Intrapreneurial Business Proposal

Running Head: INTRAPRENEURIAL BUSINESS PROPOSAL 1
Intrapreneurial Business Proposal
Ingrid Little
Full Sail University

INTRAPRENEURIAL BUSINESS PROPOSAL 2
Table of Contents
Introduction 3
Description 4
Industry Analysis 4
Description of Products Offered 5
Customer Analysis 6
Competition 7
Unique Selling Proposition 8
Management 8
Identifying a Business Need or Pain Point 9
Proposed Solution for a New or Improved Product 11
Conclusion 12
References 13

Introduction
This comprehensive business proposal for EA (Electronic Arts) examines our internal
business environment, including a description of our company, our products offered and
customer analysis and reviews. It also examines our external business environment which
includes an industry analysis and information regarding our competition. Strategic scanning of
the environment and industry trends help us to determine strengths, weaknesses and threats. It
also helps us to determine opportunities by solving a need in the market for the video game
industry. Growing trends and consumer wants and needs leads to the suggested implementation
of innovative product solutions offered in this proposal. Leveraging our unique selling
proposition, popularity among consumers, and our “player first” outlook on products and
services, we consider developing innovative entertainment options for our customers. This
report suggests creating Virtual Reality (VR) versions of our top selling games to take advantage
of the growing trend of video game players purchasing VR consoles and wanting innovative and
new experiences in the latest editions of our games.

Description
The name of our organization is Electronic Arts or better known as EA. We are a
corporation that is publically traded on the Nasdaq stock market. (Yahoo! Finance, 2018). Our
organization was established in 1982 and was founded by Trip Hawkins. (Successstory.com,
2018). The current CEO is Andrew Wilson. Our company “develops, markets, publishes and
distributes games, content and services that can be played by consumers on a range of
platforms.” (Reuters.com, 2018). It serves the video game publishing industry and is a business
to consumer and a business to business organization.
Industry Analysis
The video game publishing industry is one that is expanding as the “consumer appetite
for video games continues to grow.” (Daws, 2017). The average revenue for the industry is over
23 billion dollars with an annual growth rate of 7.4 percent. (Ibisworld.com, 2017). “The threat
of new entrants is high...particularly in the video game production segment.” (DePersio, 2016).
It is not expensive or hard to create video games and all that is required is an innovative concept
or idea and the programming skills to bring the idea to life. With other major companies, like
Activision and Ubisoft, creating similar products and game designs the threat of substitutes for
EA’s products is also high. Another substitute that can be considered a threat is “app-based
games, which users can play on smartphones and tablets.” (DePersio, 2016). Since 1972 and the
release of Pong, video games have continued to be popular all around the world. We have seen
new developments and concepts behind gaming since the 80s when Nintendo developed Mario
Bros. As graphic design has grown, so has the ability to publish new games that have utilized
new technology to make the game more realistic and exciting. The video game world is going to

be a steadily expanding industry, as better graphics, different platforms, and new technology
continue to mold how games are programmed and designed. The next big thing that will hit the
gaming industry is virtual reality. Having the player experience the game like never before is the
future of this industry. With 4k picture quality, graphics that astound, and new ways to
experience the action, the future of the industry and our company look bright. However, with the
number of gamers increasing to almost 2 billion players, one threat to the industry is
cybercrimes. It is common with online gaming and downloading that users provide credit cards
and other personal information online. This creates an opportunity for cybercriminals to try and
hack into video game companies and commandeer a lot of personal information. We saw this
occur as the online shopping industry and the mobile device industry took off. We should be
weary of this threat for the future of the industry. (Trendmicro.com, 2015). We have an
observed business opportunity to make our products, like Madden NFL, more realistic with new
and exciting features and greater capabilities.
Description of Products Offered
EA’s products include “critically acclaimed, high-quality blockbuster brands such as The
Sims, Madden NFL, EA Sports FIFA, Battlefield, Dragon Age, and Plants vs. Zombies.”
(Electronic Arts, 2017). Our products feature intricate campaign or story modes, online play, in-
game purchases and an online community. Majority of our flagship products start at a price of
$59.99. This price is average compared to other similar products in the industry. However, it is
substantially higher than the price of app-based games which range from free to about $10. Our
company is well positioned as it relates to the pricing and the quality of our products. We offer
high quality products and services at a price that is reasonable to afford. We have a business

