It started before then. Sega sowed the seeds with the "Nintendon't" ad campaign and Sony came in around the right time with third-parties to capitalise with PS1 vs N64. Of course, since then Nintendo haven't done anything to really change that image which they could have done over the years if they were so inclined.

Do a little market saturation with some GOOD video game movies would be an amazing first step. Let's see what a live Fatal Frame can do, but I'm more going to bank on a series of CG films to get the franchises back into the household. Being a part of Universal will help as well. 

The WiiU is just the latest in a gradual decrease in Nintendo's appeal to core gamers. Just another nail in a rather large coffin if you will. The lack of third-party support, a failure to recognise market trends over the years and an unwillingness to change is what has lead them to this point.

The damage to their brand can't really be down to a single console, each of the consoles since the SNES have all contributed to an image of Nintendo that has lead to core gamers seeing it as a console only for Nintendo first-party and a general lack of value-for-money.

This. We'll see how it plays out through the gen. 

Well they have an uphill battle to win mindshare next gen thanks to the WiiU

imho, nope, which is the only opinion that matters :p

Its surely looking bad and they NEEDED Zelda this year, now its all looking downhill. Mostly because every good game has no release date and is mostly just speculation at this point. Not being at E3 is another blow, but as I've said before the thing that kills it is that behemoth of a gamepad the costs as much as the console to make, it was an unnecessary gimmick.

Now the same thing can be said about all the other consoles, no good games are close to release and are just speculation but Nintendo made alot of hardware mistakes with the Wii U. Sony in particular did not, the PS4 is hardware perfection in my opinion, nothing redundant just good features and good hardware and a GOOD controller, the cornerstone to every good gaming experience, Now if it could only get some good RPGs.

Wasn't it the Wii that ruined their image?

I think releasing two over-priced and under-powered consoles in succession has entrenched the view that Nintendo consoles are very low performance. Not forgetting at the beginning when the wii u came out and had third party support most games were inferior to on wii u to ps3 and 360 which is hardly going to promote the power of the console. The gamepad also did it no favours, it was bulky, had a short battery life and wasn't suitable for young children due to its size, weight and easily damaged screen.

The wii u situation now is the console has a small range of excellent software but the range of software is tiny overall and is easily inferior to the ps3 and 360 libraries for choice by a long, long way. The pricing now is more realistic but we still have the gamepad issue which is still as bulky as ever.

The fact remains most gamers are simply ignoring the wii u, it's not on their radar, they know its technically weak with a limited range of games and just don't want it. It's the wrong choice for online gaming, it's the wrong choice for hardcore gaming, it's the wrong choice for small children etc. It's only the right choice for those of us who love Nintendo games and don't mind paying over the odds for weak hardware to play those games.

I think that makes sense. It alienated the regular gaming consumer, while appealing to casuals. When casuals moved to smartphones, the regular consumer wasn't considering Nintendo as an option anymore.

However, I think the strategy of being 1 generation late in hardware that they started with the Wii makes more damage. They should release consoles that are more on par with the rest.

I think that we are seeing a pattern with multiplats. If you look closely, the X1, PS4 and PC versions aren't much different. You change the res, bump textures a bit, turn SSAO on/off, change the AA method, but in the end all 3 devices run pretty close builds. The differences are only on things that are easy to change. That's cheaper. Developing 3 builds is costly. As these devices are comparable, do something that runs decently for everyone in a single build and cut costs. It's not finnancially possible to do anything else.

That's why games like Dying Light and PCars removed the last gen versions and why games like Mortal Kombat X are being outsorced to external, cheap devs. Because you can't use the same build than PS4/X1/PC and needs to do some re-engineering. Wii U fits on this category, so it isn't cost-effective for 3rd parties. If you have a game that's PS4/PC exclusive and you want to port it for X1, just fine tune somethings, cut here and there and it's done. For Wii U you may have to cut features that really change a lot your pipeline and porting becomes more costly.