3. Introduction : Industry summary
Year
Market Share
Size
- Global market
- Opportunities for a large number of competitors
Growth!
- Video Game Industry growth 10.6%!
2006 2007 2008 2009 2010
4,736.0
8,988.8
15,553.5
18,761.4
15,423.3
US
$
Millions
Revenue!
4. Introduction :
Past strategy and Challenge
1983 1990 1994 1996 2001 2006
Past Strategy
Challenge!
• Up sale revenue
• Enjoyable
• Cost reduction
• Focus on “non-gamer”4
6. External Analysis : Five Forces Model
Threat of
substitute
products
Rivalry
Among
Established
Firms
Threat of
new
entrances
Bargaining
power of
suppliers
Bargaining
power of
customers
(+) อำนาจตอรองของ Supplier สูง
(-) Personal computer
และ Website
(+) แผนเกมสถูกออกแบบมาใหเลนกับเครื่อง
เกมสคอนโซลนั้นๆเทานั้น
(+) คูแขงเขาไดยาก เนื่องจาก
ตองการการวิจัยและพัฒนารวม
ถึงตองมีนวัตกรรมใหมๆ
(+) ตลาดมีอัตราการเติบโต 10.6%!
(-) ตลาดมีการแขงขันสูงและลอกเลียนแบบ
7. External Analysis : Competitor Analysis
Focusing on performance systems to Hardcore gamer and extreme graphic
Focusing on fun and new experience rely on its unique controller aggressively
courting non-traditional gaming groups outside this traditional profile in an
attempt to increase the size of the console market!
9. Internal Analysis :
Resource, Capabilities, Core competency
• Strong cash flow
• Factory
Tangible
• R &D team
• Marketing team
• Supplier
• Manufacturing process
• Company management by
Iwata
Intangible
resource
• Ability to predict future of video gaming
• Give it capabilities in innovative technology and
game concepts
• Effective brand
• Reach economies of scale and produce cost
lower than competitor
Capabilities
• Create casual game
• Low cost in production
• Strong brand
• Nintendo’s console and in-house game development department
CORE Competency
10. Strategic Analysis : SWOT Analysis
Strength
• Leader in sales thanks to the penetration of
"blue oceans"
• Industry Expertise
• Customer Loyalty
• Traditional gameplay Differentiation
• Best selling console in history (DS)
• Brand Image
• Low price competition over
• New applications other than games
• Creating new ways to play (family, 3rd age)
• Strongly established brand
• Robust revenue growth
• Strong cash flow from operation
• High employee efficiency
• Debt free status
Weakness
• Smaller company sector
• Technological innovation Unit
• In the medium / long term missing star
products / unknown in the portfolio
• Lack diversification, focusing on only 2
products
• Core Business (target markets) falling
• Inventory shortage
• Limited option of online gaming
• Narrow presence in online community
Opportunities
• Leader to develop new products
• Taking advantage of technological innovations
(3D) that already applies in some products
• It has no threat of substitute products (only
direct competition)
• Ability to diversify into alternative products
• New Accessories
• Rising demand for company’s product and
related software
• Growing US game software market
• Increasing demand for game online
Threats
• Ability of the competition (economic,
technological, ...)
• Mature and saturated
• Obligation to innovate the medium term
• Games developed for these little
interactive media
• Improved products from competition
• Loss of video game regular customer
• Short product lifecycle
• Slowdown of the Japanese, The US and
European economies
11. Strategic Analysis : GE Matrix
Focuses on
Creating
consoles and
games geared
toward
nongamers and
families.
- Introduce a more varied selection of video game genres to its
software collection!
- continue developing innovative game technology!
!
General Electric Model!
12. Strategic Analysis :
Strategic group Analysis
DistributionChannels
Overall Cost to Players of Video Games
Low
(Coin-operated
equipment)
Medium
(Video game Console
cost $100-$300)
High
(Use PC)
Many
Some
One
Sony, Sega,
Nintendo,
Microsoft, etc.
Arcade
operators
Publishers
of games on
CD-ROMs
Online game provider including MSN
Gaming Zone, Pogo.com, America
Online, HEAT, Engage, Oceanline,
TEN, Zynga
13. Stratigic Analysis :
Generic Business Strategy Analysis
Nintendo had Cost leadership.
US$299.99 US$499.99 US$249.99
Nintendo drove differentiation and
market segmentation together.
targeted to non-gamers.
As a result, many people bought the Wii and played it
who would have never played it otherwise, including
grandmas, young children, and a lot more women.
