Integrated Marketing
Communications Plan
Virgin Games ( ViGi console)
2013
Assingment 1: Edyta Kosnik
Integrated Marketing...
2
Table of contents:
1.0 Introduction........................................................................................
3
1.0 Introduction
This report outlines the integrated marketing communications plan for the product launch of a newly
dev...
4
2.0 Situational Analysis
2.1 Virgin and the Virgin Games Brand Analysis
Company description
Founded in 1970 Virgin inves...
5
Vision Statement
Virgin vision can be defined by words of Richard Branson (1997). “We are planning a global presence in ...
6
Promotion of travelling and energetic way of life creates good opportunities for development of Virgin travel,
healthcar...
7
Virgin Gaming also provides a unique player rating system which allows to be paired with gamers with a similar
skill lev...
8
sluggish economy recovery, following the last recession. Apart from televisions that noticed an increase, every
other se...
9
PEST analysis of the market
To enable good understanding of the market, PEST analysis was carried out. The main factors ...
10
Weaknesses
Huge competition among well established brands like Nintendo, Sony and Microsoft;
Entering well penetrated a...
11
3.1 Competitors
Competition in the game console sector is fierce. Products are in the technology race with each other,
...
12
Microsoft’s game consoles are represented by Xbox 360, Xbox Live and Xbox Kinect. Microsoft’s Xbox LIVE
service enables...
13
Source: VG Chartz 2013
External competitors
Moreover, indirect competition threatening game console market mainly comin...
14
and became the world’s largest manufacturer of smart phones. It registered turnover of £2, 78 billion in 2010
down by 1...
15
UK video games industry was worth £4.65bn — a 2.8% rise on the previous year. The market has seen
consistent growth ove...
16
Using cloud storage technology there is No need for separate bulky hardware storage units.
Stores music, videos and pho...
17
-Wi-Fi Network Adaptor (fixed broadband access)
Characteristics:
-Aesthetic Design (High gloss black and red, Virgin co...
18
1. To achieve at least £15m in sales value in the first 12 months after the launch of the product
Total value of game c...
19
Marketing flow chart
Marketing
tool
Feb’13 March’13 Apr’13 May’13 Jun’13 Aug’13 Sept’13 Oct’13
TV adv
Radio adv
On-line...
20
Guardian’, ‘The Sunday Times’ etc. The press releases will be sent to the editors, reviews editors, features
editors as...
21
search, comparison and evaluation of different available products in the market, ideally including first-hand
trial of ...
22
measurement and evaluation.
For the Virgin ViGi it is important that evaluation is conducted throughout the whole marke...
23
References:
Smith, P., and Taylor, J. (2004). Marketing Communications: an Integrated Approach, 4th edition.
London: Ko...
24
25
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My idea of the integrated marketing communication plan for the newly developed product ( imaginary product). Consists of the market and industry analysis, customer profile, my idea of mixed marketing communication tools from above the line and below the line marketing, following the budgeting and proposed methods for control and evaluation of the campaign.

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Integrated marcomms plan

  1. 1. Integrated Marketing Communications Plan Virgin Games ( ViGi console) 2013 Assingment 1: Edyta Kosnik Integrated Marketing Communications PlanMC5005X 2013-03-23
  2. 2. 2 Table of contents: 1.0 Introduction........................................................................................................................................ 2.0 Situational analysis.......................................................................................................................... 2.1Virgin and the Virgin Games brand analysis ............................................................................... 3.0 Home entertainment market / Gaming market overview .............................................................. 3.1 Competitors .................................................................................................................................... 3.2 Consumer trends and patterns................................................................................................... 4.0 Virgin ViGi Console............................................................................................................................. 4.1 Target Audience ............................................................................................................................. 5.0 Campaign Objectives......................................................................................................................... 5.1 Marketing objectives...................................................................................................................... 5.2 Communications objectives......................................................................................................... 6.0 Budgeting and timing........................................................................................................................ 6.1 Buying context and level of involvement........................................................................................ 6.2 Budget breakdown........................................................................................................................ 7.0 Campaign control, measurement and evaluation .............................................................................. 8.0 References
  3. 3. 3 1.0 Introduction This report outlines the integrated marketing communications plan for the product launch of a newly developed product ViGi Console in the UK market. The campaign will be launched by Virgin games, part of the worlds most recognisable and respected investment group Virgin. Aim of the marketing campaign is to stimulate awareness of its new product, which is being launched in the UK for the first time in May 2013 and to successfully establish the product on the market. The report provides an analysis of the brand, current market situation in the UK, followed by the product definition with outlining of the USP, definition of the target audience and its purchasing behaviours approach- this is to determine advertising objectives. This will be followed by thorough budget planning and finally strategic approach to effectively penetrate the UK market. The advertising message to be conveyed and its design are explained, followed by the choice of above-the line and below-the line communications tools and tactics to effectively reach the target publics. Report includes effective evaluation methods to measure the campaign performance. The information presented is based on research from published secondary sources as well as on the creative input of the author.
