Giuseppe Nelva
First of all, we hear from CEO Haruki Satomi, who states that his goal is to make Sega Sammy’s Japan’s number one entertainment company, able to release products that truly represent the country.
Satomi-san goes on to explain that one strategy to generate the kind of titles he’s talking about is the creation of the previously-mentioned Super Game. One such title is in development with a target release before March 2026.
Going forward, I want us to turn out hits that go above and beyond these crazes. The latest Sonic movie is one such hit. Released worldwide in the spring of 2022, Sonic the Hedgehog 2 broke the record for the highest grossing video game-based film ever in the U.S., and met with high acclaim worldwide. I saw a local shopping mall in the States that was overflowing with Sonic merchandise. Those are the kind of hits we want to create, titles that represent Japan, and we want to see similar scenes all around the world demonstrating their huge popularity.
Satomi-san also sets the sales target for such a game in 100 billion yen, just under $700 million.
One relevant strategy Sega is engaging with is simultaneous worldwide releases.
More than anything else, the starting point for building that kind of community is creating an interesting game that gains user support. Truly interesting games attract a lot of people, and a variety of communities naturally spring up around them. For this reason, we’ve started collecting user data, such as what kind of games users play, how long they play, and how often. By reflecting this data as well as our experience and knowledge in game development, while drawing on our capabilities in digital technology, we hope to create an appealing game that meets the demands of future users.
Satomi-san also explains that previously there was skepticism within Sega about releasing Japanese games simultaneously worldwide. Yet, the company has realized that carrying out with the usual sales strategy would let the massive global game companies get ahead.
This climate within the company was changed completely in the wake of the success of the Persona and Like a Dragon/Yakuza series, which sparked growth of sales globally.
As a result, there is now a conviction within Sega that Japanese IP can connect well with global audiences.
In the fiscal year that ended in March 2022, Sega released 7 new games in line with this new strategy, selling about 6 million units. In the current fiscal year ending March 2023, the company aims to release 13 games, and the forecast is that they may sell about 13 million units.
Another aspect of Sega’s new strategy is prolonging the life cycle of its products with remakes, remasters, and spin-offs. There have been multiple new games released according to this strategy in the fiscal year that ended in March 2022, and they sold about 4 million units. On top of that, Sega is also diversifying its monetization strategies such as supporting subscription services.
The final point of Sega’s strategy is strengthening user engagement using a mix of media and other approaches to connect the company’s IPs with more people. Sonic is an example, with the movies and animated series added to games like Sonic Frontiers.
Interestingly, Satomi-san also explains that he has a theory that a company that does not create empathy does not survive the market. He wants to create entertainment that can move the users’ hearts by surpassing their expectations. As a result, employees will also be moved and get motivated, creating a virtuous cycle.
Basically, Sega’s strategy to expand its brands is as follows.
So, what can we do to move people’s hearts in this way? The answer lies in offering entertainment that surpasses people’s expectations. People are satisfied with products and services that meet their expectations, but their hearts aren’t moved—that only happens they glimpse a future that they’ve never felt or experienced before. This is why we should always pursue new forms of entertainment with an eye to the future, continuing to embrace challenges, not wedded to the past.”
Expanding touchpoints with usersStrengthening global roll-outMultiplatform supportMultilingual supportProlonging product life cyclesUtilizing IP assetsStrengthening digital salesMultichannel monetizationStrengthening user engagementCommunity managementStrengthening the mix of media
Interestingly, we also get to hear about the specific strategy for Sega’s subsidiary Atlus, which focuses on the “utilization of a lineup of titles that are highly acclaimed by users” This includes remastering and the utilization of existing IPs and multiplatform deployment to build a global fan base. The report also included a summary of sales for Sega’s major IPs. This includes 19 million units for the Shin Megami Tensei series, 15.5 million for the Persona series, 40.4 million for the Total War series, 1.51 billion units for the Sonic series, 5.8 million units for the Sakura Wars series, and 19.8 million units for the Yakuza/Like a Dragon series. Do keep in mind that these include free-to-play downloads. Speaking of the Persona series in general, the report also mentions that Persona 5, Persona 5: Dancing in Starlight, Persona 5 Royal, and Persona 5 Scramble: the Phantom Strikers generated 7.22 million units sold, 77% of which were outside of Japan.
