1. 2. A brand is more than a product Companies try to satisfy needs or wants of consumers with their products. But brands go beyond that: a brand is a product that adds other dimensions. These dimensions are important to differentiate your brand from another. If we take a look at the ads of Nintendo we can see that they differentiate by being emotional and intangible. This is an ad for Nintendos Gameboy advance, where you can see a crashed paratrooper with his Nintendo Gameboy advanced in his hands. With this ad, Nintendo wants to anticipate on peoples emotions by being funny.
Another example with the same explanation is the one with the young bridesmaids and the little boys behind them, who are secretly playing on their Nintendo DS. But Nintendo also has their ads of Brain Training and Wii. The ad for brain training says: Can you use a video game to rewire your brain? Nintendo has much competition of the Internet and video games so they want to differentiate with Brain Training on a rational way. The same is for the ad of Nintendo Wii, where you can see prints on a wall of a tennis racket, hockey stick, boxing gloves and golf clubs.
The only thing that hangs on the wall are the controls of the Wii, it replaces all of the other equipments. These two ads want to differentiate on a tangible and rational manner. 1. 3. Why do brands matter ? 1. 3. 1. To consumers and to manufactures Consumers can have a lot of different reasons to like a brand. It mostly starts with a number of benefits and brand offers. The reasons can be that they can identify themselves with the product, reduce a risk, the price, a special promise, good quality, ¦ Nowadays brands can be described as things that help give our live meaning.
Brands have meanings and values attached to them in which we can and want to relate. To manufacturers a strong brand means growth and its benefits; to expand, to be competitive, to introduce new products. But there are also benefits related to profitability; loyalty, premium pricing, trade leverage. Nintendo is one of the oldest video gaming companies and at a certain point they had almost disappeared completely. But they took a 90 degree turn in their corporate strategy to prevent that. During their history they constantly had to focus and then re-focus their brand promise to their customers as their business changed.
At a certain point many customers were tired of the poor quality of graphics and people had to go to an arcade to play. So Nintendo developed the consoles to play at home and they communicated especially about the quality of their product. Their products became successful again and when they released newer consoles the consumers had to be convinced about the quality improvement. Nintendo stayed true to their brand that cutting edge technology and an established stable of reliable game brands would prove that they still had the power. In 1995 Nintendo had complete domination in the home console market.
Kids ran home after school to continue their saved game or they pulled out their game boy to start playing right away. Those days there were relatively few games coming out. And Play Station pulled out the trick of less quality but much more choice, quantity and consumers fell for it. Play Station had no problem with allowing violence and blood in their games while Nintendo was always with kind characters. The Nintendo gamers had also become adults and the new generation wasnt to appealed. To prevent losing more customers they released Nintendo DS just before the PSP.
Their marketing campaign was centered around the word Touch to highlight the new stylus/touchpad technology, on the dual screens. In previous marketing strategies, Nintendo always used comparisons to show they were better than their competitors, but for the first time, Nintendo just needed to focus on their customer and simply tell them that the DS is a good thing. The First to Market approach paid off, and the DS, along with some innovative games, would not relinquish their share of the handheld market. This step was good enough to survive but not to grow in any way. So they had to make a bold step.
There was a war going on between Xbox and Play Station and Nintendo tried a new strategy build it and they will come. They built a Console Nintendo Wii that appealed to parents, children and teens. It was a tremendous success. All of these brand changes¦simple slogan, clean design, dull colors was to prove to the world that the Wii was for everybody. (Dignam, 2001) (Sixsix8productions, 2009) (Aaker & Akutsu, 2010) 1. 4. How are brands positioned? 1. 4. 1. Segmentation Market segmentation is the division of a market into different groups of customers with similar needs. Nintendo has divided the gaming population into three categories.
The First category is referred as Active Users, people who have played video-games at least once in the last year. The second one are the Sleep Users, those who played but more than a year ago. And the third one are the Non-Users, those who have never had contact with video-games.
We will clarify the market segmentation of the Nintendo Wii and the Nintendo DS and 3DS. 1. 4. 1. 1. Nintendo Wii (2006) With the Wii, which was launched in 2006, Nintendo has been extremely smart in their approach as it has discovered and attacked a new and unexplored segment in the video-console market.
