1. Nintendo The Launch of Game Boy Color
Anna Montanana
Rosemary Nocito
Deena Vezo
Maggie Wu

2. Nintendo History
1889: Nintendo was founded by Fusajiro Yamauchi as a manufacturer of 'Hanafuda‘ - Japanese playing cards.
The name 'Nintendo' actually means 'leave luck to heaven’
1970: first field of video entertainment after creating the Beam Gun with opto-electronics
1980: launched Game & Watch which was an LCD based platform that had 59 games
1983: introduced first home console, Nintendo Entertainment System (NES)
1989: released Game Boy, a smaller portable version of Game & Watch that had great potential in terms of graphics and interchangeable games

3. Nintendo History
Since the release of Game Boy, Nintendo has also introduced, Super Nintendo, Nintendo 64, and Game Boy Advance to the market
1997: it was estimated that more than 40% of U.S. households owned a Nintendo game system
Nintendo is the worldwide leader in home gaming systems.

4. Game Boy History
1989: Game Boy was initially released coupled with the addictive puzzle game Tetris for $169
1993: Original Game Boy was offered in various colors including, blue, yellow, and red
1993: Game Boy Pocket introduced to the market
1994: Super Game Boy was launched enabling gamers to play Game Boy games on TV through the Super Nintendo system
1996: Original Game Boy was released in a new and improved slimmer version
1997: Game Boy Pockets released in six new colors
July 1998: expected launch of Game Boy camera and printer additions that will turn Game Boy into a digital camera with printable pictures and stickers
November : Anticipated launch of Game Boy color in North America and Europe

5. SWOT
Strengths
Opportunities
Weaknesses
Threats

6. Strengths

7. Strengths Game Boy is the most successful gaming platform in history
sold more than 70 million units during its almost 10-year life
Nintendo was the leader in the worldwide US$15 billion retail video game industry.
Nintendo manufactured and marketed hardware and software for its game systems
Nintendo 64 is named Time Magazine’s “Machine of the Year” for 1996.
Control of the games that ran on its game machines, keeping its third-party software providers under tight control
Improvements:
In 1994, an add-on for the Super Nintendo Entertainment System was launched, enabling gamers to play Game Boy games on that system.
In 1996, Game Boy was relaunched in a slimmer housing with further improvements in screen clarity.
In 1997, Game Boy Pocket was introduced in six new colors..
The new Game Boy color would display sharp and vivid color graphics. Game Boy Color’s screen was also not backlit, which meant two AA batteries would last about 12 hours.
Nintendo Canada would have access to a broad selection of ads from the US that could appeal to all the target segments being considered for their launch plan.

8. Weaknesses

9. Weaknesses
Both Game Boy hardware and software sales had declined steadily from 1992 to 1996 on a worldwide basis.
By 1998, support of third-party developers for Game Boy was waning. Many viewed it as a “spent force” in the market and were reluctant to invest the US$200,000 to US$300,000 to develop a new Game Boy cartridge, when there were more attractive opportunities in the much larger console market.
The marketing communications budget for Nintendo in Canada was only a small fraction of the Nintendo budget in the US. Also, Nintendo Canada selected its ads from the pool developed by Nintendo in the US.
When the original Game Boy was launched in 1989, it had been priced slightly higher in Canada than the US, attributing to Game Boy’s proportionately greater sales in the US.

10. Opportunities

11. Opportunities
On November 23, 1998, a color version of Nintendo’s Game Boy would be released simultaneously in North America and Europe, one of the most important launches in Nintendo’s history.
Game Boy Camera and Game Boy Printer were scheduled to be released in July 1998.
Retailers had “open to buy” dollars that could be shifted around during the year to support the “hot” products.
Sega and other competitors lacked new exciting software for their handheld hardware. Handheld users seemed to want exciting, current software.
Six new games, specifically developed to take advantage of the 56-color palette on Game Boy Color, were expected to be available at the launch date.

