Nintendo's Brazen (& Successful) Marketing Strategy
Dean
I notice that pretty much everyone I know who plays video games either has a Wii or, more often, badly wants one.
I don't know anyone with a PS3, and I don't know anyone who tells me they want one. Now it may be that everyone who has a PS3 has no desire to tell me about it, and had no trouble getting one and so had no reason to complain. Still, all I notice is that all the gamers I know--even the casual gamers like me--want a Wii, or have one and are thrilled with it.
At this point, the way I've been watching it go down, though, I'm pretty well convinced that Nintendo has created artificial shortages on their systems on purpose. I normally pooh-pooh such ideas because it seems intuitively like bad business sense. If nothing else, because if it backfired it would go very badly. A big "screw you, Nintendo" attitude might have been the result of these shortages, and people may have flocked to the Xbox 360 or the PS3 instead.
For my own part, for example, I have no significant loyalty to Nintendo as a company. I like their products, but they weren't the first video game company I bought from. I liked the PS1 and the PS2 from Sony a lot. Sony has pissed me off with the PS3 though--expecting me to drop $600 just for a base unit with no frills is ridiculous. The entry price point for a brand new video game system has been between $250 and $350 for years and years and years--what the Hell was Sony thinking?
It's obvious to me that Nintendo is playing a similarly dangerous game here. But they've won. It's obvious that their problem here isn't manufacturing issues. They're very intentionally releasing limited numbers of the system in order to build up desire and build up buzz. It's ballsy. By all rights people should be angry with them.
But somehow they've got enough market loyalty--and also a system that's just so damned good--that they're willing to brazen it out and intentionally create shortages in the product just to get people talking about it.
It is a beautiful system. It is very well-designed. It's so innovative on user interface that it's brought video gaming to a new level. Its internet integration is nearly seamless. The backward compatibility with not just Gamecube games but also all the old Nintendo, Sega, and even TurboGrafx-16 games is genius.
They've done something marvelous here. I really think that they're likely to be the dominant gaming platform by the end of this year.
I'm just stunned by how well they carried off this temporary artificial shortage right after the official launch. This could have backfired on them so bad they'd never recover. Instead it's just helped them get ahead. It's amazing.
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I have worked in the electronics chip industry for 25 years. It is hard to get these systems ramped up and into high volume productions. At this point it looks like Sony took a big risk by putting blue-ray into its game console, and it make have put them into 3rd place in the console market.
After Christmas, they stopped taking any reservations. Indeed, more than one store manager told me that they are not ALLOWED to take reservations anymore. They're not ALLOWED to.
One offered to make one for me anyway on the sly, then changed his mind.
Yesterday, one told me there was a hot rumor that anyone who showed up at Target or other select stores in the morning would be able to get one. Lo and behold, we could--but they were passing out numbers and only had so many in stock.
Suddenly, also, accessories were hard to come by this morning. For weeks I've been walking into game stores and they have all kinds of things on sale for the Wii--games, controllers, other accessories. I was tempted to buy some. Somehow, suddenly, every store I visited today (I visted 5) had no major Wii accessories at all. They were all sold out. All of them. They'd all had only so many accessories and games in stock. Suddenly, they all got the units, and amazingly, the number of units almost exactly equaled all the accessories they had on hand. No more. Suddenly, all the accessories they'd had on sale for weeks were gone. They had no extras.
I really do think they're doing it on purpose.
I think the best evidence is this:
We seem to have a dearth of press statements by Nintendo saying, "We're really sorry, we're having production difficulties for X, Y, and Z reasons." They're being entirely mum about it. The units just show up when they show up.
I'm pretty sure they're doing it on purpose.
Yeah, I had Pong, too. ;^D
I keep thinking how retro-cool in a camp way it *might* be to port something really dumb like Pong to the Wii...maybe a pack of old '80's stuff. I think I could set up my furniture like a PacMan maze...
Someone at Sony heard this and said... well OK.. developers saw the trends in movies and read a few polls. Games with extreme content got the front page and the CNN coverage and THAT sold systems. Players and programmers unlocked (Hacked) other games and now we had virtual soft core porn. More Headlines.... WOW, any publicity is great publicity right?
WRONG, here's where the rubber hits the road, at $600-800 dollars, content that in some cases (The most publicized ones) has moved from just mature to adult, and little to say for the system but "It really is better than a PS2 when you have a $6000 TV", the PS3 is in trouble.
They entire market of kids and teenagers funded by Mom and Dad and Grandma is out in the cold. The only thing my Mother (and my children's Grandmother) could tell you about the PS3 is that "Isn't that the game thing with the prostitutes that you can kill?", the only thing my wife could tell you is "Doesn't that cost like $1000?"... those are the wrong marketing messages you need to be giving the people paying for your systems.
Add the "Can't get one anywhere" and the "People waiting 2 days in line" news coverage and who in their right mind expects anyone but 30 something men with $800 to burn to be buying these things?
I think 3D perspective versions of the old classics has great potential, and would be little work for any Wii team. Pong, PacMan, and Space Invaders would all be pretty fresh in 3D perspective with Wii's interactive play.