  4. 4. 4 2.0 Situational Analysis 2.1 Virgin and the Virgin Games Brand Analysis Company description Founded in 1970 Virgin investment group consists of about 400 operations, a tangled web of enterprises owned via a complicated series of offshore trusts and overseas holding companies. Virgin Group Ltd. engages in the fields of leisure, travel, tourism, mobile, broadband, TV, radio, music, finance, and health in Asia, Europe, North America, Africa, and Australia. It engages in the fields of airlines, rail services, vacation and cruise packages, and passenger motorbike transportation services. The company also operates gym facilities, racing teams, online casino and slots, and balloon flights; publishes non-fiction books; provides cord blood stem cell banking, home IT and technical support, health and lifestyle management, employee health program, and NHS services; and offers corporate gift vouchers, and online gaming and video games, as well as wines online. In addition, it offers phone/mobile telecommunication, broadband Internet, and TV services; and film and television development, packaging, and production services. Further, the company operates music and entertainment stores, radio stations, and music festivals. It also offers financial products and services, such as credit cards, pension products, insurance products, savings, superannuation, and home loans, as well as online fundraising solutions; and equity for growth capital, management buyouts, recapitalizations, and corporate spin-outs for renewable energy and resource efficiency sectors. Virgin Group Ltd. has a strategic partnership with Tribe Mobile. According to a spokesman for Branson, "branded revenue from companies that bear the Virgin name", reached £13bn last year. Branson himself is estimated to be worth more than £3bn. Mission Statement The company’s vision is to be the shopper victor, by delivering brand values, which are: value for currency, superior quality, dazzling customer service, pioneering, competitively testing and fun.; to provide a quality service by motivating employees and to assist and examine consumer feedback for nonstop enhancement of the customer's experience through improvement; to create products and services that make the customer’s life more enjoyable (Virgin Group, 2012).
  5. 5. 5 Vision Statement Virgin vision can be defined by words of Richard Branson (1997). “We are planning a global presence in travel, mobile communications, entertainment retailing and music. We are in exciting markets which are set to benefit considerably from technological developments in distribution and fulfilment. I believe that Virgin has the opportunity to be in the top 20 of global brands.” Ethical, Cultural, Environmental and Social Vision Today’s amplified consciousness of environmental and ethical issues and the pressure on business to play a position in society led Virgin to creating Project Aware designed to widen reliable business operations. Virgin contributes to these issues by participating in initiatives and creating social and environmental awareness among all its stakeholders – customers, suppliers and employees, encouraging them to participate in concern and responsibility. Virgin believes that employees are the foundation of the business and attending to their needs and encouraging them to take ownership of the difficulties they encounter to help lead to the company’s success. Virgin’s compassion for employees include: a spotless, vigorous and secure work environment, understandable and reasonable terms of service, and equivalent opportunities for all current and prospective employees, and motivating employees to widen skills and evolve in their professional positions. At the same time Virgin encourages employees to share the company’s responsibility towards society. Virgin value its stakeholders as an essential part of Virgin production and brand and claims them to replicate the same values as the company does. In 2006 the Group defined a Code of Conduct, covering human rights, environmental concern and business ethics issues. To plaster these issues Virgin Group launched 3 non-profit projects: Virgin Earth, Virgin Green Fund and Virgin Unite. Virgin Earth rewards a million dollar prize for inventing a method or design of anthropogenic and atmospheric greenhouse gases removal which will result in Earth’s climate stability. Virgin Green Fund focuses on investing in companies from renewable energy and resource efficiency sectors “whose products and services reduce net greenhouse gas emissions and/or improve management of scarce resources, operate in environmentally and economically sustainable markets, and have a long-term positive impact on their communities and society more broadly (Virgin Group, 2012). Virgin Unite unites entrepreneurs, funds and individuals and distributes their resources towards helping resolve social and environmental issues. Virgin Unite launched several successful medical partner projects in South Africa to deal with HIV and AIDS. PEST Analysis Political Factors Virgin Group operates in a sound political situation, but the company has to carefully choose the countries it conducts business with because it can have a great negative impact on the business. In being that the business operates in many different sectors and at a global scale, different legislation and government policies affect them throughout. General growing concern on international terrorism impacts some of the company’s centre action areas, particularly the travel and airline sectors. Economical Factors Overall secure economic situations in UK allow Virgin to develop long-term strategic planning. The majority of the company’s accounts are located in offshore zone that allows Virgin to avoid many UK’s taxation fees. Operating in different countries decreases the company’s profitability due to currency fluctuation, but nevertheless allows it to gain greater market share by international expansion. Social Factors
  6. 6. 6 Promotion of travelling and energetic way of life creates good opportunities for development of Virgin travel, healthcare and associated businesses. The Virgin brand is highly renowned among clientele. Due to Richard Branson’s well-thought-out promotion, the company receives wide coverage in press and media what provides constant public interest towards it. The differing cultures make a need to specialize in each location. Technological Factors The ecommerce development provides opportunities for a multitude of distribution channels. Strong competition in media and telecommunication area forces Virgin to create innovative services and products. Increased regulations regarding product safety and environmental concerns impact the technological developments. Strategy Development At the present time Virgin Group uses the following types of strategies: A) Strategic Partnership: Virgin is able to diversify and enter new markets by establishing good partnerships. When the company’s experience or recourses are not enough to enter a market or create a competitive advantage it establishes joint ventures or outsources the services in order to fill the experience gap. This approach allows Virgin to expand, both in product range and in geography (Virgin, 2012). Although businesses within the group are independent all of them inherit Virgin brand name, Virgin culture and management style, benefit from access to the Group’s resources. B) Unrelated Diversification Strategy: Virgin started entering new business sectors outside its core activities area, retail and travel services. Presently, Virgin Group is presented in a huge amount of independent enterprises within completely different business segments, such as beverages, travel, cosmetics, telecommunications, etc (Virgin, 2012). C) Risk mitigation strategy: Branson’s divided the group into small legally independent businesses. The group’s management employs risk mitigation strategy and helps to avoid many difficulties of legal and financial nature faced by other groups of traditional corporate structure (Virgin, 2012). Virgin brand and reputation has become a synonym to Richard Branson, its founder. Realizing public image and views of the organization and Branson became the most important company’s advertising and promotion force. The unique feature of all Virgin advertisements and promotions is a challenge to competitors and fun which evoke laugh and positive emotions among end consumers. Branson and ‘Virgin people’, his employees, make up the organization; they form the resource of a ‘certain type’ people united by Virgin culture. The success of Virgin Group is based on the corporate parenting strategy, i.e., every new business unit inherits company’s brand name, values, management style, support and access to resources not expending resources to create them. Sustainability of its competitive advantage depends on how well it will manage to support Virgin culture and decentralization under a unified brand. It has been determined that in order to create sustainable competitive advantage, the company should integrate its core competences into corporate culture and internal processes. Virgin Gaming Virgin gaming, one of Virgin Group businesses, is an On-line platform that provides games and competitions for gamers on Play-station 3, and xbox360 to put their skills to the test all from the comfort of their own living room. All that’s needed is the console, a Virgin Gaming account, a Play-station System Network account or an Xbox Live account. Player also need access to the Virgin Gaming site to issue and accept challenges
