Power Gig: The Rise (and Fall) of Music Games

POWER GIG: THE RISE (AND FALL) OF MUSIC GAMES

Boston-based First Act created a gaming division called Seven45 Studios. Bernard Chui, Chairman and CEO of First Act thought that his company could take advantage of music video games market to gain extra profits as well as growth of sales for the existing line of instruments. However, after spending $30 million and two years time on development, the company’s first music video game Power Gig: The Rise of the SixString (Power Gig) did not quite meet expectations. At this moment, a review of First Act’s strategy within the industry and market segments targeted by Power Gig would be important and necessary for Bernard and his company before they make further decisions on their next steps.

First Act’s Strategy

First Act is a company who designs, creates and produces affordable musical instruments. Unlike other traditional companies who choose to sell instruments in dedicated music stores, First Act company created a new distribution path and sold its products in the toy department of large department stores, such as Wal-Mart and Toys “R” Us and big-box retailers (Wesley, 2013). The selling price of First Act’s products is in the range of $70 to $200 (Wesley, 2013). In general, First Act’s strategy is to attract people who want to learn musical instruments but have a limited budget. They offer them quality entry-level instruments with exceptional value.

Following the success of Guitar Hero and Rock Band, First Act identified a possible opportunity for them to extend their product line into the gaming industry. They identified that the existing companies, in the music gaming industry, product’s lacked realism. First Act thought it could provide a more realistic product that appeased both the artists and consumers. They created Power Gig which would be the world’s first realistic guitar game (Wesley, 2013). The game would offer players a more realistic approach to learning to play an instrument or be in a band. First Act strategy was to differentiated itself with Power Gig, which would be different than any other games offered in the gaming industry.

Market Segment(s)                  

Kotler (2000) suggested that when segmenting consumer markets, marketers could apply one or more variables, such as demographic, geographic, or psychographic related to consumer characteristics and behavioral variables related to consumer responses. By applying market segmentation, it enables business to formulate marketing strategy and to focus its efforts towards the areas that most meet expectations and preferences of consumers (Maričić & Đorđević, 2015). First Act identified that the current segments targeted in the industry were those who valued the entertainment aspect of the music based video games. They also identified that artists had issues with the positioning of current competitor's product, as it did not seek out to enhance any musical skills. Due to the lack of realism, many artists refused to allow their music to be integrated with those companies platforms. First Act contacted musicians to inquire about their hesitations with the current musical gaming products, and if they would prefer a real guitar to be used in conjunction with the game. Artists such as Eric Clapton, Dave Matthew and Kid Rock, all expressed positive interest and willingness to partner with First Act. These musicians valued that actual guitars were being used over buttons that falsely led participants to believing they were learning instrumental skills. Power Gig does not have many limitations to the players. Anyone who could hold a guitar would be able to play it. Combining other research results, First Act concluded that its target market would be worldwide players who were interested in guitar games for entertainment purpose, players who currently play other guitar games but want to a more realistic approach, and players who want to use a video game platform to learn actual instrumental skills.

Next Steps

Power Gig launched to the market on Oct 2010 with a real guitar as the game controller and a bank kit included a wireless air drum set and a microphone (Wesley, 2012). However, the result showed that the market did not buy First Act’s idea of involving realism into the music video games. In order to deal with the failed product launch of Power Gig, Bernard Chui might consider the following advice.  

First, it is suggested that Chui review the research conducted, the marketing plan, and segments targeted to try and identify issues involved in the failed launch. The following are identified issues that may have led to the failure of the launch.