The sudden departure of Microsoft's Entertainment and Devices president Don Mattrick, and his arrival as CEO of Zynga, have caused an excited buzz about what this means for Zynga. You can read a detailed analysis of the effects on Zynga (and the questions this move raises) here. There's another side to this equation, though: What does Mattrick's move mean for Microsoft?
Mattrcik's departure a scant few months before the launch of Xbox One has raised more than a few eyebrows in the industry. Usually an executive likes to finish a major project before departing. The situation here is anything but usual, though. Zynga needs effective leadership immediately, and waiting six months would seriously affect the business.
Microsoft by this point should have all the hardware issues for the Xbox One dialed in, policy changes notwithstanding. At this stage, the emphasis at Microsoft has shifted from product engineering to manufacturing and marketing. Mattrick left behind an experienced team, so any disruption should be minor. According to a report by Bloomberg, Microsoft senior vice president and Windows head Julie Larson-Green may add the Mattrick's duties to her own.
At this point the biggest issue facing Microsoft is a public relations one. The company has still been dealing with the repercussions of its initial stance on connectivity and used games for the Xbox One. Mattrick's shift to a policy resembling the Xbox 360 has quieted much of the controversy. Still, Microsoft has to contend with those initial impressions, and added to that Mattrick's departure raising questions of whether he was pushed out because of that... it's time for some positive messaging.
Microsoft needs a solid communication strategy for the fall campaign in addition to the marketing spend it's already got in the works. Sony's $100 price advantage has led to an early lead in pre-orders; Microsoft has to emphasize the advantages of the Xbox One's Kinect bundle to overcome that pre-order disparity.
Microsoft also needs to get the message out that Mattrick's departure won't affect any of the Xbox One's rollout plans, or the great games Microsoft has coming for it. It should be a non-event as far as consumers are concerned, and that's the message that needs to be out there. Microsoft does have to be careful not to peak its messaging too early. That's a danger considering how much time there is before the Xbox One launch.
Microsoft also needs to consider that while the Xbox One is important, the bulk of the division's revenue and profit is still going to be from the Xbox 360 this year. The Xbox 360 received scant attention from Microsoft at E3. Yes, a new version was announced... but not priced, or a release date provided. The World of Tanks announcement for the Xbox 360 is potentially of huge importance, yet it hasn't gotten much attention lately. Third-party publishers also have the best 360 titles ever coming up for the holidays, including Grand Theft Auto V.
Microsoft should shift resources into pushing the Xbox 360 for the next month or two, establishing when the new version comes out (hopefully with new, lower price points). Sony was careful to promote the PS3 as well as the new PlayStation 4 at E3. Microsoft should take a cue from Sony on this and give some love to the Xbox 360 lineup, making sure it will have a solid holiday selling season. There's time enough to pivot to the Xbox One after that.
Inevitably, it all points to an increased marketing effort this fall. Microsoft should not pull back on Xbox 360 marketing, put instead should increase it. The marketing for the Xbox One should be in addition to this marketing effort, not a replacement for it. Microsoft needs to have a great Christmas for the Xbox 360 as well as the Xbox One. It's a tall marketing task, made more difficult the later it gets started. We'll be watching to see how Microsoft handles this.