Activision Blizzard Inc. is an American video game holding company headquartered in 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. The Company currently includes four business units: Activision Publishing, Blizzard Entertainment, King Digital Entertainment, and Activision Blizzard Distribution. The major products produced by Activision Blizzard include Call of Duty, Tony Hawk’s, Spyro, Skylanders & Sekiro 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 been trailblazers, breaking several release records and catapulting Activision as the largest game company in the Americas and Europe in terms of market capitalization and revenue. Based on the 2022 annual reports, platform providers like Sony, Apple, Google, Microsoft, Facebook, Valve or retailers like Best Buy, GameStop, Target, and Walmart also contribute significantly to this gaming giant’s net revenues (approximately 50% of their revenues) in addition to end customers. As of 2023, the company had approximately 13,000 employees.
The USP or Unique Selling Proposition of Activision Blizzard lies in being the world's largest gaming company in the Americas and Europe by market capitalization as of 2023. Activision Blizzard’s mission statement reads “Connecting and engaging the world through epic entertainment – has never been more relevant and important. As we continue to execute our strategy, our investments in our biggest opportunities continue to allow us to provide superior shareholder returns.”
Business Sector
Video Games
Operating Geography
North America, EMEA & Asia-Pacific
Revenue
US $7.5 billion - FY ending 31st December 2022 (Y-O-Y decline of -14%)
US $8.8 billion - FY ending 31st December 2021
SWOT
SWOT Matrix for Activision Blizzard Inc
Strength
Weakness
Broad distribution and reach
Robust product portfolio of leading mobile gaming franchises
Strategic partnerships, mergers, and acquisitions
Digital revenue streams are more recurring and provide relatively higher profit margins
Commitment to Workplace Excellence and Diversity
High dependence on a few products
Reliance on third-party platforms
Seasonality in sales increases the risk
Lawsuits regarding toxic workplace environment
Possible failure in effectively managing growth and business complexity
Opportunity
Threat
Merging with Microsoft enhances competitive edge in tech advancements.
Target expanding gaming markets in Asia.
Capitalize on the growing esports industry
Emergence of platforms like cloud gaming and VR.
Rise of free-to-play games & potential to expand mobile gaming audience
Increasing importance of free-to-play games
Impact of Technological Innovation
High competition in the industry
Piracy is a persistent problem for the gaming industry
Detailed SWOT Analysis of Activision Blizzard Inc
The detailed SWOT analysis for Activision Blizzard Inc is presented below:
Strength
Broad distribution and reach: Many of the products produced by Activision Blizzard contain software that 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 connection, 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 specialty stores, and other stores, or 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, digital content delivery, and other similar features designed to allow people to connect irrespective of the games that they are playing on the platform.
Robust 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, StarCraft, etc. Over time, based on their expertise and success, the company also plans to roll out media integrations across the Activision Blizzard portfolio which will prioritize platforms based on their ability to provide better opportunities for the brand. The company's diverse interactive content portfolio has attracted millions of customers, resulting in a substantial increase in net bookings for FY 2022, compared to the previous year. This growth was primarily driven by a $205 million increase in King net bookings, fueled by higher in-game player purchases within the Candy Crush franchise. Additionally, a $185 million increase in Blizzard net bookings was influenced by the anticipation and success of Diablo Immortal and Overwatch 2. Additionally, the company also partners with companies like Apple, Facebook, Google, Microsoft, Sony, and Valve to serve the purpose of marketing, sales as well and financial gain through licensing fees.
Weakness
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Opportunity
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Threat
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PESTLE
PESTLE Matrix for Activision Blizzard Inc
Political
Economic
Loot box regulations affect game releases in Dutch & and Belgian countries.
Regulatory changes in China may impact business operations.
Impact of fluctuations in foreign currency
Impact on discretionary spending for video games
Social
Technological
Behavioural changes due to video games
Gaming as a cultural force
Video games redefining social spaces
Unions revolutionizing the gaming industry
Workplace initiatives to improve working conditions of women
Opportunities due to emerging innovations
Risk of the emergence of mobile gaming and free-to-play games
Increased awareness of data privacy among consumers
Legal
ENVIRONMENTAL
Risk of inadequate intellectual property laws
Increasing laws for regulating the operating sector
Sustainability priorities to address growing concerns on climate change.
Made significant progress in the green energy adoption
Detailed PESTLE Analysis of Activision Blizzard Inc
The detailed PESTLE analysis for Activision Blizzard Inc is presented below:
POLITICAL
Loot box regulations affect game releases in Dutch & and Belgian countries: The release of Diablo Immortal in Belgium and the Netherlands was terminated due to the countries' regulations on loot boxes. Activision Blizzard, the game's publisher, has cited the operating environments as the reason for this decision. Loot boxes have faced scrutiny in both countries, with authorities arguing that they resemble gambling. As a result, Diablo Immortal is not available on platforms like Battle.net, the Belgian and Netherlands App stores, or Google Play Stores in those countries. These regulations have strongly affected the game's availability impacting customer outreach.
ECONOMIC
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SOCIAL
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TECHNOLOGICAL
This section is available only in the 'Complete Report' on purchase.
LEGAL
This section is available only in the 'Complete Report' on purchase.
ENVIRONMENTAL
Sustainability priorities to address growing concerns on climate change: The company celebrated Earth Day across its organization, aiming to educate employees about sustainability priorities, engage them through challenges, and inspire sustainable changes in their daily lives. In collaboration with Trees for the Future, the company planted 10,000 trees in Sub-Saharan Africa, providing employment, food, and sustainable agricultural techniques to local farmers. Additionally, the partnership between King and Earthly successfully removed over 8,500 metric tons of carbon, equivalent to eliminating the carbon footprint of more than 34,000 flight hours, through nature-based projects focused on carbon removal and ecosystem restoration.
More Info
Major Competitors
Nintendo
Electronic Arts
Rockstar Games
NCSoft
Table of Contents
Company Overview
1.1 About the Company
1.2 Business Sector
1.3 Operating Geography
1.4 Revenue
SWOT Analysis
2.1 SWOT Table/ SWOT Matrix
2.2 SWOT Overview
2.3 Detailed SWOT Analysis
2.4 Strength, Weakness, Opportunity and Threat
PESTLE Analysis
3.1 PESTLE Table/ PESTLE Matrix
3.2 PESTLE Overview
3.3 Detailed PESTLE Analysis
3.4 Political, Economic, Social, Technological, Legal and Environmental
You can use the following in your reference section to
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Games' cultural impact on society - https://www.weforum.org/agenda/2019/12/video-games-culture-impact-on-society/
Activision Blizzard union could revolutionize the games industry forever - https://www.inverse.com/gaming/activision-blizzard-union-abetterabk-could-change-the-games-industry
Activision Blizzard Commits to Expanded Workplace Initiatives, Reaches Agreement with the EEOC | Business Wire - https://www.businesswire.com/news/home/20210927005844/en/Activision-Blizzard-Commits-to-Expanded-Workplace-Initiatives-Reaches-Agreement-with-the-EEOC
Game publishers’ detail green credentials - https://www.gamesindustry.biz/articles/game-publishers-detail-green-credentials
The detailed complete set of references is available on request in the 'Complete report' on purchase.
Activision Blizzard Inc SWOT and PESTLE analysis has been conducted and reviewed by senior analysts from Barakaat Consulting.
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