How Nintendo won by losing

Thanks to Kacie Burton for sharing an instructive piece of strategic insight about Nintendo.? (This comes from Alex M H Smith’s Basic Arts newsletter, which is a good source of clever examples of marketing strategy in action.)

Nintendo had struggled to keep up with the performance of Microsoft Xbox and Sony Playstation. Their breakthrough came when they stopped trying.

Smith’s point is that sometimes you can embrace a weakness and make it a strength – it is a form of blue ocean strategy.

Rather than playing the performance game, Nintendo decided to play the portability game. The result was the Nintendo Switch, the first fully hybrid console that can be used at home or on the go.

And because the Switch didn’t have enough horsepower to properly support some of the popular high-powered game titles shared by Xbox and Playstation, it leaned in a different direction with multiplayer games. This helped Nintendo own the niche of in-person gaming – an area in which the brand already had credibility thanks to the earlier success of the Wii.

From a research perspective, how can you figure out where that blue ocean is? ?Perhaps understanding barriers is one way to go: What is going on with infrequent users or your product or lapsed users? What are they using as a substitute for your product, and why?? ?

What are some other approaches?