There was some interesting analysis of Nintendo’s sales over at Kotaku yesterday, that indicates a very sobering reality that I’ve come to suspect. It would seem that the level of online engagement between Nintendo and its European and Australian customers is not quite up to the growth that’s being seen in the US and (especially) Japan.
On a technical level there’s no real reason for this to be happening. Both Sony and Microsoft seem to be quite engaged with their players online in both regions, and with digital downloads quickly becoming a very important market opportunity, this is one that Nintendo knows it needed to gain ground in.
While Miiverse and premium discounts for online purchases with the Wii U Nintendo is setting itself up better than ever before to engage with its fans online, but simply having the service there isn’t a guarantee – the eShop has full retail downloads and as the Kotaku story states, they haven’t taken off here.
I don’t believe it’s an issue with pricing, either. Over on the PSN and Xbox 360 retail downloads are priced at RRP. On the PlayStation Vita there’s only a slight discount with the download version. Despite this, the data suggests that those services are growing at a rate roughly in line with the rest of the world.
So what does Nintendo need to do to engage with its customers in Australia (I won’t comment on Europe, but I suspect the situations can be similar)? I’ve outlined a couple of ideas below:
1) And this is the big one – Nintendo’s online service exists almost entirely in isolation. For an online service to be really effective in reaching customers here, it really needs to be prevalent. I have my PlayStation Network account on my phone – yes it’s not especially useful, but I can check whether my friends are online and check up on the PlayStation Blog (ie which games are available for me to buy now). Nintendo’s mobile strategy doesn’t need to be about making games to sell on mobile devices, but Nintendo sure as heck needs a mobile strategy.
With online selling being as much about building a community as it is directly selling something, Nintendo does need to do something about making sure people can interact with it even when they don’t have their 3DS handy.
2) Social networking engagement – When I get a trophy on my PlayStation account my Facebook friends know about it. My Xbox Gamerscore is there should I ever want to stick it on my forum signature. Both services integrate with Raptr, which is itself a social network for gamers. With Nintendo though, I have a… friend code… I can trade with someone and then check out their 16-character catchphrase of the day and whatever game is their current “favourite.”
Social networking is important for drumming up buzz about a game. I’ve bought games when I’ve seen they’re popular with my Facebook friends. It’s easy for me to share screenshots of my Vita games on Twitter. Again, Nintendo’s consoles exist in relative isolation.
Miiverse might even be a curse here. I’m already active on multiple social networks, and adding yet another one to that list isn’t necessarily something I want to do. Nintendo needs to either make Miiverse more useful than Facebook and Twitter (good luck), or also integrate with other social networks (which Nintendo might not consider necessary, thanks to Miiverse).
How can this help sell digital games? Again, it’s about presence. The Nintendo Wii did so well because it became ubiquous with family gaming. But in the current environment, being “everywhere” means being talked about, shared, and engaged with via social networks. This is an area Nintendo has a long way to go (let me export my activity log playtime data, please).
3) Embrace freemium models – The PlayStation Vita is a struggling console in the broader market, but those networks of players who have them – such as my Friend’s List – demonstrates a niche community of very connected players. We are all connected because we’re all playing the same games together. We’re playing those games together because they’re free. Treasures of Montezuma Blitz has weekly leaderboard challenges for friends. Ecolibrium is a highly social game and Treasure Park is a highly entertaining diversion.
Because you need to log into the PSN to download these free games, the Vita’s PSN store has the opportunity to sell additional games, or even virtual goods through the freemium model. These are opportunities that currently the Nintendo Network lacks. There is a world of psychological difference between going into an online store to grab something that all your friends are playing and is free (and then seeing a really awesome-looking game for $40), and knowing that if you go into an online store like the eShop, you’re going to have to pay money for any content that isn’t promotional in nature.
Nintendo’s given a way a couple of games for free, sure, but a healthier long-term strategy would be to allow social games and freemium games onto the service. After all, these games are the ones that help build awareness that there’s fun stuff on your network to download.
In general Nintendo’s taking great steps towards improving the online experience, but it doesn’t quite seem to understand that the point of an online store isn’t just to sell games. It’s to provide a community of gamers a ready library of content to access, discuss, and share with one another. Once Nintendo starts to shift its approach in online to engagement, rather than sales, it will more accurately reflect how sales are done in the real world (relationship building rather than passive engagement), and in doing so Nintendo will then see a marked increase in engagement with its online services.
It's a little too early to make conclusions about Miiverse.
The service's goal–from what I've witnessed so far–seems to be making video games more social, resonating with one of Nintendo's goal for the Wii U console. Facebook wants to make social life more digital. Therefore, Nintendo technically wouldn't be competing against Facebook.
While I can guess the idea of what Nintendo is trying to accomplish with Miiverse, we still don't know what exactly it will do. Maybe they will actually integrate Miiverse with other social network services, since they don't seem to be competing.
Oh, absolutely. I'm not in any way criticising MiiVerse – I think it sounds great (especially if I can transfer my current 3DS Mii over). And I don't think it's in any way competitive with Facebook.
