1.0 Terms of referenceThe report will present an implementation of the marketing concept into business strategy of Electronic Arts. The report will evaluate the benefits and cost of the marketing approach in Electronic Arts.
All information has to be submitted to Mrs. Susan Campbell, the HNC course co-ordinator on 25th October 2007.2.
0 ProcedureIn order to analyse how the marketing concept elements are incorporated into Electronic Arts (EA) overall business plan the following steps has to be taken:2.1 Electronic Arts main web site has to accessed in order to obtain company business information.2.2 Internet and book resources have to be scrutinized to collect all relevant data about the MarketingConcept implementation.
2.3 All aspects of marketing concept has to be assessed against EA policies and analysed company production, sales and promotion activities.3.
0 Findings3.1 Satisfying Needs As the Key Business ElementElectronic Arts started creating electronic entrainment software in 1982 and from that day the company grew rapidly becoming the one of world leaders in the industry. The number of employees increased from two people to 7,900 worldwide in the beginning of 2007. Marketing concept is based on analysing and satisfying customer’s needs and the management team in EA knows well that the business would not survived if those needs where not meet. Commitment to the customer is expressed in the company Code of Conduct as one of the “Action Values” which are the principles on which the entire business idea is based (see App. 1).3.1.
1 Products for AllElectronic Arts driven by marketing principle of meeting customer needs has created games which relate to nearly all aspects of human life. Sport, strategy, action games and even simulators of everyday life (Sims) are all in the company games portfolio. EA is not leaving any users without the access to their products and the company titles are available on all gaming platforms like Xbox, Playstation, Nintendo and PC.
3.1.2 Software DevelopersMany of existing staff in the company used to play the EA games when they started creating their own pieces of work, so back in the days they where the customers – gamers who used to buy the company products. Nowadays as they are shaping new titles themselves and they know how important is to adapt to what the new generating of game fans is looking for.3.
1.3 Games TestersThe company has a big number of professional – salary paid and amateur, game testers. These are the people who are giving non-biased opinion and guidelines on how the future products will be developed. The amateur testers are the selected from the gamers who take part in game tournaments all around the world, members of computer games conventions, players with best score and performance in over-internet competitions as well randomly selected game buyers.3.
2 Research – Assessing Change in Customer NeedsThe world of electronic entertainment is evolving very fast and to keep with the competitors EA marketing team needs to have access to customer feedback and “fresh” data on daily bases.The company uses primary and secondary research as well as the quantitative and qualitative research. Researches are used to identify market opportunities, improve marketing efficiency, quality of the software and service provided by the company.
Electronic Arts uses surveys and questioners to gather data and feedback from the customers. Advice from testers is also very useful tool in developing products. All of the gathered information’s are used to prepare prognosis and sales simulations for completely new games and new editions of existing titles. Marketing team analyse competitors moves by attending all industry expositions and conventions.
3.3 Integrated Marketing3.3.
1 Product.As emphasised by Jobber and Fahy (2002)”The core element of the marketing mix is the company’s product or service because this provides the functional requirements sought by the customers”Electronic Arts products are offered to worldwide customers. All of the age groups are targeted and most of the titles are available in the country of sale with appropriate language version. All sorts of game types are manufactured by the company: sport games (branded EA Sports) this include famous FIFA and race game Need for Speed, strategy games like Command & Conquer series, action games like newly issued Crisis and all types of fun-family games i.e. Simms – a simulator of everyday life. Product range was recently extended by purchasing leading mobile phones game manufacturer JAMDAT Inc and currently EA group is the largest manufacturer of games for mobile phones.
Software is extensively tested to ensure great playability and quality.3.3.2 PlaceGames are sold by many different channels of distribution from big supermarket chains like “Tesco” or “Wal-Mart” to specialised software retailers including “Game” or “PC World” and directly through Internet shop on main company web site. For the future EA is planning to increase sales on-line by creating internet megastore which will be available in different language versions.3.3.
3 PriceTo ensure that the products are competitive on the market EA have to offered games at the price comparable to the market rivals. In this segment of the market most of the competitors are using similar pricing technique – price of the game depends on the platform it is issued for. Newly released games for new consoles like Playsation 3 and Xbox 360 would be most expensive. It could be called a gentle skimming technique. Gamers who are prepared to pay big money for the new console would also pay higher sums for new innovative game.
Games and game consoles are complementary products so as long as the price of consoles is high, price of the games will usually stay up as well.3.3.4 PromotionBecause of the huge competition in the industry there is a big emphasis on promotional efforts. Nowadays even best developed software without massive advertising may fade in the crowed of similar titles. Electronic Arts are prepared to spend big on promotion of their products. Sport games issued by the company are marketed with using the biggest names in the sport world. Company is hiring football stars like Ronaldinho or Wayne Rooney to promote their football series FIFA along world champion Tiger Woods who is promoting interactive golf game.
3.3.5 Customer OrientationThe idea of marketing approach is spread through out the entire company. Electronic Arts puts an emphasis on all staff to maintain highest standards of work and in order to deliver best possible product for the final customer. Pro-active approach is in place and starting from software developer through sales people up to board of directors all are treating they co-workers as they own customers. This approach gave effect of $3.
09 billon revenue for financial year 2007 and over 24 titles which sold in more than one million copies.3.4 Customer SatisfactionFeedback from customers and the way they are reacting to new releases is very important for proper implementation of the marketing approach. Marketing team in Electronic Arts is very closely analysing any suggestions coming from the customers. They know that it is much easier to keep the existing customer satisfied than gain a new ones. They are aware as well that the customer who will be lost may never return and turn for the competitors’ product.3.5 Marketing Concept as Part of Company ObjectivesFrom “day one” the customer orientated approach is an integral part of the Electronic Arts.
Without looking at customer needs and successfully satisfying them it would be impossible for the business to achieve such high position in one of the most competitive markets of the world. For the company which bases their business “to be” in the hands of gamers it is the most important to deliver products tailored to their expectations. Marketing concept in Electronic Arts evolved with the company becoming an example for the competitors. The company have a massive gain from applying the marketing values into their business strategy and it could not exist without it.3.
6 Society ImpactGames produced by the company are played by all age groups. Youngest gamers are aged five and that’s why the company has to be very carefully in the way the products for those young children are presented. In the recent years EA was in the group of companies’ accused that why they are transferring all of the customers’ wishes into world of games, they went a step to far in making them “to real” by applying excessive violence into their products.Although the company assignees strict age limits to selected titles, many pressure groups in likes of government agency Entertainment Software Rating Board – US, and many children welfare organisations are blaming the EA and other games manufacturers for aggressive behaviour of teenagers.
The issue is currently being widely discussed and USA some parents are taking court cases against the EA. The company is limiting the violent content in their games but frequently it collides with what the older gamers wants, especially in the war and action games.