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Agente42 on 10 January 2020
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The_Liquid_Laser said:

I've only read the OP really, but I appreciated a good discussion about Blue Ocean Strategy, especially from someone who has either read the book or at least knows enough that they understand the main points of the book.

For the record I would say that Switch IS NOT a blue ocean console.  However it IS disruptive.  (The OP didn't mention disruption, but during the Wii years Nintendo was using both strategies.)  Blue ocean products grow a market from unserved or underserved customers.  Disruptive products grow by competing using asymmetric skills and motivations.  A product can be both, but the Switch is not both.  It is disruptive only.

Why isn't Switch a blue ocean product?  It's not for a want of trying.  Nintendo has made the following games so far in an attempt to reach brand new or underserved customers: 1-2 Switch, Arms, Labo, Pokemon Let's Go, Ring Fit Adventure.  Of these 5 games only Ring Fit Adventure is actually reaching new customers and not nearly on the level of Wii Fit.  1-2 Switch, Arms and Labo are essentially niche games and represent only a small fraction of the customer base.  Pokemon Let's Go would only be Blue Ocean if it could bring in a significant number of mobile gamers from Pokemon Go.  It didn't, because its sales were mostly front loaded.  It was selling to an established customer base instead of a new one.  Ring Fit Adventure is actually selling like a Blue Ocean game, but Switch was already extremely successful before it came along.  There are several other games that contribute to Switch's success much more than Ring Fit Adventure.  Clearly Switch is not a blue ocean product.

What about disruption?  Is Switch a disruptive product?  Disruptive products either start in a different market or on the low end of an existing market.  Switch started in both.  The handheld market is a different market.  Also the launch price of Switch is cheaper than the launch price of a Sony or Microsoft console.  Does Switch fit the profile of a low end/different market product?  Check.  Disruptive products also compete by ignoring functionality and instead improve other aspects that make the product either more reliable, more convenient, or cheaper?  Portable gaming and hybrid gaming are both more convenient than home gaming.  Also carts are more durable (reliable) than disks and it launched at a cheaper price.  Meanwhile it has ignored functionality (hardware power).  Does Switch compete like a disruptive product?  Check.

Switch is a disruptive product, but it is not a blue ocean one.  If it's sales grow to unprecedented levels (and I think it will), it is because it will take customers away from Sony and Microsoft.  In fact that is one reason why I think it is called "Switch".  Iwata liked to give consoles 2 or 3 different meanings.  Obviously Switch refers to switching between home and handheld gaming, but I also think it means Nintendo has a strategy of people switching from Sony and Microsoft to Nintendo.  Switch's growth will come from competition and not from reaching a lot of new customers.
Great point. The same coincidence as DS. DS may refer to the developer system, dual screen and disruptive system. With the DS, Nintendo threw Sony out of the handheld market. Climbing the market share and snapping up much of the market even with its successor, the 3DS. Nintendo played Sony so much for the high-end gaming market that Vita ran out of AAA games because it wasn't profitable to produce games for him, despite being very powerful.