  7. 7. 7 Virgin Gaming also provides a unique player rating system which allows to be paired with gamers with a similar skill level. To keep things fair, everyone starts at skill level zero. The player rating system provides a detailed list of one’s wins and losses, which allows getting an idea of what a player is all about just by checking out their player profile. The player reputation system allows players to be rated according to their sportsmanship. There are currently 12 and 13 games to compete in on the Play station 3 and Xbox 360. The majority of the titles are in the sports genre; however there are a handful of multi-player titles to choose from. With more titles to come, this is the best place for competitive gaming. Virgin Gaming is under a fortune 500 organization, it is also the only organization that cooperates with EA Sports regarding real cash play. Virgin marketing strategy in media business. Virgin consumer marketing strategy focuses primarily on bundled offerings of digital products and services across its “quad-play” portfolio to existing and prospective customers. Company is focusing on those customers and prospective customers who reside in premises at which cable services are already available, most of whom are not yet mobile telephone customers. Virgin bundling strategy provides its customers with discounts and additional value added services when they buy the services. Company also provide the convenience of a single bill for “triple-play” (TV, broadband and fixed line telephony) packages and additional value to these customers when they take our mobile services. Virgin believes that customers who subscribe to multiple services are less likely to churn. It also actively pursues opportunities to cross-sell complementary services across our product range and up-sell higher value services to our existing customers. Virgin offers its consumer products and services through a broad range of retail channels, including via inbound and outbound telesales, customer care centres and online. It also engage in direct face-to-face marketing initiatives through a dedicated national sales force, as well as comprehensive national and regional mass media advertising initiatives. It now has a significant national retail store base and kiosk type retail outlets which offer a complete range of our consumer products and services. Virgin stores not only provide sales services but also showcase our products, allowing demonstrations and customer interaction, and help resolve customer queries. Virgin believes that effective customer service contributes to customer satisfaction, which in turn results in reduced churn and acquisition of new customers. As of December 31, 2012, it employed approximately 2,200 staff in cable and non-cable call centres, which includes the in-sourcing of one of our U.K. call centres in April 2012 that resulted in an additional 700 staff, and approximately 500 staff for mobile telephony call centres, in the U.K. Company also use outsourced call centres in the U.K., the Philippines, India and South Africa. Competition Virgin offers most of our products on a standalone basis or as part of bundled packages designed to encourage customers to subscribe to multiple services. On offer are broadband internet, fixed line telephony and mobile telephony and data services throughout the U.K., and currently offer television services exclusively in areas served by Virgin cable network. Its primary competitors are BT, British Sky Broadcasting Group plc, or BSkyB, Talk Talk Telecom Group plc, Vodafone, EE and O2. 3.0 Home entertainment market/Video gaming market overview The Home Entertainment market can be divided into three main categories: 1. Television, DVD, Blu- ray and video players 2. Audio Equipment 3. PCs and games consoles. A recent Key Note report estimates that the total value of the market have declined by 1.2% in the last 5 years- from £7.32 billion in 2007 to £7.23 billion in 2011 (Source: Key Note). The reason behind it is believed to be
  8. 8. 8 sluggish economy recovery, following the last recession. Apart from televisions that noticed an increase, every other sector has not even reached the pre-recession level. The home entertainment market is changing very rapidly due to new products being introduced to the market, developments and innovations in technology. The way that consumers can access content and internet have changed the market completely. The popularity of downloadable media has caused the decline in sales of CDs and DVDs. Market share by sector As of 2011, the biggest market share in the total home entertainment market has televisions sector with 40.1%, followed by PCs- 23.2%, non- portable audio equipment at 14.9% of total sales. The least share in the market has gaming consoles sector with 7.9% of the total home entertainment market. The table below illustrates the market share of UK home entertainment by sector:
  9. 9. 9 PEST analysis of the market To enable good understanding of the market, PEST analysis was carried out. The main factors that influence the home entertainment market externally can be identified as follow: Political Government spending cuts in housing benefits/childcare Increase in income tax for high income earners Digital Economy Act 2010 (ISPs to pay cost of illegal downloading and file-sharing) Economical Bleak economic outlook for the UK has pushed consumers to restrict spending on consumer electronic products (sale of premium consumer electronic gadgets did not perform well in 2011) Consumers tend to adopt the path of 'value for money' as the economy is rather sluggish Inflation is likely to remain high due to external factors such as high energy prices and rising commodity prices Disposable income is expected to remain squeezed Economic growth still very low; UK economy grew only by 0.9% in Q3 of 2012 following three consecutive quarters of contraction) [Source: ONS] Overall total employment has now recovered to the pre-recession level although there are fewer people in full-time employment and more people in part-time employment [Source: ONS] Socio-cultural Slowing consumer spending Customers are more likely to cut down on out of home entertainment for new in home technology Smaller households (Mintel) Technological Internet access has increased in recent years and government investments would soon even double the speed of broadband (Keynote,2012) Digital downloads {(Minel,2012) Issues in the market} Innovation R&D- companies invest in technology improvements Unity Game Development Engine Now Compatible in Virtual-Holographic 3D Platform zSpace (Developers Can Now Build Holographic Games, 2012) available at: www.gametrailers.com/side- mission/32561/developers-can-now-build-holographic-games 3D Holograms With an XBox Kinect were introduced SWOT analysis of the market Strengths Popular sector of entertainment market Quick adaptation and embracing of a new technology Highest penetration of Wi-Fi home entertainment
  10. 10. 10 Weaknesses Huge competition among well established brands like Nintendo, Sony and Microsoft; Entering well penetrated and saturated market Older users may find it confusing and therefore will be put off Opportunities Consumers are receptive to new technology and the choice in the market (Mintel, 2012). Faster broadband connectivity (Mintel, 2012). 3D TV is getting Threats Consumers changing lifestyle and the urge to possess the trendiest gadgets. Therefore the game console lifecycle is short and needs constant modernization. (Keynote,2012) Console and games prices are quite high therefore not everybody would afford to switch the brands. Vat increase is affecting game consoles and games (MCV,2011) Game consoles market According to the research conducted by the Association for UK Interactive Entertainment, sales of boxed gaming products including game consoles have continued to fall in the recent years. After reaching its peak at £612m in 2008 it fell to £569m in 2011- latest figures show. The rise in popularity, variety and availability of gaming applications (apps) on smart phones and tablets is likely to have a huge impact on the sales of game consoles. A large variety of apps is available to download free of charge. The market of gaming consoles is very saturated and highly competitive. However, a number of consoles currently available are reaching the end of their retail lifespan. Lack of new and exciting products in recent years caused stagnation in the market. Nevertheless, figures from Ofcom’s report’ The Communications Market Report: UK’ (published in August 2011) show that some 54% of UK households own at least one type of gaming console.
