Video games go pay-per-view
EA, ESPN to offer sneak peek at this year's Madden - for those willing to pony up $20
NEW YORK (CNNMoney.com) -- Fans of the Madden football series are hardcore - but are they hardcore enough to pay $20 to get an advance look at the game?
Publisher Electronic Arts and ESPN are betting so, teaming up to produce a one-hour pay-per-view special that will describe the newest features of this year's game and interview some of the game's creators and most skilled players along with NFL players featured in the game.
Convincing people to watch what is essentially a one-hour infomercial is tough enough. Convincing them to spend $20 on it is another - but it might be a mistake to bet against the Madden fan base.
Last year's version of the annual franchise sold 1.7 million copies in the first week, ultimately selling more than 3 million copies. Life to date, the Madden games have generated over $2 billion in revenue for EA (Charts).
This year's version is due in stores Aug. 22. The pay-per-view starts Aug. 4. That's a long period to whip the loyalists into a lather, but it underscores the changing face of video game marketing.
That change, arguably, started with Microsoft's release of "Halo 2". Moving beyond the typical print and television campaigns, the company ran trailers in motion picture theaters in 2004. It also launched an alternate reality game (a cross-media puzzle blending in-game experiences with the real world) that captivated fans and kept interest piqued in the game without forcing Microsoft to leak any details about the plot or gaming experience.
The unusual marketing cost Microsoft (Charts) tens of millions of dollars, but it paid off. Fans lined up outside some 7,000 retail stores for up to 15 hours before the game went on sale at midnight on Nov. 9. In the first 24 hours, the game sold 2.4 million copies, racking up sales of $125 million. Ultimately, more than 8 million copies were sold.
Will a pay-per-view special create the same frenzy? Almost certainly not - but no one expects an annual franchise to match the anticipation of one that only appears every three or four years.
"Video game publishers are following the eyeballs," said Colin Sebastian, Senior Research Analyst with Lazard Capital Markets. "There's been a core shift - especially among the core 18-35 demographic - from traditional media consumption to other fields. It's a challenge to find the right people and generate sales off of that marketing."
Pay-per-view does have some advantages other marketing doesn't, too. For one thing, if the Madden special proves to be a hit, EA can recoup some of its marketing budget for the game, lowering its overall costs. Perhaps more importantly, it positions the game as an event.
"The chief advantage of a pay-per-view is it goes on the schedule and folks who are interested can plan around it," said John Taylor, an analyst with Arcadia. "The thing about a traditional television ad is you can target an particular audience at a particular time, but people don't know when the thing they're most interested in will be on, so they can't plan their schedule around it."
The timing of this year's marketing push isn't coincidental. With the release of the PlayStation 3 from Sony (Charts) and Nintendo's Wii this fall, the media spotlight will be squarely on hardware, not software. Those games that do get extra attention will do so not necessarily because of quality - but because they show off either the graphical ability of the machines (in the case of the Xbox 360 and PS3) or the functionality of the Wii's unique controller.
By making the Madden release an event, it could help the game stand out further from the crowd - capturing the eye of people who might normally bypass it. (Adding to the hype machine, ESPN Classic will air four hours of "Madden Nation" - a reality show showing a competition among Madden players for a $100,000 prize - before the pay-per-view episode launches.)
It's not the first time EA and ESPN have worked together, either. The two companies, which struck a 15-year marketing relationship in 2005, gave fans their first look at the Xbox 360's graphically advanced version of "Madden 2006" last year during the NFL draft.
Don't expect the non-traditional marketing methods to end with Madden, either. "Halo 3," due out next year, will almost certainly utilize new methods in reaching out to fans. And earlier this year, EA's Will Wright (creator of the "The Sims") discussed one possible plan in the works for his upcoming title "Spore".
One of the principle features of the game is the player creates a truly unique creature, deciding the body shape, number of arms and legs and more. It adds a sense of personalization that is well beyond any title to date. Wright mentioned the possibility of allowing players to order custom created models of their creatures.
That's not only unusual marketing - that's a slick way to boost revenues from the game.
Morris is Director of Content Development for CNNMoney.com. Send him an email at firstname.lastname@example.org