Analysis of the Marketing Environment for Microsoft Xbox

Contents

1  Introduction  4

2  Environmental Analysis  4

2.1  External Analysis  4

2.2  Internal Analysis  5

3  SWOT Analysis  5

3.1  Strengths  6

3.2  Weaknesses  6

3.3  Opportunities  7

3.4  Threats  7

4  Conclusion  7

5  Reference List  8

1 Introduction

What comes first to your mind when you hear the names Sony and Nintendo? Maybe you associate them as the two huge players on the video console market which dominate this segment. So what happens if the giant of the software industry, Microsoft, steps into a so far protected territory and introduces a perfect planned marketing campaign that brings the green Xbox-logo in everybody’s mind? Considering that Microsoft is a very aggressive and well financially equipped company, therefore one of the most successful in the world, you can expect a major showdown. But what will happen to the customer who should be the driving force of the ma rketing effort of those players?

2 Environmental Analysis

Microsoft like any large company is exposed and heavily influenced by the industrial

environment. This environment can be analysed both externally and internally.

2.1 External Analysis

The external analysis is determined by various factors, which affect companies from the out side and can not directly be influenced by them (Thompson & Strickland 2003, pp.72-112). The external analysis can be divided into a closer (industry-) and a broader (macro-)

The industry environment includes customers and competitors (compare 5- forces-modell by Porter) which are specific for the industry sector. The macro-environment includes political,

legal, ecological, technological and social conditions which are mainly the same for all companies, regardless of their sector (Baker 2000, pp.171-187).

2.2 Internal Analysis

Through the external analysis which is described in section 2.1 of this report it is possible to identify opportunities and threats. The extent to which these chances and risks can be managed depends on the company’s preparation for challenges on the market: its strengths and weaknesses. The u ltimate cause of those strengths and weaknesses are the special competences of a company - its resources and capabilities, which can be contributed to the

3 SWOT Analysis

A SWOT analysis is advantageous for presenting the database derived from the internal and external analysis in a systematic and concise manner (Kotabe & Helsen 1998, pp. 236-237). “SWOT analysis is grounded in the basic principle that strategy- making efforts must aim at producing a good fit between a company’s resource capability (as reflected by its balance of resources strengths and weaknesses) and its external situation (as reflected by industry and