Developing marketing strategy for an online social game

TRNG I HC M TP. HCM UNIVERSITÉ LIBRE DE BRUXELLES HO CHI MINH CITY OPEN UNIVERSITY SOLVAY BRUSSELS SCHOOL MBAVB4 LAM VI QUOC DEVELOPING MARKETING STRATEGY FOR AN ONLINE SOCIAL GAME MASTER PROJECT MASTER OF BUSINESS ADMINISTRATION (PART-TIME) TUTOR’S NAME: DR. HOANG THI PHUONG THAO HO CHI MINH CITY 2012 Acknowledgement I would like to express my heartfelt gratitude and deepest appreciation to my research supervisor, Dr. Hoang Thi Phuong Thao, for her guidance, share of experience, valuation suggestions and comments. I would also like to thank my friends in Empire Corp who have helped me a lot during my research: Nguyen Thanh Trung, Hoang Thanh Trung, Pham The Minh from the board of directors of the company and other personnel from the development, support and marketing department. Last but not least, I would like to thank all of my classmates in MBAVB4 who have always supported and encouraged me to complete the research. Abstract Empire Corp is a successful company in launching self-developed online casino web game. However, due to the restriction from the government on this kind of game, the company is facing challenge in sustaining the growth of the company with that set of game. It has been decided to develop another set of new game which is not restricted by the government to reduce the portfolio risk of the company as well as to maintain the growth rate. In that context, a social online web game is selected to fulfill this goal. The project is designed to help Empire Corp come up with a marketing strategy to launch the new game. The outcome of the research will be the proposed targeting segment, the marketing mix to help the game become a successful online game. Table of Contents List of figures 1 Abbreviations 2 Chapter 1: Introduction 3 1.1 Rational of the study 4 1.2 Statement of the problem 4 1.3 Research questions and objectives 4 1.3.1 Research objectives 4 1.3.2 Research questions 4 1.4 Research approaches 5 1.4.1 Qualitative research 5 1.4.2 Quantitative research 6 1.5 Scope of the study 6 1.6 Structure of the study 6 1.7 Significance of the study 7 Chapter 2: Literature review 8 2.1 Porter’s generic framework theories 9 2.1.1 Cost leadership strategy 9 2.1.2 Differentiation strategy 10 2.1.3 Focus strategy 11 2.2 Ansoff’s matrix 11 2.2.1 Market penetration 12 2.2.2 Market development 12 2.2.3 Product development 13 2.2.4 Diversification 13 2.3 Marketing mix 13 2.4 Customer participation and personalization 15 2.5 Product levels: the customer-value hierarchy 16 Chapter 3: External and internal environment 18 3.1 External environment 19 3.1.1 Types of online games 19 3.1.2 Market overview 20 3.1.3 Competitors 24 3.1.4 The barrier of the industry 27 3.2 Internal environment 29 3.2.1 Empire Corp overview 29 3.2.2 People 29 3.2.3 Processes 30 3.2.4 Program 31 3.2.5 Performance 31 Chapter 4: Data analysis and findings 32 4.1 Characteristics of the respondents 33 4.2 The loyalty segment 33 4.3 The high value segment 35 4.4 Community loyalty 37 4.5 Crucial factors: IT infrastructure and customer service 39 4.6 Key promotion channels: word of mouth and game forum 40 4.7 Customer participation and personalization trend 42 Chapter 5: Proposed Marketing Strategy 43 5.1 SWOT Analysis 44 5.1.1 Strength 44 5.1.2 Weakness 44 5.1.3 Opportunity 44 5.1.4 Threat 45 5.2 Proposed marketing strategy 45 5.2.1 Objectives 45 5.2.2 Segmentation, targeting, positioning 46 5.2.3 Differentiation and competitive advantages 46 5.2.4 People 47 5.2.5 Processes 47 5.2.6 Product 48 5.2.7 Price 49 5.2.8 Place 50 5.2.9 Promotion 51 5.2.10 Performance 51 5.2.11 Evaluation and control 51 5.2.12 Conclusion 52 References 53 Appendix 54 5.3 Online game survey 54 1 List of figures Figure 2-1: Porter's generic framework 9 Figure 2-2: Ansoff's matrix 12 Figure 2-3: Product levels 16 Figure 3-1: Gunny web game published by VNG 22 Figure 3-2: Tam Quoc Truyen Ky published by SGame 22 Figure 4-1: Respondent occupation 34 Figure 4-2: Hours spent per day on online game 34 Figure 4-3: Number of games played last year 34 Figure 4-4: Age of the users who spend more than 300,000 VND per month on online game 35 Figure 4-5: Expense per month on online game of segment age above 23 36 Figure 4-6: Expense per month on online game of segment age below 23 37 Figure 4-7: The benefit apart from relaxation gets through playing online game 38 Figure 4-8: The top most reason makes users stop playing an online game 40 Figure 4-9: How users know about a game 41 Figure 4-10: Do users' colleagues play online game together with them? 42 2 Abbreviations CEO : Chief Executive Officer 4P : Product, Price, Place and Promotion SWOT : Strength, Weakness, Opportunity and Threats MMO : Massively Multiplayer Online MMORPG : Massively Multiplayer Online Role-Playing Game RPG : Role Playing Game ADSL : Asymmetric Digital Subscriber Line SMB : Small and Medium Business CSM : Cyber Station Manager VND : Vietnamese Dong SEO : Search Engine Optimization BOD : Board of Director 3 Chapter 1: Introduction 1. RATIONAL OF THE STUDY 2. STATEMENT OF THE PROBLEM 3. RESEARCH QUESTIONS AND OBJECTIVES 4. RESEARCH APPROACHES 5. SCOPE OF THE STUDY 6. STRUCTURE OF THE STUDY 7. SIGNIFICANCE OF THE STUDY 4 1.1 Rational of the study Empire Corp. (name disguised) was established around 3 years ago and has been very successful in developing and launching a set of casino online games. The growth rate of the company is quite impressive and has now reached the size of more than 70 employees and owed a 3 million user market size. However, lately, the CEO of the company sensed that it’s unlikely the company could keep the existing growth rate with the existing games due to the more and more aggressive competition and the un-support government policies in developing that kind of online games which had been a very big barrier to the growth of the company. To continue growing the company to the next level, it is necessary to move forward with a different path. Several different kinds of games were investigated and the conclusion came to a horse racing online social game. 1.2 Statement of the problem The horse racing online social game has been put under development and is about to finish. However, the marketing strategy to launch the game has not been considered up till now. It’s the time to work on the marketing strategy so that the game can be launched successfully. 