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Nintendo is not in a transitional year - Moffitt

Marketing executive responds to criticism of E3 lineup, amiibo shortage frustrations, and concerns around price erosion

Nintendo fans have a lot to look forward to these days. The company is working on a new "Quality of Life" platform, the Nintendo NX gaming platform, a foray into theme parks, a long-awaited expansion into mobile, and an open-world Zelda for the Wii U, absolutely none of which was shown off or even talked about at last week's Electronic Entertainment Expo in Los Angeles. Instead, Nintendo leaned heavily on titles that were announced and playable at last year's show (Super Mario Maker and Yoshi's Woolly World), backed up by a handful of somewhat high-profile new offerings (StarFox Zero, The Legend of Zelda: TriForce Heroes). Speaking with, Nintendo of America executive VP of sales and marketing Scott Moffitt downplayed the idea that this year's show was filling time before those other initiatives were ready.

"I wouldn't view it as a transitional year at all for us," Moffitt. "At least, I don't think of it that way. We're bringing a plethora of great games to the market this year. We have 14 games we're launching between now and the end of the year, eight of them on Wii U and six of them on 3DS. They're great, bold, imaginative, transformational games... Our company is always moving on many different dimensions, but E3 is probably not the place to talk about a theme park experience, it's not a mobile game show. So a lot of those things are really better talked about and discussed at other times of the year. We focus on games, games, games. We make great games and we want to showcase those here and allow fans to play them."

"Our company is always moving on many different dimensions, but E3 is probably not the place to talk about a theme park experience, it's not a mobile game show."

Moffitt said E3 is still the company's biggest event of the year and the one it saves most announcements for, but he noted that different audiences want different things from the show.

"It's always a balancing act. You want fans to be enthusiastic about what's coming, but the focus is on what's going to be here-and-now," Moffitt said. "We have meetings with retailers where all they care about is, 'What am I going to be selling in my store this coming holiday?' They don't really care about a game that's going to be three years down the road. Those buyers may be on different desks; they'll be buying deodorant by then. That's an important constituency here at the show, as well as game fans and media."

One thing many fans did not want was Metroid Prime: Federation Force. The 3DS team-based co-op shooter take on the sci-fi action-exploration franchise spurred some fans to create a petition asking Nintendo to halt production on "this atrocity of a game." To date, more than 20,000 people have signed the petition.

"We love our fans. They're the most passionate, vocal group of fans I've ever seen, and we listen carefully to their opinions," Moffitt said. "We respect their opinions and their right to share those opinions with us. We try to make the best decisions we can with them in mind, but also with our content in mind, with our franchises in mind. A lot goes into the decision of which games to produce and which games not to produce. I don't pretend to know how all those decisions are made, but we certainly appreciate our fans' enthusiasm for the Metroid franchise. It's a franchise I love as well, and I hope they will find other games in the 14 we've announced at this E3 that they can play in the meantime while we all wait for the game we'd like to come out in the Metroid franchise."

"We would love to be able to make enough for everyone that wants an amiibo to be able to buy it."

Another sore spot for some Nintendo fans has been the company's handling of its amiibo toys-to-life offerings. While the figures themselves have been a success story for Nintendo, persistent shortages of certain characters have fueled a secondary market, as well as ire from those who don't want to pay as much for a toy as they do for the retail game it's based on.

"We're aware of the frustration game fans have had, and I'm empathetic with how difficult it's been to find some of the amiibo," Moffitt said. "We would love to be able to make enough for everyone that wants an amiibo to be able to buy it. And we are making them in greater and greater quantities. Every wave we release, we're trying to do a better job estimating the demand and producing enough to satisfy it."

Part of that job is being more transparent with fans about when new quantities of rare amiibos will hit shelves, Moffitt said. Nintendo is also working with retailers to institute policies that would limit each customer to buying at most two of any given character. Regardless, amiibo has become another in a growing line of successful Nintendo products that are struck by shortages. The Wii is perhaps the best example of this, but Nintendo has also been challenged to keep Super Smash Bros. Wii U controller adapters in stock, and even the Wii U Deluxe Edition hardware was a tough find on shelves during the system's launch window.

"We read demand signals from all sources," Moffitt explained. "Pre-sell is a great indicator of potential demand. On some things, our supply chain is just quite long. On other things, it isn't. On Wii U game discs, if you look at our biggest launches last year--Mario Kart 8, Smash Bros. for Wii U--no issues. But on things like amiibo, or sometimes adapters or controllers, there's just a longer lead time. We do the best we can to anticipate demand, but we don't have a perfect crystal ball. We don't always anticipate the right number. But we try to strike that balance of having enough to sufficiently satisfy demand but not to have too much. It's just an inexact science, but we try to use every form of demand signal we can: pre-sale numbers, Google search trends, everything to anticipate what the true demand's going to be."

"[W]hat we're seeing with amiibo is we've expanded the big demographics of the typical toys-to-life consumer to be older, and that's a good thing for the whole toys-to-life category."

Moffitt noted that it's been less than a year since amiibos first hit shelves, and the company has learned a lot in that time. He said Nintendo has improved its production processes, and believes it will be in a much better position to meet demand by the launch of Animal Crossing amiibo Festival (the first game to require the figures rather than support them as optional bonuses) later this year.

