Challenges of transitioning to a new console: Nintendo’s Switch strategy

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Nintendo talks about the challenges of continuing the transition of video game consoles and that despite the success of the Switch, they do not feel in a secure position.

Nintendo has held a meeting with investors this week, after presenting financial results that demonstrate the good health of its business, the Nintendo Switch console, and its games (139 million consoles, 12 million copies sold of Super Mario Bros. Wonder…).

A console that, as they pointed out, will be their “main business” in 2024, without confirming or denying that they will release a new console this year (although perhaps we will know more before May).

Shuntaro Furukawa, president of Nintendo, avoided all questions about Switch 2, or a possible successor to the Nintendo Switch, which many people assume will be released this year. However, he acknowledged that generational transitions are never easy, and they cannot afford to be complacent.

The generational transition of platforms in the business of dedicated gaming consoles is never easy. We have experienced significant challenges after successful platforms several times, so we never consider our current situation to be totally safe.”, he said in the Q&A session with investors (translated by VGC).

Nintendo knows it can’t get complacent after the success of Switch

Nintendo has a curious tradition: its most successful consoles are succeeded by much less popular ones. Wii sold 102 million units, but against all odds, its successor Wii U sold 13.5 million.

Nintendo has experienced many “hills”, and to ensure that it doesn’t happen again with Switch 2, they have to approach the business “with a continuous sense of urgency“.

Furukawa recognizes other challenges, such as it being a highly competitive business, not only from other gaming offers and platforms but also from other forms of entertainment, so “there is an increasing need, more than ever, to continue offering unique propositions to become the brand that customers choose.”

How do they plan to achieve it? “To continue offering innovative entertainment that our customers worldwide can enjoy, we believe that continuing with our integrated hardware and dedicated software gaming console business is the best strategy at this time,” said Furukawa, adding that they are working on research and development projects

Since our products are not necessities, if they are not interesting, we quickly lose people’s attention. Therefore, it is crucial to continue efforts to make Nintendo feel close, even outside of the console, increase the customers who support Nintendo’s intellectual property in the long term and maintain connections with our customers”.

It is rumored that there will be a Nintendo Direct next week, although news about a Switch 2, if it is forthcoming, may take a little longer. It is going to be a very important year for Nintendo.

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