Blue Ocean Strategy(Source: Founded by W. Chan Kim & Renee Mauborgne) Definition Metaphor of Red Ocean Difference Superiority
Red Ocean vs. Blue Ocean Red ocean strategy Blue ocean strategy Head-to-head competition Creation of new marketsCompete in existing market space Create uncontested market spaceBeat the competition Make the competition irrelevantExploit existing demand Create and capture new demandMake the value-cost trade-off Break the value-cost trade-off Align the whole system of a firm’s Align the whole system of a activities with its strategic choice firm’s activities in pursuit of of differentiation OR low cost differentiation AND low costSource: (W. Chan Kim, 2010)
Put into A Simple WayThe market that’s not being pursued!
Nintendo’s HistoryNES Cube Wii Wii U NDS 3DS N64 Game Boy
Implementation of BOSLaunched Nintendo Wii in 2006 Reposition/ Alternative market Brand association Sales growth Industrial revolutionSource: (Gruener, TG Daily, 2009)
“While some people put their money on the screen,we decided to put ours into the game experience”, in an attempt to“not just improve the market, but disrupt it.” Nintendo CEO, Satoru Iwata
$200 million campaign AIDA MODEL• Brand partnerships Catch• As seen on TV attention Cognitive stage Stimulate• Hands-on sampling interests Affective stage• Feeding the buzz Create desires Behavioral stage
SWOTAnalysis Nintendo 2011Strengths 1. Innovative and simple game-play. 2. Target Market = people ages 3-112 !! 3. Affordable, Wii = $250 (PS3 = $599)
SWOTAnalysis Nintendo 2011Weaknesses1. Limitation of game on Wii Violence 3 party companies = Unhappy 90% of Wii games are developed by the 3rd party companies.2. Nintendo GameCube and Nintendo 64 were not successful. Hard to predict on Wii’s direction Too few Wiis3. Wii VS PS3 Hardcore gamers complain on graphic. Cut cost is a double-edged sword.
SWOTAnalysis Nintendo 2011 Opportunities1. PS3 = Sale decreases Wii = Sale increases2. Wii VS PS3 - On the same shelves to compete - Same promotion period
SWOTAnalysis Nintendo 2011Opportunities3. Partnership4. Higher rate cost of living Growth in Total Health Expenditure Per Capita, U.S. and Selected Countries, 1970-20085. Health concern Source: (Organisation for Economic Co-operation and Development , 2011)
RecommendationsPartnership with other IT companiesImprove in Customer Relationship Management (CRM) - NinClub60+ - Free Wii to almshouse/nursing home
ConclusionThink as a Marketer Don’t play no game that I can’t win Gabor George Burt
References• Bold, B. (2011, June 8). Marketing Magazine. Retrieved from http://www.marketingmagazine.co.uk/news/1073885/Nintendo-deploy-Wii-U-fight-gaming- share/• Davies, C. (2010, March 24). Slash Gear. Retrieved from http://www.slashgear.com/iphone- os-grabs-us-game-market-share-from-psp-ds-2478947/• Gruener, W. (2009, July 17). TG Daily. Retrieved from http://www.tgdaily.com/trendwatch- features/43289-nintendo-wii-surrenders-market-share-in-weak-game-console-market• Gruener, W. (2009, July 17). TG Daily. Retrieved from http://www.tgdaily.com/trendwatch- features/43289-nintendo-wii-surrenders-market-share-in-weak-game-console-market• Layton, D. S. (2009, July 6). /blueoceanstrategicplanning. Retrieved from http://blueoceanstrategicplanning.blogspot.com/2009/07/after-you-define-three-tiers-of- non.html
References• Moats, B. (2008). Nintendo Wii. Marketing Plan for Marketing Management, 4-12.• Nintendo Co., Ltd. (2006). Annual Report 2006. Tokyo: Nintendo Co., Ltd.• Nintendo Co., Ltd. (2011). Annual Report 2011. Tokyo: Nintendo Co., Ltd.• O’Gorman1, P. (2008). Parmelo Business Review 2008. Wii: Creating a Blue Ocean, The Nintendo Way, 97-107.• Organisation for Economic Co-operation and Development. (April 2011). Growth in Total Health Expenditure Per Capita, U.S. and Selected Countries, Kaiser Family Foundation: http://facts.kff.org/chart.aspx?ch=1964• Pethkar, M. (2011, April 13). Strategy Development. Retrieved from http://strategyatheinz.blogspot.com/2011/04/nintendos-wii-swimming-in-blue-ocean.html• W. Chan Kim, R. M. (2010). Blue Ocean Strategy. Retrieved from http://www.blueoceanstrategy.com/abo/4_action.html