The Nintendo Wii U got off to a decent start at launch, selling about 3 million units during the holidays. Once the new year rolled around, though, the system plummeted to the bottom rung, outsold by virtually every console out on the market.
A big reason for the decline is clearly a lack of quality games, but there's also the fact that Nintendo has completely botched its marketing efforts for the Wii U. Among consumers, there has been a lot of confusion regarding exactly what the Wii U even is. Is it an add-on to the Wii? Is it actually a brand new system? Is it just the new GamePad controller?
There have even been reports of frustrated customers returning Wii U games because they believed the titles would work on their Wii. Satoru Iwata, the company's president, recently also took over the job of Nintendo of America CEO, and GamesIndustry International recently rounded up a number of comments from analysts on the situation.
"Nintendo of America's performance the past couple years has been a disaster on almost every level. Much of this was due to lack of execution on basic stuff like product marketing," said David Cole of DFC Intelligence. "They forgot Marketing 101 for the Wii U and no product could have done well without basic marketing support. Clearly a change in execution was long overdue. The damage done is enormous but there is the possibility of a turnaround. The fact is that the general public is not really aware the Wii U even exists so it is an opportunity to almost start from scratch."
Echoing what we said on Wednesday, one analyst made the connection to the 3DS, saying that Nintendo still has a viable strategy for turning the Wii U around.
"I believe that 3DS offers a perfect template for how Wii U could succeed in the future," said Asif A. Khan, CFO of Virtue LLC. "Nintendo had an equally poor 3DS launch lineup as we have seen with the Wii U. One thing that holds true for most systems they have made, software moves the hardware. Nintendoland was not as compelling and groundbreaking as Wii Sports was in 2006. The wow factor of the Wii U is very hard to advertise on television and with no robust third-party exclusives, the system's launch can definitely be characterized as a flop. This does not mean that the company is going to die.
"What has given life to the 3DS in recent months is the introduction of high quality first party titles and I believe we will see the same process play out for the Wii U ... I still believe Wii U will outsell past flops like the GameCube, and Nintendo's brands will retain their value for decades to come."
As EEDAR's Jesse Divnich says, once those big-name brands hit and if the Wii U is still barely chugging along, then it would be time to hit the panic button.
"We've yet to see the best Nintendo has to offer for the Wii U. I am reserving long-term judgment on the Wii U until we see stronger first party content released. If a new Super Mario, Smash Brothers, Pikmin or Zelda game are unable to revitalize sales, then I'd begin to be concerned," said Divnich.