opportunity to provide the consumer with more features, support, and unique game play for a
reasonable price.
Customer Analysis
In our business to business activities, customers like Best Buy, GameStop, Walmart and
Amazon represent large corporations in the entertainment and sales industry. For example, “our
direct sales to GameStop Corp. represented approximately 13 percent” of our total revenue.
(CSIMarket.com, 2018). As far as our business to consumer endeavors, our customers range
from 16 to 50 years old, with about 30 percent of those users falling between the age of 18 to 35.
(Entertainment Software Association, 2015). The usage of video games between male and
female is not a huge difference, with females accounting for 42 percent. (Entertainment Software
Association, 2017). The socioeconomic status of our consumer ranges from below average
income and education to those well above average. The primary needs and wants of our
consumers is to be entertained. The primary factors influencing decisions to purchase video
games are the quality of the graphics, price, interesting storyline or premise, online gameplay
capabilities, products being a continuation of a favorite game series and products being familiar
to the consumer from past experiences. (Daws, 2017). Our products satisfy our customer needs
by providing many of the influencing factors in the decision to purchase a video game. Forty-
eight percent of households own a dedicated game console and there is a growing market for
Virtual Reality (VR) devices. (Entertainment Software Association, 2017). With 11 percent of
households owning a virtual reality device, we have a unique opportunity to get ahead of this
growing trend and produce games that satisfy consumer needs and wants and take advantage of
new technology.

Competition
“Industry competition represents the biggest threat to Electronic Arts (EA). Video game
players do not tend to have high degrees of brand loyalty toward particular game manufacturers.”
(DePersio, 2016). While our primary competitors are Activision, Ubisoft and Nintendo, app-
based game developers are big competitors, as they provide a substitute that a consumer may be
driven towards in place of our products. Some notable app-based game developers include
Supercell, Niantic and Tencent as they are rated as the top three developers of 2017 by
Pocketgamer. (Pocketgamer.biz, 2017). More and more customers are moving from physical
sales of a video game to a digital format of sales which includes subscriptions, digital full games,
digital add-on content, mobile apps and social network games. In 2016, 74 percent of game sales
was in a digital format. (Entertainment Software Association, 2017). One of the strengths that
app-based game developers have over our company is ease of access. Many app-based games
can be downloaded directly to your phone or tablet. Another one of the strengths that app-based
game developers have over EA is the price at which the game is made available. Most app-based
games are free or relatively inexpensive to download and play. Where they make their money is
with in-app purchases that enhance the game for users. One of the weaknesses our competitors
have is that they cannot produce the same quality of graphics which is a selling point for many
consumers. Another weakness that our competitors face is brand recognition. We sell games
that have an established reputation and have been around for decades. People are willing to pay
in order to play their favorite game series. (Daws, 2017). Our company still has competitive
positioning within the marketplace as it not only offers an above average gaming experience but
has also recently released free-to-play games in the app-based market. We have the opportunity

to capitalize on our competitors in the app-based game play world by providing app-based games
that have better graphic, storylines and online gameplay capabilities.
Unique Selling Proposition
We have been in the video game and entertainment business since 1982. We are the
“leading global interactive entertainment software company.” We “deliver games, content and
online services for Internet-connected consoles, personal computers, mobile phones and tablets.”
We are “recognized for a portfolio of critically acclaimed, high-quality blockbuster brands such
as The Sims™, Madden NFL, EA SPORTS™ FIFA, Battlefield™, Dragon Age™ and Plants vs.
Zombies™.” (Electronic Arts, 2017). Our video games are some of the most popular in the
world as many of our titles rank in the Top 20 Best-Selling Video Games of 2016.
(Entertainment Software Association, 2017).
Management
In order to support business development, growth and new technological ideas for video
games, one of our most notable people on the management team is Ken Moss. “Ken Moss is the
Chief Technology Officer of EA.” “In this role, he oversees mechanisms to ensure the most
seamless experience for players, including Identity & Fraud, Security, Data, Games Services,
Infrastructure, Mobile Platform and the Frostbite Engine to drive the future of the gameplay
experience.” (Electronic Arts, 2017). Given his history in global marketplace technology, Ken is
well-equipped to lead the strategy and vision initiative for our digital platform at EA. Our board
of directors has been headed by CEO Andrew Wilson since 2013. The board is made up of

