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Nintendo NX may capitalize on "largely ignored" kids market - DFC

"Someone is going to come along and take advantage of the opportunity to make games simple again"

In the latest note from DFC Intelligence, the research firm ponders the future of Nintendo and the console market. DFC sees the under-12 market as the "lost console generation" that could ultimately be a significant opportunity for the right company. Naturally, Nintendo has always been kid-friendly, and with the right approach its upcoming Nintendo NX platform could capitalize on a market that's been vastly underserved.

"One of the ironies of the latest generation of console systems is how children under the age of 12 have been largely ignored. The Nintendo Wii U is the only dedicated system remotely targeted at kids and it has been a failure. Twenty years ago many casual outside observers viewed children as the ONLY market for video games. The fact that console systems can thrive without targeting a younger audience speaks volumes to how the industry has grown. However, it also highlights a major missed opportunity," DFC says.

"Arguably Sony and Microsoft don't need younger gamers and can simply rely on the trickle down effect where kids come on board several years into the lifecycle. Really it is hard to point to major specific new generation games targeted for kids outside of Lego titles and toys to life products. Furthermore, these products play fine on older console generations and do not really justify an investment in expensive new hardware.

"Of course, the company that has had the greatest success with targeting children is Nintendo. Nintendo is currently in a holding status until they can launch a new console system but the company has a real opportunity to reinvent the groundwork in the game space by introducing an easy to use system that targets the entire family."

DFC believes that current consoles from Microsoft and Sony have become overly complex to operate, especially for children. If Nintendo or some other company can make console gaming easy again, it could be a real win for the under-12 market.

"The original beauty of the console business was a kid could push a button and in seconds be playing games. In the current generation, that appeal has been lost and the immediacy of being able to play games is now found on Apple devices, the Nintendo DS and even PC games. Of course, it is not only kids that want to get in and out of games as fast as possible. Apple, Supercell, King Entertainment and other major growth stories are all about giving consumers quick access to games," DFC continues.

"The current hole in the market for accessible high-end games that are NOT on Apple devices could be a real opportunity for Nintendo. Nintendo really helped pioneer the easy in and out accessibility that is a major appeal of Apple devices. Of course, saying there is an opportunity and doing something about it are two different things. The market is ready for an easy to use system that targets the family. The question is will Nintendo be able to capitalize on what is clearly a major vacuum in the game space.

"Someone is going to come along and take advantage of the opportunity to make games simple again... Many observers are rightly skeptical of Nintendo's chances. DFC also believes Nintendo is a dark horse... Poor recent execution has not been encouraging but the opportunity to turn things around is clearly there."

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Latest comments (11)

Lance Winter Game Designer, NordeusA year ago
Not sure it has anything to do with "immediacy", or being "overly complex for children".

It's more likely that kids love mobile devices. Because they're personal, they have nearly infinite amounts of (largely free) content, you can play with them anywhere, and you can do a ton of things with them.

A far cry from the game console, that probably has 4 or 5 games, which you can only play once you've negotiated TV time.
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Jeff Kleist Writer, Marketing, Licensing A year ago
Exactly Lance. Kids are very tactile, and naturally gravitate toward touch screens. The direct manipulation of the assets is very appealing. Look at preschool toys, they're all about direct action/reaction.

The WiiU was designed around the Japanese household, where there is often a communal sleeping area with a single television That's also why it had the TV features in it that pretty much never got used (I don't even think the tuner came out in Japan did it?) What Nintendo hasn't figured out is that they've lost 3 generations of mind share. Ask the kids what they want, it's iPad or Kindle Fire above DS by a very wide margin. They may HAVE a DS, but if you put them in front of them and say "choose", theyre grabbing those tablets
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Richard Browne Partner & Head of Interactive, Many Rivers ProductionsA year ago
Nintendo just has to make the message simple and family centric ; they did it brilliantly with the Wii and then in a disastrous manner with the Wii-U and it's (seemingly) single player focused gamepad. They have the IP, they have brilliant development teams, the software shouldn't be the issue - the hardware has to be instantly understandable and cheap. My kids don't need a $400 console, Mario on a $200 console playable by multiple people with the same style controller will do just fine.

Edited 1 times. Last edit by Richard Browne on 1st July 2016 4:37pm

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Show all comments (11)
Jordan Lund Columnist A year ago
For decades Nintendo fans have attempted to shrug off the stigma of "It's a kid's machine." I don't think they'll take well to Nintendo actually embracing that demographic.

The problem with the kids market is that kids will buy anything. They have no discernment of quality. Slap Spongebob or whoever in the game and you're guaranteed a million sold regardless of the quality of the game.

And there are limits to the kids market. Look at Disney halting Disney Infinity due to over-saturation of the toys to games thing. You'd think that would be a license to print money, but apparently it's not.
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Jeff Kleist Writer, Marketing, Licensing A year ago
@Jordan Disney's game division in general was losing money big time, and the big problem Infinity had was that they grossly over printed 2.0 by about 250% of demand. That resulted in 7-10 million figures in a warehouse somewhere in addition to a ton of starter kits. Disney has never done their own toy manufacturing for retail, and they bailed on that after talks with Hasbrobdisnr bear fruit.

Infinity would have been fine if they hadn't gotten greedy. It's sales are solid, and the move to longer life for each version was a good one. Disney has pulled back all their own initiatives. I just wish we could do the same with Disney Movies Anywhere and get them on UV, but Apple is running that for them so I figure they have very little incentive.
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Shane Sweeney Academic A year ago
If Minecraft can become big with children something else can.

Nintendo is positioned to produce such a title, I'm just not sure they can produce that lightning in a bottle on demand. The surprising success of Splatoon makes me think they can though.
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DFC suggesting that Nintendo should swoop in to grab the "underserved under-12 market (with their new NX console)" makes it clear that DFC too, like Nintendo, does not understand the market of today. Under-12's are not underserved. They have more games they can play in their lifetime on mobile already, with 500 more coming every day. Why would their parents buy them a kids console when they have already bought them mobile phones? And why would the kids want to jump from mobile, where everyone is always connect to others, to a console?
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Greg Wilcox Creator, Destroy All Fanboys! A year ago
(Unless... that new console is... also a mobile device of some sort... hmmmmm...) :D
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Paul Jace Merchandiser A year ago
Hasn't Nintendo always catered to this market?
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Greg Wilcox Creator, Destroy All Fanboys! A year ago
"The original beauty of the console business was a kid could push a button and in seconds be playing games. In the current generation, that appeal has been lost and the immediacy of being able to play games is now found on Apple devices, the Nintendo DS and even PC games..."

Um... they DO know the DS has been replaced a while ago, right? I don't think that's a typo either, but it's important to note.
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Alfonso Sexto Lead Tester, Ubisoft GermanyA year ago
I think kids market is now more on mobile than anywhere else. I'm also seeing more kinds (the sons of my friends) growing in homes with 1-2 gaming devices. Kids will most likely play what their parents allow them to.
I wonder how they will do, But I admit I'm curious. Nintendo has always been able to pull off this time of stunts and make them work.
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