Here's How Microsoft Spends Nearly A Billion Dollars

Advertising for two new products.

That's right, the company behind Windows, Office, Xbox Live, the Xbox 360 and a myriad of nearly successful consumer electronics is planning to spend an estimated $US900 million to market the Xbox 360's Kinect and Windows Phone 7, according to two recent reports.

This morning the New York Post reported that Microsoft is matching the money they spent pushing the original Xbox out the door in 2000 on the 2010 launch of Kinect, planning to spend half a billion dollars on the motion-detecting add-on. Add that to the estimated $US400 million that Microsoft is spending on the launch of Windows Phone 7 and you have quite a tidy sum.

The Kinect launch is being orchestrated by Microsoft and Hollywood producer Steven Spielberg, according to the New York Post article. Though the article never goes into how the game-friendly producer is involved exactly.

Maybe he's overseeing the promotion partnerships with Burger King, Pepsi and Kellogg's which will see the Kinect slapping on cans of soda, boxes of cereal and creepy King games.

The Post also reports that there will be about 7000 stores staying open past midnight for the Kinect launch.

Other marketing ploys:

Taking over YouTube's home page. Nickelodeon and Disney website presence. Showing up in television shows like Dancing with the Stars and Glee. Tons of print ads, yes print because that is apparently how mothers read.

Microsoft's move [New York Post]


    I'd love to know how how they're going to market it in Australia.

      I've already seen Kinect do the rounds on a couple of Today Tonight/A Current Affair 'exposes' into controllerless gaming. It is quite embarrassing to watch, tbh. And quite embarrassing to admit I was watching those shows.
      Apparently Kinect is going to revolutionise the way the world plays games. All I know is that it will see me lose a lot of friends if I find out they are getting one.

        "All I know is that it will see me lose a lot of friends if I find out they are getting one."

        I think they'll be better off, not having an emo like you banning people from having fun.

        That's how we know you're not Core.

        Core gamers don't have friends... they have systems, cheevos and noobs to be pwned.

    I just can''t see Kinect being a big success to justify the marketing, has a peripheral add-on ever done well?

    Unless it is basically free, you just don't get the sell-through, then the numbers aren't there for the developers.

    I guess this time there is XBLA that provides a lower investment/risk way to produce and release casual games, but I still can't see this working.

    I'm surprised they are giving it such a big push, the Wii is outrageously successful, but game attach rates are poor. Maybe if they bundled connect with *every* 360 sold from now on, but otherwise I think it is going to be a flop (compared to their expectations).

    I think it would have been smarter to hype it less, take it as a loss product that is R&D for the next generation of console that would incorporate a Kinect style motion control. Iron the bugs out of it, find out what works and then get it dead-on-right in the next generation and have it in the box. Then developers know that everyone with a console can play the game they develop.

      Microsoft don't care about game attach rates. They just want to sell a but-load of units and roll in the cash like Nintendo did.

      And yeah, they should have perfected the tech and made it a next gen console thing. But both M$ and Sony want a quick cash grab on the success of the Wii and more importantly each don't want the other to have something without offering a competing product.

    $500m / $150 = 3.3m kinects.

    MS could GIVE AWAY 3.3m Kinects for that money.

    Or sell 7m Kinects at half the price they're charging.

      Thats 500 million worldwide. kinect is going to be launched in 35-45 countries. thats like 12 million in advertising in each country...

      doesnt seem like too much now does it...

    That's a ludicrous amount of money to spend on advertising. What does Kinect sell for? US$200, if I recall correctly? So they'll have to sell well over 2.5 million of them just to pay for the advertising before they even start paying for the R&D etc.

    They might as well just can the advertising, and spend the money giving away a million or two units for free to get the word out there and get people buying the software.

    Except, of course, there is no software, hence the need to spend so much money on advertising to convince people they want it, because the games sure as hell aren't going to do it.

      But if that's their global advertising spend, then they'll make that back in the U.K. alone.

      Let's say the U.S. covers the cost of research / production... then the rest of the world is pure gravy.

        What about retail costs? What about profit? This is an insane amount of money to spend on a product that has a fairly high chance of bombing in the market place.

        I can smell an ngage coming on.

          Its possible its a brand recognition strategy, more to do with drowning out potential or existing (wii) rivals and making it so the Kinect becomes if not a household name at least still ubiqitous amongst non-gamer folk giving them both brand awareness, oppurtunity for expansion packs/sequels/add ons and of course new people on the 360 spending money on 360 games and on Live gold accounts.

    I have zero interest or space for Kinect.

    They should have worked on thought controlled Control, instead of jumpy jumpy wave controls.

    I can only see short mini/party games working well.
    You can't simply force this "control" method onto all game types.

    Just like iphone games you can't have touch control for everything, virtual buttons suck.

    It's a case of technology looking for an application rather than developers pushing ideas.

    Microsoft's only successful ads are for Windows (Laptop Hunters was a great campaign). Everything else has been really embarrassing.

    I remember when Bing rolled out and MS paid millions of dollars to shoe-horn it into movies and TV and had characters say stuff like "I Binged it" while keeping a straight face and acting like it was totally normal. This isn't good advertising, it's obvious, shameless and plain jarring.

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