12. Threats

13. Threats
In 1998 Nintendo began to lose momentum as some of the third-party developers began focusing more of their development effort on Sony Playstation, which was viewed as an easier platform on which to develop games, and the Sony business model was viewed as being a more profitable one.
Sega had been much more aggressive in promoting its console business in Canada than in the US.
Third-party developers were spending fewer marketing dollars in Canada due to the relatively small size of the Canadian market. Canada represented only about 3 percent of the global Game Boy software market, whereas the US accounted for between 35 percent to 40 percent.
As sales velocity slowed in the mid to late 1990s, retailers shifted more of their shelf space to Nintendo consoles and competing platforms and reduced their advertising and promotional support for Game Boy.
In the late 1990s, a number of specialty stores had delisted Game Boy because they felt that they were not achieving competitive returns on their sales of Game Boy hardware and software.
Competition:
Atari Lynx, the world’s first color handheld video game system.
TurboExpress
Sega’s Game Gear
Sega’s Nomad

14. Issue Identification
Issue #1: Choosing the right target market and the right positioning
Issue #2: Choosing the right market approach
Issue #3: How to price Game Boy
Color in Canada
Issue #4: Product

15. Issue #1: Target Market and Positioning
Alternative #1: Focus on teens who were more likely to already own a Game Boy
Alternative #2: Focus on new kid/tween users

16. Issue #2: Marketing approach
Alternative #1: In-store interactive display
Alternative #2: Mall tour
Alternative #3: Cross Canada tour

17. Alternative #2: Price Game Boy Color at a lower cost of Cdn= $100
Issue #3: Pricing
Alternative #1: Price Game Boy Color according to the mid-1998 exchange rate conversion of U.S. price
U.S.= $ Cdn =$120
Alternative #2: Price Game Boy Color at a lower cost of Cdn= $100

18. Alternative #2: Stop offering the black and white version Game Boy
Issue #4: Product
Alternative #1: Continue to offer the Black and White version of the product
Alternative #2: Stop offering the black and white version Game Boy
Alternative #3: Bundle a game cartridge with the Game Boy Color
Alternative #4: Do not bundle a game cartridge with the Game Boy Color

19. Group Discussions
Issue #1: Choosing the right target market and the right positioning
Issue #2: Choosing the right market approach
Issue #3: How to price Game Boy
Color in Canada
Issue #4: Product

20. Issue #1. TM and Positioning
Alternative #1:Focus on teens who were more likely to already own a Game Boy
PROs:
If successful in getting teens to adopt, this might spur sales among kids and particularly tweens, who often aspired to use the same products as teens
Teens tended to purchase machines with their own money, making their purchases all year round, not just at holiday times
If teens already owned a Game Boy we know that they are interested in this type of handheld device, and we know how to target them because we have reached them in the past
CONs:
If Nintendo Canada targeted teens that had used Game Boy in the past, they might view the Game Boy as a product that was great when they were younger but not sophisticated enough to meet their current gaming needs
If Nintendo was unsuccessful in getting teens to adopt, then perhaps kids and tweens would avoid it as well
Many in this segment already had a black and white Game Boy and a library of five or six games and viewed the product as “old technology”
Many teens appeared to have moved past the handheld machines to consoles, which offered greater speed and game complexity
Only represent 6.7% of the total population of Canada

21. Issue #1: TM and Positioning
Alternative #2: Focus on new kid/tween users
PROs:
If Nintendo targeted kids and tweens and was able to convince kids/tween nonusers of Game Boy that Game Boy Color was a “cool” product, it could become a “gotta have” for the younger set
This younger audience was less likely to already own a Game Boy product
Kid/Tween users represent 19.9% of the total population of Canada
CONs:
The difference between being cool or not cool with the younger set was a very fine line
If focused on the kids and tweens, it might turn off the teens because Game Boy Color was “a kid’s toy”
Game Boys were typically purchased for kids and tweens by their parents as gifts, resulting in peak sales occurring in November and December for holiday gift giving and in June as a graduation or “great report card” present

22. Issue #2: Marketing approach
Alternatives #1: low-cost interactive display
Pros:
generate brand/product awareness when teens/kids/tweens visit the stores
Estimated in store interactive displays would be used approximately 20 % of store hours for an average of 3 min/use.
No sales staff required to monitoring the displays ( easy to operate)
1000 potential outlets and Nintendo could achieve an 80% placement rate
Low Cost
Cons:
No one is there to explain the new product or the benefits of the product if kids/tweens/teens have questions
Most sales clerks knew little about Game Boy Color hardware or software
Competitors have similar displays  Direct Competition

23. Issue #2: Marketing approach
Alternative #2: Mall Tours
Pros:
Nintendo reprehensive is highly knowledgeable gamers, and would show game insights and tricks that kiosk visitor could use to improve their scores on popular games
Incentives encourage trial among teens/tweens/kids  Mall tour visitors can enter contests for Nintendo products and would receive a temporary Nintendo tattoo when they left
6-8 minutes on the product ( more than store displays which lasts only 3 minutes)
Teens/kids/tweens spend a lot of time in the mall
Cons:
Expensive: $10,000 per Mall visit, means only 25 mall tours per year
Mall selection problems
staff is limited/place is limited

