Business Analysis on Nintendo
Introduced a home video game system in Japan 1978- Sold coin-operated games 1981- Donkey Kong developed (major success) 1985- Super Mario Brothers developed Initiated a licensing program with six retail companies Started selling Nintendo systems in New York 1988- Sales reached 7 million; licensed to 31 American software companies 1990- Nintendo had 90% of market share worldwide 1991- Increased to 100 licensees; rescinded its exclusivity requirements 1992- Nintendo had 40% market share (Sega with 60%)Left alliance they had with Sony 1996- Launched Nintendo 64 in Japan and US (had 3D capabilities) Nintendo had 41% market share (Playstation with 49%) 2001- Gamecube introduced (CD’s and wireless controllers) 2002- Cut prices along with competitiors 2004- Launched BrainAge 2006- Launched Wii Strengths: •Strong position in all major markets •Lower priced/cheaper games •Innovative design/Interactive games •Recognizable games and variety of games •Market strategy Weaknesses: •Processing Power (compared to Xbox or Sony) Graphics (compared to Xbox or Sony) •Not adaptable to all games •Higher investment due to numerous accessories Opportunities: •Moving into more markets (i.
e. schools) •Eliminating competition •Updating technology/Constant innovations •Moving into a more markets Threats: •Potential New Entrants (competitors creating similar systems) •Substitute Products: Board games, TV, Internet, iPods, Books, Sports, PC games •PS3 combined gaming system with BlueRay Player Analyze findings:After thorough comparison of Nintendo’s strengths, weaknesses, opportunities, and threats, we believe that they currently hold a strong competitive position. Their differentiation strategy sets them apart from competitors, and continuing to grow and develop will keep them ahead of any potential substitutes. Business Level Strategy: Who are the customers? > Individual consumers of all ages; Families What markets does it compete in? > U. S.
, Europe, China, Japan, and more Competitive strategy > Differentiation strategyMarket strategy > Offering a wide variety of games, targeting a wide range of consumers; appealing to older ages and people looking to stay active by offering interactive games as well as workout programs Developing Costs > $5 million (compared to $20 million for the PS3) Corporate Level Strategy: Mission > Product and Market the best products and support services available Vision > Nintendo products found in every home across multiple markets Goals > Constantly improve products, listen to customers