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One of the big questions of the 2006 Holiday season revolved around video game Gears of War as Microsoft (NASDAQ:MSFT) Xbox 360’s first “Killer App”. After selling nearly 3 million copies worldwide (nearly 1 for every 3 Xbox 360’s) it has become a staple in any gamer’s library. But a true killer app should drive people to buy the console. Looking at Xbox 360 shoppers online, Gears of War was a great success among current owners, but Microsoft will have to wait until next holiday season for its first console-defining game. The good news for Microsoft: A year from launch, Halo 3 was already driving significant Xbox 360 purchase consideration.

Microsoft addressed the launch of the Sony (NYSE:SNE) PS3 and Nintendo (OTCPK:NTDOY) Wii by reminding people that the 360 was out, easy to find, and had great games in the pipeline. The November Gears of War launch and teasers for Halo 3 were a part of this strategy. Throughout the holiday season, we assessed the degree to which Xbox 360 shoppers also considered various games at online retailers.

MF-Gears-Game-Graph-1.3

  • From November to January, an average of 4% of online Xbox 360 shoppers also considered Gears of War.
  • During the same period an average of 12% Xbox 360 shoppers viewed Halo 3 at online retailers, nearly triple the overlap that Gears of War received.
  • A game in a series as popular as Halo would be expected to generate massive interest, but the significant overlap between Xbox 360 shoppers and Halo 3 shoppers* is surprising. This metric begins to explain the relationship between exclusive games and their impact on console demand. Shopper overlap doesn’t definitively measure this impact, but looking at people who considered both the game and the console at a retail product level starts to demonstrate why someone was shopping for a 360, since it can be assumed that they were interested in purchasing both.

    Comparing Halo 3 to Gears of War on this metric, three things become apparent: Gears of War may have sold a lot of copies but it was only marginally effective at driving 360 adoption (calling its “killer app” status into question); promoting Halo 3 during the Wii and PS3 launches probably swayed a large group of neutral shoppers towards the 360; and its probably not a bad idea to pre-order Halo 3 if you want it before next February.

    *Halo 3 shoppers were defined as people visiting SKU level Halo 3 pages at the 20 largest online retailers.

    Where do Compete's traffic numbers come from?

    Source: Game Consoles: Microsoft's Search for the Killer App