CAMPAIGNS: Sega overcomes two crisis events

Client: Sega of America (San Francisco)

Client: Sega of America (San Francisco)

Client: Sega of America (San Francisco)



PR Team: Access Communications (San Francisco)



Campaign: Dreamcast launch



Time Frame: Late 1998 to Sept. 9, 1999 launch and several days

thereafter



Budget: dollars 5 million



Product Launch.



Sega of America (SOA) faced a daunting task in getting video game

consumers to give the company a second chance with its new Dreamcast

game machine. Once an industry leader, Sega had stumbled badly in recent

years and by 1998 had less than 1% of the game market.



Strategy



Access, Sega’s PR agency since 1997, began its Dreamcast efforts late

last year, following the system’s launch in Japan. Using import

Dreamcasts for demonstrations, the agency courted the gaming-enthusiast

press, and later the mainstream press, to build excitement for the Sept.

9 North America launch.



By early August awareness of the Dreamcast launch was high. But with the

media watching closely, Sega was hit by two potentially unsettling

events - the departure of SOA president Bernard Stolar in mid-August and

the discovery on the day of the launch that some software disks would

not work on the new machine.



Given their recent troubles, Sega and Access knew the media and

consumers were looking for any signs of chinks in the company’s armor.

For Stolar’s departure, they decided to meet the issue head-on. The PR

team briefed retailers and financial analysts before the news became

public to reassure them the departure would not affect the launch.



’Our message to the media was that yes, Bernie was great in organizing

the management and laying the groundwork, but that work was already

done,’ says Access VP David Karraker. ’Now the train has left the

station, and nothing is going to stop it.’



The defective software disks required a faster response. Sega traced the

problem back to a particular factory. While the problem was minimal,

affecting less than 1% of disks, the Associated Press ran a story about

it on Sept.



10. Sega and Access decided to counteract with some news of their

own.



Tactics



Charles Bellfield, SOA director of marketing, says, ’Whenever any

nonpositive news came out, we immediately put out some positive news in

terms of new sales records being broken.’ On Sept. 10, the company

announced Dreamcast had generated dollars 97 million in sales in 24

hours, surpassing Star Wars: The Phantom Menace as the largest

single-day launch in entertainment history.



’Star Wars was a great benchmark because it was still fresh in the minds

of most people,’ says Bellfield. Sega followed that up with a release

noting 372,000 Dreamcasts had been sold in the first four days,

reinforcing the product’s early success.



The PR team used the Internet as a key component, not only to

disseminate information about replacing faulty software, but also to

build overall Dreamcast awareness through news groups and e-mail

announcements.



Results



While Stolar’s departure and the defective disks received some play,

most media focused on the system itself. In the 96 hours following the

launch, 904 TV news segments were run, generating 286 million audience

impressions. Included were pieces on ABC World News Tonight, Good

Morning America, CBS Today and CNN.



Time, Business Week and U.S. News & World Report each devoted features

to Dreamcast, while Newsweek did two full-page stories. Coverage in

major newspapers included The New York Times, The Wall Street Journal

and Los Angeles Times. USA Today has run 10 Dreamcast-related stories

since early September. ’Our key messages were played back in 90% of all

media coverage,’ Karraker adds proudly.



Future



Sega and Access are going back to major outlets to tout Dreamcast as the

’must have’ holiday gift. Long-lead magazines were courted back in June

and July, and the team is currently pitching shorter lead media with the

Christmas-buying message.



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