They have targeted the Non- and Sleep users, not the core gamers. They have chosen to attract the users that want to have fun while playing and those who do not look for the best graphic resolution (like the Playstation and X-Box target group), but for ease of use and simplicity. Nintendo has segmented the market according to three categories:
* Demographic * Behavioural * Lifestyle As mentioned above, Nintendo has targeted the casual or non-gamers. So they have taken into consideration the users status and usage rate which is behavioural and lifestyle segmentation.
As most core gamers are men, Nintendo has also segmented demographically. With the Wii, they wanted to appeal different ages of gamers, more female gamers and even whole families. This segment group is shown in their advertising (Annex 1). But they still develop Wii games for specific markets, focused on specific groups, like Call of Duty. (Marketing weblog, 2007), (Slideshare, 2011) By targetting this market segment, Nintendo has been able to expand the video-game market and attracted new users that otherwise would not have purchase a console.
It is a very profitable segment, one with a higher purchasing power than teenagers. They have also become the only player in that ease of use segment. 1. 4. 1. 2. Nintendo DS (2004) and Nintendo 3DS (2011) The Nintendo DS target also the casual gamers. The DS wanted to appeal a wide audience with games focused on specific groups. For example, with the game Brain Age, Nintendo attracted an older audience, while Super Mario and Pokemon aimed at children and youngsters (demographic segmentation). (Techdirt, 2007) In contrast to the Nintendo Wii and Nintendo DS, Nintendo 3DS is aimed at the active users.
Nintendo has chosen to targeted the core gamers and the hardcore fans of their company instead of the casual market. Nintendo has chosen this segment because they believe that the people who will be most interested in buying the 3DS, will be the people that have been buying previous versions of the DS. These consumers are Nintendo loyalists and core gamers. Nintendo has segmented this market according to two categories: * Behavioural * Lifestyle As targeting the core gamers Nintendo has, similar to their segmentation strategy of the Wii, taken into account the behavior of their target group.
These are frequent users in contrast to the target group of the Wii. Therefore they also have a different lifestyle. In the long run, however, Nintendo wants to expand the 3DS demographic to almost anyone with a remote interest in playing games on the move. (Softpedia, 2011) But in the end, Nintendo wants to appeal and encourage as many people as possible to game, regardless of age, gender or gaming experience. They dont feel that they have to concentrate on one segment at the expense of the other. 1. 4. 2. Positioning.
There are many epic stories of companies battling for a particular market putting tremendous resources and their future on the line: Pepsi vs. Coke; Apple vs. Microsoft. Video gaming is one such market. More specifically the market of gaming consoles: devices that are being attached to TV sets allowing to play games on screen. So what makes Nintendo different from its competitors? What do they promise to their customers? Nintendo is very clear in their positioning. Nintendo is about innovation and bringing new and unique game play to the consumer, both the core gamer, as well as new gamers. As we did in 1.
4. 1. segmentation, we will clarify the positioning of the Nintendo Wii, the Nintendo DS and 3 DS. 1. 4. 2. 1. Nintendo Wii With the Wii, Nintendo promises their customers a whole new way to play. It has to be seen as a fun thing to do during your free time. Everybody can play it as you dont need any gaming experience. What made Wii unique was an innovative controller responding to players movements. The new controller made gaming more interactive, easy to learn and much more fun to play. Players now had to move rather than sit for hours in front of TVs a healthier alternative to traditional video gaming.
Most noticeably, the new console was 17% less expensive than the cheapest version of the Xbox 360 and cost only half of what the simplest PlayStation 3 would. Nintendo did not only had a unique selling proposition, it also had price advantage in contrast to its competitors. The Nintendo Wii wants to be associated with fun, interaction and something that will bring the family together. This positioning is also supported by their advertising (Annex 1). (NY Times, 2006) 1. 4. 2. 2 Nintendo DS and Nintendo 3DS Like the Nintendo Wii, the Nintendo DS was also unique and different from its competitors because of its innovation.
