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Nintendo’s 2016 Financial Strategy

Being the business minded person that I am, I love watching Nintendo make various moves that affect their financial success. I love analyzing the decisions that Nintendo makes and trying to determine what their strategy is in the very tough and competitive video game market. It is clear that 2016 is a gap year for Nintendo with the Wii U phasing out and the NX scheduled to hit stores March 2017. The predicament becomes making enough money in 2016 to keep investors happy while still preparing for a HUGE 2017 with the release of the NX. It is clear that the main strategy for 2016 and really up until the release of the NX is to do as little work as possible that will bring in the most revenue possible.

Re-releasing Existing Hardware

The easiest way to make money is to slightly modify some hardware to bring something “new” to the market for people to buy. Nintendo recently just announced a new 3DS that is “galaxy” themed. Which essentially means it is a new 3DS that’s purple and has sparkles on it. This simple change in color will bring in some revenue for Nintendo, but probably not that much. The company also announced a Super Mario 3D Land 3DS as well, which comes with two Mario themed face plates and Super Mario 3D Land preinstalled on the system. I expect that this Mario themed console will bring in more money for Nintendo.

Re-Releasing Old Hardware

Bring on the nostalgia. It seems that people today are obsessed with nostalgia. When Nintendo announced the Mini-NES coming in November, the internet exploded. So many people posted on various social media sites that they were definitely purchasing this. With a price point of $59.99, this also makes a great Christmas present as well. This product is genius for multiple reasons. First, it takes advantage of the nostalgia factor. Secondly, it can be played by virtually all age demographics of people. Adults will play the games and remember old times while kids can still have fun playing these classics as well. Thirdly, this console is probably DIRT cheap for Nintendo to make. All the thirty games are already created and I’m pretty sure they are all purchasable as a virtual console game on the Wii U or 3DS. The hardware needed for this console is extremely cheap as it is severely outdated. I would not be surprised if it costs Nintendo less than $10 to make this console. That’s a huge profit margin for very little work.

Bringing “Familiar” Games to 3DS

If you watched the Nintendo 3DS Direct from September 1st, you may have noticed that there weren’t very many (if any) original or new games for the 3DS. Almost every game or title is some sort of port or slight modification of an existing game. Very little work was required to bring games like Super Mario Maker and Yoshi’s Wolly World from the Wii U to the 3DS. Other games coming to the 3DS most likely use existing frameworks from other games to create those games. Mario Party Star Rush probably runs off of similar code to the most recent Mario Party game and Mario Sports Superstars is most likely running off of re-used code from Mario & Sonic: At the Rio 2016 Olympic Games. Now by no means do I think this is a bad thing. I’m glad Nintendo is working smart not hard. I’m just trying to make the point that most of the games coming probably take very little work to develop (relative to the amount of time it takes to develop a normal game).

All this is to just further prove my point that Nintendo is doing all they can to make money for their shareholders before releasing the NX. I think that what they are doing is genius. By capitalizing on the brand that they have already established, they can make money again on games and hardware that they already did all the work on. I think seeing these group of games coming makes me very hopeful for the NX. With Nintendo showing (to me) that they aren’t putting a ton of time into developing 3DS games, it shows me that they’re spending time building their library of games for the Nintendo NX. We already know that The Legend of Zelda: Breath of the Wild will be amazing. Hopefully we see a strong lineup of games when they announce the NX for next March.

What do you think of Nintendo’s business strategy? Let us know in the comments below!

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