eleven members each having specific role and duties within the board. The chairman of the
board is Lawrence F. Probst III. (Electronic Arts, 2018).
Identifying a Business Need or Pain Point
Our mission statement here at Electronic Arts is as follows: “We are an association of
electronic artists who share a common goal. We want to fulfill the potential of personal
computing.” (Answers.ea.com, 2017). “We exist to inspire the world of play.” (Glassdoor.com,
2018). Our company culture is surrounded by our goals at EA Actions. “Be bold: Go big, take
the right risks, back our bets, and lead. Think players first: Listen and respond, deliver beyond
their expectations, build lifetime players. Create quality and innovation: deliver products and
services that surpass expectations, be relentless about improving quality, take creative risks. Act
with integrity: do the right thing, trust others and support their decisions, be transparent. Be
accountable: deliver on commitments, always do what we say, play our positions, deliver and
reward results. Learn and Grow: work hard, play hard, develop yourself and others, measure
your improvement, share knowledge generously.” (Answers.ea.com, 2017). Our company is
very transparent, as we release press releases on our financials, events, and new endeavors on a
regular basis, nearly twice a week. (EA.com, 2018). One media trend that is happening within
the industry is the rise of Virtual Reality (VR). In a recent poll, “1 in 3 of the most frequent
gamers said they were likely to buy VR in the next year.” (Entertainment Software Association,
2017). In some previous years, we were named the “Worst Company in America by fan vote
from a consumer affairs blog.” (Makuch, 2016). Our public perception has greatly improved
since the introduction of our “player-first model.” (Makuch, 2016). Customers are reviewing our
products well, as majority of our products have received 4 or more stars out of 5, on Amazon.

(Amazon, 2018). Customers with positive reviews are enjoying the gameplay and graphics.
Trends show that our flagship games like Fifa, Madden, Battlefield, and The Sims are leading in
customer satisfaction. On Amazon, Madden 17 showed that out of 677 reviews 69 percent of
customers gave it 5 stars. While only 15 percent gave it 2 stars or below. Customers with
negative reviews suggest that the game has not developed from the last edition. They believe the
gameplay has not evolved. A few comments complained about the amount of memory the game
takes up on their console. Other negative comments most predominately had to do with the
provider and not the game itself. In-app game purchases received mixed reviews, as some loved
the ability to enhance the game and others suggest that these micro transactions are not exciting
and feel that the company is just trying to make more money. (Amazon, 2018). Our
competition’s reviews on the same website almost mirror ours, as most of Ubisoft and Activision
games have also received 4 out of 5 stars. (Amazon, 2018). Positive comments about their
games include praises of gameplay, graphics and overall great entertainment. While most of the
negative comments on Amazon have more to do with the packaging and shipping of the game to
consumers. Based on reading the customer feedback, the fans of our most popular games are
looking for some innovation and new forms of gameplay in our new editions. We also have an
obligation to our customer to provide the appropriate support for our games. We need to take
this player-first model and apply it to what the customer is actually saying about our products
and services. We need to develop games that have evolved from one edition to the next and
include new innovative ways to play. With the innovation, however, we must ensure that it is
user-friendly, so that our customers will be able to enjoy the game.

Proposed Solution for a New or Improved Product
Based on research done on the video game industry, new trends developing in how video
games are being played and customer reviews, it is my recommendation that our company
develop an innovative way to play new editions of our best-selling games through a virtual
reality console. To turn this idea into a plan, we will need to requisition our best programmers
and graphic design teams to develop 360-degree video game gameplay modes, clear and
intriguing graphics and the functionality to be played on any Virtual Reality device. This
innovation will benefit the company because we will be able to take advantage of a growing
trend and turn it into a lucrative and exciting venture for both the company and customers
wanting to experience new ways of gameplay in the most recent editions of our best sellers.
Electronic Arts can be one of the first companies to master intricate and complex gameplay with
VR technology, which will set us apart from our competitors. To produce a virtual reality game
with 3D graphics, of high-complexity, we can expect to spend about $300,000 for each game
developed. However, to ensure that are game is top-of-the-line in photorealistic imagery, game
features, and 360-degree game interactive content, we will have to make a hefty contribution to
research and development, game development and design and marketing and distribution, which
could bring our financial contribution to the project in the millions of dollars. (Levski, 2017).
Despite the cost of developing a game, the return on investment will be great, with 1 out of 3
frequent gamers in the world likely to buy VR headsets and games in the next year
(Entertainment Software Association, 2017) and with graphics and new forms of gameplay being
the most prominent reasons consumers buy video games. In 2016, 2.2 billion dollars was spent
on gaming accessories including VR and this number is trending upward. (Entertainment
Software Association, 2017). If we sold our new innovative games for $50 to only those who

