Examining the Key Players of Casual Gaming: Nintendo

Arguably the first video game company to significantly expand into casual gaming, Nintendo has made great strides in expanding the gaming demographic beyond the characteristic male teen and young adult consumer segment in the last gaming generation. Instead of focusing on the incremental technology advancement that had become the industry trend, Nintendo choose to focus on a blue ocean: intuitive control. The Nintendo DS and Wii introduced touch and motion control into the video game world, making gaming much more accessible to new consumers deterred by the growing complexity of button controllers. Controlling a game  became intuitive from writing on the DS’ touch screen or swinging the Wiimote like a golf club.

This industry risk paid off rewardingly for Nintendo as the DS and Wii systems have sold hundreds of millions of units worldwide. Nintendo’s focus on innovation and creating accessible products successfully attracted new consumer segments including women and older adults to pick up gaming. Internal survey data from Nintendo shows 46 percent of Americans aged 6 to 74 using the Wii or Nintendo DS at least once in the past year – quite a significant industry achievement.

However in the last year, Nintendo has suffered significant drops in DS and Wii sales as these products reached market maturity and consumers are looking forward the next generations of systems. Furthermore, direct competitors Sony and Microsoft both recently launched peripherals that add more advance motion control to their respective gaming platform.

Market Value: A report showed that over a third of the U.S. population has not played a video game in the last 12 months, with a large proportion recognizing the Nintendo brand.  My last post already highlighted the popularity of social network games and its value of introducing non-gamers to their first gaming experience. With brand familiarity and consumer interest already established, Nintendo’s marketing drive should be to leverage the core value drivers of non/casual gaming consumers to turn product interest into purchase intent.

Perhaps Nintendo’s biggest advantage is their relative low pricing model compared to Sony’s and Microsoft’s offerings. Preliminary research indicates that Microsoft’s Kinect and Sony’s Move is having little effect on motivating new system purchases – likely due to historic hardcore branding and high product pricing. Buyers of the Kinect and Move appear to be primarily existing owners who seek to supplement their experience with the product, not new consumers. This provides Nintendo an opportunity to leverage the interest in gaming created by competitors’ marketing campaign and emphasize the Wii’s and DS’s similarly gaming experience and more importantly affordability in marketing campaigns towards these price-sensitive gaming consumers.

What do you think Nintendo can do to maintain their market leadership among so many competitors?

Examining the Key Players of Casual Gaming: Social Network Games

Picking up from the Casual Gaming Explosion! post, the first key player examined: social network games.

Perhaps the current king of casual gaming, social network games have gained significant popularity and adoption for a relatively new gaming activity. Some quick statistics:

• The NPD Group finds that one in five Americans age 6 and older reports having played a game on a social network in the past three months; equating to 56.8 million U.S. consumers.
• The same study found that 10 percent of social network gamers have reported spending real money playing these games and 11 percent indicate that they are likely to make a future purchase.
• Nielsen reports that online games, including social networks games, is the second most popular activity online in the U.S., consuming 10.2 percent of the time people spend on the internet. Number one was social network and blog sites at 22.7 percent.
• Appdata.com reports that the very popular social network game Farmville had reached 81 million users in April 2010, with stories of Farmville addiction widespread online. The number has decreased significantly now, but Farmville still has over 55 millions active users as of December 2010.

Once reserved for those with dedicated gaming systems, social network gaming has seen significant growth likely due to its free-to-play nature, simplistic concepts, and easy accessibility online for the average user. However, a weakness of social network gaming have been gamers’ frustration with slow loading and performance issues and getting bored by the games easily.

Market Value: I see social networking gaming being a catalyst to broaden the gamer demographic by introducing previously non-gamers to their first electronic gaming experience. This gaming platform does not have to be a direct competitor to the big three gaming companies Nintendo, Sony, and Microsoft if they are able to leverage the stated weakness and effectively position their offerings to be a richer, more fulfilling gaming experience towards those consumers seeking more. Each company needs to capture the faint interest established and develop it to a call to action within users to upgrade to their respective entertainment experience.

What are your thoughts on social network games?