Xbox The State Of Xbox One In India

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Just read the article from The Mako Reactor:

Xbox One India launch

Instead of concentrating on the audiences that helped the Xbox 360 remain competitive, Microsoft India thought it made sense to tackle another segment altogether — digital natives.

“We know our audience is natively digital,” said ex-Xbox India head Anshu Mor in an interview in August 2014 leading up to the Xbox One’s India launch. “They’re already talking, buying online, not opposed to placing orders online. They make all their decisions online. They might walk into a store and buy something but if it was online they’d be just as happy. They’re more digital than anyone else.”

To push this forward, the company partnered with Amazon India, hoping to get consumer insights that would help it drive sales forward.

With this thought process in mind, gone were expensive hoardings and TV commercials, Akshay Kumar and Yuvraj Singh were traded in for AIB — a comedy group, and an offline presence was swapped for bombarding Amazon India’s homepage.

Initial sales were strong with reports of 300 units sold during the pre-order phase itself. However it didn’t take long for it to be discounted with increasing frequency. Most notoriously, the Xbox One price was slashed by almost 20 percent from its MRP of 39,990 barely a month since launch during Amazon’s Diwali sales with free games and Amazon gift cards thrown in.

All in all, less than 1,500 Xbox One consoles were sold in the first four months and that too after rampant price cuts and offers. In comparison, the PS4 sold 4,500 in its first two weeks and continues to dominate the market. Right now, total lifetime to date Xbox One sales in India across all variants including the original Xbox One, Xbox One X, Xbox One S, and Xbox One S All Digital Edition is estimated to be close to 50,000 with the sum total of PS4 consoles in India across all versions being around 400,000.

Xbox One in India – what went wrong?

To begin with, the Xbox One India price of Rs. 39,990 was perceived to be exorbitant. Despite having the same price as the PS4 and shipping with a free game, most users didn’t see the value of buying an Xbox One officially. For the same amount of money, the US got the Xbox One Assassin’s Creed bundle with Kinect, Halo: The Master Chief Collection, Diablo 3, Kinect Rivals, Alien: Isolation ,and Dragon Age: Inquisition. The situation in the grey market wasn’t too far behind with the console going as low as Rs. 27,000 with a game. Even when you factor in situations when Amazon discounted official stock by 20 percent, it was still around Rs. 5,000 more. This simply made it a bad deal for many. You’d think that restricting sale to a single retailer would allow for lower distribution costs and in turn result in a lower cost for end-users, this was not the case outside of panic discounting.

Furthermore, Microsoft overestimated the willingness of consumers to drop close to Rs. 40,000 on a device they haven’t tried out. Granted the Xbox One was available at events like Comic Con, but public demonstrations weren’t widespread for many to check out and consider purchasing. So much so that the company enlisted the help of the retailers and distributors they once shunned for Xbox One public demos in the hopes of pushing sales.

It didn’t help matters that Microsoft’s positioning of the Xbox One in India was at odds with what was being done internationally. During this period, Xbox boss Phil Spencer was trying to focus the Xbox One’s messaging around the games rather than Kinect with the likes of Sunset Overdrive, Rise of the Tomb Raider, and Halo 5. Meanwhile the Xbox One in India was being pushed as video conferencing device to gamers instead of well, a device that could play games.

At a time when most third-party publishers stuck to a Rs. 3,499 price (around $58 then), it made the Xbox One’s exclusives seem expensive in comparison. It got worse with 2015 Xbox One exclusives like Rise of the Tomb Raider, Forza 6, and Halo 5 having a Rs. 4,699 price (nearly $74 at the time) with Microsoft stating perplexingly that each game has its own individual price for India despite sporting a uniform $60 tag internationally.

From September 2015, Microsoft Priority Retailers were selling the Xbox One offline. Fourteen months after the September 23, 2014 Xbox One launch, Amazon India’s competitor, Flipkart, started selling Xbox One consoles as well. Four days later, India’s third biggest e-commerce platform, Snapdeal followed suit.

Wider distribution to other offline game stores finally happened in 2016, nearly two years after its official release. Interestingly, Microsoft never made an announcement regarding its foray into brick and mortar and only confirmed it after it was brought to their attention that several stores were selling the console with an official Microsoft sticker. Demo units were few and far between too.

What followed was a string of odd moves and radio silence from Microsoft on all things Xbox. This included making Quantum Break and the Xbox Elite Controller Flipkart exclusives at launch without telling consumers. There was silence regarding bringing Dead Rising 4 to India (fearing competition from Battlefield 1 and Call of Duty: Infinite Warfare was the rationale), and dropping a physical release for Sea of Thieves at launch altogether.

Much like the original Xbox One, the Xbox One S hit India long after its international release in October 2017 starting at Rs. 29,990 promising Scalebound which was well and truly cancelled by then. The response to the Xbox One S at the time was muted at best.

The Xbox One X fared a bit better with Microsoft deeming India fit to receive the souped up console two and a half months after its international release in February 2018. At a price of Rs. 44,990 it was the company’s most expensive console launch to date. However sales were brisk and the initial shipment of a hundred units sold out in the first week itself. Though any hopes of a turnaround were short lived. It was too late. There simply weren’t enough games to support it.

Amidst all this hubris, there seems to be one value proposition that could keep the Xbox One afloat in a country where Microsoft’s moves appeared confused for most part, the Xbox Game Pass. Several retailers speaking to The Mako Reactor have seen success selling the Xbox One S when bundled with Xbox Game Pass. It turns out the audiences enthralled by the offering is the same that gravitated towards Kinect during the Xbox 360 days, parents and kids.

“The Xbox One S with Game Pass has sold well for us,” says a Chennai-based retailer. “Parents like the fact that they don’t have to buy games for their kids, though they prefer not to use their credit card online after the subscription expires. They keep coming back asking if they could get Xbox Game Pass prepaid codes like we have for Xbox Live.”
Similar sentiments were echoed by store owners in Delhi, Mumbai, and Bengaluru making it seem like Microsoft has missed a trick by not working on in-store Xbox Game Pass prepaid codes akin to Xbox Live subscriptions.
 
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