Both technology firms have slashed as much as £50 off their consoles ahead of the holiday season to try and ensure they are under the Christmas trees of millions of gamers across the UK. While price drops are a normal part of a console’s life cycle, they have been used far sooner than in previous generations.
It reflects the heightened stakes Sony and Microsoft feel from the possibilities of being in a position of strength. The PS4 has continuously outsold its rival in 2014, forcing Microsoft to ditch its multimedia entertainment positioning this summer in favour of gamer friendly ads.
The price drops are a continuation and response to this strategy with Sony making cuts of its own just weeks after Microsoft played the discount card earlier this month. It has sparked a near endless stream of bundle offers with the likes of Tesco and Game that are being pushed, alongside the prices, in new TV ads in the run up to Christmas.
With the majority of the biggest titles this holiday season available on both consoles, Sony and Microsoft are doubling down on TV media to promote themselves as the better deals for releases such as Call of Duty: Advanced Warfare and Assassins Creed: Unity.
While the sheer raft of ads for bundle deals currently on TV points to where most of their budgets are being spent this Christmas, Sony and Microsoft have not abandoned their traditional product-led efforts completely.
The Japanese business has kicked off its global “Welcome to the Future of Play” TV campaign (see above) to push the console’s social features, particularly an option that lets gamers join their friends sessions remotely even if they have not purchased the game. The 180-Amsterdam-created ad extends to print and outdoor.
Meanwhile, Microsoft is running ads that showcase how the console fits within its wider eco-system such as its Microsoft Cloud service. The approach aims to inject more desirability into the machine after its Kinetic motion-tracker feature, which was set to be a key differentiator for the console, was benched earlier this year.
Neither company responded to requests for comment on their advertising strategies. However, it is clear the video games industry sees TV as the key media channel this year, a marked shift from the broader, multi-channel campaigns employed 12 months ago when the PS4 and Xbox One launched.
The UK gaming industry is spending £107m on media in the quarter, a drop on last year’s £128m, according to a Generation Media report comissioned by gaming trade title MCV. The majority of the outlay has been spent on TV, which is predicted to rise by 50% year-on-year in comparison to declines across the board for print, outdoor and radio. The study of video games publishers and media agencies concluded TV would be the most cost-effect for advertisers this year amid greater competition.
Dubose Cole, a planner with gaming expertise at JWT, says: “Simply put, the strategy for Microsoft has been one of ‘returning slightly to the mean’, whereas Sony looks to carry on and defend their gaming heartland focus.”
Both companies will be hoping their strategies can convert online buzz around upcoming releases into present requests.
In October, Xbox One had over 81,000 mentions on Twitter in the UK in comparison to 75,000 for the PS4, according to social media tracker BrandWatch. Interestingly, mentions of the Xbox One were able to infiltrate PS4 discussions as shown by the Xbox One hashtag ranking second in the top ten PS4-related hashtags in the period. However, PS4 did not rank in the top ten hashtags for the Xbox 1 conversation.
Cole says: “The price drops are a normal part of the console lifecycle, but have certainly happened sooner.
“Microsoft’s vision of the value that can come from being a connected entertainment hub may have arguably been ahead of the market’s appetite for it, but there is no doubt that console dominance is going to provide increasing revenue opportunities in consumers’ living rooms in the form of content distribution and integration. The price drops are just one move in attempting to claim that in the long term.”