Activision’s Skylanders: The Quest to Bring Toys to Life

Introduction

Activision is among the top video game companies and has produced popular games such as Call of Duty and Guitar Hero. After the success of these games in the industry, the company proposed a strategy to create a new game product known as Skylanders. Due to recent advancements in technology, Activision developed physical toys that were included in the company’s game structure resulting in a new game class referred to as ‘toys to life’. However, the strategy faced several challenges since other rival companies in the industry introduced similar products. As a result, the company had to create a new plan to facilitate its growth and at the same time, remain competitive in the industry.

Activision’s Strategy

Activision’s strategy to grow through acquisitions contributed to its success in the entertainment industry. Acquisitions bring economies of scope to a company allowing them to tap into the demand of a larger customer base (Soundarya et al., 2018). Also, acquisitions enable companies to increase their market share making them more competitive. In the case of Activision, the company acquired Neversoft Entertainment and Infinity Ward (Dann et al., 2018). These acquisitions enabled Activision to strengthen its position as a game developing company in the entertainment industry. The move to grow through acquisitions enabled the company to enter new markets and reach more clients increasing its profit margins.

Moreover, Activision’s marketing strategy significantly contributed to its success and growth. The company implemented a marketing strategy to bolster its consumer products and initiate a licensing division (Dann et al., 2018). In doing so, the company increased the value of its products which ultimately resulted in additional revenue and improved the brand image of its franchises. A good marketing strategy increases sales and also enhances the reputation of a business (Alhadid & Qaddomi, 2016). The strategies implemented by Activision are recommendable and should be employed by any organization to achieve a competitive niche in their specified industries.

Key Issues

Since Activision operates in a very competitive industry, competition is a major issue.

Activision faces competition from other gaming companies such as Disney, Nintendo, and Warner Brothers. According to Dann et al. (2018), when Skylanders was introduced in the market, it faced competition from Disney Infinity. Even if Activision had a head start in developing an array of characters and toys, the ability of other rival companies to create similar game content was a primary challenge for the company. Due to increased competition, Activision had to remain innovative or run the risk of losing its position in the industry.

Another issue troubling Activision’s Skylanders is organization competence. The decision-making process implemented by lead executives on the Skylanders project was not effective. Weissbrod, one of the company’s executives, noted that decisions about the Skylanders franchise were not implemented as expected (Dann et al., 2018). To ensure the success of the game franchise, the lead executives weighed various options and the process took a long time delaying the release of the game. Activision lacked organizational competence and as a result, the company was unable to exploit the full potential of its resources. According to Marczewska et al. (2020), organizational competence allows a company to better manage its business and allocate resources accordingly. The level of success of the Skylanders franchise was highly dependent upon the executive team. Hence, the team’s competence and capabilities were critical in the project.

Change Management

Over the years, Activision has implemented various changes to facilitate its growth. According to Dann et al. (2018), Activision expanded its portfolio of games and introduced new genres of games by investing in independent developers. The company also invested in former employees and granted them the autonomy to develop their studios and create new games. In doing so, the company was able to strengthen its position in the industry as a game developer. Every organization in one way or another needs change management. Change management is the process in which a company implements change within its structure for competitive advantages (Jalagat, 2016). Without change management efforts an organization runs the risk of losing its position in the competitive market environment. Just like Activision, companies need to reinvent themselves to avoid competitors catching up with their products and taking away their niche market positioning.

Recommendations

Activision needs to establish a sense of urgency within the company. There are various areas within the organization that require urgent changes. The lead executives at the company need to organize the sales team to meet competitive realities. As stated earlier, Activision’s Skylanders faces stiff competition from well-developed companies such as Disney, Nintendo, and Warner Brothers (Dann et al., 2018). The sales team needs to develop effective strategies to maintain and attract new clientele or else the company will lose its market share to competitors. Also, Activision needs to implement a new organizational structure to expand into new markets as well as explore new opportunities. In doing so, the company can avoid its current status quo and remain competitive.

Also, Activision should use various marketing tools to achieve its business objectives and obtain desired outcomes from its target market. Even if the company has implemented a marketing strategy, it needs to explore more marketing approaches to enable them easily enter into new marketing. The use of various marketing tools not only promotes the business but also allows a company to get attention and recognition from the target audience across the specified market. Therefore, Activision’s lead team should invest in multiple marketing strategies to support its growth and enhance its operational processes.

Lastly, Activision should focus on utilizing its strengths to capitalize on its opportunities. The company has a talented workforce and should invest in its capabilities to create more high quality content. By creating more quality content, Activision can diversify its target market and reach more people. The company should put a framework in place that allows employees to remain innovative as technology advances. In general, the company can focus on short-term achievements within the long-term transformation. Also, the company can institute short-term goals and reward employees for achieving those goals.

Conclusion

The case of Activision’s Skylanders: The Quest to Bring Toys to Life resonates in several ways with my career experience. Over the past few years, I have seen many companies fail due to increased competition. Even though competition allows companies to be innovative it can also harm businesses. That’s why Activision tries to remain competitive and innovative by investing its resources in the Skylanders franchise. Organizations need to launch more content and products to broaden their customer base and enter new markets. It is the only way to avoid the status quo and achieve more growth. In my future career, I will ensure my team remains innovative and motivated to achieve both short and long-term goals. In doing so, I can obtain desired results from the target market.

References

Alhadid, A. Y., & Qaddomi, B. A. (2016). The effect of marketing strategy on maximizing the performance of an organization: Sustainable competitive advantage as a mediate variable: Empirical study on small and medium companies in Jordan. International Journal of Academic Research in Business and Social Sciences, 6(4), 318-324. http://dx.doi.org/10.6007/IJARBSS/v6-i4/2110

Dann, J., Szymanski, M., & Sathyanarayanan, D. (2018). Activision’s Skylanders: The Quest to Bring Toys to Life. Harvard Business Publishing Education. https://hbsp.harvard.edu/product/SCG546-PDF-ENG.

Jalagat, R. (2016). The impact of change and change management in achieving corporate goals and objectives: Organizational perspective. International Journal of Science and Research, 5(11), 1233-1239. https://www.researchgate.net/publication/310828676_The_Impact_of_Change_and_Change_Management_in_Achieving_Corporate_Goals_and_Objectives_Organizational_Perspective

Marczewska, M., Jaskanis, A., & Kostrzewski, M. (2020). Knowledge, Competences and Competitive Advantage of the Green-Technology Companies in Poland. Sustainability, 12(21), 8826. https://www.mdpi.com/2071-1050/12/21/8826/pdf

Soundarya, M. B., Lavanya, S. M., & Hemalatha, S. (2018). Merger and acquisition of business organization and its impact on human resources. Journal of Business Strategy, Finance, and Management, 1(1), 69-72. https://www.jbsfm.org/pdf/vol1no1/JBSFM_Vol1_No1_p_69-72.pdf