1.3 Research questions and objectives 1.3.1 Research objectives In order to solve the problem above, the research has the following objectives: 1. To analyze the current situation of the company and the market. 2. To identify the target segments which the game should focus on so that. 3. To identify the positioning of the new game as well as its points of differentiation. 4. To identify the marketing mix strategy to launch the new game successfully. 1.3.2 Research questions The research problem leads to the following research questions: [...]... Browser games can be created and run using standard web technologies or browser plug-ins Browser games include all video game genres and can be single-player or multiplayer Browser games are also portable and can be played on multiple different devices or web browsers Browser games come in many genres and themes that appeal to both core players and casual players 20 Client game Client games are games... greater than the sum of their parts and they accomplish multiple objectives for the firm Performance is defined as capturing the range of possible outcome measures that have financial and nonfinancial implications (profitability as well as brand and customer equity), and implications beyond the company itself (social responsibility, legal, ethical, and community related) 2.4 Customer participation and personalization... the game publishers to implement various technical solutions to enhance game players cannot play more than 5 hours a day and discourage players to play more than 3 hours a day Besides, starting from 2011, the government had not issued any game license to the game publishers for any import games from foreign countries: China and Korea The license approval process is extremely restrictive on the game. .. company Through its successful online casino web games, a base of 1 million registered users and a site of more than 5000 thousand web games were formed With the gained market, the earned development skills and operating experience, the company should have achieved much greater achievements if the legal framework for online game was mature Due to the immature legal framework in managing the online game. .. 2.3 Processes 2.4 Program 2.5 Performance 19 3.1 External environment 3.1.1 Types of online games Casual game A casual game is targeted at or used by a mass audience of casual gamers Casual games can have any type of gameplay, and fit in any genre They are typically distinguished by their simple rules and lack of commitment required in contrast to more complex hardcore games They require no long-term... East Asia is an attractive market for the game studios, in which, Vietnam is the most potential one China has the biggest impact to the game online industry in Vietnam who provides the majority of the web and client games The big companies like Perfect World, Shanda, Uuzu, Kunlun, Soho, Tencent, Giant Entertainm their business due to its potential growth More and more client game and web games will be... play, and there are comparatively low production and distribution costs for the producer Casual games are typically played on a personal computer online in web browsers, although they now are starting to become popular on game consoles and mobile phones as well Social game A social game can be considered as a casual game plus It owns the simplicity attribute which require no special skill to play and... Kiem, Pockie Ninja, and Ngoa It could be said that Gunny and Tam Quoc Truyen Ky were the father who found the web game foundation for the online game industry in Vietnam Due to its simplicity in the gameplay and requires not long time comm suitable for the business officers who do not have much time to spend online Hence, the trend of game is a promising market Web game and client game co-exist in year... differentia here is it involves social interaction It encourages community activities and interactions It is a game not only for personal relaxation but also a place where people can build network relationship through the advance internet technologies Social games are also typically played on a personal computer online in a web browser Web game Web game or browser game is a computer game that is played over... teams and good corporate reputation It was found that companies that were successful in their differentiation strategy had three tactics which were significantly related to organizational performance These included innovation in marketing technology and methods, fostering innovation and creativity and focus on building high market shares In order to succeed with a differentiation strategy a company needs . QUOC DEVELOPING MARKETING STRATEGY FOR AN ONLINE SOCIAL GAME MASTER PROJECT MASTER OF BUSINESS ADMINISTRATION (PART-TIME) TUTOR’S NAME: DR. HOANG THI PHUONG. meant as help for companies to understand what actions need to be carried out given current performance. 12 Figure 2-2: Ansoff's matrix As an example of a suitable scenario for. playing online game 38 Figure 4-8: The top most reason makes users stop playing an online game 40 Figure 4-9: How users know about a game 41 Figure 4-10: Do users' colleagues play online game