Business analysis- Nintendo Corporation
Assessment of Company Corporate-Level Strategy
Nintendo utilizes two corporate strategy levels which are the differentiation and general leadership cost strategy. Nintendo is a console video game manufacturing corporation in japan which is among the largest gaming industry major players (Jung, 3). In the year 2006 most of the competitors were utilizing the norm in the industry which aimed at developing the general features of the video games products but Nintendo corporation opted to adopt a path that can be termed as disruptive as it aimed at targeting a fresh market with the introduction of fresh products that were not held by the competitors which are regarded as Wii. In the context of the corporate level, Nintendo follows an innovative approach which is significant to the organization as it assists in the building the corporation competitive advantage. The corporation utilized this strategy in order to attain a distinct position from the competitors through concentrating on consumer’s needs. This strategy is regarded as differentiation which was achieved through the utilization of product uniqueness and innovation that incorporated individuals from different ages. The product was designed to fit the abilities and needs of individuals through motion capabilities. The corporate level strategy of the corporation has attracted a revenue and income of 1,672,420 and 257, 347 respectively (Jung, 4). The major competitors of Nintendo in the market are mainly Microsoft and Sony Corporation.
The corporate strategic level of Nintendo Corporation aims at generating fun in gaming in all ages through breaking down the barriers of gaming (Jung, 3). The corporation is purposed at generating more sales and revenue through increased efficiency and developing consumer relations. The corporation is a single business corporation and its business portfolio is thus characterized by a single business. Based on the existing business portfolio of the corporation Nintendo products are characterized by low technology while comparing to those that are produced by the competitors. The video game market has developed and transformed rapidly in the recently years and games are becoming more intense in regard to quality and graphics and they are additionally characterized by complexity (Jung, 3).
The corporate strategy is characterized by different strengths which include the cost advantage, the utilization of basic software’s, the ability to enhance virtual abilities, motion revolution sensing wireless technological advancement and fresh applications (McLoughlin, and Aaker, 51). However despite the strengths, the corporate is characterized by numerous threats and weaknesses. This includes the production of simple games thus ignoring to produce games that are characterized by hard-core, state art lack of high definition clips and lasers and graphic features that are scrawny. In addition, the gaming industry in japan is highly competitive because of the evolving technology which reduces the life cycles of products based on software’s sophistications capabilities. The corporation is however characterized by significant opportunities which can result in long-term success and effectiveness. This is mainly because first the console gaming sector in japan is characterized by three large corporations currently (McLoughlin, and Aaker, 51). This means that the corporation holds the capability of transforming its operations to suit uniqueness and efficiency by stating a competitive position in which the competitors may not be able to establish. The second opportunity is that Nintendo Corporation can venture into fresh markets in order to increase its consumer segment and develop its rate of revenue generation (McLoughlin, and Aaker, 51).
In focusing on sustaining Wii as a unique product of Nintendo, the corporation is faced with three major strategic issues. The first strategic issue is the need of continuous innovation and reduced tricks. With promotions, the corporation faces issues of offering continuous innovation focus. The original entertainment 8bit system produced by Nintendo was very innovative mainly because it offered video games with quality control approaches (McLoughlin, and Aaker, 52). The system was succeeded by super NES 16bit because it was able to offer better sound features and graphics which made the system to be successful. The second issue is the need of becoming a game killer yet its sophistication fails to meet those of the competitors. In addition, it is faced with the issue of home-ness which is a big issue. This is mainly because the gaming world is more globalized today than previously. This, therefore, means that the gaming corporations are required to compete beyond their home market. For instance, the Chinese market is a potential success for games. This is mainly because the nation is highly innovative and modernity is rapidly taking the wellness of the consumers. More innovativeness is therefore required in the gaming world which might help Nintendo in gaining competitive advantages and more innovation on developing products (McLoughlin, and Aaker, 51).
The gaming market today is characterized by globalization and therefore venturing into these markets has been eased (Grant, 92). The third opportunity lies on the first that it was the initial corporation to attain success in the particular gaming console industry. This, therefore, shows that the corporation is characterized by high abilities to develop its products further through the utilization of the differentiation strategy. The corporation is highly innovative which can help in gaining a competitive advantage as their competitor relies mainly on established ideas to develop brands (Grant, 92).
Recommendations
There is a need of developing Nintendo’s products with features that attract more consumers. The promotions strategies that are being utilized by the corporation cannot be regarded as adequate. The corporation should, therefore, shift its focus on advertisement and promotional sales which will rise to promote the switching of brands. In addition, the corporation should focus on developing more serious games. This is mainly because it is faced with the challenge of competitiveness based on the fact that the competitors are manufacturing more sophisticated games that are characterized by fewer products cycles. The corporation is therefore required to sophisticate its games through developing classiness and innovation while still incorporating the expectations and the needs of the consumers. They should shorten their products cycles to increase efficiency. This is mainly because the rapid technological developments are decreasing the ability of products to existing in the markets since more and more products are generated every day.
In summary, the console video game industry has currently proven its capabilities through innovation, technology and the increased competition. The competitive advantage of Nintendo is, however, decreasing based on the fact that its games are not innovatively sophisticated as required by modernity. Nintendo as a technology corporation is highly necessitated to acquire a rigorous pace in inventing and innovating through maintaining creative thoughts. The console market is more open to the consumers more than the previous decades which means that marketing and entry barriers are no longer sophisticated enough for a corporation to gain competitive advantage. The ability to drive innovativeness will help Nintendo Corporation in attaining a competitive advantage.
Work Cited
Grant, Robert M. Contemporary Strategy Analysis. , 2016. John Wiley & Sons. Print.
Jung, Corinna. Strategy Analysis of Nintendo - Executive Summary. Place of publication not identified: Grin Verlag, 2013. Print.
McLoughlin, Damien, and David A. Aaker. Strategic Market Management: Global Perspectives. Hoboken, N.J: Wiley, 2010. Print.