  11. 11. 11 3.1 Competitors Competition in the game console sector is fierce. Products are in the technology race with each other, therefore profiling the competition is very important. Virgin Game is competing in very saturated market with many game products available. Also competition from other home entertainment sectors gives new consoles a challenge to succeed in the market. Three main direct competitors can be identified: Nintendo Co Ltd. It originates from Japan and was founded in 1889. It is worldwide innovator in the creation of interactive entertainment. Its success lies in targeting typical audiences, including families and elderly. Its customers are casual game players. The portfolio of game consoles includes Wii, Wii U, DS and 3DS. The company also creates and publishes games, including the Mario, Donkey Kong, Metroid, Zelda and Pokémon franchises (KeyNote 2012, Mintel 2012, Nintendo.com ND). Nintendo’s worldwide sales for 2011 represent £7, 2 bill and its net income was £574, 8 mill, which is down by 66, 1% from previous year. Despite that the company remains a market leader in the UK with 44% share sales of its game consoles sold in 2011 (KeyNote 2012, Mintel 2012). Microsoft Ltd. Microsoft was established in 1975 by Bill Gates as CEO. It is a huge player in the PC and software market. The company moved into a gaming market in 2001 with release of Xbox. Their customers are devoted game players who do not mind spending money on rebranded replacements, upgrades or enhancements.
  12. 12. 12 Microsoft’s game consoles are represented by Xbox 360, Xbox Live and Xbox Kinect. Microsoft’s Xbox LIVE service enables online gaming and social networking and also grants users access to a wide variety of video, gaming and entertainment content. (KeyNote 2012, Microsoft.com ND). The company’s turnover for 2011 was £639, 9 million, down by 3% from previous year. Its Xbox 360 remained the most popular game console sold in the UK in 2011 garnering 29% of all sales (KeyNote 2012, Mintel 2012). SONY UK Ltd. Sony is a global manufacturer of audio, video, communications and information technology, originally established in Japan in 1946. They are renowned for creating their own standards and products instead of adopting those of others. They released their PlayStation game console in 1994. Currently their portfolio of game consoles represents PS3, PS2, PSP and PS Vita (KeyNote 2012, Sony.co.uk ND). Sony registered turnover of £326, 5 million for 2011 down by 2, 1% from previous year. PS3 is the second most popular console after Xbox on the UK market and Sony’s PS account for 27% of all sales in 2011 (KeyNote 2012, Mintel 2012). Share of console games by brand in 2011 Source: Mintel 2012 Sales of consoles by platform in 2012
  13. 13. 13 Source: VG Chartz 2013 External competitors Moreover, indirect competition threatening game console market mainly coming from iPads, iPhones and tablets, which not only enable customers to play games and play games on the go, but also allow them to be part of other entertainment media such as music, film, books online etc. Table below illustrates the market share in the UK in-home consumer electronics market. In-Home consumer electronics market share by company in the UK Source: GMID, Euromonitor 2013 Virgin Game therefore recognises those main players in the home entertainment market, of whom they have to be aware of. Also Apple UK Ltd. was added to those analyses as it is a market leader in portable audio devices (48, 6%) and second in computer and tablet market (6, 5%) (GMID, Euromonitor 2013). Panasonic UK Ltd. – Successful electronics brand in home entertainment market since 1935. It is the only remaining HD television manufacturer who concentrates on plasma technology. Its turnover for 2011 was £168, 6 million, up by 1, 1% from previous year (KeyNote 2012). Samsung Electronics Ltd. – The Company became the world’s largest manufacturer of LCD screens. Its core strengths of new technology, innovative products and creation of solutions helped in overtaking Apple in 2011
  14. 14. 14 and became the world’s largest manufacturer of smart phones. It registered turnover of £2, 78 billion in 2010 down by 11, 2% from previous year (KeyNote 2012). LG Electronics UK Ltd. – The Company has operations in all major markets across the globe and is now the world’s third largest mobile phone manufacturer. Its turnover for 2010 was £725, 7 million down by 18% from previous year. Apple UK Ltd. – It is the world leader in consumer electronics, software and PC. The company saw a gap in the digital portable music player market and launched their now famous iPod in 2001. In 2007 the technological revolution saw the iPhone being launched. The most current company’s turnover for 2011 was £880, 3 million which is up by 74, 6% from previous year (KeyNote 2012). 3.2 Consumers’ trends and patterns Virgin research and development activities involve the analysis of technological developments affecting its cable television, telephone (including mobile) and telecommunications businesses, the evaluation of existing services and sales and marketing techniques and the development of new services and techniques. The communications industry is constantly evolving and there are a number of new and emerging technologies which can be used to provide video services that are likely to compete with our DTV and VOD services. These include the DSL services mentioned above and next generation LTE services. Virgin expects continued advances in communications technology and in content, such as 3D TV. Research shows that consumer electronic market showing slow but consistent demand for innovative and upgraded devices on one side and diminishing interest on old established devices. Looks like product lifecycles in consumer electronics have become short. Any slight advancement or upgrade becomes determinant for increase in demand. Despite the economic conditions, product adoption is increasing as long as product is better, newer. Moreover, according to Euromonitor International report 2012, ‘’ Possessing a product of high technology performance has become a new lifestyle statement’’. For video games consoles, men aged 15- 24 were identified as the variable having most influence on market value. Mintel raport predicts that despite the likely release of the Wii U in Q4 2012, sales for the year will fall below 2011's performance, finishing 17.3% down. This is thanks to an exacerbation of the historical decline in sales, caused by consumers holding off on purchasing videogames consoles in favour of