Nintendo Case

Was Nintendo just lucky, or does the Wii’s success have strategic merit?

Their success with the Wii really stems from two sources. First, they have gained substantial market share with previously untapped demographics (elderly, smallchildren, and families). Second, because they have eliminated many of the additional costs and features of the more advanced game systems, they have been able to better compete based on price.Even while they were struggling, Nintendo maintained a strong brand within thegaming industry. They are the industry pioneers who created the big ticket names likeDonkey Kong, Zelda, and Mario, but as their systems became more advanced they wouldbecome victims of their own success. As they advanced their products moretechnologically savvy competitors such as Sony and Microsoft were able to enter themarket with advanced equipment and games. Nintendo’s ability to think outside of thebox has prolonged what could have been a dire fate.

The more advanced competitors are entering this new market using similartechnologies to compete in the interactive gaming market. Their technologicalsuperiority paired with the motion sensor technology is sure to make a significant dent inthe Wii’s market share. The one major advantage that has substantial strategic merit is the low cost. Withthe current global economic state low cost alternatives have become crucial and the Wii fits the bill.

Has Nintendo put the “fad” question to rest? State a case as to why the Wii is oris not here to stay.

When this question and case study were written in 2008, the Wii had already had two great years of salesand no sign of slowing down. The company had rebuilt a failing company within the console gaming market.The “fad” they created got so much buzz that the competitors had to emulate their formula for interactivitywhich would grossly halt the sales of their systems. These mock Wii technologies combined with a growingdemographic of cell phone gamers has created a dim future...