I think the Wii U is dealing with 5 or 6 issues in order of significance
1. No new Wiimote type idea to bring back casuals. Many of the Wii Sports crowd has moved on to tablets/phones. No casuals = no explosive sales. Casuals are fickle, the tablet screen concept just doesn't appeal to them, and isn't getting people talking around their water cooler at work.
2. Not enough strong Nintendo IP upfront. The Wii U has games that's really not the issue so much, they are probably a game or two short of what you'd want right now though. They should have greenlit a Star Fox game and another new IP for the post launch window to fill in the blanks.
3. Price. Price is too expensive, especially for kids and a lot of Nintendo's fanbase doesn't like to spend a lot on hardware as they're used to not paying much for Nintendo consoles traditionally. Other gamers see PS3/360 with better libraries and more third party content, similar visual output and a lower cost and that kills the Wii U in its tracks. It's also killing the Wii U with parents I think, why pay $350 for a Wii U, when $250 gets you a 360 + some cheapo $20 LEGO Harry Potter/Star Wars game that'll keep the kids happy.
4. Mario burn out. They've released too many Mario games in a short time frame and didn't change up the NSMB formula enough, as such Mario on Wii U has a "been there, done that" feel to it even though it's pretty darn good game.
5. Poor third party support. Predictable I guess, but the Wii U probably could've used BioShock Infinite, MGS Rising, Resident Evil 6, and Grand Theft Auto V for starters. Ubi Soft delaying Rayman also hurt.
6. Crap marketing. Self explanatory.
