Magazine article Marketing

Will New Arrivals Mean 'Game Over' for Sega?

Magazine article Marketing

Will New Arrivals Mean 'Game Over' for Sega?

Article excerpt

With PlayStation2 and next year's planned launches of the X-box from Microsoft and Nintendo's Gamecube, Sega's marketing must refocus.

It's a long time since Sega's glory days of the early-90s, when a blue hedgehog called Sonic was driving sales of its MegaDrive console and the only competition was an Italian plumber called Mario.

Since then, the video games market has changed beyond recognition. Sony introduced its PlayStation and has sold 70 million to date, relegating Sega to a distant rival -- although it has made up some ground with its Dreamcast. Sega's earlier Saturn console was badly received and criticism was heaped on its poor games support and reliance on old technology. Dreamcast was meant to make up for it.

Despite delays, Sega's new box rolled out in Europe last October amid much fanfare, a [pound]60m marketing push through WCRS and a raft of football shirt sponsorships.

It has since switched its ad business from WCRS to Bartle Bogle Hegarty and parted company with European marketing director Giles Thomas. But Sega has shifted about 300,000 consoles in the UK and claims it will meet its first-year European sales forecasts of one million consoles.

Last week, it named former Coke man Jeremy Stern as Thomas' replacement, and said it plans to focus on direct marketing. It has cut the price of its console to [pound]149 and is readying a raft of new games.

But it may not be enough. Sony is expected to roll out its PlayStation2 in Europe in November and despite press criticism of the [pound]299 price tag, industry analysts predict a big success. Nintendo last month announced plans to launch its Gamecube in October 2001 and Microsoft has pledged a whopping $500m ([pound]330m) backing for its X-Box, also due to launch in autumn 2001.

We asked two industry experts how Sega is faring. Andy Mee, a former European marketing director at Sega, is marketing director of games retailer Gameplay. Geoff Glendenning, a former head of marketing at PlayStation UK, is managing director of youth marketing specialist Third Planet.

DIAGNOSIS

Despite countless statements to the contrary, Sega has shown its inability throughout the Dreamcast's lifecycle to put into practice the lessons learned from the demise of the Saturn console.

Sega remains excellent at developing barnstorming games titles, but in the hardware market, it is still somewhat lacking. Faced with fast-approaching, high-calibre competition, it is now cutting the Dreamcast's price. …

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