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Capstone Nintendo Strategy

Final Presentation

Antony Joshy

on 16 August 2016

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Transcript of Capstone Nintendo Strategy

Start Strategic Issues Strategic Alternatives Industry Analysis Technology arms race
Competitors also spend on R&D
Global Economic Crisis
Affects disposable income
Losing market share
Gamers are unsatisfied with number of available games
Strategic Management - Nintendo Business Unit Analysis End Questions?

Thank You Industry Overview US Market PWC, June 2010, in US$ Billion Industry Overview Industry Overview Industry Overview Strategic Group Map Porters Five Forces Analysis Strength: 4
Huge investment in R&D
Oligarchy prevailing in the industry Threat of new entrants Competition Rivalry Strength: 8
Two major competitors (Microsoft, Sony)
Price Competition Strength: 7
Mobile and Internet computing
Social Media
Computer Games
Outdoor, Indoor and Board games Substitutes Bargaining power of suppliers Strength: 3
Suppliers high dependency on console makers
Effect on shares of Mitsumi Electric and Hosiden Corp
Mutually beneficial relation with these developers
Developers, suppliers - Price takers Strength: 4
First time purchase
High price elasticity
High switching costs
Not upgradable Bargaining power of customers Driving Forces Analysis Technological Change - Product Innovation
Product Innovation
Industry Growth Rate
Changes in PC Industry
Changes in consumer behavior
Internet Technology Summary Industry Analysis Overall average score: 5.2
Moderately attractive
Potential in emerging markets
Good growth rate Macro Environment Socio-Cultural Decreasing young population
Improving economic conditions in developing countries
Awareness of environmental issues
Awareness of Intellectual property
Interest in Technology Protest about violence in games/movies/Tv series
Legal issues Trademarks, copyrights, licencing, online ownership Political- Legal Environment Main Regions Economy:
Yen’s position in global areas
Recession since 2008
Shrinking young population
Disposal Income
Effectively protecting and using intellectual property & copyrights Asia Pacific - Japan European Union -Europe Economic
Slowdown in economy
Increasing unemployment
High disposal income
Strong gamer culture
Consumer expenditure on leisure and entertainment products
Low birth rate and increasing aging population
Political – Legal
Intellectual Property
Laws about content of games Economic
Economic slowdown and increasing unemployment.
Decreasing household income
Young population
Strong gamer culture
High disposal income USA - Americas Technology Macro Environment Social Factors
Legal Issues
Political Issues
Economical Issues
Technology PESTL Analysis Improvement in processor speed, visuals, memory capacity
Disruptive Innovation
Social Networking
Slowed growth of traditional technology retailing Slowdown in the economies of developed countries Economic Core Competencies Core Competencies Value Chain Excellent brand and sales marketing
Consistently the first to market with new technology
Effective and efficient global operations Marketing & Sales Management Brand History Products Target Market Age group: 5-95
Family-friendly Gamers
Casual Gamers
Wide audience

Sony: Hard-Core Gamers
Microsoft: Hard-Core Gamers
Android: Casual Gamers Marketing Strategy Technology Management First mover
Differentiation Strategies Nintendo: Technology Leader
Sony: Quality Leader
Microsoft: Connection Leader
Android: Cost Leader
Mr. Saturo Iwata
President as of 2002
Open to R&D
Claimed to have “vision and foresight” towards the video gaming industry
Research & Development Expense Operations Management Global Market
Asia Pacific: Japan, Korea, Taiwan, Hong Kong, Australia, New Zealand
Americas: USA, Mexico, Brazil
Europe: Netherlands, Deutschland, Spain, France, Italy, Poland, Portugal, Russia, UK, Ireland
Manufacturing plants
Subsidiary companies
Licensing agreements
Third party manufacturers Operations Management Operations Management Product life cycle
5-7 years
New products launched during Holiday Season
Pursue the telephone
Focus more on cloud computing
Focus on hard-core gamers
Focus their operations on software – gamers want more games
Increase sales and marketing expenses so they’re not so dependent on the holidays
Pursue emerging economies aggressively
Looking for young population with disposable income
Nintendo Corp. Antony, Daniela, Dmitry and Ilay Business Unit Analysis Corporate Vision Expand gaming audience
Devotion to entertainment business
Devotion toward employees
Strategy Corporate Level Differentiation Focus on family friendly entertainment
Redefine definition of gaming Emphasize simplicity and ease of use Differentiation Emphasis on corporate culture
Strength in finance and partnerships
Innovative technologies
Choice Business Level:Blue Ocean Strategy TOWS matrix Fitness- Wii Fit, 2010
Home cinema- Wii U, 2012
Cost leadership
Financial Financial Financial Financial Market Competition Number of units shipped and Market share
Market Competition Market Competition Unit shipped year wise (in million) Wii U Wii U: New games Some exclusive games of PS3 and Xbox 360 are going to appear in Wii U
Typical Nintendo games
Full transcript