What I do think is that MiiVerse (and the eShop) absolutely have to be integrated with both Facebook and Twitter. The average person wants their consoles to be feature-rich and very social now. Nintendo cannot rely on people signing up for yet another social network to achieve that, though. So my earnest hope is that MiiVerse is like Pinterest and Instagram, and the other new wave of social applications, and integrates with the big boys in town.
But you seem to be making assumptions about the service when we don't know about how it will work and the company's intentions. Nintendo has yet to release more specifics, and you seem to fear that Nintendo sees Facebook as competition-
Oh, I see now…
you think the company always seems to find little interest in beefing up features not related to pure gaming, like as though they're lazy, or unwilling (Wii Shop Channel anyone?). You're afraid that they won't find the motivation to work hard to integrate with other services when they already have Miiverse. Thus, they save time and money by not worrying about extra work. Is this what's on your mind?
I have been doing my best trying to stay patient on the Wii U's Miiverse and online details. I just hope many of these questions/suggestions are answered fully, though the Miiverse social interaction thing appears to be a separate "network", at least that's what I was guessing… Do you remember the pre-E3 showing, where the guy was at the coffee shop and got the "update" on his phone about his friend being stuck in ZombiU? Apparently that mobile functionality for the "network" won't happen until after launch with an app, but it seemed like it was almost real-time… then again that was a marketing piece for the system, and I wouldn't doubt it being nowhere close to that in the end, considering the source. o_0
The one issue I hope they address, is sales. They need to get rid of the rigid WiiWare price structure and start doing some sales with Wii U digital titles, which I think they have already done with the 3DS, so I would imagine it happening/continuing on the Wii U.
I'm not really making assumptions at all. I'm actually saying here what I think Nintendo *has* to do if it wants to properly engage with its customers – that's different to saying what Nintendo is, or is not doing with them. I don't personally know whether Nintendo is or is not – I'll save my assessment for what Nintendo is actually doing with social networks for my hardware review.
My personal fear is that Nintendo has not, previously, done anything of note with social networks. The 3DS is an incredibly isolated device, the DSi only had minimal Facebook integration (for photos), and the Wii is useless when it comes to online. Any other company and that would be three strikes. I would like to believe there's some form of Facebook and Twitter integration with the Wii U, but we just don't know yet.
That app really needs to launch with the Wii U – and it's very unlikely that it will. 🙁 And if indeed Miiverse is an isolated social network, then I hate to say it, but Nintendo has missed the point again. At the very least it *has* to integrate with Facebook.
Twitter integrates with Facebook. YouTube integrates with Facebook. Pinterest integrates with Facebook. FourSquare Integrates with Facebook. Even Apple integrates with Facebook. Like it or hate it, for a *lot* of people, Facebook is the dominant force in their online social circle, and I really cant see a lot of people being committed to another social network that doesn't play nice with Zuckerberg's.
I would hate to see MiiVerse turn out to be yet another nice idea, failed execution – and any social network that only appeals to a tiny fraction is a failed social network. For now I'm just going to assume the best, prepare for the worst.
"That app really needs to launch with the Wii U"
Reggie said it wouldn't be at launch, but would be after launch. That was at E3 I believe.
"Like it or hate it, for a *lot* of people, Facebook is the dominant force in their online social circle…"
So says the site's ranking, just not its STOCK PRICE! It's crazy kind of…
"For now I'm just going to assume the best, prepare for the worst."
Haha, I just said a very similar thing in another comment.
Then already my fears that the Wii U is launching not-completely-ready are coming true :-/ That app might sound like a small thing, but the way I see the market, and how people are using their consoles/ phones/ tablets, that feature would have gone a long way in convincing people that the Wii U had a place in the living room.
As for Facebook, it undoubtedly is facing some teething problems as a listed company – given Zuckerberg's age and lack of big business experience it amazes me that anyone didn't see this coming. It's still going to be the next Google – it understands how people behave better than anyone, I think.
"Then already my fears that the Wii U is launching not-completely-ready are coming true"
The app after launch was said months ago though, so that shouldn't have been an expectation as we didn't even know anything about Miiverse really (still don't). Maybe they'll surprise us and we'll find out they used some of their billions of cash on hand to pay coders 24/7 for the last 5 months to get it straightened out?
I'm all about no excuses from them though, and I really think they should be getting this ready FOR launch, not AFTER launch… but at least Reggie did say it months ago that it wasn't going to be at launch.
Your personal fear sounds more like what is causing your fear, but it isn't addressing what your fear actually is. So you seem to fear that Nintendo will strike out once again based on their approaches to past devices.
Hm. This isn't exactly related to the article, but I want to state that Wii U looks to be something unique. I can't predict the outcome, but I wouldn't be too surprised if they made some sort of innovation in socializing video games.
I'm not completely familiar with Xbox LIVE and I don't have a Sony device, but their social features look like features centered around online multiplayer, self pride, competition, and many more. Miiverse looks friendly and inviting as far as I know.
Oh, what am I to make sense of Miiverse? We'll just have to wait and see u_u