The DS has two screens, a touch screen and voice activation. Features the competitors didnt had and therefore Nintendo could give its customers a new gaming experience. We see the same strategy with the Nintendo 3 DS. This one was the first console who had the capability of producing a 3-dimentional image without requiring special glasses. So again Nintendo differentiate itself by promising the gamers a new gaming experience. (Engadget, 2006) (Journal of business case study, 2012)
2. BRAND EQUITY 2. 1. What is a strong brand? 2. 1.1 Brand Awareness and Brand Image Do people know Nintendo? We can all agree on the fact that everyone knows Nintendo. Nintendo is historically the best known console manufacturer; also the longest running company in the market, and long-time dominant market leader. Nintendo is this important because of the so-called Nintendo Generation and its iconic game characters. The launch of Nintendo Entertainment System in 1986 turned the whole industry around. Sales of over 61 million units before 1995, helped the company to create brand awareness and strong brand associations with the brand.
Being the first console of its kind Nintendo was able to attract vast numbers of customers that nowadays are referred to as the Nintendo Generation. For this Nintendo Generation, Nintendo is an iconic and lifestyle brand that resembles their nostalgic feelings about their childhood. These positive associations have helped Nintendo raise its brand awareness. On top of that Nintendo has created iconic game characters, that have contributed to the identity and the brand awareness of Nintendo too. You could compare Nintendos Super Mario Bros as the Coca-Cola of video games. Nintendo is a brand that is known world-wide.
Nintendo is seen as a family-friendly brand. Many parents see the inexpensive systems and game cartridges as convenient ways to reward their kids for good grades or give them a distraction during long trips. While PlayStation and Xbox games are geared more toward adults, most GameCube titles of Nintendo are aimed at kids whose parents want to know that the games they buy wont be excessively violent. Those kids will in turn have kids of their own, and they will likely remember the child-like quality of Nintendos games. With the Nintendo Wii, Nintendo wanted to expand their market to a much larger audience, to attract consumers of all ages.
With the Wii they want to focus on family entertainment. So the brand image of the Wii promoted physical participation and family oriented gaming-style. (Brand Audit Nintendo, 2012), (Nintendos hidden advantage, 2012) 2. 2. The Value of Nintendo 2. 2. 1. The value of a brand The value of a brand is not only determined by its buildings, machinery or profit but also by its reputation. Strong brands have a good brand reputation. This is based on the experiences, clients have had with the company. Strong brands foster trust and loyalty in customers.
They also have a better chance of keeping business afloat even during hard market times, and this was certainly put to the test with the way the global economy has been these past few years. 2. 2. 2. The value of a Nintendo Nintendo is 56 on the list of global brands of 2012. Its brand value has been estimated around $ 7 million.
Nintendo has had another difficult year, declining 8% in brand value compared to 2011. In 2009 its brand value was estimated around $ 9 million. Since that year, the value of Nintendo has been shrinking. To compare, Sony, the biggest competitor of Nintendo, has reached place 40 on the list of global brands of 2012.
Sonys brand value was estimated around $ 9 million. This change is due to the decrease of the buzz around flagship products, like the Nintendo 3DS. Nintendo has advanced its digital interactions by promoting download sales of game software and by adding a social media component to consoles, but it has failed to effectively respond to the smartphone- based online gaming market. But the Nintendo brand is still distinctive. It is still the leader in its field, and 2013s launch of the next-generation Wii console is something the global gaming community can look forward to.
(Interbrand, 2012) In the ranking of the worlds most reputable companies, Nintendo is ranked 32. Again Sony beats Nintendo as they are te second most reputable company. Nintendo did stand out with its innovation. (Global Reputation Pulse, 2012) In 2009, however, Nintendo was the sixth most reputable company and Sony didnt make the top 100. One of the reasons that Nintendo dominated over Sony is the fact that the creators of Mario and Wii were only focused on developing gaming consoles and videogames for them, while Sony had other interests, like software and other electronic products.
Now we can see that Sonys strategy is paying off. But as we mentionned before, the launch of the next Wii in 2013 can turn this trend around. (Softpedia, 2009) 2. 3. What makes Nintendo strong? 2. 3. 1. The initial choices for the brand elements The initial choices Nintendo made were good choices, the brand elements are very memorable. The name is known by everyone and easy to pronounce. The logo is simple and despite some minor changes very well remembered. They also used the Mario character to support their brand and it was a good choice because almost everyone links it to Nintendo.
The only thing thats not so memorable are the different slogans because for their different products they use other ones that change quite often. Nintendo means leave luck to heaven but hardly anyone knows that and it doesnt tell you a lot about the brand. In Japan people know what it means of course. The Mario character with all its colors is very meaningful because Nintendo stands for gaming, fun, the use of color and of cartoon figures in their games. The other brand elements became meaningful due to people buying the product and give it a meaning. But they havent much meaning themselves.