waiting for the next- generation devices to appear in 2013. Video game sales are also likely to slow down, as consumers try to avoid amassing collections that may be incompatible with next-generation releases. Finally, Mintel predict that in 2016 refinements in the manufacturing process will allow next- generation consoles to be sold in slim-line format for a reduced cost. This will bring in an extremely wide range of consumers interested in owning a next-generation console but who were unable to afford the initial price point. Significantly increased competition from tablet devices and internet-connected smart televisions capable of playing games will prompt console manufacturers to push this new price point down further in order to attain higher volume sales so they can firmly establish themselves as entertainment hubs inside consumer homes, and start earning revenue from the sale of content and applications. This will result in a large console revenue increase of 54.2% for the year, and an overall market increase of 24.2%. In 2010, the
  15. 15. 15 UK video games industry was worth £4.65bn — a 2.8% rise on the previous year. The market has seen consistent growth over the last few years, with the exception of 2009, when market value fell by 5.7%. This was principally down to a lack of new products and the economic crisis, which caused consumers to reign in their spending on unnecessary items, such as video games. The range of consoles on the market at present has become somewhat stagnant in recent years and, as a result, the three main console manufacturers — Nintendo, Sony and Microsoft — have reacted by releasing extensions of their consoles that incorporate motion-sensitive technology, e.g. the Xbox Kinect. This new type of technology has proved extremely popular with consumers, although, a new generation of consoles will be needed in the next few years in order for market value to continue to improve. Consoles such as Microsoft's Xbox already have games where users 'appear' in 3D on screen via a motion-sensor camera mounted on top of the television, allowing users to 'star' in everything from war games to a version of Michael Jackson's Thriller. Television broadcasts using such a technology could require at least 200 HD cameras filming the action simultaneously: hence 'holograms' might first appear in the gaming world. True 3D holographic projections would be another leap forward for the technology - and offer mesmerising, 'real' environments to explore. Research and medical reports shows that 3D projectors can and are causing eyestrains, that is due to technology which makes eyes having to look at two points at the same time- the screen and the 3d picture. Another fact is that 3d requires glasses what as surveys shows people find not very comfortable especially for customers who wears own medical glasses. This shows that 3D is not a good seller and currently it’s being predicted that Led will take a lid in the market. 4.0 Virgin ViGi Console- product definition and positioning After the initial research, using the SOSTAC model ‘the situation’ (where are we at now?) within the home entertainment environment, Virgin represents an unusual approach to console gaming. Basing on the research that customers are still looking for the new, healthy technology, which will give them quality time with family in the comfort of own living room without compromising on quality. Virgin developers team have created the console to provide a traditional gaming experience with a holographic view. Hologram-is a solution to 3D projection. Using same principles as photo hologram projectors we have already seen in decades on tech savvy conferences and exhibitions. Interference patterns are very limited at the moment but as other games developers’ shows, consumers are looking for more real experience, both in gaming and in any video projections. Virgin focused on digital holography and that what makes it unique among competition- first holographic home games console. Because it is already 3D, there is no need to wear glasses and one can move ones head around and look around the object. Virgin presents customers with the real, amazing experience of being able to play the game actually by being part of it, not only by looking at the screen or even by creating movements that are synchronised with the console but we will have the experience of small little world in front of our eyes which we will be able to see from any angle- like real. With regular software updates the products has firmware that allows: Holographic streaming gaming: Compatible with any make of television. Compatible with Wii remote and accessories. Integrated CD / HD DVD player
  16. 16. 16 Using cloud storage technology there is No need for separate bulky hardware storage units. Stores music, videos and photo’s, which can be streamed instantly using wireless technology via the touch screen interface or via your television. Whatever the occasion is the Virgin ViGi will continue to amaze with its cutting edge technology, providing integrated ease of use for customers entertainment needs. Device caters for every audio and visual format. Using the unique Laser waves system, ViGi offers extremely clear and vibrant picture. Using unique Surround Sky technology, WIFI speaker system offer immensely dynamic and breathtaking stereo sound helping to get the very best out of your audio and visual files for the ultimate home experience. The Virgin ViGi understands you! Once you have activated your AVSD cloud space, the device intelligently creates list of your favourite games, saves them wherever you have finished, so when you are back to game, all you have to do is choose the game and press play. AVSD cloud space also allows you to access 1TB of content instantly from music, video, radio, TV, movies and games. No need for separate hard drive. If you wish to change from holographic image to your TV, all you have to do is connect the console to your TV using ViGi cable and it’s done. The ViGi has hidden touch screen which will allow accessing Wi Fi internet connection in order to download online games and other content. It also comes with a remote for more comfort of choice. For more product information please go to www.VirginViGi.co.uk Name: Virgin ViGi (Virgin Gaming) Type of Product: INTERGRATED, Wi-Fi enabled Holographic Games Console Purpose: Gaming/ ultimate home entertainment/ be in control of all your entertainment needs through one device Contains: -Portable Entertainment Device. Dimensions: 30x4x20 -Home Base / Docking Station (power charger + connectivity) -4 wireless WIFI speakers (incl. subwoofer). Wireless Wi-Fi transmitter (Fixed Broadband Access). -REMOTE CONTROL/programmer -Power Cable /USB CABLE -Instruction manual Features: -Cholographic gaming (access Games on Cloud + access to Virgin gaming on-line) -Access online digital download stores (iTunes, Amazon, etc) Play music (Mp3/CD/Audio Streaming via services like Spotify or Last.fm) -Access online Video and Movies - On demand Services + digital download -Watch Movies (DVD, files on your Cloud storage, VoD Services / Streaming Services) Connectivity: USB connection -Bluetooth capability -3G/4G/UMTS SIM card slot (Mobile Broadband Access) -Multiple Data-Card Reader
