In a detailed message to shareholders and investors, Nintendo President Satoru Iwata said that “…what we have focused on for the last decade is our basic strategy of expanding the gaming population by offering products which can be enjoyed by everyone regardless of age, gender or gaming experience.” With that in mind, he feels that Nintendo’s current direction fulfills that promise, though it may not relate in sales.
As a bode for confidence to his investors and shareholders, Mr. Iwata’s letter detailed how Nintendo’s current marketing direction will continue to vary from their most obvious competitors in Microsoft and Sony. Nintendo will now focus on what they call a “Quality of Life” game system, as opposed to a console where you lie around, or won’t interact with people directly.
…we have decided to redefine entertainment as something that improves people’s quality of life (“QOL”) in enjoyable ways and expand our business areas. What Nintendo will try to achieve in the next 10 years is a platform business that improves people’s QOL in enjoyable ways.
Mr. Iwata continued in saying that they believe that the console market is still the best direction to approach the “Quality of Life” goal in a hardware/software integrated business. Focusing on simply the console market, however, is not the intent of Nintendo as they plan to expand into this quality of life market with new ideas, stretching the brand beyond where it’s most comfortable.
We have set “health” as the theme for our first step and we will try to use our strength as an entertainment company to create unique approaches that expand this business. Through our new endeavors with the QOL-improving platform, we strive to further promote our existing strategy of expanding our user base, create an environment in which more people are conscious about their health and in turn expand Nintendo’s overall user base.
Though most of the home console market is clearly grabbing up consoles by the bunches, Nintendo has been left in the cold in recent years for their lackluster system performance and unconventional style – only buoying to the surface through exclusive titles, not the blockbuster third party offerings as in the PlayStation 4. When compared directly, the Wii U enjoyed a strong opening in their home country of Japan. That being said, Sony easily met Nintendo’s initial sales of consoles, and blew away the company’s numbers internationally. With a continued outlook of change, Nintendo is abandoning great success in the console industry, while thriving in the handheld market. Nintendo isn’t afraid to shy away from change, according to Iwata, he closed in saying that this isn’t Nintendo’s first transition in company direction.
After Nintendo started the manufacture and sale of Hanafuda (traditional Japanese playing cards) 125 years ago, it has innovated itself from a playing card company to a toy company, a toy company to an electronic toy company and finally from an electronic toy company to a company developing video game platforms. Nintendo has continued to try new things, and with a history of experiencing many failures and small successes, we managed to pioneer the home video game market. What has remained the same from the past is that we have always tried to create something new from materials and technologies available at that time, to position entertainment as our core business and to improve people’s QOL in enjoyable ways. We will continue to value self-innovation in line with the times and aim for growth.