzard will be able to sell the games at $50-60 per game with the same effort as selling the games at $40 per game in a combined package. That is to say if consumers were willing to pay $130+ in one purchase. Which most likely they are not.
And lastly, would you pay for the 'Bnet package'? Are you a WoW player who is also interested in playing SC2 and D3, and willing to pay $130+ upfront?
EDIT: If it IS like the Orange Box, then I would not recommend it either. The Orange Box works because all the games that comes in it all cater to the same market segment: FPS gamers. However, this 'Bnet package' has components of multiple game genres. The amount of money that Blizzard will put into advertising, promotion, publicity, packaging, etc. will not be reimbursed by the sales that they will make from this package, as the percentage interested in this package would be, I would guess, around 1-2% of the gaming population. The majority of Blizzard's sales will come from selling and advertising to the general population. Blizzard, as a company, is looking for ROI, and focusing to a small market segment surely isn't.
How am I stupid? The topic of discussion was having the release dates of all three games near the same time period, not the fact that there will be three games to be released. It doesn't matter if there are three titles announced, what was proposed by the OP was the fact that the games would be released near the same time.
True, Blizzard could very well profit from doing such a thing. But this method is very risky, as how is Blizzard supposed to predict how many copies they should order, as this move hasn't really been made before. Will people buy more than one copy? Or will people buy just one copy? And what percentage of the population will buy which copies? Too many variables to factor into a decision like this. If Blizzard orders too much or too less, they will not gain as much revenue as with a conservative choice. But suppose they are able to calculate the number. This method could prove very profitable. But what happens if it doesn't? Just a waste of money lying in stores waiting to be bought. Although the loss of money would not be significantly greater than the other method. If Blizzard is willing to lose money this way, it is going against it's company policy and cheating Vivendi's supporters and stockholders, as Blizzard is not trying to maximize profits as a company shoudl do. But again, with great risks come great profits. The question is, is Blizzard willing to gamble its capital on an method like this? I'm pretty conservative when it comes to my marketing ideas, and I'd say Blizzard shouldn't.
As for the monopoly part. It's highly improbable. Blizzard only releases titles every like 4-5 years I would guess. Blizzard might hold a high market share if and when all three games are released, but this market share will not hold out for the next 4-5 years when Blizzard releases its next titles. People will be looking for new games to play, but Blizzard won't have any to offer, so therefore, no monopoly.
As for people who will buy other games due to the delay of the Blizzard titles, Blizzard has already taken an aggressive stance towards that with their advertising strategy, i.e. this week's splash teasers. Blizzard also already has a large loyal crowd that will wait for them. People will be willing to wait months to buy Diablo 3. For example, when Starcraft 2 was announced, people went back and started playing Starcraft. The majority didn't go out and buy Red Alert or whatever. The same way with Diablo 3, I'm pretty sure people will go back to Diablo 2. I keep on repeating myself, but Blizzard has a large foothold in the market, hardcore gamers will wait and do whatever Blizzard wants them do. You don't see them rushing production of a game because people are waiting and asking for the game. Blizzard is a patient company that wants everything done to perfection. I can still remember when Starcraft 2 was announced, they explicitly said, "It will be out when it is ready." And they keep on mentioning that same sentence every time that question appears. They also release Beta's, not only to help in the development of the game, but to also keep the gamer's hype up, as new information will be leaked out, and people will want to play the game even more. The amount of gamers that will go out to play a different game when the game they are waiting for to come out should be very small.
Also, if people are buying Titan Quest instead of Diablo 3, who says they won't buy Diablo 3 also? As you have stated, people get paid every week / every two weeks, they can afford buying both games, can't they? Thus, it won't result in a loss of revenue. And if people can't buy both games, then think about people who want to buy Starcraft 2 and Diablo 3 at the same time; they're in the same boat.
edit: check your pm
People will not wanting to pay for something they are not going to use right away. Do you buy a car when you are 10 because you will use it later, but you're taking the bus to school right now?
1) That is true, I am just responding to the OP because he also assumed D3 was going to be released
2&3) See my second long post. I think I address the fact that whether or not they are different genres, coming from Blizzard and having a long history will make their markets conflict.
4) If they were to market the games separately, they would maximize profits because the longer the games are out but not bought, they lose money. If they released each game separately and waited for the hype to die out, optimal sales would happen.
And how does the support for there being three releases credit a special marketing strategy for it?
But let me ask you, what is Blizzard's purpose to releasing all games at once? I read on your first post that it's aim was publicity. Is that correct?
Let's look at this another way. What is Blizzard's point in selling all three games close to one another? To gain additional publicity? Blizzard is selling three sequels of franchises with long gaming histories. There is no reason to advertise the games for publicity any more than Blizzard already has. That's why you probably won't see ads flying around on the internet announcing the new titles. Why? Because a large population already knows about the releases, and therefore, advertising like that is just a waste of money. You don't see that many Mercedes commercials on TV as compared to Kia commercials. Why? Because people know that Mercedes is good. Just like that, the names of the three franchises are common names in the world of gaming, so publicity is not the goal here. The goal here, since Blizzard already has control of the market segments, is to maximize profits. And if Blizzard wants to do so, it shouldn't release the games so close to each other.
And by 'at the same time' i mean, for example, releasing all three games in one or two quarters.
World of Warcraft has over 10 million subscribers, and the population has started to plateau a little bit. By announcing WotLK expansion, it'll hold these subscribers and gain more until the expansion comes out. Because of WoW's dominance, market share conflict when WotLK releases will not be that prevalent when compared to a normal game. However, D3 and SC2 are not a normal games. These franchises hasn't been seen in over 5+ years. They're like Star Wars Episode 1. You already had a bunch of good reviews and history with the previous 3 movies, so the hype for the sequel will be extremely large. Now imagine that Star Wars Episode 1 is premiering on the same night as The Lord of the Rings III (WotLK), and both movies are produced by the same company, let's say Blizzard. Now, both movies are in different genres and lore, but they both hold large amount of common knowledge with the general population, however, because of their dominance, their market share will conflict with each other, and it is not in Blizzard's interest to let both of those premiere on the same weekend. Granted, there will be a segment of the market that will go see both, that would represent us. However, the mainstream or general population will most likely not see both movies.
Now back to the games. Blizzard is an extremely large company and basically all gamers have played or heard about their games. Given the fact that Blizzard's target market is the casual gamers (for SC2 and D3... WotLK is different since it depends on a current marketing segment owned by Blizzard), it is not in Blizzard's best interest to release the games at the same time.
As for when to release the games? Blizzard's marketing team has to do research on what other games come out, what time of the year is best, and etc. And as we can see, Blizzard's marketing team is already doing a great job with the viral teasers, so we can expect a good job in final marketing.
Plus, where the heck did you get those street dates from? Blizzard hasn't announced a beta yet, and they've been saying the games will be out when they are ready. BUT, if those dates are correct, which i DOUBT, but SC2 and WotLK cater to different marketing segments. One is an RTS while the other one will be picked up by loyal WoW fans. Releasing those two near each other, theoretically, should not have that much impact on sales. BUT, this is BLIZZARD. A major gaming company. With releases like SC2, a highly anticipated game, WITH WotLK, an expansion pack to one of the most played games, the sales of the games will eat each other up. And that's without D3. If D3 was in the mix, it would take away from WotLK's sales as they're both catering to MMORPG players. AND, D3 has been really anticipated. EVEN lower revenues for Blizzard.
Basically. That marketing strategy = FAIL.