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EA spends more money on marketing than on developing games

I'm sure there are TONS of companies who waste money on marketing because they believe it's the best way to get new customers, etc. I have no idea if it really works but marketing very rarely works on me.
 
Originally posted by: MustISO
I'm sure there are TONS of companies who waste money on marketing because they believe it's the best way to get new customers, etc. I have no idea if it really works but marketing very rarely works on me.
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Sure seems to have worked for EA. Most of their games are pretty bad (although they're improving lately) and yet they're what, the second biggest publisher? Maybe first, especially with Madden.
 
Originally posted by: mindcycle
"According to Electronic Arts officer Rich Hilleman, 'the price of producing console games has rocketed, with marketing costing up to three times more than the development of a title.'"
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via http://games.slashdot.org/stor...n-Development?from=rss

I wonder why that doesn't really surprise me.. It's probably 10 times less for PC games. sorry.. "ports".
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The very general rule in marketing mass media is 1:1 ratio for production and marketing budgets. Perhaps it is more for video games. Three times seems pretty far out of whack, but it doesn't sound like that's the average for all their titles.
 
It's not surprising, when you consider the various licensing agreements that EA Sports, for example, has with professional leagues. I haven't worked with EA in particular, but we represent one of its competitors, and the licensing agreements each have very strict marketing requirements. I'm not surprised that EA both voluntarily, and by force of contract, spends a lot on marketing.
 
I'm really not fussed. If I like a game, I buy it. I don't arbitrarily hate on one publisher or another. I have several EA titles that I enjoy a lot, and you know what? Their marketing budget never even factored into that enjoyment. Strange, right?
 
Originally posted by: mmnno
Originally posted by: mindcycle
"According to Electronic Arts officer Rich Hilleman, 'the price of producing console games has rocketed, with marketing costing up to three times more than the development of a title.'"
Click to expand...
via http://games.slashdot.org/stor...n-Development?from=rss

I wonder why that doesn't really surprise me.. It's probably 10 times less for PC games. sorry.. "ports".
Click to expand...

The very general rule in marketing mass media is 1:1 ratio for production and marketing budgets. Perhaps it is more for video games. Three times seems pretty far out of whack, but it doesn't sound like that's the average for all their titles.
Click to expand...

I really feel like 3x the budget for marketing has to be VERY rare. I'm not saying that marketing doesn't get a big budget for games, but 3x dev cost would be really rare... maybe for something that had little dev cost. The return on advertising dollars has to plateau long before that most of the time.

And I have no doubt that in most cases the marketing dollars more than pay for themselves. EA's been marketing games for a long, long time.

As for me buying a game, I don't care what was spent on marketing since I'll look at reviews/hear word of mouth/etc before purchasing. Although, it's possible the marketing might get me to take those steps and perhaps lead to a purchase.
 
Operating Expenses:

Marketing and sales $164mn (2009) // $128mn (2008)
Research and Development: $312mn (2009) // $356mn (2008)
(That's in a single quarter)
 
Originally posted by: GodlessAstronomer
I'm really not fussed. If I like a game, I buy it. I don't arbitrarily hate on one publisher or another. I have several EA titles that I enjoy a lot, and you know what? Their marketing budget never even factored into that enjoyment. Strange, right?
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Yeah totally, i hate as as well. 🙂
 
I fail to find the shocking, its their money and business. I'm sure its similar in many industries. I highly doubt Mc Donalds spends more developing its menu than they do advertising it.
 
Well, I don't really find this surprising. I mean, you can pay one intern minimum wage to update the roster in Madden every year, but it takes substantially more $$$ to market that roster update as being worth $60.
 
Like Hollywood. No suprise why they market such huge steaming piles of crap (GI Joe). It's not cheap placing your product in magazines, commercials, product placements, store promotions, and advertisments either.
 
Makes sense. EA is such a crappy company they have to flood the media with ads about what a great publisher they are to drown out the negative.
 
I read somewhere that some pharmacuetical company spent 3 billion on advertising in a year and 600 million on research and development. Now that's scary.
edit, it's ONLY a 2/1 ratio. I feel much better now.
 
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