That said, I'm interested in the PS3. However I don't see me getting it for at least a year or more. The reason is that it demands hi-def TV. Hi-Def TV demands hi-def Cable, home theater, and of course a hi-def capable television. I have my eyes set on a 50" plasma ($2k), home theater system ($500). But KomKast gets enough money frm me as it is, and I can't justify spending $3000 on "the television experience."
The Wii, on the other hand, doesn't demand that. I also like the idea of making video games more interactive. Sony hasn't seriously pushed interactivity even though it sold the Eyetoy and licensed the tech for the floor pad for Dance Dance Revolution and the guitar for Guitar Hero.
Sony has clearly doesn't take anything but pushing buttons on a controller seriously. They are in love with the technology - the Blue Ray and the hi-def capability of 1080p - but the PS3 controller hasn't changed much.
It reminds me of the way the Germans used to engineer cars. They were technically good, but about as much fun to drive as a milk truck. The Italians were the one who made the cars people loved to drive - when they worked. The Wife still loves her Fiat even though it loved to die on her in the fast lane, earning it the moniker "Fix It Again Tony".
The PS3 is over engineered for now. Maybe in a year or two the technology will make more sense - but not in my house. And I'm a technophile... Sony's target audience.
Idiots..
Meanwhile, I stand a good chance of finding a PS3 in any number of stores I go into.
600,000 units sold is not an artificial shortage. Not taking reservations for the Wii makes good business sense. Why hold on to a unit for a customer when they're guaranteed to sell it the moment it hits the floor?
I'd talk about the rest of your post but I don't have the time. You don't understand how the video game industry works. You've not spend enough time in the, well, culture. And I don't expect you to. It's not your thing.
As for the $600 PS3 price tag - even at that rate Sony is still taking a huge loss. Heck, Sony wasn't making a profit on the PS2 hardware until the last year or so. And Blu-Ray players alone cost anywhere from $800-$1000. The PS3 at $600 is a frickin' steal.
You write on politics, religion and everything else. Leave the video game stuff to me. ;-P
I don't know anything about the "Wii" - not even how to pronounce that - I keep thinking "W2" but that seems wrong. It can't possibly be pronounce "wee", can it?? Why not call it the Nintendo Poo instead?
Anyway I know nothing about it but if it has fun games - and not just super 3D graphics - I'm interested...
(Hi Dave!)
I'm not certain about Dean's 'artificial shortage' argument, regardless they came out on top of Sony's PS3 for several reasons. In my mind, they include:
1) Impeccable backwards-compatibility. Simply put, every game I've tried on it, old or new, has worked, while I've heard dozens of horror stories about the PS3 on this.
2) $250 is affordable for the average consumer. $500-600 makes you wonder if you really need it right now.
3) It's fun to play and easy to get started.
4) Shortage or not, Sony's was far worse, so their big competitor for launch was badly out of position.
I do have one beef with them, though - they started off with Wi-Fi only. It should have been incredibly simple to add an RJ-45 port somewhere.
Supposedly the Wii Lan Adaptor is available for purchase now... but it's not in the local stores yet. I'd be happy to buy it if I had a local option instead of trying to get UPS to work with me.
I'll have to ask my resident Game King for his opinion.
JonD: The retail prices for the PS3 were $599 for the basic unit and $699 for the slightly upscale unit last I looked.
Martin: It's already been done with Pac-Man and some other classic games.
Nicholas: It's pronounced "whee," exactly as you thought. It sounds silly at first but once you get over it, it's fine. Think "Wheee!" as in fun and you get it. It's also easy to say in almost any language, which is a major attraction for the marketing folks.
They stopped rather suddenly after Christmas.
It struck me as an unusual and gutsy move.
Also, Scott, are you sure that Sony had anything at all to do with either the dance pad or the Guitar Hero controller? I'm pretty sure that Konami was the primary developer of first the arcade DDR games, and then brought them to PS2. Similarly, Red Octane and Harmonix developed GH and the controller for it. Sony licensed their use for the system, but had zero to do with developing the controllers.
Sony has stuck with essentially the exact same Dual Shock controller now through three systems. They should have known better after the original Xbox and Gamecube came out with evolved controllers, that worked better and felt better. In fact, the Microsoft Controller 'S' is the best controller I've ever used (never used a 360). For Sony to release the same controller again is an embarassment.
We just bought a used Xbox (not 360) two months ago, when I finally caved in to my 10-year-old's pleas. I like the fact we are able to use it as a DVD player, something the Wii won't be able to do until the next iteration gets released later this year.
There was no artificial shortage. Nintendo had 4 million Wii's already available in a warehouse. Before they had an opportunity to SHIP all the units a few idiots decided to not hold on to the controllers and destroy their $5000 plasma TV's. So Nintendo recalled all the controllers to replace the strap. The 4 million stored in the warehouse just became JUNK until they replace the strap. It takes time. As others have said XBOX360 was in major short supply last year. Now this year they had plenty. The real arms race begins next Christmas season. Each console will have a year under their belts and the real selling point begins to shine. The GAMES make the console.
Lets see how it all shakes out next year..
Jerry
Of course we all lose our tempers now and then. Dean freely admits to being imperfect in this regard, which is why regulars to this establishment will generally be cut more slack than people who we don't know very well.
Still: behave like an adult, or go find somewhere else to play. Thanks.