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Forums - Nintendo Discussion - Do you ACTUALLY believe that Nintendo is creating artifical Switch shortages?

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Suky on 22 June 2017

Well, they are well known for doing it before many times throughout the years ,but in this case I think they are having suply cost issues too. They are creating shortages at the same time to create speculation and high demand to the end of year for holydays, and cover the debts at the same time by then. However look they are having some setbacks in the Switch production. I never heard shortages from Microsoft just to give you an example.



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specialk on 22 June 2017
KLAMarine said:

And an example is given:

"One of the most notable examples of scarcity marketing – the Disney Vault – started during the 1980s. Walt Disney Studios Home Entertainment began to reissue limited editions of their films and urge consumers to purchase these films before they went back into the “Disney Vault.” Because each Disney film is only for a limited time before it is put in the vault and not made available for several years until it is released again, consumers are driven to act fast when a new video is released."

Yes! The Disney Vault is a brilliant example of actually restricting supply to creat demand. I'm surprised I didn't think of it.

There is virtually no barrier to Disney stamping more blu rays. There is zero barrier to them adding more movies to their online service, "Disney Movies Anywhere". I was recently peeved to find though, that I could not buy a digital copy of The Lion King, because it was "in the vault".

If someone wanted to accuse Nintendo of restricting access to their old games, I'd say that is a perfectly valid accusation.

There is no suppy chain reason that Nintendo couldn't sell us Super Mario Bros. 3 today on the Switch. The reason is that they're hodling it back to make their online service bundle look more appealing. 



Mandalore76 on 22 June 2017
Aeolus451 said:
specialk said:

You're linking opinion articles and blog posts fairly consistently. 

Your Forbes opinion piece cites Apple's iPhone 5 being backordered as an example of scarcity marketing.

Your polygon opinion article cites Apple as a company with a firm grip on supply chain management that is able to meet demand. (i.e., you can just walk into an Apple store and buy an iPhone)

Your links don't even agree with eachother. 

Nintendo shipped 18.6 million Wii's in FY 2007. What was their actual production capacity? 20 million 25 million? 30 million? 

Every article of any kind is an opinion piece in reality, sherlock holmes. You're ignoring valid points just because you don't like idea that nintendo is using a well known marketing strategy to help sell their products. You'd rather go with the idea that nintendo is so incompetent that they can't produce enough product to keep up with demand even years after something has been out. There's many cases of shortages with nintendo's products. The people running nintendo for all these years must be diaper-wearing idiots if you're right.

Somehow, I'm the one out to hate on nintendo by trying explain that their repeated shortages of their products are a sign of nintendo being smart by using scarcity marketing to market their products so their sales ultimately increase.

Their production capacity is irrelevent in this context because we don't what it could upped to or lowered to based on Nintendo's tactics in marketing it. It just needs to be lower than demand for scarcity marketing to work. 

No, the belief is that Nintendo WAS competent enough to not bank on producing 16 million units of the Switch the year of it's launch after not being able to sell 16 million Wii U's in it's 4+ year lifetime.  That's not a desire to create artificial demand.  That's a very cautious approach after a very tepid reaction to it's previous product.



Aeolus451 on 22 June 2017
KLAMarine said:
Aeolus451 said:

Look up what scarcity marketing is and maybe look up anything on the history of nintendo's shortages. You'll see a pattern if you're being honest with yourself. 

Okay, as requested, I've looked it up and I found it at the following web page:

https://www.sitepoint.com/scarcity-marketing/

And it's defined as follows:

"Scarcity marketing involves motivating people to buy something by telling them there is a shortage in what is available and a limited time to act. The goal is to create a sense of urgency through an aggressive call to action; to make people scared that they will not be able to acquire something that they want if they don’t act fast."

And an example is given:

"One of the most notable examples of scarcity marketing – the Disney Vault – started during the 1980s. Walt Disney Studios Home Entertainment began to reissue limited editions of their films and urge consumers to purchase these films before they went back into the “Disney Vault.” Because each Disney film is only for a limited time before it is put in the vault and not made available for several years until it is released again, consumers are driven to act fast when a new video is released."

I'm noticing a difference however: in the Disney Vault example, Disney urges consumers to purchase these limited edition films before they go back to the "Disney Vault" helping to create a sense of urgency.

Contrast this to Nintendo that has said numerous times that it plans to up production of the Switch for the sake of meeting demand:

https://www.wsj.com/articles/nintendo-to-double-production-of-switch-console-1489728545

http://time.com/4705071/nintendo-switch-production/

https://www.ft.com/content/7edcebea-4207-11e7-82b6-896b95f30f58

http://bgr.com/2017/06/22/where-to-buy-nintendo-switch-online-shipments-increasing/

http://cogconnected.com/2017/06/nintendo-switch-shortage-apology/

http://www.ign.com/articles/2017/06/15/e3-2017-nintendo-working-to-scale-up-switch-production

As for the history of Nintendo hardware shortages, understand that a shortage can have multiple causes: supplier purposefully holding back supply is one, supplier underestimating demand is another. How does one distinguish between the two?

This brings me back to a question I asked you before and you have yet to answer: how does one distinguish between a product being scarce because the supplier is intentionally holding back supplies and a product being scarce because demand is beyond manufacturing and supply chain capabilities?

Nintendo nor any other company would admit they used scarcity marketing in the past or using it now. So quoting what ninty says isn't very relevent. It's just the kind of pr that goes along with it. Owning up to the practice would defeat the point of it and consumers generally don't like it. It's a smart business strategy but it has some risks.

In response to your questions, you can't distinguish between the two just from one instance (like looking just at the switch because you can easily say it's due to supply contraints, etc) but you can tell the difference if it's obvious, something is leaked or if it's done enough to form a pattern. In ninty's case, they've done it enough to show a pattern if you look at past shortages with their other products and you're just honest with yourself about it.



Shiken on 22 June 2017

Just seems like a way to downplay the success of the Switch to me.



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Peach_buggy on 22 June 2017

Personally i think the evidence points to Nintendo not using scarcity marketing. The risk of missed sales for them is too big imo.



Paperboy_J on 22 June 2017

I don't know if they are or not but if they are, let me just say that takes some pretty huge balls. Especially if you're in the delicate position Nintendo is currently in.



NeroPrototype on 22 June 2017

I don't remember where I read that the main problem was that Nintendo was competing with Apple, not directly but indirectly since a bunch of the components the Switch uses are used for Apple products therefor there's a shortage of components and that hurts the production for the Switch.



 

Nem on 22 June 2017

Well... they shipped a limited about of NES mini's and discontinued them despite beeing sucessful.

The ways of Nintendo are misterious.



shoichi on 22 June 2017
NeroPrototype said:
I don't remember where I read that the main problem was that Nintendo was competing with Apple, not directly but indirectly since a bunch of the components the Switch uses are used for Apple products therefor there's a shortage of components and that hurts the production for the Switch.

https://www.macrumors.com/2017/05/30/apple-supply-chain-nintendo-switch/

"According to people in the industry, smartphone makers -- namely Apple -- and their increasing ramp-up on component manufacturing for high-end devices have led to dwindling supplies of Nintendo Switch. "

also https://www.wsj.com/articles/nintendo-battles-apple-for-parts-as-switch-demand-rises-1496136603 if you have a sub to the WSJ