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

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Alby_da_Wolf on 22 June 2017
TruckOSaurus said:

Well do you?

i've seen it said time and time again in various sales threads but I somehow can't bring myself to believe some people actually believe it. I mean, I could understand saying it to rile up Nintendo fans, it's surprisingly effective and fun but not actually believing it.

To be clear, I'm not talking about Nintendo setting aside units for big release weeks, I'm talking about people who really think Nintendo has loads of Switch consoles hiding somewhere and they're not shipping them to retailers who are begging for supply just because they want game sites to publish articles about stock issues.

To me that is pretty crazy but who knows maybe some users here can make sense of it?
Cloudman said:
I'd like to hear a logical reason as to why Nintendo would deliberately do this.
pokoko said:
No. A bird in the hand is worth two in the bush. That sale you failed to make today might not be there tomorrow.

Does a shortage drive demand somewhat? Does it create a positive impression for your product? Yes, but it's not worth the risk to purposefully manipulate the market and it's an awfully short-sighted tactic. The upside is relatively minor and probably doesn't even make up for the downside--and that's without considering the logistics of screwing up your own supply chain.
pokoko said:
Cloudman said:
I'd like to hear a logical reason as to why Nintendo would deliberately do this.

Well, to be fair, Nintendo does have a long history of manipulating the market.  They did a LOT of dodgey stuff in the 1980s that left a sour taste in the mouths of consumers and got them in hot water with various governments.  They've undersupplied retailers all the way back to the NES, both with consoles and with games.  At this point, it's pretty much expected.

Personally, I think it means that Nintendo cares more about their bottom line than anything else.  They'd rather a supply deficit than to have an over-supply on the books for the year.  

No. Even in the period of its shadiest behaviour, Ninty wouldn't have created artificial shortage of its consoles.
People are mixing two true things to create this inexistent third behaviour:
1) The first, as pokoko writes, is a thing of the past, in NES times, less and less in the following gens, Ninty not only kept cartridge production monopoly and stroke horribly one-sided deals with 3rd party devs, for example forcing timed exclusives on almost all of them, it also strictly controlled the amount of cartridges it supplied to them, up to creating shortages for some of the most successful 3rd party titles. Added to the aforementioned deals, it's how it ruined its relationships with 3rd parties.
2) To avoid overproduction, Ninty is prudent in its initial predictions, then, after observing demand trend for some time, it ramps up production and shortages either disappear or at worst happen for very short periods, only during higher than expected demand spikes, like it happens to any other successful product.



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fedfed on 22 June 2017

It makes no sense to not sell.

Hype is now... playing it down and not use it will be simply silly....
More hardware = more software sales....

they did not expect the success.



Switch!!!

Mnementh on 22 June 2017
Vor said:
It's just a dumb way to downplay someone's success. Tbh I didn't see any benefit for the company with creating artificial shortage, well apart from fooling customer that their product is a hot item. But it still hurt their image and reduce their revenue so it's a huge risk with little reward.

There is no way this is beneficial. There might be a slight increase in demand from people who think: my this is hot, I need it too. But for starters: a console never reaches the level of hotness like an iphone. The increased demand from a hot item is mostly because all your friends have it, not so much because you don't see it in stores. The downsides outweigh it massively. You lose the impulse buyers, you piss of customers who try to find it. On the forums somewhere someone told about a friend who set out getting a Switch and came back with a PS4 - to have at least something, you know.



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Mnementh on 22 June 2017

I think why it happens more often to Nintendo is for two reasons: first Nintendo is very conservative in their predictions and second the sales for them are very volatile. Look the Gamecube, Wii, WiiU and now Switch. The Wii sold more than four times what the Gamecube did, the WiiU did only a seventh part of Wii sales. Playstation has a stronger brand identity, and even if their product isn't that attractive (PS3 with it's pricetag at first) they sell just based on brand perception. Also Sony is less conservatives, they ramp up production for launch and just think they throw more advertisement if the sales are not that good.



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Johnw1104 on 22 June 2017

They've been guilty of this practice in the past (or at the very least extremely negligent when it comes to recognizing the problem of scalpers with their limited quantity products), but never for consoles. They are definitely doing everything they can to meet demand with the Switch, but these things can't be manufactured in the millions overnight... It was, after all, their single strongest console launch in the company's history that was following in the trail of its single worst selling console (excluding w.e the Virtual Boy was), so it should come as no surprise that there's supply issues.



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Nogamez on 22 June 2017

Nope



Eagle367 on 22 June 2017
Aeolus451 said:
Eagle367 said:

Yes you can have shortages for something that sells 20mil+ each year and something that was planned as a novelty item and made only a couple million only for it to blow up and even outsell current consoles in its last month. 

And haha hahaha people actually believe ninty is some nefarious company purposefully screwing itself and its customers. I mean ninty made 2.74mil consoles in March. 2.74mil in a month is an amazing feat and that's not called short supplies especially considering this was their best console launch month even more than the Wii. We then hear stories how Ninty is using freaking AIRPLANES to meet demand in USA. Why would a company who purposefully restricts supply do that. Then in May it sells less than a ps4 even though demand is clearly there. I would assume they would not reduce it that much as to loose face by selling less than a 4 year old console and at least bare minimum keep it above that number. And as consumers have shown they are willing to buy from scalpers for more money. Ninty is loosing all those sales right there since it demand was met they would have sold twice the consoles one for the scalper and other for the consumer and made a hell of a lot if money but no their evil sells just wanted consumers to buy expensive products from people ninty doesn't even know about just for the hell of it. Sure ninty looses money and sales but ninty is pure evil right? Yeah when you think of Ninty as a company it makes zero sense for creating false shortages and they are literally loosing sales and money the longer shortages continue. Anyone who believes otherwise just really hates Ninty or is really gullible to believe a company would do stupid stuff like that which actually harms them and their consumer and only random scalpers benefit

Whoever said that? 

