Nintendo – Horrible Planning Or Evil Genius?

Written by Link on 26th November, 2008

Normally, I try to avoid the Christmas rush. Having spent a few years in retail, I know all too well how things can be hard to find. I’ve even seen a few parents trying to do all of their shopping a day or two before Christmas and boy, have I felt sad for those kids.

Historically I have also had a tendency to shop for gifts at the last moment, and I know most of you have too.

I’ve gotten a little better recently however. As some of you may know, I have a two year old son – and I also have a wife that loves to shop. The later means that most of the presents have been bought for our family long ago. The former means that I don’t have to worry about him asking for the super popular and impossible to find toys for a few years yet (for example, I’m assuming the Playskool Kota My Triceratops Dinosaur isn’t easy to find).

This year however, I find myself in a bit of a panic. My wife decided that we should get a Nintendo Wii as a family gift. Not only that, but the only gift she’s really asked me for, is a Wii Fit.

What Link? You have no Wii? Shamefully, I don’t. I actually sold mine last Christmas to a close friend who was in a panic to get one for his kids. Like many non gaming parents, he just assumed he could stroll into Wal-Mart and get one without any problems. Boy was he wrong.

I never felt the motivation to buy another one, as all I seemed to use it for was buying and playing virtual console games that I already own (sorry Wii fanboys).

So three hours after we decide to get one, I stroll into EB Games (gameStop in Canada essentially). Remarkably, they have three Wiis. The woman ahead of me buys one, I buy one, and as I leave the store I see another couple freaking out as they realize there is actually a Wii in stock.

That was three weeks ago. Since then I have seen a total of ten Wiis. This was today actually, as I strolled into a 24 Hour Wal-Mart early in the AM on an insider tip that they would have some Wii Fit games in stock. Turns out they received four overnight, and then sold them between three and four that morning – moments after they hit the shelf. Lame.

The Wii system itself has seen shortage since launch. In fact, this will be the third Christmas where they are selling for hundreds above the MSRP on eBay.

The 2006 shortage was understandable, as launch shortages are common, especially when that launch is in November. But why is there till a shortage of consoles almost three years later? Nintendo hasn’t led hardware sales since the SNES. Is that the problem? Did the company forget what it’s like to be the leader?

Microsoft and Sony lose money on each hardware sale, hoping to recoup those loses in software. The Wii on the other hand (according to the Financial Times) makes up to $49.00 per sale in North America.

Two years of producing a console that makes money should be enough time to straighten out any issues in production or logistics that keeps consoles off of shelves. I understand that demand can easily outstip what was anticipated at Christmas, but a Wii is in no way easy to find year round. Not impossible, but not easy. Locally at least, nine times out of ten, Wal-Mart and EB Games have none.

Even worse, the lack of supply the Wii Fit has seen since launch is borderline ludicrous. Do you know how many times I have physically seen a Wii Fit on a retailers shelf since the North American launch in April/May? Once. Even then it was a unopened carton box on a stock pallet that probably never made it into a display case.

Once again, I have a two year old and a wife that loves to shop. Do you have any idea how many times I go to Wal-Mart during the run of a week? If not for that one fluke months ago, I’d almost think they never got a Canadian release.

I’ve seen all the articles and report on issues plaguing the production of both the systems and the game, but I don’t think that’s the major issue. Why?

Nintendo Is an evil genius.

The fact that I’m even writing this article shows much much extra attention they get due to these shortages. And perception? Well, no advertising budget could give Nintendo what they get by actually losing sales.

Parent: My son wants a video game system…

Store: What one? We have the XBOX and PS3 in stock, but are all sold out of the Nintendo Wii.

Parent: Sold out? Is that the best one?

Store: Well, as soon as we get them, they sell. We can’t keep them in stock, too many people want one.

What do you think that perception creates in non gamers, the very market that the Wii is trying to seduce?

The lack of availability of the Wii makes it instantly more appealing than the 360 or PS3.

Like my wife said today, “I probably wouldn’t even want a Wii Fit so bad if they were easy to find”.

Well played Nintendo, well played.

Side Note:

As a more traditionally gameSniped note, the selling prices of both the Wii and the Wii Fit are an excellent opportunity to make your own Christmas bonus. I avoid doing this myself at Christmas, as it makes me feel somewhat scroogish, but hey, we’re a capitalistic society for a reason.