The brand elements of Nintendo are quite simple but clear and they can easily be transferred to other product categories, whether in a new form or just the same. All the elements appeal to gamers because its a fantasy world and there is a lot of choice. People in different regions will always be able to relate with the product. The brand elements are adaptable and flexible, they use and change the slogan, adapt the Mario and other cartoon figures with new graphics into a new game or gaming experience. The logo has changed slightly and for a logo quite adaptable.
Because the gaming industry is all about creativity and coming up with new ideas its important to protect your product, which is very well possible. The Wii was a breakthrough in gaming and although it has been copied by now was a big hit that gave Nintendo a boost. Most of the elements are protectable but it needs to be examined very well. (Olaniyi, 2012), (Aaker & Akutsu, 2010) 2. 3. 2. The way the brand is integrated into the supporting marketing mix In terms of product design the brand stands for quality. The controllers are easy to use and the game play is easy to catch up with.
The graphics are of a high standard and quality was one of their strong points through the years. More intangible and symbolic are the fun you have while playing. You can decide what you do during a game and its all about enjoying or playing where you want. On the boring bus ride to school or wherever. With the Wii it was more about social related themes. Play with your friends and family and move while you play. Gaming can cost you a lot of money but to most gamers its worth it. If you want to play you need a console and games. New games are expensive but the quality is very high.
The anticipation is being build up before its release. They use value-based pricing strategies. In stores Nintendo uses store images and they make sure that new games are surrounded with enough publicity. Nintendos president Satoru Iwata has suggested that digital games will be priced the same as retail games. Satoru Iwata was quoted as saying We do not hold such a premise that digitally distributed software has less value. If a game is going to cost the same, then people will want the satisfaction of having the case, disc or cartridge. In a lot of stores people can return their old games and get a discount.
But gaming doesnt have to be expensive if you wait a year most games are very cheap and you can exchange with your friends if you want. (PCS, 2012), (Billy, 2012) 2. 4. Associations A brand is always linked with some other entities, whether you want it or not. Being linked with something can be both good and bad for your company. The way a brand is linked has a big influence on your products. If you brand is linked with other high quality brands, your customers will expect high quality products, but if its linked with low budget companies the expectations will not be as high and you can get away with lower quality products.
Products made by Nintendo are linked with a few key points: These are three key elements that are linked to Nintendo, but of course there are many more. Think about the Gameboy, the ever so successful portable gaming console made by Nintendo. Every product they produce up till today will be associated with the Gameboy. This has some positive elements but also some negative. People remember how much fun they had with the Nintendo Gameboy, they will remember this and consider buying a new Nintendo product.
Once they have bought a product they will have very high expectations because they will want their new product to be at least as good as their old and beloved Gameboy. Another thing that is still associated with the Gameboy are the poor graphics. All over the Internet you hear people complaining about the quality of the visuals on their new consoles. I admit, the graphics of the new devices arent the best but there are devices with much worse graphics, and people dont say a word about it. This is the bad thing about associations. 2. 5. Ten keys to a strong brand.
The Nintendo brand has many elements that make it a successful brand. Nintendos key promise is to sell fun and entertainment to their customers. They really stick to their promise and with all the consoles and games they have produced over the years no one will ever argue that it did not bring fun and entertainment to the market. Nintendo has always been consistent in the product they make: gaming consoles and games. Unlike Sony, one of their competitors, that has been making products like TV and Hi-Fi systems. Over the years Nintendo has created a very high brand credibility.
What this actually means is that customers are loyal to the brand, in a way that they will buy Nintendo products because they know and respect the brand. Nintendo has managed to differentiate themselves from the crowd. Back is the day with the NES and the Nintendo 64 they were revolutionary. The last 5 years Nintendo has managed to stun their customers with the new and intuitive controls of their Wii gaming console. Nintendo gives very good support to their customers by way of the online customer service. For over three decades Shigeru Miyamoto has been the innovating and guiding force at Nintendo.
