Introduction to Marketing
“Blizzard”
Kyle Thompson
Assignment #2 - Research of an Entertainment Company
Ms. Sherry
December 4, 2011
Company
For this research paper the topic of discussion is the video game publisher Blizzard Games. Blizzard started out in the early 1990’s as the brainchild of three UCLA grad students. At first the company worked on the coding of games and small projects that were ported over to the different video game systems at the time. After the modest success of Rock & Roll Racing and The Lost Vikings for the Super Nintendo Entertainment System, Blizzard struck gold with their first commercial success of Warcraft: Orcs vs. Humans. Perhaps what is most important about this landmark game for Blizzard was that it did not just attract hardcore gamers, but it generated them.
Thanks to addition of multiplayer over modem and LAN allowed millions of friends to experience online competition. Following the success of Warcraft, Blizzard released Diablo and StarCraft in the upcoming years. Both were in the mold of Warcraft with them being another massive multiplayer online role-playing game (MMORPG). Blizzard has released sequels to their big three of video games and has reached sales over a million on each title they come out with.
Throughout the years Blizzard has merged and been bought out by several companies but have always maintained their name and appeal. In December of 2007 an announcement was made that Activision and Vivendi Games were merging and in effect made Activision the parent company to Blizzard. Having Activision as the parent company combines to make the Activision Blizzard team one of the largest video game companies and have appeal over several different video game platforms. Activision has an index membership into the Nasdaq 100 and has over 7,600 full time employees (Yahoo! Finance 2011).
Business
The main products and services that this company offers are video game related. The main seller is the consoles such as the Xbox 360, PS3, & Nintendo Wii but are also featured on just about every platform from phones, PDA’s, to Internet sites. The brand licensing goes beyond just the game itself though merchandising is made in just about every aspect. Physical “boxed” products in retail stores, DVD sales from the game’s soundtracks, monthly subscriptions to online gameplay, and upgraded features and bonuses to their games. Another new concept that is providing more and more income is the selling of add-on packs or level expansion packs. These packs allow the gamer to experience the same game over and over again with new content and added features extending the original gameplay days, months, and even in some cases years further. As Clayman states in his article “through prescience, a little luck, and an excellent understanding of what makes a games fun the developers at Blizzard have established a pedigree for excellence and a design sense that stays just in front of the curve” (Clayman 2010).
Target Market
Blizzard’s target customer base ranges from the casual players to game enthusiasts, children to adults, and mass-market customers to value buyers. The typical age range is between 14 and 54, with a huge percentage in the 24-35 age range. Blizzard tries to make every game open to the entry level skilled players letting them join and progressively make the game harder depending on the players newfound playing abilities. Blizzard has three main services that it provides the audience with music, games, and online social connectivity.
The first one of music is available for purchase from their company website. The music is the original soundtracks to their games and has in some cases a full orchestra performing the music. The games that Blizzard provides are World of Warcraft Cataclysm, Wrath of the Lich King, Burning Crusade, Reign of Chaos, Warcraft II, StarCraft I & II, and Diablo I & II. Development of Warcraft III and Diablo III is expected in the next calendar year. The online aspect to Blizzard is really unrivaled and is the huge money maker. As Nicholas Werner states “every game they release clears one million units with ease, and quickly become known as a classic of its medium” (Werner 2011). Millions of people can purchase digital copies of games online and instantly connect to other friends nearby or around the world. Being able to just drop into any game or be recruited to play with people of the same player level gives Blizzard players the social angle to have support, assistance, and help to questions in their gameplay right away though this online system.
Competition
With so many companies out there today the market for making a good and unique products is hard to come by. As one of the industries leaders, Blizzard has several competitors that are trying to knock them off their top sales spot. The three main competitors are Electronic Arts (EA), THQ, and Ubisoft. In Mathew Kumar’s article he says “EA and Blizzard will only make games they expect to sell over 2 million units every year, while the others will still try clever Wii and DS games that make plenty of money at 500,000 units” (Kumar 2010). EA is probably Blizzards closest rival as it has the games that can come the closet to comparison. THQ and Ubisoft are in the second tier of competitors that are gaining ground overall but still lack that big name brand product and sales to truly compete with Blizzard and EA.
EA games as several different games that try to appeal to every market. One of the biggest selling titles that directly competes with Blizzard’s World of Warcraft is EA’s Command & Conquer franchise. This game has a huge online multiplayer set up and uses that aspect to gain more players. Command & Conquer uses a similar real-time strategy of playing as well as a first-person shooting aspect. The C&C series has been around since 1995 and has eleven games and eight expansion packs. The overall subscribers to the C&C series are a close second to Blizzard’s World of Warcraft. This is probably the closest game to Warcraft as it is played in the same genre and style of graphics.
THQ is known for their WWE and UFC fighting games as well as well as the Warhammer game series. Warhammer is a science fiction real-time strategy game that is made for the PC with online gameplay the setting to the game. This title has been followed up with three expansion packs with an actual sequel being in development. This game has a cult following and has yet to appeal to the mass market as Blizzard has done with it’s games.
Ubisoft is a French video game publisher that has Assassin’s Creed, Prince of Persia, Tom Clancy’s H.A.W.X, and Shaun White Skateboarding to its credit. Ubisoft’s EverQuest franchise is a direct clone to the World of Warcraft series. This game series is a MMORPG game and uses varies expansion packs and ads to lure away fans from Warcraft to try something new. Up to the moment EverQuest’s efforts have not made a dent in World of Warcraft sales but have provided Ubisoft with a solid contender.
Altogether EA, THQ, and Ubisoft are successful businesses overall, when comparing the online gaming market and the accompanied users those three companies are well behind Blizzard’s sales in the MMORPG niche market.
Summary
In summary the company’s structure and current position in the video game market has never been stronger. Blizzard has plans to maintain and build upon their leadership position in the MMORPG genre by regularly providing new content, game features, and online services to further solidify the loyalty of their subscribers. Expanding their consumer base in all regions and continuing development on broadband connectivity facilitates online games and community experiences while creating access to new potential customers. Blizzard’s online gaming site Battle.net has several million active users and is growing to unprecedented levels. The future looks very bright for this one time company ran by three individuals that now has over four thousand and six hundred employees worldwide.
References:
Clayman, David. “The History of Blizzard, We track the ascent of one of today’s biggest and most important developers.” Online posting. 21 Oct. 2010. PC feature at IGN. 3 Dec. 2011 http://pc.ign.com/articles/111/1111475p1.html
