Debbie McDonald Case
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SWOT ANALYSIS FOR ALPHABET GAMES
I have been asked to carry out a SWOT Analysis for Alphabet Games. Before I carry out the SWOT 3 factors have to be considered. These are:
PEST ANALYSIS
Political
The Association for UK Interactive Entertainment (UKIE)
Copyright, Designs and Patents Act 1988
The Independent Game Developers Association (TIGA) The Federation Against Software Theft (FAST) and Investors in Software (IiS)
Political lobbyists against computer games
European Games Developer Federation (EGDF)
Training and development
Economic
Development costs (costs up to £15 million for development)
Government taxes (VAT etc)
Economic climate
Customers ever changing tastes
Economic monetary issues
Customer wants and needs
Piracy
Interest and exchange rates
Social
Whats in trend and what is not (consumer choice)
Customer and magazine reviews
On line reviews
Pressure on parents to buy games
Major events (e.g. Football season, Olympics and Wrestling seasons)
Dealing effectively with film and TV production companies and magazines
Technological
Microsoft and Sony have a serious advantage over the smaller games manufacturers in terms of technological development
Licences and patents
Rising costs of equipment
Development of games
Apple Macintosh computers do not have the ability to run Flash Player
STAKEHOLDER ANALYSIS
Primary
Secondary
Owners and shareholders
Good revenue and return for initial investment
Being part of a successful business
Employees
Good rate of pay/good working conditions
Pride in working for a successful company
Customers
Develop exciting games
Excellent return on initial outlays
Creditors
Payments made on time
Keeps the credit scoring of the company good
Suppliers
Payments are made on time
Long term partnerships with companies
Government
Ensures rules and regulations are adhered to
Tax income
Banks
Financial status/credit rating
Interest received on loans/investments
EGDF (European Games Developer Federation)
Ensure interests of members are looked after
All members must ensure any rules and regulations are successfully adhered to
MARKET ANALYSIS
Diagram of Porters Five Forces
The threat of entry of new competitors
The threat of new competitors is middle to high threat as although it is a much specialised market to break into; more people have access to computers and the internet and can buy specialised software to produce games to sell or even give away free on file sharing sites.
The threat of substitutes
The threat of substitutes is very high as piracy is a massive drain on software companies. Software companies are losing millions of pounds each year through piracy. Games can be copied very easily and sold online and in markets for a few pounds. Games can also be found on file sharing sites such as Torrent Zap or Pirate Bay.
Peer pressure is a high factor amongst people especially children. Kids want to have what is popular so will purchase whatever software is in trend.
The bargaining power of buyers
The bargaining power of buyers describes the influence customers have on the market. Customers have the choice where to buy their products and seek out the cheapest prices.
Large stores, especially supermarkets buy their stock in bulk so can pass the savings on to the customer whereas small companies do not have the same bargaining