The "future" of gaming... Has Nintendo broken through for a massive win?

[fkusumot]

kn - It's all entertainment. Since your anecdotal evidence involves elementary school kids I'll note a corollary in the music industry. To wit, how does popularity with the younger generation (pre-teen) translate into continued popularity?

The simple answer is the popularity usually does not carry over. When it does then you get a big winner. For instance The Beatles started out as a "fad" or what I think is better described as a "cultural phenomenon". The Beatles place in history was primarily carved out (IMHO) because they carried over their pre-teen audience into the teens, and from the teens into adulthood. Very few musical bands/groups manage to do that, to keep appealing to a generation as it moves from childhood into adulthood and simultaneously pick up new fans (which keeps it from becoming niche). It's a magic formula. For perhaps the best earlier example see Sinatra and how the bobby soxers followed him into adulthood.

There are several historical examples of how the gaming cultural phenomenons work out. You can look at the rise and fall of the card game "Bridge" in America. Bridge was a staple "party game" from the 1930's well into the 1960's and then started falling out favor for one reason or another. Chess had a huge expansion in the USA starting in 1972, directly attributable to Bobby Fischer, and has had a slow decline since then. "Trivial Pursuit" was one of the big hits of the 1980's and the trivia genre has been present in gaming since then. For the last ten or so years we've had Poker and now more specifically Texas Hold'em as one of the biggest winners in gaming. Things go in and out of fashion... but why?

Nintendo has a history as a consistently profitable gaming company for over 100 years. The Hanafuda cards that Nintendo makes have been declining in popularity recently but you can still find a deck of cards for sale in a 7-11 in Japan. Nintendo is a gaming company and has failed famously with attempts to diversify. Their strength is gaming.

Part of Nintendo's success is the "E" for everyone philosophy. Parents buy games for their kids that they know and trust, a lot of times the same games they played when they were young. Parents will also pick up games that they can play with their kids. That's part of the reason why Hanafuda is still around. In the USA there are similar games like Monopoly, Old Maid, Go Fish and Chess/Checkers. I believe Nintendo's strategy is the same: to make games that have cross-generational appeal and to continue to be a "brand" that indicates to the consumer that it's kid safe.

Nintendo has branched out in certain genres with more sophisticated games with darker themes but that's not going to be their emphasis. The more mature themed games will overwhelmingly be 2nd or 3rd party efforts. Nintendo will continue to concentrate on the cross-generational strategy, and will win or lose based on that.

So to answer your original question, Nintendo does want to have carry over from the pre-teen to the teen and into adulthood. That carry over is a big factor in the short-term. Nintendo's real strategy is longer term than that. What they want is 20 and 30 years down the road those kids that you were polling to be buying a Nintendo product for their own kids.