He also invented the ever so successful Super Mario Brothers concept. It has always been easy to manage the leadership at Nintendo because it was a family company. Later on the company changed. Instead of diffentiating between management and creative talent, Hiroshi Yamauchi invested in his designers placing them frond and center as the face of the company. As you can see Nintendo has a lot of elements for being a successful brand.
(Minott, 2011), (Bryukhanov, 2012) 3. BRAND ARCHITECTURE 3. 1. Brand portfolio Over the years Nintendo has made many products.
The company started with play cards, called Hanafuda-cards and now they have an enormous brand portfolio. We can divide their pursuits in 3 types of products. We have the consoles, the games and also the characters. 3. 1. 1. Consoles At the moment Nintendo has 2 major products: Wii and Nintendo DS. 3. 1. 1. 1 Wii Launched in 2006, Wii is one of Nintendos prime products. The product was a huge success and gained unprecedented popularity. The success of Wii not only depended upon a great product, but the Wii had several distinguishing features which made it better than many of its competitors.
The wireless controller can be used as handheld pointing device and thus it can detect movements in three dimensions. The name Wii, conveyed the products image but it went on to be symbolic because the Wii is for everyone, not only for professional gamers. It created associations with unity, and it targeted a broader market especially families. 3. 1. 1. 2 Wii U The Wii U is an upcoming video game console from Nintendo as the successor to the Wii. The system was unveiled during Nintendos press conference at the Electronic Entertainment Expo 2011 and is scheduled for release November 30 in Europe.
According to Nintendo, the Wii U GamePad controller removes the traditional barriers between you, your games, and your TV by creating a second window into the video game world. 3. 1. 1. 3 Nintendo DS Family The Nintendo DS is a hand-held gaming console, an essential part of Nintendos brand inventory and is considered to be the successor of Game Boy. Game boy was the first hand-held gaming device in 1989. When Game Boys product life cycle was coming to an end, Nintendo released the Nintendo DS in January 2004. This console targets gamers in the age group from five to seventeen years old.
The Nintendo DS has several redesigns: Nintendo DS| a dual-screen handheld game console| | Nintendo DS Lite| The first redesign of the Nintendo DS. While retaining the original models basic characteristics, it features a sleeker appearance, and brighter screens. | | Nintendo DSi| The second redesign of the Nintendo DS. It is based on the unreleased larger Nintendo DS Lite model. It is similar to the previous DS redesign but there are new features include two 0. 3 megapixel digital inner and outer cameras, a larger inch display, internal and external content storage and connectivity to the Nintendo DSi Shop.
| | Nintendo DSi XL| This redesign is a larger design of the Nintendo DSi. It features larger screens with wider view angles, improved battery life, and a greater overall size than the original DSi. While the original DSi was specifically designed for individual use, Nintendo president Satoru Iwata suggested that DSi XL buyers give the console a steady place on a table in the living room, so that it might be shared by multiple household members. | | Nintendo 3DS| The Nintendo 3DS is a portable game console. The device is able to project stereoscopic 3D effects without the use of 3D glasses or any additional accessories. | | 3. 1. 2 Games.
Nintendo has a history of producing high-quality and unique games for consoles. Nintendo has a large offer of games, it has 3896 games over all its consoles. The world famous ones include Super Mario series, Sonic series, Donkey Kong and many more.
Nowadays Nintendo focuses on product games for Wii and Nintendo Ds. Nintendos games have their unique features, they tend to be more fun and cartoon-like. Moreover, the game experience is totally different compared to traditional games. The games in Wii are more physical, requiring body movements and the games in Nintendo DS use a touch style and enable more people to play at the same time.
The games of Nintendo are specially designed only for its own consoles. It means that Nintendo could perfectly combine the game characteristics with the consoles feature. The games of Sony and Microsoft are produced by a third party.
Usually the game producers will launch their games on PC, Xbox and PS3 at the same time and therefore customers have a wider choice. But on the contrary, Sony and Microsoft will compete with each other because their games are supplied by the same producers. 3. 1. 3 Charachters Nintendo introduced several game characters that grew along with the brand.
These characters became products on its own. 3. 2. Typology of branding structures 3. 2. 1. Patterns of brand architecture Because there are three different patterns of brand architecture the category to which a brand belongs isnt always entirely clear. For every different kind of company there is a structure that works best. Due to the constant changes in the market and the strategies, these structures evolve all the time as well. The three main structures are corporate dominant, product dominant and the mixed or endorsed structures. It is quite clear that Nintendo belongs to the corporate-dominant structure.
