Activision Blizzard SWOT & PESTLE Analysis
COMPANY PROFILE -Activision Blizzard
Business Sector :Video Games
Operating Geography :United States, North America, Global
About Activision Blizzard :
Activision Blizzard Inc is an American video game holding company which is headquartered at Santa Monica, California. The company was originally incorporated in California in 1979 and was reincorporated in Delaware in 1992. In June 2008, Activision Blizzard was founded after the merger of Activision, Inc. and Vivendi Games. Activision Blizzard currently includes five business units: Activision Publishing, Blizzard Entertainment, King, Major League Gaming, and Activision Blizzard Studios. The major products produced by Activision Blizzard include Call of duty, Guitar Hero, Tony Hawk’s, and Spyrol/Skylanders through the Activision Studios, StarCraft, Diablo, Heroes of the Storm, World of Warcraft, etc., through Blizzard Entertainment and mobile titles including Candy Crush Saga through King. These titles have broken a number of release records and have made Activision the largest game company in the Americas and Europe in terms of market capitalization and revenue as per the reports.Based on the 2019 annual reports, platform providers like Sony, Apple, Google, Microsoft or retailers like Walmart or GameStop also contribute significantly of their net revenues (approximately 40% of their revenues) in addition to end customers.
Activision Blizzard’s mission statement reads “Dedicated to creating the most epic entertainment experiences.”
Activision Blizzard Revenue :
US $6,489 million - FY ending 31st December 2019 (Y-O-Y growth of (negative) -15.6%)
US $7,500 million - FY ending 31st December 2018
Competitive Analysis of Activision Blizzard
| Strengths | Weaknesses |
| 1. Broad distribution and reach 2. Strong product portfolio of leading mobile gaming franchises 3. Strategic partnerships and acquisitions 4. Digital revenue streams more recurring and providing relatively higher profit margins 5. Skilled labour force and recognized for positive work culture | 1. High dependence on a few products 2. Reliance on third-party platforms 3. Seasonality in sale increases risk |
| Opportunities | Threats |
| 1. Differentiated experience using latest technology 2. Increased user activity due to ongoing pandemic 3. Growth in interactive entertainment including mobile gaming 4. Opportunities to expand franchises outside of games | 1. Increasing importance of free-to-play games 2. Effectively manage growth and business complexity 3. Impact of Technological Innovation 4. High competition in the industry 5. Piracy a persistent problem for the gaming industry |
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Detailed SWOT Analysis of Activision Blizzard
Strength
1. Broad distribution and reach:Many of the products produced by Activision Blizzard contain software which enables them to easily connect with customers directly. This results in ease of communication and marketing directly to the customer through customized advertising and in-game messaging based on consumer preferences and current trends. To establish a strong connect, the company has also indulged in activities like online social networks, other online advertising techniques; participation in cooperative advertising programs; direct response programs, etc. The company also receives support from hardware manufacturers, retailers in connection with their promotional efforts and producers of consumer products related to a game. The physical merchandise is also available for sale in outlets around the world, through mass market retailers (like Walmart, Target etc.), discount warehouses game speciality stores and other stores or through third party distribution or licensing. In addition to this, most of the products are also available in a digital format, which allows ease of purchase based on the convenience directly on the PC or mobile device. Blizzard Battle.net also offers a distribution platform with communication features, social networking, player matching and other similar features designed to allow the people to connect irrespective of their games that they are playing on the platform.
2. Strong product portfolio of leading mobile gaming franchises: The company’s portfolio showcases leading mobile gaming franchises like Candy Crush, e-sports opportunities like Call of Duty League and Overwatch League and some of the leading PC and console gaming franchises like World of Warcraft, Star Craft etc. Over the time, based on their expertise and success, the company also plans to roll out media integrations across Activision Blizzard portfolio which will prioritise platforms based on their ability to provide better opportunities for the brand. This varied portfolio of interactive content has managed to garner millions of customers for the company; Overwatch (40 million), World of Warcraft (more than100 million players) to name a few of the trending games of the company. Additionally, due to the huge following, the company have also had the opportunity of partnering will companies like McFarlane (Collectible Figures), USAopoly (Risk and Monopoly board games in North America), Pyramid (Homeware, Accessories). These collaborations serve the dual purpose of marketing as well as financial gain through licensing fees.
The remaining section under "Strengths" is available only in the 'Complete Report' on purchase.
Weakness
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Opportunity
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Threat
This section is available only in the 'Complete Report' on purchase.
Major Competitors :
- Nintendo
- Electronic Arts
- Rockstar Games
- NCSoft
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References used in Activision Blizzard Analysis Report
1. Activision Blizzard fourth quarter and financial results 2019 - https://investor.activision.com/news-releases/news-release-details/activision-blizzard-announces-fourth-quarter-and-2019-financial
2. Activision Blizzard annual report 2019 -https://www.activisionblizzard.com/content/dam/atvi/activisionblizzard/docs/Activision-Blizzard-2019-Annual-Report.pdf
3. Activision Blizzard Recognized on Fortune's "100 Best Companies to Work For®" List for Fourth Consecutive Year - https://investor.activision.com/news-releases/news-release-details/activision-blizzard-recognized-fortunes-100-best-companies-1
4. Activision Blizzard product portfolio - https://www.activisionblizzardmedia.com/our-portfolio
5. Activision Blizzard Consumer Products Group Brings Franchises of the Future, Esports and Fan-Favorite Properties to Licensing Expo 2018 - https://investor.activisionblizzard.com/news-releases/news-release-details/activision-blizzard-consumer-products-group-brings-franchises
The detailed complete set of references are available on request in the 'Complete report' on purchase.
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Activision Blizzard SWOT & PESTLE Analysis - SWOT & PESTLE.COM
SWOT & PESTLE.com (2020). Activision Blizzard SWOT & PESTLE Analysis - SWOT & PESTLE.com. [online] Available at: https://www.swotandpestle.com/activision-blizzard/ [Accessed 05 Dec, 2020].
In-text: (SWOT & PESTLE.com, 2020)
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Activision Blizzard SWOT and PESTLE analysis has been conducted by Pallavi Roy and reviewed by senior analysts from Barakaat Consulting.
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