  17. 17. 17 -Wi-Fi Network Adaptor (fixed broadband access) Characteristics: -Aesthetic Design (High gloss black and red, Virgin colours) -Connectivity/wireless/portable -Power consumption – 5KW -Touch-screen control -Integrated system - convenience -Ease & comfort of us 4.1 TARGET AUDIENCES & SEGMENTATION Seth Godin (2010) defines seduction towards a product or brand as the main aspiration of marketers, highlighting at the same time that the basis of seducing someone is a level of cooperation, contribution and interest by the other person. Instead of treating everyone the same and trying to please everyone, effective communication is much easier attained by seeking out the right people, with attitudes making them open to being seduced – based on personal relevance and high associated significance towards the message exposed to. For effective marketing communications to take place one must first determine - who the buyer of the Virgin ViGI is, why do they buy, what exactly do they want to buy, how, when and where? Virgin closely monitored changing consumption trends and identified potential growth opportunities. Virgin needs to leverage and build on its already existing internal (employees) and external (loyal customers and trade buyers of previous products) relationships to support the Virgin ViGi launch. It is a huge Virgin advantage to have already established great Brand Identity and therefore great relationship with online and offline consumer electronics retailers in the UK. Sales education program and well operating support system will help to maintain this good relationship. Target market The following main groups of audiences have been established to be targeted: Virgin loyal customers- leverage high brand loyalty, previous experience with Virgin products & positive attitudes/trust; purchase decisions are made more quickly Innovators of technology- Games & home entertainment fans/enthusiasts/collectors University graduates/ young professionals, married couples and families with and without children, teenagers, adolescence, students Characteristics: affluent, well-informed and educated young and mature female and male adults aged 25-54, classed in the price-insensitive ABC1 socio-economic segments; higher disposable income; either own property holders or rent privately; any nationality living in the UK; multi generational users regardless of age, gender, language, cultural background or experience; principle of mass-market appeal; primarily households of three or four people with children, higher income households with children Role: BUYERS, USERS, -> important role of influencers, early adopters Important role of children, teenagers and students; the age segment from 15-19 years can be leveraged as taking up the important role of the INITIATOR or INFLUENCER and USER in the consumer decision-making-unit (DMU) of households with children, encouraging friends and family members of with the decision-making power to adopt Virgin VIGi console. Location: Buyers are located throughout the UK, with heightened density around major cities & urban areas (London, Birmingham, Glasgow, Liverpool, Leeds, Edinburgh, Bristol and Manchester) 5.0 Campaign objectives 5.1 Marketing Objectives
  18. 18. 18 1. To achieve at least £15m in sales value in the first 12 months after the launch of the product Total value of game console market in the UK in 2011- £569m £599- RRP £450- Wholesale price 2. To penetrate the video gaming market and achieve 3% market share by the end of the first 12 months in the UK consumer market 100% market share= £569 000 000 1% market share= £5 690 000 3% market share= £17 070 000= 37 934 units sold at £450 3. To increase interest in the video gaming among the targeted market from 54% to 57% in the first 12 months since the launch of the product. 5.2 Communications objectives: With the target audience identified, virgin begin to focus on the communication objectives. It has been shown that consumers respond Hierarchy of effects: Awareness- building 60% awareness within the target audience within first 3 months Interest- of the 60% it is hoped that 40% will be interested in the product Evaluation- out of the 40% of customers who are interested in the product, Virgin want them to evaluate, that is compare to other consoles and for our product to make their first list of possible choices at least 30% of the time Trial-after evaluation we want customers to select ViGi over other devices in at least 20% of the times Adoption-it is intended to build 75% of adoption with positive response to the product, what will then increase good word-of mouth publicity and will have a positive impact on further sales. 6.0 Budgeting and timing The outlined marketing communications campaign is scheduled to be implemented over a period of 14 months from Feb 2013 to May 2014. Attention needs to be given to the fact that communications activities start from march 2013, 2 months prior to the consumer product launch, in order to effectively educate Virgin employees and sales force about the new product as well as to establish good sales and support system for already well established web of retailers and distribution channels. Essential time scales: 1. sales force training/ trade pre-launch preparations( Feb 2013) 2. Pre-launch Consumer activities ( March –April 2013) 3. Launch date May 2013 4. Post-launch activities (June 2013-May 2014)