There structure is mainly based around the corporate name. Nintendo tries very hard to establish a strong global identity. It needs to be said that there are only two main competitors, namely XBOX and Play Station. (SixSix8, 2009).
Nintendo always sells under the same name and although they have a large product range Nintendo Wii, Nintendo Game Cube, Nintendo DS, and so on they dont sell products without Nintendo in the name. Whereas the two main competitors are products from Sony and Microsoft. When Nintendo invested in the electronic gaming industry they had found what they had been looking for.
A market in which they good grow and be very creative. Now everybody links Nintendo with Electronic gaming but it used to be different. (Schneider Associates, 2007) Through the years Nintendo had to adapt and reinvent itself all the time because competition became very fierce or due to a change in customer demand. The markets were constantly evolving. The key factors for success in this industry are: quickly adapt new technology, establish a strong brand name, take advantage on economies of scale and anticipate the competitors moves.
If you look at these key factors and see how Nintendo adapted them it becomes very clear that their success has a good reason. (Entmoney, 2010) If we take a look at the brand portfolio we can see that Nintendo has two main products, the Nintendo Wii and Nintendo DS accompanied by all the games they produce for these consoles. Because its structure is corporate-dominant their portfolio isnt that complicated. (Raza & Hao, 2011) The only strange product in their portfolio is the iQue player which is a console released in China and is a joint-venture with Chinese-American scientist Dr. Wei Yen.
In China there is a very strict policy on what is allowed and what not. And the console can be compared with the Nintendo 64 that was released in 1996. (Arneisa & Ganesamoorthy, 2012), (Wikipedia, 2012) Nintendos brand architecture proved to be successful over the years. They altered their strategy where necessary and were able to be competitive against the two other big players on the game market. What there next step in their evolution will be remains to be seen. Because the market is constantly changing. 3. 3. Dynamics in brand structures Which strategy does Nintendo use to expand and differentiate its company?
Nintendo uses the extension strategies because it wants to improve its products and be an innovative player in the gaming market. In the beginning, Nintendo made only playing cards. As they were innovative with technology they started to launch new products with variants but always under the existing brand name Nintendo. In 1990 Nintendo launched a whole new product, the first portable game console, namely the Game Boy. It became a huge success and Nintendo started to improve the console. The Game boy knows several versions like the Game Boy Pocket and the Game Boy Color.
After that, they launched the Game Boy Advance. Again a new variant, this time with another shape and more buttons. Also this extension was improved, which resulted in the Advance SP. The company continued to innovate with the launch of the Nintendo DS. Still a portable game console but with another system, 2 screens and a touchscreen. As like their other extensions this one was also updated, which resulted in the Nintendo DSI and the Nintendo 3DS. As the company name Nintendo was well-known due to the success of their portable game consoles, Nintendo launched again a whole new product in 2006.
This time the brand was extended with the Nintendo Wii. The company could take advantage of their strength and the consumer awareness. It turned out to be an effective strategy as soon also this console was a great success. Like the other extensions, this console has also some new versions like the Wii Fit and the Wii U. Nowadays, the Wii and Nintendo DS are the two major products of Nintendo. In contrast with endorsement strategies both products have their own campaigns, which causes high media costs. Along with the game consoles Nintendo also produced the corresponding video games.
Again another brand extension as all the games are launched under the brand name. Similar to the consoles, the games have different versions as well. For example the Super Mario series, the Donkey Kong series and the Pokemon series. As like the consoles most of the games have their own marketing campaign. 3. 4. Key principles for brand structures Deeltje Ken.
3. 5. The end of local brands Deeltje Ken 4. ADVERTISING CAMPAIGN By Camille Vanbesien 1. 1.Advertising campaign: Wii UAs we have already discussed in 3. 1. 1. 2 Wii U, The Wii U is released in November 2012. The Wii U is an upcoming video game console and it is seen as the successor to the Wii. Logically the launch of this new product is accompanied by an advertising campaign. Nintendo has officially kicked off its advertising campaign in North America, debuting the first commercial that will begin airing across the U. S. and Canada ahead of the devices launch. The Wii U is eagerly awaited by quite a lot of Nintendo fans and plenty of cu.