Nintendo Wii Case Study Essay

Nintendo Wii Case Study DeVry University Professor Earnhardt 11/13/11 Executive Summary This marketing plan is looking at Nintendo’s Wii. This innovative hardware has really changed the way people, young and old, look at gaming. Considering the Wii has only been out since 2006 this is an extraordinary feat. Nintendo has been keeping gaming alive since 1985 with the release of the original Nintendo (Famicom in Japan) and still keeps the true spirit of gaming alive today. Situation Analysis Internal Environment Key Executive The board of directors includes the following people: Satoru Iwata: President and Representative Director -Reggie Fils-Aime: President, Chief Operating Officer, and Executive Vice President of Sales and Marketing of Nintendo of America Inc. -Tatsumi Kimishima: Director, President of Nintendo of America Inc. and Director of Nintendo Inc. -Elichi Suzuki; Managing Director and Director Board of Directors -Satoru Iwata -Tatsumi Kimishima -Masaharu Matsumoto -Elichi Suzuki -Yoshihiro Mori Employees Nintendo has a large number of employees ranging from hardware based people to software based people, programmers to business people, and the thinkers and the doers.

The employees keep Nintendo alive and thriving. External Environment Customers Without the support of customers ages 3-120, Nintendo Wii would be sitting on store shelves collecting dust and losing money for Nintendo. Competitors The two main rivals to the Nintendo Wii are Sony’s PlayStation 3 and Microsoft’s Xbox 360. Without this competition, Nintendo may not be to the point that it is now. It could rest on its laurels and not supply its customers with newest and greatest ideas. Media The media can at times be a business’s enemy or a friend.

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Regardless which side it is on at any given time, the publicity the media gives helps position Nintendo and its products into the minds of consumers. Suppliers Nintendo doesn’t make all of its own parts. It buys parts from companies such as Panasonic (batteries), IBM (processors), ATI (video cards), and so on. Nintendo keeps on good relations with these people to get best deals, faster deliveries, and because Nintendo needs them. Distributors Nintendo may sell some of its own products online, but the majority of it sells is through other retailers. Places like Wal-Mart, GameStop, Amazon, etc. re responsible for selling Nintendo’s products like the Wii. SWOT Strengths 1. Innovative and simple game-play using a mixed of motion sensitivity and aiming device. 2. Opened the gaming doors to people ages 3-112. 3. Affordable ($250) for people of a variety of economic classes. Weakness 1. From 1996-2004, Nintendo had issues with 3rd party companies. 3rd party companies are responsible for release nearly 90% of the video games for a game system. During those years, Nintendo, for whatever reason, was limiting what games it would allow 3rd companies to release on their game systems.

The only explainable reason for this limitation was to reduce game related violence. Since 2004, it has fixed many of those issues it had with most of the 3rd party companies. This has in turn affected the amount of 3rd party game support for the Wii. 2. Due to the failure of the Nintendo GameCube and Nintendo 64 during those 8 years, they chose to be more cautious when producing Nintendo Wii’s. They couldn’t foresee the success that the Nintendo Wii would have, and therefore produced too few Wii’s compared to the current demand. 3.

Nintendo always tries to keep video games affordable. Nintendo’s Wii starting price was $250, and Sony’s PlayStation 3 that released within the same month had a price of $599. Even though Nintendo has sold more Wii units than Sony’s PlayStation 3, there is still some notable complaints from hardcore gamer consumers. The big difference between the two game systems is graphics. The PlayStation 3 has graphics that look near real-life using a 256MB GDDR3* graphics card where the Wii has a 64MB GDDR3* graphics card. This desire to cut cost is a double-edged sword.

Opportunities 1. With Sony’s high price tag and dropping sales with the PlayStation 3, Nintendo has a good chance to sell more of its Wii units. That is exactly what they have done this year. They have been tried their best to keep Wii on the shelves of stores this past Christmas to compete against the PlayStation 3. 2. We have already seen the spread of video game fascination with all age groups this past year. If Nintendo can keep the fun factor of the Wii in its next game system, Nintendo can be sure that they will survive yet another decade.

Threats 1. With the economy being as unbalanced as it is, Nintendo could feel the ripple effect of the rising oil prices. If people can barely afford to drive anywhere, their game sales will drop. According a recent article in the Clarksburg Exponent, more than five million Wii units have been sold from November 2006 to November 2007 in the US alone; however, that doesn’t mean that they will sell very many games if oil cost continues to rise, which basically defeats the purpose of selling the game system. 2.

On top of that, they shipping prices may be higher, and considering they are selling the Wii’s are being sold so cheap, they may end up going into the red. Works Cited Pigna, Kris. “Bizarre Nintendo Wii Patents Surface”. 1up. com. 4 February 2008. 12. February 2008. ;lt;www. 1up. com;gt; Nintendo: Corporate. 2007. Nintendo of America Inc. 12. February 2008. ;lt;http://www. nintendo. com/corp;gt; Qualls, Eric. “Xbox 360 Xbox Live Pricing Info. ” About. com. 2008. 12. February 2008. ;lt;xbox. about. com;gt;