  19. 19. 19 Marketing flow chart Marketing tool Feb’13 March’13 Apr’13 May’13 Jun’13 Aug’13 Sept’13 Oct’13 TV adv Radio adv On-line Print Sponsorship Events/ promo mat. Sales edu. Nov’13 Dec’13 Jan’14 Feb’14 March’14 Apr’14 May’1 4 Since the primary target for ViGi product are technology innovators and Virgin loyal Customers, Virgin will be using several approaches to reach its target market. First step is to build awareness by 60% amongst the target market. The market is subdivided into existing Virgin customers and new technology innovators. The objective is to make the market aware of the product existence, its functionality and availability. Company will be using It is planned to create awareness amongst the Virgin existing customers by organising a pre-launch events in Virgin shops. Information about those events will be heavily spread over the mass media, as well as online, on website and social media 6 weeks before the events. Aim of the mass media activity will be to introduce the product to Virgin customers to the events, where they will have a chance to be introduced to the product and to try it. Loyal customers with 2 or more Virgin products will have priority to try and pre-order console. Those events will take place one week before actual launch. It is planned at the same time to place around the country the ‘’warners’’ billboards and posters, which will be informing about ‘’extraordinary game coming soon in Virgin...’’. Those print materials will be aimed at general target market. At this point it is expected to gain a print media interest and promotion in news papers and magazines will commence. Virgin is expecting to reach many kinds of papers and magazines for all different age and interest groups that are targeted, such as ‘Play’, ‘ Games TM’, ‘PC Games’,’Neo’, ‘The Spectator’, ‘New Scientist’, ‘Wired’, ‘How It Works’, ‘Stuff’, ‘T3’, ‘Men’s Health’, Marketing’, ‘Campaign’ and ‘What Hi-Fi? Sound and Vision’. ‘Woman& Home’, ‘Easy Living’, ‘Essentials’, ‘Yours’, ‘My Weekly’, ‘Grazia’, ‘Vogue’, ‘Red’, ‘Glamour’, ‘Maria Claire’, ‘Cosmopolitan’, ‘Ideal Home’, ‘Grand Designs’, ‘First News’, ‘The Week’, ‘Heat’, ‘Twist’, ‘Seventeen’, ‘Boys life’, ‘J-14’ etc. The newspapers to be targeted are ‘The Times’, ‘The Independent’, ‘The
  20. 20. 20 Guardian’, ‘The Sunday Times’ etc. The press releases will be sent to the editors, reviews editors, features editors as well as to the news desk on a regular basis in order to keep consumers updated On the day of the launch it is planned to involve billboards and posters with hot and sexy message about ‘’ ViGi- first holographic game console introduced by Virgin’’ aiming to the whole target market around UK. Bearing in mind that billboards are only seen for 3 seconds it will be crucial to make sure that strong and appealing image will be delivered. Several billboards will be situated near popular hangouts for colleges, and students, as well as near secondary schools and nightspots frequented by the target audience. While print advertising provides a way to build awareness of the product, it is not as effective as audio/visual for a complex product such as ViGi. Virgin will therefore carry on using TV and radio to reach more segmented target market at more specific times and with well adjusted content. The Virgin Website is the most effective way to communicate with the potential Virgin customers, therefore 20% discount on the new console will be there offered to customers ordering Virgin services online. Customers will be asked to register online in order to receive a unique code which will apply for the discount. In store events and points of purchase will be the major communication strategy for reaching existing Virgin Customers. To broaden the reach, posters and audio/visual tools will be used over other Virgin divisions, such as Virgin Gym, Virgin trains etc. The next step is to create interest in the product by 40% of target market. To do so, Virgin ViGi will sponsor national gaming Tournament in Birmingham as well as several festivals and concerts around the country. Lots of promotional materials will be distributed, such as sun glasses, umbrellas, ponchos, raincoats, flyers, etc. ViGi will also have a presence at the mentioned events by placing a ViGi tent where participants will be able to try the experience of ViGi playing and they will be able to purchase the console. Here Virgin is approaching the next objective which is evaluation of the product. This step is accomplished by having the product directly accessible to the consumers. By participation in mentioned here events and activities, ViGi will not only generate interest in product, but will also encourage evaluation at a target rate of 30%. As shown above, evaluation will be facilitated at the various events by having the product for the event participants to try. The fourth step is to encourage trial (purchase) by 20%. Again, as mentioned earlier, Virgin will achieve this by giving 20% discount on the online product purchase price. Such price promotion will encourage customers to believe they are getting a bargain. To encourage sales by retailers, Virgin will provide additional trade discounts in the form of marketing funds to encourage companies such as Curry’s, to advertise and promote the complete Virgin Media and gaming product family. Last, Virgin wants to encourage adoption by 75%. To reach that goal we will offer various deals and packages for new and existing customers. The adoption phase is crucial to the success of the product as customers who use the product are the best source of communication for new products. The early adopters who are pleased with the usability of the product often demonstrate the products capabilities to their friends and family. 6.1Buying Context & Level of Involvement. The Virgin ViGi can be categorised as a speciality consumer product. As a new product development consumers have no previous product experience or knowledge. The purchase is infrequent and the relatively high price represents a once-off investment for most consumers with the expectation for the product to last for a long time. Consequently there is a high perceived risk (primarily financial risk) resulting in the need of the potential buyer to get involved in extended-problem-solving. Generally, the majority of potential buyers will engage in an extended decision-making process, requiring a high involvement, to determine the offered value and form attitudes prior to the purchase decision. Consumers will engage in extensive external information
