Nintendo does the opposite.

November 5, 2006

What do you do if you are yesterday’s brand? If the giants of the world have entered your category and have taken it over? If your competitors are bigger, faster, better and richer than you? What should you do now? Should you give up, go home and take up golf?

No, not necessarily. If you are losing the marketing battle, you simply need to change the battlefield. That is exactly what Nintendo is trying to do. Because of divergence, in a growing category there are always opportunities to narrow your focus, be the first and dominate a new segment.

In the early 1990’s Nintendo dominated the videogame market with its Super Nintendo. They were on top of the heap and sold 49 million units. But in 1994 Sony introduced the PlayStation and the rest you could say is history.

PlayStation 1 & 2 have sold 214 million units. Then in 2001, Microsoft introduced the Xbox. While Microsoft has yet to eek out a profit on its XBox, it has gained mindshare, market share and has sold over 30 million units putting the final nail in Nintendo’s coffin.

Or has it? Currently stuck in third place, Nintendo apparently has little going for it. It doesn’t have the resources or the where-with-all to compete in the ever-escalating videogame player arms race with Sony and Microsoft.

Nintendo has struck back not by trying to be better than the competition, but by doing the opposite. If you’re not winning the marketing war, change the battlefield. I learned that from a very good book, Marketing Warfare.

While Sony and Microsoft escalate the arms race with more and more computing power and faster-paced graphics, Nintendo has gone in the opposite direction. Nintendo’s new game console is a slower and simpler system. The keystone of the new system is a new kind of controller that players wave in the air and use with simple games like tennis, bowling and fishing.

Conventional wisdom in the videogame industry says that the fastest and most powerful machine will win. But conventional wisdom in marketing does not necessarily work. In marketing, you win by being the opposite of the leader. And that’s exactly what Nintendo has done.

Will Nintendo’s Wii be successful? No one can predict the future, but I think they have a good chance to come back and be one of the giants of the videogame industry again.