What does Nintendo stand on?


The novel coronavirus pneumonia seems to have put the global pause button down. No one expected that Nintendo's game and its players would rely on the collection! The animal friends club has been burning all kinds of social networks to detonate the global gaming industry. As the founder of the modern video game industry, Nintendo, one of the three giants in the video game industry, has maintained a profit margin of more than 20%, which is unique among large Japanese enterprises.

Nintendo's history can be traced back to 1889: in this year, Mr. Yamauchi founded Nintendo. His early business was selling flowers, a traditional Japanese playing card. In 1962, Nintendo went public. In 1975, the rise of Japanese video game craze, not satisfied with the playing card business Nintendo immediately bet. But the results coincided with the economic crisis caused by the world's first oil crisis, with a large number of game manufacturers closing down and many orders of Nintendo being cancelled. Thanks to the poker business at that time, Nintendo got through the difficulty.

How to make the game machine a lasting product? Through continuous improvement of products, Nintendo's product sales are each at the level of one million units, but not for a long time. With the best-selling of Nintendo products, there are a lot of imitations in the market. When Nintendo reacts to apply for patent protection, it has no market advantage in Japan.

In the face of the market situation, Nintendo has done two important things: one is to go to sea and seize the foreign market; the other is to fight price war and seize the domestic market share. In the United States, Nintendo launched a "fool's game machine" that can play games with itself only by coin, which soon became popular in the United States. In Japan, Nintendo went all out to make the game machine cheap and popular, and let the game machine fly into the "ordinary people's home", which became the most critical step in Nintendo's construction of the "game Empire".

In July 1983, Nintendo's first home FC game machine (red and white). This product has caused a huge shock in the game industry, and the peers have also launched a fierce competition with it, and began to vigorously boast that their game consoles have various functions such as computing, layout, etc. Nintendo, on the other hand, tells us that its products are useless except for games.

In the face of the product price of 30000-50000 yen, Nintendo beat almost all competitors with an ultra-low price of 148 thousand yen. Since then, Nintendo's game consoles have dominated the market. In just 10 years, the penetration rate of Nintendo game consoles in Japan has reached 50%, and the share of domestic hardware market has reached 80%.

Nintendo found that 34% of Nintendo's fans are adults, and developed portable game consoles suitable for adults. In 1989, Nintendo developed the first portable game machine, "Game Boy". In 1996, Nintendo's game boy sold 40 million. But Nintendo is far from stopping. The invention of its "game style" textbook has solved the problems of parents who are worried about their children's playing games and delaying their studies. Nintendo's market share has further expanded as the "game machine" has become a "learning machine".

How to do the different products that users buy? "What matters is not the next generation technology, but the revolutionary new game experience, and the technical power is not the most important thing," said Satoru Iwata.

In 2004, Nintendo launched the third generation of hand-held game console NDS (Nintendo dual screen), followed by the introduction of ndslite, NDSI, NDSI ll and other improved products.

In 2006, Wii, Nintendo's first somatosensory control game console, came out: This is the first time that someone has introduced somatosensory games into a video game console.

Behind the victory, Nintendo once again entered the innovation dilemma. Wii u, the host product launched in December 2012, has a sales volume of more than 13 million yuan. At the end of 2016, it was announced that it was shut down domestically in Japan, and at the beginning of 2017, it was announced that it was shut down globally. In contrast, rival Sony's earnings report showed that the Sony PS4 released in 2013 still sold 19 million and 17.8 million units in 2017 and 2018. The concept of dual screen made NDS beat PSP, but failed in Wii U.

But the dramatic scene is that in the Japanese game market share in 2019 announced by game magazine famiton, Nintendo's sales increased by 16% year-on-year, accounting for 79% of the market share, while Sony's and Microsoft's console sales fell by 34% and 46% respectively. And in the 20 years from 1999 to 2019, 2019 is the best year for Nintendo's game console sales.

The direct reason can be found out is that Nintendo launched switch in 2017. On this game console, Nintendo has made great product innovation. Switch realizes the "two in one" of video games and hand-held games. The product is highly praised for its detachable handle, multi player play, support for 4K TV and 720p hand-held output. The game console, which has been selected as one of the ten most influential technology products of time in the past 10 years, sold 52.48 million by the end of 2019, and only 32.74 million by 2018.

Excellent exclusive games are the reason why most players buy switches.

On January 31, 2020, Nintendo held the third quarter financial statement meeting in Japan. As of December 31, last year, switch had sold 52.48 million units worldwide, and the sales of game software reached 310 million.

Nintendo is also very clear about the difference between itself as an entertainment product and apple as a necessity of life, so it is more committed to maintaining its core value. Now the game industry has entered a dead end, everyone is trying to spend more money, use more dazzling technology, develop more complex games. But the game is only for one purpose, that is to bring fun to everyone. Nintendo operators focus on the game itself, not afraid of being out of date, not afraid of being slow, trying to make the unique products to the extreme, which is the Nintendo philosophy they have been keeping for a hundred years.

Source: China's strategic emerging industries, May 1, 2020