Nintendo's Strategy
INDUSTRY ANALYSIS
SWOT ANALYSIS
To examine Nintendo’s position in its current industry the following SWOT analysis has been constructed.
Strengths:
Nintendo’s strengths include a well established brand name, well known franchises, ability to manufacture goods at a low price and innovative products as will be discussed later in this report.
Since its computer gaming establishment in 1977 Nintendo has maintained a strong and brand image. This has been supported by their success in quality products such as previous market leaders the Super Nintendo Entertainment System and Nintendo 64 (Edge, 2007).
The franchises that Nintendo possess such as their gaming icons, Mario, Donkey Kong, Zelda, etc have enabled them to maintain customer loyalty and recognition. These franchises have also allowed Nintendo to touch on other markets i.e. toy market (Parfitt, B, 2009).
Weaknesses:
Nintendo’s two major weaknesses would be their dependence on outside contracted manufacturers and lack of games compared to its competitors. Ironically, one of Nintendo’s strengths would also constitute as one of their biggest weaknesses. The dependence on specific manufacturers (Moats, B, 2008) leaves Nintendo vulnerable if those manufacturers were to fail or suffer any difficulty in producing the required amount. The inability for manufacturers to supply goods on a timely basis would significantly impact on Nintendo’s performance as the switching costs between competitors within the industry are relatively low. The unavailability of products would ultimately constitute in loss of market share.
Currently, the game variety of Nintendo has been overwhelmed by its competitors, capitalising on attaining franchises. Even though Nintendo does have a well known franchise, its variety limits them from producing other games (Hirooka, N, 2009). Also the motion sensing capabilities of the Wii console has restricted their compatibility to a wide spread of games. Game producers find
SWOT ANALYSIS
To examine Nintendo’s position in its current industry the following SWOT analysis has been constructed.
Strengths:
Nintendo’s strengths include a well established brand name, well known franchises, ability to manufacture goods at a low price and innovative products as will be discussed later in this report.
Since its computer gaming establishment in 1977 Nintendo has maintained a strong and brand image. This has been supported by their success in quality products such as previous market leaders the Super Nintendo Entertainment System and Nintendo 64 (Edge, 2007).
The franchises that Nintendo possess such as their gaming icons, Mario, Donkey Kong, Zelda, etc have enabled them to maintain customer loyalty and recognition. These franchises have also allowed Nintendo to touch on other markets i.e. toy market (Parfitt, B, 2009).
Weaknesses:
Nintendo’s two major weaknesses would be their dependence on outside contracted manufacturers and lack of games compared to its competitors. Ironically, one of Nintendo’s strengths would also constitute as one of their biggest weaknesses. The dependence on specific manufacturers (Moats, B, 2008) leaves Nintendo vulnerable if those manufacturers were to fail or suffer any difficulty in producing the required amount. The inability for manufacturers to supply goods on a timely basis would significantly impact on Nintendo’s performance as the switching costs between competitors within the industry are relatively low. The unavailability of products would ultimately constitute in loss of market share.
Currently, the game variety of Nintendo has been overwhelmed by its competitors, capitalising on attaining franchises. Even though Nintendo does have a well known franchise, its variety limits them from producing other games (Hirooka, N, 2009). Also the motion sensing capabilities of the Wii console has restricted their compatibility to a wide spread of games. Game producers find
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