The Wii Fit is selling for nearly double on eBay. $130.00 – $140.00 US seems to be the average for new copies. I’ve even seen local people trying to hawk a used Wii for $150.00. As Christmas gets closer, these prices are only going to get worse.

The Wii itself seems to be hitting $320.00 minimum, with $360.00 a more common price. The price varies a lot, as most auctions try to include a tons of junk accessories or games to boost the overall price. Used consoles seem to be around the original MSRP.

Add Your Comments

8 Responses to “Nintendo – Horrible Planning Or Evil Genius?”

portnoyd on November 26th, 2008 12:25 pm

Nice post, Link. I read a while back that the reason why so few Wiis hit the US was because the US dollar was so weak, that it made more business sense to allocate systems to the EU/JP. I don’t know how true that is. I do think Nintendo is playing hardball and it’s not a shortage (considering that the Wii hardware is similar to the GC’s). Good for them – it’s a very smart ‘play dumb’ move. They are dominating the system sales marketplace (both Wii and DS) which everyone would have scoffed at a few years ago. I just hope they make a better effort next generation to up the system power and quality library for us non-casuals.

I think the Wii will be an easier mark this year. I went into a local Best Buy last weekend and they had a pallet of about 60-70 Wiis sitting in the middle aisle. Granted this is pre-rush, but that’s a lot to see in one spot.

However, to support your point, Wii Fit will be the big hard to find game this Christmas. I also have seen it once – and this was three weekends ago. The Mrs and I bought it as she wanted it for sometime but we’ve had yet to see it.

I’ll be honest – I didn’t think that this season for Wiis would be as bad as two years past, but now what you’re saying made me wish I bought a couple of those Wiis and 2-3 more of the Fits the Gamestop had for sale.
portnoyd on November 26th, 2008 3:37 pm

Btw, I saw that Kota My Dinosaur thing at BJs (regional club store). My god, that thing is totally unnecessary.
Link on November 26th, 2008 3:47 pm

lol. Yeah, the Dino is a bit intense. Lego doesn’t quite cut it compared to some toys these days.

Here’s the thing I seeing though. You may have seen a pallet – but how long did it last? And how long to they get another? Toys R Us got 18 this week. Wal-Mart got 23. The allocations are insane.

I’ve heard the EU theory too, makes sense. However, from what I understand though, the profit margin on the Jap console is under twenty bucks.

Yeah, the fits would have been a nice investment without being really expensive like a console. I would bet a lot of money they’ll start breaking $200 in three weeks.
Limbofunk on November 26th, 2008 3:51 pm

Nintendo has been accused of creating the false sense of a shortage for their products since the NES days with their top selling titles. With the N64, the top story was that Nintendo kept saying they weren’t going to be able to produce enough consoles for launch to meet the demand they expected. Everyone got in a tizzy over that news so they rushed to stores on the launch….only to find that all the stores had more than enough of a plentiful supply to meet holiday demand. They got a lot of flack after that, so it seems as if they learned their lesson and are creating a shortage and this time sticking to the illusion.
GoNintendo » Blog Archive » Nintendo - Horrible Planning Or Evil Genius?- What are you waiting for? on November 26th, 2008 4:39 pm

[...] Article here [...]
jointhiway on November 26th, 2008 5:09 pm

I like the well though out conspiracy theory you propose Link. It is not like WiiFit or the Wii System just came out.

If you look at Kijiji, it seems that most of these items are ending up on the local market as opposed to on ebay. WiiFit has been a Kijiji staple for 6 months.

The funny thing is just how terrible that the Wii is for software. Mine has been collecting dust since Smash Bros came out and Mega Man 9 (contrary to what most Wii fanboys claim) is available on all 3 consoles.

I hope you have some luck in your pursuit, Link. I went through it last year.
Seyb on November 27th, 2008 4:35 am

Too bad Wii and Wii soft are not region free… You can find plenty, no, tons of Wii and Wii Fit in -virtually- any local retailer… For now. Better hurry though I guess ?
Seyb on November 27th, 2008 4:35 am

‘Forgot to mention I’m talking about the situation in South West France. Sorry about that.