"It's really our third platform," Moffitt said of amiibo. "Certainly, creating great games is what we're best at. But it's added an important new dimension to gameplay that our developers have really embraced. It's still not our core franchise, not our core business, but it's a nice third platform that allows us to innovate and bring new ideas to satisfy creativity in our developers, but also allow our game fans a new kind of gaming experience. But I wouldn't say it's our core platform."

The toys-to-life market has taken off in recent years, but it's also become more competitive. Beyond amiibo, Disney Infinity, and Skylanders, Warner Bros. Interactive Entertainment is also rolling out Lego Dimensions later this year, bringing a host of new properties into the scene, from Batman to Back to the Future. Fortunately for Nintendo, Moffitt doesn't think they're all chasing after the same audience.

"Certainly as new entrants come in, it tends to grow a business to a point, and then it gets over-crowded," Moffitt said. "But what we're seeing with amiibo is we've expanded the big demographics of the typical toys-to-life consumer to be older, and that's a good thing for the whole toys-to-life category. The second thing we're seeing is retailers are continuing to expand the space that's dedicated to toys-to-life. That's all good for the category, and I think it will continue to have a good holiday. The thing I would point out to your readers is that the Wii U is the platform of choice for toys-to-life gaming. It's the only place you can play all of the platforms. That's exciting and I think we want to continue to be the destination for toys-to-life gaming."

"It's expensive to develop games, and the value of software needs to be respected and kept high."

Toys aren't the only new market Nintendo has been playing with. Last month, the company became the first platform holder to participate in a Humble Bundle, offering a selection of indie games for Wii U and 3DS at a pay-what-you-want price point. It was an unusual move for Nintendo, which has in the past been vocal about the importance of preserving price points for game and not undermining their perceived value among consumers. Still, Moffitt said Nintendo was pleased with the results, and wouldn't rule out a future bundle using Nintendo's first-party titles rather than independently developed offerings. However, price erosion remains a concern.

"Our developers work hard on games," Moffitt said. "It's expensive to develop games, and the value of software needs to be respected and kept high. It's a concern with everything we do, all the way through to creating hardware bundles for the holidays. It's a factor in all of those decisions. It's very important for us to keep the value of software high."

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Latest comments (4)

Patrick Frost QA Project Monitor 6 years ago
I'm not sure what to say in response to Moffitt's comments on amiibo. It still seems as though they are hilariously out of touch with the reality of the market (in the UK at least) and although the situation is improving, there is tiniest fraction of store space being dedicated to them in retailers, despite it being a crucial product line for them to get footprint in bricks and mortar shops.

To make it even worse, they are seriously hammering their relationships with retailers by hoarding amiibo for their own online store rather than making sure that stock gets out to retailers. That also goes for things like faceplates for the 3DS, which are yet to even appear in some GAME shops and have very little replenishment, despite being pieces of easy to manufacture plastic.

GAME had their entire shipment of Splatoon special additions high-jacked and stolen. Now if that doesn't tell you demand is high for special amiibos then I don't know what will. GAME had to cancel all of those orders, despite many customers being happy to wait. This would suggest that it's highly likely that Nintendo had no ability or inclination to produce another run for them despite there being a definite list of pre-orders from customers.
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Reza Ghavami Marketing Analyst, NVIDIA6 years ago
It's amazing how these amiibos have reduced grown men to whining little children. Then again, I did drive to a town 70 miles away just to get Mega Man.
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Jeff Kleist Writer, Marketing, Licensing 6 years ago
Toys are hardly a new market for Nintendo. In Japan thry have serious merchandising, especially for Pokemon. They have a longer relationship with the Nation's toy departments than almost anyone else in electronics.

They're not hoarding them in their online store, the retailers don't want them cluttering up the shelves already overflowing with Skykanders, and one of the biggest Bulls in toys, Disney Infinity.

They're in their online store for two reasons 1- Nintendo keeps all the money, and 2- the large majority of the customers for Amiibo are adult collectors and lifelong Nintendo fans and technology geeks. They have no issue buying online and don't have to ask their parents permission to do so.

Attributing the high jacking to the fact there were Amiibo on board is a tad presumptuous. I bet you that if you could talk to them, they were hoping for PS4s.

Nintendo has a thirty year history of mysterious shortages, and bending over backwards to keep those going Who can forget the alternative sourcing of ROM cartridge components in the 80s during that alleged shortage, the components passed independent inspection, but Nintendo refused to use them. By all indications, thry are artificial and intentional, outside of a few genuine surprises. It's true, producing plastic stuff has a long lead time, but once you have the tooling and the machines set up, it's not that hard to get additional runs moving and on shelves in 6-8 weeks.
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Klaus Preisinger Freelance Writing 6 years ago
After an E3 where arguments challenging Nintendo were mostly quality based, the response points out the quantity of Nintendo's activities.

That Metroid response sums up 21st century PR so far. We understand, we are the same, we do what we want, next topic.

Edited 1 times. Last edit by Klaus Preisinger on 28th June 2015 8:59am

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