Global Marketing Strategy of Nintendo Wii

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1.This essay focuses on the global marketing strategy of the Nintendo Wii, in particular the segmentation, targeting and positioning strategies and the communication adaptation adopted for the promotion of Nintendo Wii in the three key markets of Japan, United Kingdom (UK) and United States of America (US).


2.The gaming industry comprises of three key segments: (i) the platform system or infrastructure segment which includes consoles, mobile devices and online media, (ii) the games publishing segment which includes games distribution, retailing and marketing and (iii) the games development and design segment. The platform segment is considered the most fundamental and important sector as it determines how users interact with console games, and has witnessed the most exciting innovations.

3.The current key players in the platform segment are Microsoft (with its Xbox 360), Nintendo (with its Wii) and Sony (with its Playstation 3). For Microsoft and Sony, the video game console business is just small part of their large business portfolio, while Nintendo is highly focused on the video game industry and has a hand in all three key segments of the industry. Nintendo is one of the most influential video game companies in the world and Japan's third most valuable listed company, and as of October 2, 2008, has sold over 470 million hardware units and 2.7 billion software units. While Nintendo had dropped to third in the video-game industry behind Sony and Microsoft in 2006, it had regained its leadership position through the release of Wii by selling the most hardware units amongst the current generation of video game consoles.

4.Video game consoles are fairly discretionary items of purchase - developed countries tend to be their main markets due to the higher discretionary incomes of a higher proportion of their population. Games consoles are expected to enjoy even greater popularity and higher sales in the coming years due to the increasing market size of the BRIC countries and the general increase in purchasing power of consumers throughout the developed and developing world.

Global Segmentation, Targeting and Positioning

5.Video consoles are essentially high-tech products with a high degree of product standardization and similarity of preferences amongst consumers. Marketing strategies for video consoles are generally similar across regions/macro-segments but different across micro-segments. Segmentation for the video game industry is usually based on consumer behavior, user status and/or rate of use. Established segments include serious/heavy gamers/early adopters, normal gamers, casual/light gamers, potential users, non-gamers, lapsed/ex-gamers, first-timers, users of competitors' products etc. Before the launch of Wii, video console makers have conventionally targeted serious/hardcore gamers (usually teenage male gamers).

6.Nintendo’s strategy for Wii was to expand the market space by looking outside the conventionally targeted segments and pursue growth through targeting new segments. Their competitors are then other forms of recreation rather than other game console manufacturers. For Wii, Nintendo focused on creating a simple, fun and intuitive console and eradicated features that were not absolutely necessary for gameplay such as high performance and multi-media functions. This created a product that was the most value-for-money in its class and allowed Nintendo to regain the lead in the console market and earn significant profits through sales of games and licensing fees.

7.The segmentation strategy of Nintendo Wii was slightly different from conventional segmentation in that it was based on who their potential targets spend their recreational time with - alone (e.g. practising yoga), family, partner, best buddies/female...
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