NEWS - Tuesday, October 11, 2005

Microsoft Seeks Female Demographic

Note to hard-core video game players: Microsoft says it is aiming for your mothers and wives. In the coming weeks, Microsoft plans to introduce a marketing campaign to expand the appeal of the new Xbox 360 game console beyond the young men who are the Xbox’s biggest fans. Microsoft hopes to win a bigger share of the market from the PlayStation 2, the top-selling console made by Sony, by promoting a more family-friendly image for the new Xbox, which will be in U.S. stores starting Nov. 22. The Xbox 360 will go on sale Dec. 2 in Europe and Dec. 10 in Japan, Microsoft has said. In 2001, when Microsoft introduced the first Xbox, it focused heavily on hard-core gamers, typically males age 17 to 24 , who wanted a high-end machine with more sophisticated graphics and more complex game functions. The PlayStation and the Nintendo GameCube, meanwhile, put more emphasis on reaching the mainstream market, analysts said. This time, Microsoft is planning a wider attack. Brochures going out to major retailers like Best Buy prominently describe the 360’s ability to double as a DVD player, play music from an MP3 player through a television’s speakers and even display digital photos on a TV. Its game functions, while impressive, are now only part of the message. The point, said Bill Nielsen, who oversees marketing for the Xbox 360, is to help a game player convince the women in the family that "this is for you, too," The brochure even says, "Here are some things you might want to tell your wife this thing does." Over Labor Day weekend, Microsoft and Pepsi began a radio promotion to give away 9,000 Xbox 360s by Nov. 22. Nielsen said those ads were meant not just to reach hard-core gamers, but their mothers. The Pepsi promotion "also hits moms," Nielsen said, because "moms make a lot of the final decisions" on whether the family buys a new game console. Microsoft will also try to showcase more family-oriented games that can be played on the 360. The Xbox has long depended on the popularity of games like Halo, a shooting game, for console sales. But with the new machine, it will promote games like Kameo, an action-adventure game for younger teenagers, including girls. Industry analysts, however, are skeptical that the repositioning will work. They say it will be difficult to alter the Xbox’s high-end image. And they point out that non-game features have not sold consoles in the past. The Xbox, like the PlayStation 2, can work as a DVD player, but most users do not use game consoles as substitutes for a stand-alone DVD player, analysts said. "It’s a tough sell" to market the 360 to a mainstream audience, said Jeff Gerstmann, senior editor at GameSpot, an online gaming review site. "It’s icing on the cake - being able to view photos on an Xbox," Gerstmann said. "But first and foremost this thing will always be viewed as a game machine." The biggest challenge in expanding the Xbox’s reach, analysts say, is making available more games for mainstream players. Evan Wilson, a video game industry analyst with Pacific Crest Securities, said that even to redefine the Xbox as a multimedia console Microsoft would have to first produce more general-interest games. That will not happen in the next few months. Nielsen said most of the titles available for the holiday season would be sports and shooting games that appeal to the young male market. And the bulk of the initial advertising will be aimed at hard-core gamers willing to pay $299 for a base model or $399 for a model with add-ons like a wireless controller. Still, Nielsen said he was confident that family-friendly marketing could help redefine the Xbox’s image as more games of broader appeal become available. The first week of November, Microsoft will begin a TV campaign with commercials on programs with a larger male audience, including many on the Fox network. The campaign will also include print ads in video game trade publications, Internet spots and heavy advertising at movie theaters. Last week, the company announced a partnership with Adidas to put Xbox game kiosks in Adidas stores. Nielsen declined to say how much the company planned to spend over all on its campaign. The early indications are that demand for the Xbox will be strong. Online preorders have been so high that some retailers now take preorders only for bundled packages, which include several games. The Web site of GameStop, for example, offers an Xbox bundle for $699, which includes five games and an extra controller. The stakes are high for Microsoft. Sony and Nintendo plan to introduce new consoles next year. In the game wars, the PlayStation 2 has sold 30 million units; the GameCube has sold around 10 million; and the Xbox has sold 13 million in North America, according to the NPD Group, a market research company. Wilson of Pacific Crest said he expected Microsoft to make two million to three million Xbox 360s available, but demand could well be greater. A shortage might even benefit Microsoft, he said, by attracting attention well into 2006. "They want to keep interest high all the way through the launch of PlayStation 3," Wilson said.

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