24. Issue #2: Marketing approach
Alternative #3: Cross-Canada tour
Pros:
Most likely to generate buzz/PR
Automatically high awareness due to scale of the events
More freedom to promote in a bold manner
Bigger kiosks, more staff to promote the new product
High reach due to the size of audiences attending each event ---80%
Cons:
costly $150,000 per year for major regional or national events: CNE, Klondike Days, and the Calgary Stampede
Events only take place in summer months

25. Issue #3: Pricing
Alternative 1: Price Game Boy Color according to the mid-1998 exchange rate conversion of U.S. price
Pros:
Remain consistent with pricing in the US
Nintendo Canada wouldn’t experience proportionately lower sales than the US similar to when the original version had been launched in 1989
Prevent black market trafficking and sales from the US to Canada because of the cheaper price
produce a retail margin of 20% on Game Boy consoles
Cons:
Hardware price would be too high to drive-high volume sales in Canadian market
Higher cost make it unaffordable for kids/tweens market
Could lose business to competitors because of high cost of gaming system

26. Issue #3: Pricing
Alternative 2: Price Game Boy Color at a lower cost of Cdn= $98
Pros:
Lower price makes the gaming system more attractive and affordable to buy, especially for kids/tween market segment
Retailers could make more profitable returns per square meter
Lowest sale price of Game Boy to date
Cons:
Could lead to black market exporting of product to other markets
Nintendo Canada would only receive a gross margin of 5% instead of the past 6%
With a lower margin received from each Game Boy sold, retailers might chose to spend their money on carrying and aggressively marketing other game systems

27. Issue #4: Product
Alternative #1: continue to offer the black and white version of the product
Pros:
Low price  Cdn $49
Backward compatibility of game boy color games mean that consumers could buy the black and white version and then trade up at a later date with out making their games obsoletes.
Cons:
With the low price, the black and white version would not generate any profits
Cannibalizing sales of Game Boy color

28. Issue #4: Product
Alternative #2: do not continue to offer the black and white version of the product
Pros:
Avoid losing money producing the black an white version
Avoid cannibalizing sales of Game Boy color
Cons:
Excludes consumers looking for a more affordable option

29. Issue #4: Product
Alternative #3: Nintendo Canada should bundle a game cartridge with Game Boy color at Launch
Pros:
Incentive to purchase
Teens/Tweens/Kids can see the difference between color and black and white games…and if they think color is superior, they would keep purchasing the color games instead of just keep using their old/already owned black and white games
History could repeat itself with Game Boy having the same success it experienced when packaging Tetris with the original Game Boy
Increased perceived value of game system
Cons:
A high price will be charge??
Lose revenue from independent game sales

30. Issue #4: Product
Alternative #4: Nintendo Canada should not bundle a game cartridge with Game Boy color at launch
Pros:
Avoid higher retail prices
Higher profits from the individual game sales
Cons:
Less incentive to buy
Consumers may expect Game Boy to come with a game cartridge because that is what they have experienced in the past

31. Recommendations
Focus on both teens already own a Game Boy and new kid/tween users
The best marketing approach is a cross-Canada tour because we felt this is the best way to generate buzz and increase brand awareness and same time it is the most informative way to educate users on the new product. We also felt the other two approaches can be carried along after the launch of Game Boy Color
PR:
we also recommended what has been stated in the case
Sales Reps visit leading magazine/web publications three month before product launch and let the writers to play the game for 5-6 hours
We decided to price Game Boy Color at Cdn $120 to best satisfy factors such as profitability, consumer price sensibility and sufficient motivation for retailers to carry the product.
Lastly, we have decided that Nintendo should stop offering the black and white version Game Boy and bundle a game cartridge with Game Boy Color. This will not only encourage users to try new Game Boy Color but also make them adopt to the new product faster.

32. Expert Choice
See printouts

33. Implementations short-term: long-term:
focus advertisements and literature on the $120 price, which includes a game cartridge, and towards both teen and new kid/tween user markets
begin research and creation of the cross-canada tour
gather information about consumer response and satisifaction
advertise aggressively in the beginning to promote the new Game Boy Color to both target markets with separate campaigns focused at each market individually
long-term:
execute the cross-canada promotions tour
sign a young celebrity as a spokesperson for Game Boy Color to appeal to the young target markets

34. Thank You