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Forums - Nintendo Discussion - Labo family at 1,8 M sales here, probably >2 M shipped

thismeintiel said:
I think you people are ignoring R&D costs. Who knows how much Nintendo spent on getting Labo working and out onto the market. Either way, it is definitely not a success in Nintendo's eyes. Given their 20M prediction, they were obviously looking for it to push HW sales early/mid 2018. That didn't happen. And it probably won't ship much more than 2M-3M in its lifetime, so poor results all around.

My guess is little to nothing spent on R&D.
This isnt a AAA game, and I doubt it cost anywhere near that, even a AA game would come more to develope than each of these kits.

This a "A" level devepement cost, at most, and sold at like 80$ for a kit.
And the cardboard obviously doesnt cost that much either, in short nintendo makes huge profits on them.



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I think people would be surprised at the development costs of such a game, if Nintendo'd ever share it. Production time was probably quite long. Testing all kinds of stuff, the innovating and design process takes time I imagine.



S.Peelman said:

I think people would be surprised at the development costs of such a game, if Nintendo'd ever share it. Production time was probably quite long. Testing all kinds of stuff, the innovating and design process takes time I imagine.

And Im pretty sure your wrong.
Seriously doubt budget is bigger than "A" level game development is.

The fact that nintendo can sell it at 80$ is amasing, and the returns must be crazy high.



JRPGfan said:
S.Peelman said:

I think people would be surprised at the development costs of such a game, if Nintendo'd ever share it. Production time was probably quite long. Testing all kinds of stuff, the innovating and design process takes time I imagine.

And Im pretty sure your wrong.
Seriously doubt budget is bigger than "A" level game development is.

How much would that be?



S.Peelman said:

I think people would be surprised at the development costs of such a game, if Nintendo'd ever share it. Production time was probably quite long. Testing all kinds of stuff, the innovating and design process takes time I imagine.

Agreed.  The kinda of material to use.  The thickness and sturdiness.  The software, while simplistic, still has a team to develop it.  These things add up.  And if Nintendo was truly making bank off of these games, like some think they are, Nintendo would be pumping them out left and right, even if the sales weren't as high as a AAA game.  Obviously, they aren't making bank on Labo.  Nor achieving their first goal for Labo, push HW.



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S.Peelman said:
JRPGfan said:

And Im pretty sure your wrong.
Seriously doubt budget is bigger than "A" level game development is.

How much would that be?

Well I see AAA games on PS4 level as being $60m+.
Double AA games are less than half of that, and A level games again are like a $5-10m.

Lets say Nintendo spent $10m to make all the various kits of Labo
And then the cardboard costs with each kit is like 2$.

$10m (R&D) + 2$ x 2m kits (cardboard) = $14m:

Lets say they sold 2m kits of 80$ = $160m revenue.
Now the shops take their cuts, and theres shipping & packageing, but its very apparent that nintendo just takes the vast marjority and banks it.

Ei. they have heavy profits on it.



JRPGfan said:
S.Peelman said:

How much would that be?

Well I see AAA games on PS4 level as being $60m+.
Double AA games are less than half of that, and A level games again are like a $5-10m.

Lets say Nintendo spent $10m to make all the various kits of Labo
And then the cardboard costs with each kit is like 2$.

$10m (R&D) + 2$ x 2m kits (cardboard) = $14m:

Lets say they sold 2m kits of 80$ = $160m revenue.
Now the shops take their cuts, and theres shipping & packageing, but its very apparent that nintendo just takes the vast marjority and banks it.

Ei. they have heavy profits on it.

i don't think subjective calculus with arbitrary numbers make for a great compelling argument.



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Mar1217 said:
JRPGfan said:

Well I see AAA games on PS4 level as being $60m+.
Double AA games are less than half of that, and A level games again are like a $5-10m.

Lets say Nintendo spent $10m to make all the various kits of Labo
And then the cardboard costs with each kit is like 2$.

$10m (R&D) + 2$ x 2m kits (cardboard) = $14m:

Lets say they sold 2m kits of 80$ = $160m revenue.
Now the shops take their cuts, and theres shipping & packageing, but its very apparent that nintendo just takes the vast marjority and banks it.

Ei. they have heavy profits on it.

i don't think subjective calculus with arbitrary numbers make for a great compelling argument.

I agree that subjective calculus with arbitrary numbers ain't the greatest. But, were on a forum about sales where we deal with estimated or outright made up numbers all the time.  So, let's play it out a bit more anyway.....

$10m R&D
 2 million fancy boxes, at several dollars each, let's call it $5 each, so that's another $10m
Shipping from China to ports around the world, then shipping from ports to distribution centers, then shipping from distribution centers to stores has to be another $15or so per unit (they're not small), gives us another $30m.  That's $50m of baked in costs, by the time the thing is sitting on a retailer's shelf

Now, we have a larger box that takes up a lot of shelf space.  Retailers take smallish margins (typically 25%) on games because they're easy inventory to handle.  But, Labo is not a game in that way.  It takes up about 30 times the shelf/warehouse space.  It also isn't something that drives accessory sales.  So, the retailer has to get paid for that space.  My retail experience tells me they want a 40% margin.   That's $64m of the total revenue that went to retailers. 

So, we have $64m of retailer margin, $50m of costs to design, produce, package, and distribute.  That's a total of $114m, out of the $160m revenue.  That leaves $46mm for Nintendo.  The problem is though, we haven't yet accounted for any marketing other than packaging.  Nobody buys the thing without some advertising, and/or other marketing expense.  Millions more were spent there (though, arguably, they didn't spend enough in this area).  So, while my (admittedly, very rough) estimates lead me to believe that Labo has been profitable for Nintendo, they also lead me to believe that profit was not huge, and probably not large enough to justify a company taking its eye off of its core business.  



CGI-Quality said:
riecsou said:
If they don't want to be massively down year over year they need to do a price cut.

They're going to start to be massively down regardless of that. The thing is going to b e 6-years-old this year. Can't stay up forever.

 

JRPGfan said:
S.Peelman said:

How much would that be?

Well I see AAA games on PS4 level as being $60m+.
Double AA games are less than half of that, and A level games again are like a $5-10m.

Lets say Nintendo spent $10m to make all the various kits of Labo
And then the cardboard costs with each kit is like 2$.

$10m (R&D) + 2$ x 2m kits (cardboard) = $14m:

Lets say they sold 2m kits of 80$ = $160m revenue.
Now the shops take their cuts, and theres shipping & packageing, but its very apparent that nintendo just takes the vast marjority and banks it.

Ei. they have heavy profits on it.

I think you underestimate the cost of shipping such product since fees are generally based on weight and one Labo kit is surprisingly heavier than it look like.

Last time I checked, Labo kits are shipped in packaged of two and the box is heavier than a box of PS4 games which include 30 units. R&D, production and shipping cost are definitely higher than what you might think.



Labo was estimated to do quite well during the holidays, even by a Nintendo exec. It didn't really achieve its goals.