Is it possible that developers have been delegating/neglecting their marketing function a bit too much and unnecessarily, to the point of losing control over the value generated?
A while ago I had the chance to listen to an interesting presentation given by Greg Speakman, the VP Marketing of Sierra Wireless. Part of the presentation was about the difficulties of marketing something that is essentially a consumer electronic product through a B2B channel. Since they did not have the marketing budget to reach the consumer, their lifeline was their business partners like AT&T, who included Sierra Wireless products in heir own offerings. Thus, they were focused on marketing to such partners. I remember him saying how he wished they could make the consumer demand a Sierra Wireless product specifically. If their brand name was strong enough to influence a purchase, then they would have significantly more bargaining power in their deals with business partners.
Their situation has a striking similarity to the relationship between game developers and publishers. A video game is essentially produced for the consumption of individuals. Yet a developer does not sell the game to the consumer directly. They sell to the publisher. In this relationship, the publisher is the heavily dominant party because:
- they have the money
- they lay claim to the IP
- they take most of the revenues
- they put their own brand equity before the developer's
At the end of that presentation from Greg Speakman, I had to ask him whether they had ever considered low cost B2C marketing campaigns through e-marketing. I was pretty surprised when he admitted that no, it had never crossed their minds.
It was surprising because that was a notable company in the high-tech communications business, yet they had completely forgotten about a powerful communication channel like the internet. It is the same surprise I have, when companies on the cutting edge of new media and content creation tend to underestimate their own reach to the consumers, and blissfully hand over their marketing functions to other parties.
"Oh no, we don't do marketing," says the game developer happily. "Let the publisher spend money for that, we can't be bothered with marketing on top of everything else."
I suspect the publishers are even happier for the fact.