already have VR consoles, we would make 110 billion dollars in revenue. That number does not
include people who will buy VR consoles in the future or the revenue from in-game purchases.
This would more than compensate for the cost of production, marketing, and distribution.
Conclusion
Here at EA, our company work tirelessly to provide our customers with games, content,
and online services that exceed the expectations of the consumer. To this point, we provide
games for “Internet-connected consoles, personal computers, mobile phones and tablets.”
(Electronic Arts, 2017). It would be a logical next step to provide a unique gaming experience
on Virtual Reality consoles for the entertainment of our customers. An investment in this
proposal will further our position as the “leading global interactive entertainment software
company” (Electronic Arts, 2017) and will yield an outstanding return on investment both
financially and in reputation amongst our competitors. By innovating our recognized “portfolio
of critically acclaimed, high-quality blockbuster brands such as The Sims, Madden NFL, EA
SPORTS FIFA, Battlefield, Dragon Age and Plants vs. Zombies,” (Electronic Arts, 2017) we
offer our customer a gaming experience like no other company has done before.

References
Amazon.com. (2018). Amazon - Electronic Arts. Retrieved March 19, 2018, from
https://www.amazon.com/s/ref=nb_sb_ss_c_1_15?url=search-alias=aps&field-
keywords=electronic arts&sprefix=electronic arts,aps,166&crid=15DEP0FQ0EAFM
Answers.ea.com. (2017, December 04). What and where is EA's mission statement ? Retrieved
March 17, 2018, from https://answers.ea.com/t5/EA-Access/What-and-where-is-EA-s-
mission-statement/td-p/4956927
CSIMarket.com. (2018). Electronic Arts's Customers Performance. Retrieved March 09, 2018,
from https://csimarket.com/stocks/markets_glance.php?code=EA
Daws, R. (2017, April 21). Research: The state of the video game industry in 2017. Retrieved
March 04, 2018, from https://www.developer-tech.com/news/2017/apr/21/research-state-
video-game-industry-2017/
DePersio, G. (2016, January 27). Analyzing Porter's Five Forces on Electronic Arts (EA).
Retrieved March 04, 2018, from
https://www.investopedia.com/articles/markets/012716/analyzing-porters-five-forces-
electronic-arts-ea.asp
EA.com. (2018). All Press Releases. Retrieved March 17, 2018, from
http://investors.ea.com/releases.cfm

Electronic Arts. (2017, September 14). About EA. Retrieved March 04, 2018, from
https://www.ea.com/about
Electronic Arts. (2017, December 12). Electronic Arts Executives - Official EA Site. Retrieved
March 11, 2018, from https://www.ea.com/executives
Electronic Arts. (2018). Board of Directors. Retrieved March 11, 2018, from
http://investors.ea.com/directors.cfm
Entertainment Software Association. (2015). 2015 Sales, Demographic and Usage Data:
Essential Facts About the Computer and Video Game Industry. Retrieved March 9, 2018,
from http://www.theesa.com/wp-content/uploads/2015/04/ESA-Essential-Facts-2015.pdf
Entertainment Software Association. (2017). 2017 Sales, Demographic and Usage Data:
Essential Facts About the Computer and Video Game Industry. Retrieved March 9, 2018,
from http://www.theesa.com/wp-content/uploads/2017/04/EF2017_FinalDigital.pdf
Glassdoor.com. (2018). Working at Electronic Arts. Retrieved March 17, 2018, from
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Ibisworld.com. (2017, November). Video Game Software Publishing - US Market Research
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trends/market-research-reports/information/publishing-industries/video-game-software-
publishing.html
Levski, Y. (2017, November 15). The Real Cost of Developing a VR Game - AppReal-VR.
Retrieved March 20, 2018, from https://appreal-vr.com/blog/vr-game-development-costs/
Makuch, E. (2016, August 31). EA Exec Responds to "Worst Company in America"
Controversy, Admits It Made Mistakes. Retrieved March 19, 2018, from
https://www.gamespot.com/articles/ea-exec-responds-to-worst-company-in-america-
contr/1100-6443178/
Pocketgamer.biz. (2017, September 29). Top 50 Mobile Game Developers of 2017. Retrieved
March 09, 2018, from http://www.pocketgamer.biz/list/66597/top-50-mobile-game-
developers-of-2017/entry/1/
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from https://www.reuters.com/finance/stocks/company-profile/EA.O
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https://successstory.com/companies/electronic-arts

Trendmicro.com. (2015, July 1). By The Numbers: The Video Game Industry. Retrieved March
04, 2018, from https://www.trendmicro.com/vinfo/us/security/news/cybercrime-and-
digital-threats/by-the-numbers-the-video-game-industry
Yahoo! Finance. (2018, March 04). EA Income Statement | Electronic Arts Inc. Stock. Retrieved
March 04, 2018, from https://finance.yahoo.com/quote/ea/financials?ltr=1

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