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Nintendo Presentation

Suleyman, Vlad, Mariya, Marina

Business Strategy

on 21 November 2012

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Transcript of Nintendo Presentation

Technological capabilities
Partnerships with independent software developers
Acceptable development and production costs
Product variety
Access to distribution Strengths
Established brand name and recognition
Nostalgia and positive emotions associated with older games
Global presence and reach
Loyal customers
Unique products
Cost leaders
First to introduce motion technology
Lots of capital
New product long before competitors release
Wii – Netflix partnership
Nintendo is solely a "toy company" SWOT Analysis Weaknesses
Smaller game selection than competitors
and less qualitative games
Dependent on global supply chain, could
cause potential problems
Margins per unit are very low SWOT Analysis Highest sales of video game consoles, software, and accessories in 2008 - $23.1 billion
19% greater than 2007
Despite recession and increasing competition, industry continued to grow through 2008
In 2009 industry revenues fell from $1.7 billion in 2008 to $1.2 billion
Console sales were specifically hurt the most, falling from $617.3 million to $382.6 million Console Segment of the Video Game Industry Nintendo’s Consolidated Statements of Income 1983 – Nintendo Entertainment System (NES)
1990 – Super Nintendo Entertainment System (SNES)
1996 – Nintendo 64 (N64)
2001 – Nintendo GameCube (GCN)
2006 – Nintendo Wii
2012 – Nintendo WiiU Nintendo Video Game Consoles Opportunities
Increasing online gaming
Expanding customer base
Middle East and Asian markets
Improving quality of console
games for other gamers SWOT Analysis 2005
Microsoft releases Xbox 360 for Christmas
Sony and Nintendo launch products to compete
Sony launches the PlayStation 3, with matching specifications and additional Blu-ray drive, but at a high price
Nintendo releases its technologically inferior Wii console and runs out of stock through the holiday season
Nintendo sells all the Wiis it can produce through 2007 and 2008
Nintendo’s Wii is the market leader in sales of seventh-generation video game consoles
Microsoft launches Xbox Kinect, Sony releases PS Move
Nintendo Launches the WiiU on November 18th Video Game Console Industry Timeline Threats
Recession affected sales of video games as non-essential products
Sony and Microsoft have released motion technology gaming systems
IPad and tablet games SWOT Analysis Mariya, Suleyman, Marina, Vlad Product innovation
Technological change
Change in the industry growth rate
Change in the personal computer industry
Change in the industry’s costumers Driving Forces Very high in the case of gaming consoles and games and accessories
Market share  R&D  new customers
New generation consoles new innovative features customer switch the company Rivalry among Existing Competitors Very challenging industry
Competition: Sony (PS), Microsoft (XBOX 360), Nintendo (Wii)
Customer range: young to old generation, females, hard core gamers, first time gamers Video Game Consoling Industry Threat of Substitute Products or Services The power of customers is very strong until they buy a console
Easy to lose existing client
Hard to gain new client
These companies are dependent on customers
Through advertising can be possible to increase power of buyer The Bargaining Power of Buyer Porter´s Five Forces Bargaining Power of Suppliers Very weak
High cost
High competition
Oligopoly Threat of New Entrants Porter´s five forces New demand in an uncontested market space
No present competition
New gaming concept/Strong value innovation
Competitive advantage –
market leader in sales of
7th generation game consoles Blue Ocean Strategy Market Strategy
Reaching beyond existing gamers
New & easy to use controller
Shortening the game time
The budget console Business Strategy
Open innovation  WiiShop channel, WiiWare
Differentiation & low cost leadership Nintendo’s Strategy Nintendo’s Strategy Key Factors Technology Strategy
Do it differently
Moving to mixed reality Console Technology War Power of Suppliers is very
Suppliers are dependent on
these companies; however,
they provide work for entire
year The threat of substitute
products or services is
So far there is
no appropriate substitute
for an electronic game or
game console
PC games and tablets Thank you for your attention! Maintain Innovative image

Face up to Xbox, Kinect and PS Move, moving into the accessible gamers market by enhancing gaming experience and improving performance

Keep costs of production low

Develop better and more games with different levels of game play sophistication Recommendations 2012: Negative Operating Income for the first time since 2000

Main products are reaching the end of their product life cycle

Insufficient sales from games and other complementary products to maintain high financial performance Weaknesses in Financial
Performance *U.S Dollars in Millions Financial Performance Competitive Strength Assessment
Full transcript