Competitive Positioning in the Video Game Industry

631 Words Feb 28th, 2012 3 Pages
By eliciting the example of Activision Blizzard, Inc., I’d like to point out the importance of administering a strong positioning strategy for firms: capacity to decide the course of marketing and sales, push for growth, and solidify their position in the market. Competitive positioning involves determining what features or benefits are most essential to the market, thereby constructing value for the market. Located on its investor’s page, the firm proclaims that it is “a worldwide online, PC, console, handheld and mobile game publisher with leading positions across every major category of the rapidly growing interactive entertainment software industry.”1
The video game industry of today looks vastly different than it did 10 years ago
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Another tactic in Activision’s arsenal is its proficiency in leveraging the particular expertise of both its internal and external development resources, thus augmenting the quality of its products and product timing. The reason it’s able to achieve such claims is its strategy of developing its products using a combination of both internal development resources and external development resources. Activision selects external developers based on track records and know-how in producing games in the same category. Moreover, the firm also signs exclusive rights in publishing for specific brand games such as Halo, thus driving exclusivity, another factor in differentiation as a source of strategic advantage. Using leverage, Activision impacts the broad consumer base by incentivizing them with higher-quality games, and accordingly causes them to be more willing to pay for the extra quality.
But leveraging expertise in development resources is not the only thing that Activision can leverage; it can also leverage costs over a larger installed hardware base, and increase unit sales. To explain, Activision has produced many online-enabled products and content, thereby positioning itself in a good place to take advantage of retail and digital distribution channels; this in turn allows it to deliver content to a broad “diversity of gamers ranging from children to adults and from core gamers and mass-market consumers to ‘value’ buyers [in all different geographies].”3 The ease…