Do some research on artificial scarcity or managed scarcity before you dismiss it so casually. As I said before, long lasting repeated shortages of multiple products is not a coincidence. Since I'm gonna give the ninty the benefit of the doubt and not assume their a bunch idiots who can't manage how to produce enough product to meet demand (like you guys do), they're purposely limiting the production of their more popular products. It's a smart strategy if scarcity is controlled in a manner that increases demand, creates "sold out" headlines, sells through all stock as fast as possible, etc. 

Seriously, this is what's annoying and mindboggling about this topic. Most ninty fans say that it doesn't make sense that ninty would use this business practice but instead keeps having shortages due to popularity. There's couple of hilarous problems with that excuse. 

1. You're basically saying that ninty is not smart enough to do it on purpose but rather the repeated and lengthy shortages (with multiple products) are due to ninty's incompetence with being unable to figure how to produce enough product to meet demand.

2. The popularity part of the excuse is especially bogus. Ninty products don't exactly outsell it's competition and yet the competition manages to outsell ninty the majority of the time and not have shortages over and over except around a certain holiday season sometimes. Also, this isn't a valid excuse when the same product has shortages throughout the whole year and for years after. I can understand a company not anticapating how popular their product will be and having shortages for about a year after because of that but that excuse doesn't apply after they had plenty of time to adjust to the demand. 

3. There's alot of articles on this and people from the world of gaming saying that ninty is likely used managed scarcity or artificial scarcity since NES because the repeated and lengthy shortages can't be explained outside incompetence or using that business practice. Neither Sony or MS have shortages like ninty does. 

So yeah you have no solid proof just speculation right. And yes I believe ninty is incompetent in measuring their demand supply ratios. They messed up with the Wii u but couldn't possibly determine the switch would be so popular that 2.74mil first month wouldn't be enough. Now they have to battle mobile giants for screen and memory parts so the shortage is real. As for the Wii and DS tell me which company sold 20mil+ consistently each year for four+ years? Even the ps2 legged out on a year to year basis Wii was destroying it. Hell the ps4 is selling more than the ps2 time matched but it is still very behind the Wii. Ninty is a Japanese company in the traditional sense unlike Sony and Japanese companies have always been conservative. Its in their genes not to over produce but under producing is alright. That's how they function. Ninty is also just a gaming company so if they go overboard and it doesn't work out they don't have a safety net like Microsoft or Sony. They also sell their hardware at a profit always over production would be disastrous while for Sony and Microsoft it is routine and they can just lower the price if they over produce. When you look at ninty as a business and Sony and Microsoft it's very clear why ninty always has shortages



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DanneSandin on 22 June 2017
bonzobanana said:
DanneSandin said:
No way! I think Nintendo themselves misjudged just how popular the Switch would be and haven't been able to ramp up the production yet to meet the demand.

I think only conspiracy theorists believe Nintendo is deliberatly holding back stocks.

It's not really a conspiracy theory its just normal business practice. Who are they conspiring with anyway? 

They can't just phone up foxconn and say more Switch's please. They have to open more production lines at Foxconn requiring more investment and get new arrangements for components with suppliers. It's a big logistics exercise. It's not uncommon to ensure there is strong demand before commiting to higher production levels and investment. This also has the fringe benefit of creating pressure in consumer demand too so there are a quite a few commercial reasons to do this. I'ts not voodoo, tin hat or supernatural or anything else wierd or strange its just business.

I don't think I quite  follow you here... are you saying that Nintendo ISN'T holding back stock deliberatly? Because that's what I said...



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Kai_Mao on 22 June 2017
niceguygameplayer said:
I think it's likely. With their past, I could believe it. They could build up this strong desire to have what ppl can't have: a Switch. At least not at a decent price. Then around Christmas, they could release a huge ammount of them at record sales. Supply constraints because of competition with Apple may be a rumor spread by Nintendo themselves. I'm not saying that Nintendo is doing this, but I do feel that it is likely.

Also, I am aware that this site has (at least it seems this way to me) a majority of Nintendo fans, so I expect hate for my opinion, but you asked a question and I answered honestly.

Except the so-called rumor you're talking about isn't just coming out of thin air. Its being known worldwide about manufacturing parts and assembly lines being affected significantly and it'll be that way for probably the rest of the year.

http://www.usgamer.net/articles/nintendo-is-facing-off-against-apple-for-switch-hardware-parts

http://www.marketwatch.com/story/nintendo-battles-apple-for-parts-as-demand-for-switch-console-soars-2017-05-30

Whether you believe this or not, this is something thats likely keeping Nintendo from producing more Switch units efficiently.



Vor on 22 June 2017
Mnementh said:
Vor said:
It's just a dumb way to downplay someone's success. Tbh I didn't see any benefit for the company with creating artificial shortage, well apart from fooling customer that their product is a hot item. But it still hurt their image and reduce their revenue so it's a huge risk with little reward.

There is no way this is beneficial. There might be a slight increase in demand from people who think: my this is hot, I need it too. But for starters: a console never reaches the level of hotness like an iphone. The increased demand from a hot item is mostly because all your friends have it, not so much because you don't see it in stores. The downsides outweigh it massively. You lose the impulse buyers, you piss of customers who try to find it. On the forums somewhere someone told about a friend who set out getting a Switch and came back with a PS4 - to have at least something, you know.

Well I was being sarcastic in the hot item part



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