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The Video Game Industry Essay

1519 words - 7 pages

The video game console industry (VGCI) is one which continues to grow at a rapid rate. Currently, we are witnessing the second generation of the video game consoles, the leaders companies being Microsoft, Nintendo and Sony. Wherever there is such a market, with an opportunity for growth and a fierce rivalry, the internal and external factors will always have to be exploited and minimised as much as possible to gain a competitive advantage over another firms. A sound analysis of the micro and macro environment for an organisation is imperative for its success. An organisation's marketing strategy should reflect its objectives while considering the firm's micro-environment.The macro ...view middle of the document...

Currently, in the media much advertising is taking place to promote active lifestyles which encourages the younger generation to get out outdoors. McDonalds, a popular icon, especially among children are airing commercials saying "I'd rather be in the game, than just play the game at home." These types of advertising poses a great threat to the video game industry as it is encouraging people to stop playing virtual games and play active ones. Even in the news, it is hard to find a program which isn't about Australia's level of rising obesity. These types of shows are targeted at adults, in the hope they will influence their children not to sit around at home, but instead participate in active sports. If parents limit or restrict their children from playing video games, that generation will grow up not playing and are therefore more than likely affect future trends and patterns of the sales of video games. Also with recent revelations that the industry's main customers are now in an older demographic, those who are both health conscious and impressionable may chose to abandon game playing instead choosing to participate in healthier activities.Another threat that faces the video game industry is the debate over whether playing violent video games leads to violent behaviour. There have been several studies undertaken to determine whether there is any truth to this argument without any real resolution, as there are varying opinions and statistics. However, those who believe that violence may be imitated by game players will no doubt prevent their children from playing such games and most likely influence others on their opinions, which will affect the amount of sales in the video games industry.Although the cultural environment has some threats on the VGI, there are also many opportunities as well. With today's lifestyle being busier than ever, there is little opportunity to socialise, instead of organising a group of people to play soccer it is far easier to sit in front of the television and interact through a virtual game.There have been links to the repetitive nature of video games and their ability to teach, with such links brings great opportunities for the industry. As more learning based games are developed, the greater the volume of sales of both consoles and games as many people in society are always looking for new ways of learning, this encourages blend of fun and learning. ( Gee, J., Halverson, R., Williamson Shaffer D., Squire, K. 2004) A breakthrough with these types of games will expand the industries consumers as this can target an even younger audience.The micro-environment consists of five bodies, the suppliers, marketing intermediaries, customers, competitors and publics. All five of these elements must be taken into consideration when a marketing strategy is developed. The marketing strategy looks to achieve the goals and objectives of the business through this strategy; it looks to determine factors such as target market,...

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