7 Ways Nintendo Can Win

It's possible for your fans to be too devoted.

Nintendo's been around since 1889, so they have seen business cycles a time or two. They have been up, and they have been down, but overall they've continued to thrive. Lately they have been looking a little tired, as the Wii begins to show its age, and the amazing run of the DS line is also beginning to weaken. As far as the world knows, Nintendo is not planning any immediate changes in the Wii product marketing strategy, and appears to be pinning its hopes for 2011 on a successful launch of the 3DS, their new handheld console. They need something to look forward to; profits have dropped 74% since last year, and sales are down significantly in all areas. Nintendo has lost its mojo; can they get it back?

The Wii still has life, but not at $199. The time has come for another price reduction for the Wii; the last time it was reduced was in September of 2009. It should be obvious to anyone that the Wii has not been able to keep its sales numbers up against an Xbox 360 and a PS3 priced $100 more; the 360 outsold the Wii over Christmas, and the PS3 was close. Don't wait around, either. Drop that price now, before the 3DS dominates the story. Renew your commitment to the Wii; make sure the fans know about some killer new games coming for it. At $149, it should see a nice sales boost. Plan to send it into orbit for Christmas 2011 by dropping the price to $99 in September. Let's see Microsoft and Sony go broke trying to match it. Use the higher sales numbers by making a greater effort to attract third-party developers. Revamp your publishing program completely; you want Nintendo to be know as the easiest manufacturer to work with, rather than the most difficult one.

Get creative with the Wii. A price drop is nice, but you need some innovation. Look for a deal with a TV maker to build a Wii into their TV sets. Get the Wii built into minivan entertainment systems for the kids. Make a special bundle for afterschool programs with fitness titles. Create some PR! Get out there and generate some more stories.

The Wii 2 is overdue. You've missed the window for 2011; the clock is ticking for 2012. If you still want to sell a lot of consoles, you're going to need a new one. The Wii is underpowered and not HD capable, and the games are showing it. The Xbox 360 and the PS3 now have motion control options, taking away the Wii's one unique ability. So it's time to change the equation.  Sure, better graphics performance and HD output are a must. Don't try to outmuscle the competition, though. You need to outsmart them. Some spiffy new interface idea would be great, if you've got one tucked away. Improvements to motion control? Other types of sensors? Whatever you can throw in there. Most important, though, is a strong online component, traditionally your area of weakness. This has to change. You need the best online interface, the best environment for players, the best set of downloadable software. And price it all at $299 for the hardware, if not less.

Make the 3DS more than just a game device. You're competing against smartphones with thousands of capabilities. You should at least make it easy to play music and videos. There have been hints you'd like to play 3D movies; get busy and make it happen. I don't see a downside to putting a music and video player on this thing, though I guess storage is the main constraint, but since you have an SD card slot you'll at least be able to put a few GB in there (and it comes with a 2 GB card). While you're at it, open up the eShop to non-game apps, and let developers expand the machine's capability. The whole App Store thing has been instrumental in Apple's iPhone success; why not use that idea yourself?

Reduce the DSi price. Yes, I know you're hoping everyone buys a 3DS, but $249 is too much for many people. Drop the DSi to $99 and watch the sales soar again, especially when you point out they can use the DS games they buy on the 3DS when they get one of those later.

Really leverage your library. Yes, it's cool you can buy old NES games for your Wii... but the pricing is absurd. Why not experiment with prices and see what price point maximizes your revenue? You can always change those digital prices. While you've got the hood open, why not steal Sony's great idea and make your old games available on iOS and Android? It's more revenue; it's great advertising; and it might get people hooked on your iconic characters, whose latest adventures are only available on your proprietary hardware. I know you've been afraid to do this lest you slow sales of your hardware, but that that's not really an issue for old NES and SNES titles, is it?

Innovate. It's really nice that you have a slew of great characters that people love: Mario, Donkey Kong, Link, Kirby, Samus... but when's the last time you created a new one? Sure, keep doing new titles with familiar characters, but take a stab at making some new ones, too. Innovation is not doing a new Mario game, or even coming out with a Wii in a red case instead of white. Come up with something new in your games. More than that, innovate with your business models. Really embrace digital distribution. Try different monetization schemes; have you heard about free-to-play and how much money it's making? Enable in-game purchasing and watch the dollars roll in.  Try licensing some of your characters to an MMO or a PC game... or a theme park or a new animated series.  Hell, just a series of digital comics released on the 3DS... 3D digital comics, that is. Get some buzz going about all the cool stuff Nintendo is doing... which means you have to do some cool stuff. Get busy!

Will Nintendo actually do any of these things? Maybe, but they'll probably do them later rather than sooner. Management seems averse to sudden movement or change. Perhaps continued poor financials will goad them into swifter action, but I'd hate to see it get to that point. If Nintendo can rev up their engine this year, we'll look back on this as just a minor rough patch for them. I hope that's what happens.