Following the success of Call of Duty: Black Ops 6, there are less people questioning Microsoft’s new strategy to be both a video game console company and a third party game publisher.
They literally debunked a report that tried, pointing out that they increased revenue in the last four quarters – yes, before Call of Duty: Black Ops 6 released.
While they won’t say so directly, the implication is clear – Microsoft found out that the hardcore gamers claiming doing this would hurt their business were wrong, and they’re going to do it even more as it’s making them more successful than they have ever been before.
But, if we can no longer question Microsoft’s rationale in their new strategy, the question emerges for the consumer. If, as this Matthew Ball report claims, the number of gamers buying video game consoles is not increasing, and you don’t need to buy an Xbox, or even a video game console, to play Xbox games, then why would you buy an Xbox?
As it turns out, Spencer does have an answer that’s more than rhetoric. In GamerTag Radio’s 20 year anniversary podcast, he shared his new pitch to console gamers to hosts Danny Peña and Paris Lilly:
“I want people to pick hardware based on the capabilities of that hardware and the choices that they want to make about where they want to play. We want our hardware to win based on the capabilities that we have.”
Elsewhere in the interview, Phil also talked about learning from working with PC handheld manufacturers like Lenovo and ASUS about bringing their games and services to those devices. And he was consistently bringing up how he liked how Microsoft’s games played on Xbox platforms.
While Xbox Series X|S is not likely to catch up to its peers in hardware sales, Spencer seems to be determined to keep the console business alive. At the same time, he’s gone above and beyond adding features to make sure the Xbox loyal gamers they have get value and feel valued. That includes not only Game Pass, but Quick Resume, Smart Delivery, xCloud, etc.
We think the way Spencer has gone about to turn around the Xbox business is similar to Avis’ famous ad campaign “We try harder.” Instead of trying to pitch their car rental services as more popular or famous than Hertz, Avis pitched the brilliant idea that as the number two company in the industry, they will do more than the number one to make their customers happy.
That ad campaign turned out to be so revolutionary in its conception, execution, and its aftermath, that it is taught in university marketing courses around the world, and outside of schools too.
There’s certainly a lot different between Avis and Xbox here. The 1960s growing middle class market for car rentals isn’t quite the same thing as the 2020s upper middle and higher class market for video game consoles. But Microsoft may have found a path to success that debunks conventional thinking, the same way Avis did. What remains now is for them to build off of that to grow their console business. And if that isn’t happening with the Xbox Series X|S, maybe it will with their next generation of consoles.
In the meantime, you can watch the entire interview here:
