Situation Analysis. When Nintendo Company was initially launched in 1800s, it was manufacturing and selling playing cards. The company diversified its production line later to produce electronic games to overcome the stiff completion it was facing by then.
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Nowadays, the company specializes in designing and selling of motion-sensor control games mainly for children. The company produces Nintendo wii, Nintendo DS video consoles, Nintendo 64, Virtual boy, Pocket boy, color boy among other children games. The company had dominated in children games as early as in 1970s. Nowadays, the company has started producing games for older people.
Nintendo is a Japanese founded enterprise and it mainly sells its products to local customers from its local agents as well as to its international clients who are based in U.S. and Europe. Prior to last summer, the company had strategized appropriately and released 16 million units of video-games that it had anticipated to sell during the peak session of Christmas through its selling agents as well as online to its overseas customers.
However, the sales of 3DS failed to sell as anticipated despite 3DS products having ever recorded a great performance for the past 30 years. The company did not record satisfactory sale of its product, despite the Company offering its products on the eve of Christmas which is the peak period for sale the of the 3DS games.
Despite the management cutting down the prices considerably to encourage its customers to purchase the 3DS games, the sale of the products was low. The following discussion will comprise on the 3DS market, competition, distribution channel, microenvironment as well as its historical performance (Reisinger par.3).
Nintendo Company sells its products to its local customers as well as its international customers who mainly reside in Europe and United States. Despite the recent decrease in its sale, Nintendo was placed the 3rd best company in performance in 2009.
The company is the market leader in the video gaming industry. It recorded a sale of over 30 million copies of New Super Mario Bros, Wii Sports Resort as well as wii fit Plus. The reason behind the decrease in the sales of the company’s profit in the recent past years is the continuous decline in the sale of Wii hardware as well as the DS software.
The sale of the Wii hardware has been eroded by emergence of rival products such as PS3 and Xbox that are better in performance. The Nintendo management complained because of a decline of $ 9000 million in 2009 as a result of decreasing demand for Wii as well as DS and 3DS hardware and software (Aaker 10).
Market Demographics Market Geographic
Nintendo Company produces games for children as well as older people such as Nintendo wii, Nintendo DS video consoles, 3DS, Nintendo 64, Virtual boy, Pocket boy, game boy color among other children games. The company mainly sells its products to its customers in; Asia, United States, Africa as well as in Europe. Market Psychographics
The Nintendo products mainly target the rich and average earners who reside in urban areas and who are economically well up to comfortably afford to buy games for their children. The company sells games to its local customers as well as to its international clients over the internet or through it agents (Lake 1).
Recently, there has been a high increase in the demand of games among the older generation. This is the reason why there has been a great demand of the smart phones as well as smart televisions.
The introduction of video gaming in smart phones as well as smart TVs has greatly affected the demand of Nintendo video gaming negatively. The decline in the demand of Nintendo products has been noted by a great decline in the sale of its games and especially the DS, 3DS and the Wii (Calver par.3).
Nintendo Company should consider collaborating with the mobile phone manufacturers and start supporting mobile phone gaming like iPod and iphone because smart phones are nowadays the battlefield in the gaming industry (Hernandez par.2).
Aaker, David. Strategic Market Management. New York: Prentice Hall, 2008. Print.
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Calver, Griffin. “Nintendo Sees Financial Performance Decline.” Terminal Gamer. 29 Jan. 2010. Web.
Hernandez, Pedro. “Investors Heavily Criticize Nintendo’s Performance.” Nintendo World. 11 Aug. 2011. Web.
Lake, Laura. “Developing Your Brand Strategy: A Step by Step Guide.” About.com Guide. 31 March, 2012. Web.
Reisinger, Don. “How Nintendo Makes the Video Game Industry Look Good.” CNET. 7 Apr. 2008. Web.