  21. 21. 21 search, comparison and evaluation of different available products in the market, ideally including first-hand trial of the product (Smith and Taylor, 2004; Fill, 2009). Consequently Virgin needs to adjust to the existing buying context and communicate the significant value and core benefits gained from the Virgin ViGi differentiating it from competitors. New product launches yield high risks, as it is difficult to predict how the market will respond to the new product. Virgin as a brand is well known globally for high-quality and innovative new products and has many loyal followers. This provides them with an advantage, as many people already know Virgin products and have had previous positive experiences. Still the majority of potential customers do not know what to expect in regards to the benefits and value provided by the Virgin ViGi in comparison to the price they are asked to pay. The Message & Appeal An essential part of the Virgin ViGi launch campaign is the creation of the core message to be communicated to its target audiences. Decisions related to the core message include the content of the message, the message appeal and the execution style (Belsch and Belsch, 2008). Irrespective of the size of our communications budget, marketing communications are only effective if the conveyed messages reach the target audience, gain and hold attention and result in the intended learning or behaviour. Cognitive/Rational message component: The Virgin ViGi offers features that in this combination are unique and innovative to home entertainment systems, these unique selling propositions (USPs) need to be highlighted in the communications: Point of Difference- Completely new technology and experience, Integration, Design, Connectivity, Ease of Use Functions as a media hub – provides convenient multimedia entertainment solutions (music, film, radio, TV, gaming and pictures) Connectivity – device provides Wi-Fi, 3G and Bluetooth connectivity options to load and stream various media on the Internet or access data stored on the cloud server Affective/Emotional message component: Messages should convey a set of emotional values attached to the product establishing positive feelings towards it Central theme of the campaign: Virgin ViGi console‘’ Play the game your way’’ 6.2Budget breakdown 7.0 Campaign control, Marketing tool Cost TV 2 203 097,60 Radio 1 704 026,10 Print( magazines and newspapers, billboards) 2 600 048,30 Online 560 000 Promotional materials 500 000 Sponsorship 600 000 Events 3 680 453 TOTAL 11 847 625
  22. 22. 22 measurement and evaluation. For the Virgin ViGi it is important that evaluation is conducted throughout the whole marketing communications process. That is because it helps to tackle problems as early as possible and to keep on track of reaching the set goals and objectives (Brassington & Pettitt, 2006). Also evaluation can help “to determine the probability of success up-front, before the money is spent” (Duncan & Ouwersloot, 2007). All areas of Virgin ViGi marketing tactics need to be measured in adapted ways to see which work and which do not. That means that an evaluation needs to be done for each: Internet Newspaper and Magazines Television and radio Events Sponsorship Software applications can record detailed statistics on: number who requested brand information number completed a customer profile number who made complaints types of people who visit the site frequency of visit number who participate in chat sessions Examples for such software are CommuniGator, Google Analytics, AWstats and Lyris HQ Web Analytics. Some of these applications are even free and therefore do not use up anything from the marketing budget. Still there needs to be a person who is constantly taking needed data from these programmes and then puts it in a context. Gallup and Robinson’s have created the ‘impact test’ to measure magazine ad recall. In that test a sample audience is selected through door-to-door or telephone interviews. Then those selected people have to look at a test ad. The next day they are called and have to answer some questions. With those questions it is looked at following metrics “include intrusiveness (recall), idea communication, persuasion, brand rating and ad liking”. For all the other tactics (newspaper, magazine, television, PR...) a firm, such as Nielsen media research, will be hired to collect and analyse data for Virgin. As Virgin ViGi is a new player in the market, it has SOM< SOV, this is due to heavy investment to create a brand awareness and to meet the objectives. That means ViGi is an Investment brand. As Virgin group is a big, well established brand with a big profit, it can afford to attack with high SOV and to monitor competitors reaction and adjust budget accordingly. There is also a budget assigned to any crisis communication. Virgin ViGi will try to increase its SOM also by improving product quality, by price elasticity of demand, extending distribution channels or adjusting promotion tools and intensity. Virgin is also hoping to increase its SOV by taking advantage of advertising in other Virgin products- this is intended to help in sales increase. Competitor communications expenditure will be monitored in order to react fast to any changes and to prevent them from gaining market share. Bearing in mind that investment should be made as long as the marginal revenue exceeds the marginal communications cost, profit will be regularly monitored and comms expenditure will be adjusted accordingly. This analytical tool will be used to monitor and estimate the effect of advertising on profit.
  23. 23. 23 References: Smith, P., and Taylor, J. (2004). Marketing Communications: an Integrated Approach, 4th edition. London: Kogan Page Limited Duncan, T., and Ouwersloot, H. (2007). Integrated marketing communications, European Edition, London: McGraw-Hill Keller, K. Aperia, T. and Georgson, M. (2008). ‘Strategic brand management.’ Edinburgh: Person Education ltd. Page. 70 - 72 Belsch, B., and Belsch, M. (2008). Advertising and Promotion: An Integrated Marketing Communications Perspective, McGraw-Hill Higher Education Pelshmacker, P (2004). Marketing Communications: A European Perspective. England: Pearson Educaion. Virgin Group. 2013. Virgin group. [ONLINE] Available at: http://www.virgin.com/. [Accessed 20/03/2013]. Virgin Group. 2013. virgin group. [ONLINE] Available at: http://www.virginmedia.com/. [Accessed 20/03/2013]. Mintel . 2013. Video Games and Consoles - UK - October 2012 . [ONLINE] Available at: http://0- academic.mintel.com.emu.londonmet.ac.uk/sinatra/oxygen_academic/my_reports/. [Accessed 20/03/2013]. Michael French. 2012. Revealed: The REAL size of the UK games market. [ONLINE] Available at:http://www.mcvuk.com/news/read/revealed-the-real-size-of-the-uk-games-market/091345. [Accessed 20/03/2013]. Euromonitor. 2012. console games industry in the uk. [ONLINE] Available at:http://www.euromonitor.com/search?txtSearch=+console+games+industry+uk. [Accessed 20/03/2013].
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