CAMPAIGNS: Product Launch - Sales figures knock Xbox expectation

With three times the power than any other games console, plus built-in hard drive and online gaming capabilities, the launch of Microsoft's Xbox was a much-hyped affair. However, all the coverage in the world means nothing if one month after launch a company slashes its price by £100, as Microsoft soon discovered.

Objectives

To promote Xbox as the world's most advanced video-games console. To build and widen purchase preference, and boost sales for a UK/European launch in March 2002. To overcome cultural barriers presented by an international campaign.

Strategy and Plan

The games console market has for years been dominated by Sony and Nintendo, and so Xbox needed the support from games magazines and websites for a successful launch.

Red covered mass media, from national papers, regional press and broadcast to men's magazines and style titles. MS&L London, meanwhile, developed a pan-European strategy and managed comms across the 16 launch countries, working with Microsoft's subsidiaries and local PR agencies.

PR activity was split into four phases.

Stage one saw the Xbox unveiled to European media. In May 2001, a group of European journalists were allowed to play Xbox for the first time at an event in the US.

The second stage, a showcase event - X01 - in Cannes aimed to establish Xbox as an object of desire to a wider consumer audience.

As part of the UK brand-building work, Red commissioned exclusive Xbox green sunglasses, limited edition Evisu denim jackets - and a potent green cocktail called 'The Boxer', which was handed out at all press events and remains on sale in the Match chain of bars around London.

In stage three, launched over the Christmas period, Xbox was to be positioned as the console worth waiting for in an attempt to slow the momentum of Sony's rival games console, the PS2. However, at this point parts of the press began to speculate that Microsoft had made a strategic error in ignoring the prime Christmas market, a claim hotly disputed by the US software giant.

The first opportunity for the UK public to play Xbox came at The Xbox Xperience - a month-long event in London with week-long stints in Birmingham, Manchester and Glasgow. Red worked to make this the focus for media promotions and coverage, while MS&L organised press tours where Xbox games developers met European press.

Stage four, in March 2002, was the launch itself. Among a number of events retail partner Virgin Megastores hosted midnight openings at its shops in London, Birmingham, Manchester, Glasgow and Dublin. These were supported by Red's local and national media relations teams.

The first UK buyer, Scott Rawlins, was personally presented with his Xbox by Microsoft director for Xbox (UK and Ireland) Chris Lewis and Virgin chief Sir Richard Branson.

Measurement and Evaluation

Considering that one of the campaign's objectives was to boost sales, it is surprising that sales figures were not part of the measurement and evaluation process.

If you were to base the launch on press coverage and 'awarness' alone, then it could be said to have been a success. In the UK, more than 80 journalists attended the unveiling press conference. X01 in Cannes attracted 500 journalists from the UK and Europe. UK coverage highlights included The Big Breakfast, Radio 1 Newsbeat, The Sun, The Mirror, The Times, The Daily Telegraph and the Evening Standard.

Equal store was also put on the 478 million opportunities to see and hear, that the campaign claims to have generated. It must be said, though, that these 478 million opportunities did not equate into similar sales, with press reports in The Times reporting sales of just 10,000 in the third week after launch.

Results

Five months prior to the launch, ICM research showed 'prompted awareness' of Xbox at 14 per cent. By June it had doubled to 28 per cent.

At the pre-Christmas stage 49 per cent of the target audience were aware of Xbox - unprompted. By January 2002, 63 per cent audience awareness was achieved.

But then came the bombshell. By early April the press was reporting that alleged poor sales could lead to a price reduction. Just over a week later this was confirmed, with Xbox dropping from £299 to £199.

Despite the Daily Mail talking of a 'humiliation for Microsoft', those close to the launch insist that it was a success. The price, they say, was always going to be cut, and although such campaigns are not evaluated by factoring in sales figures, they may be in the future.

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