Industry: Video Games
Nintendo is a multinational company with Japanese roots that was founded in 1889. In their first 67 years Nintendo was primarily a playing card company. Nintendo has also experimented with toy making, a TV network, a food company and even operating a chain of Japanese Love Hotels.
What do you think of when you hear the name Nintendo?
You might think of Super Mario, the company’s primary mascot, Zelda, an extremely popular adventure series or you might even simply think of video gaming in general – remembering the days when Nintendo was a name as synonymous with video gaming as Kleenex is to facial tissues.
The problem is that if you look at their most popular intellectual property – they all have their roots in the past. Mario, Zelda, Yoshi, Donkey Kong, Pokemon and Metroid all were introduced in the 1980s and 1990s.
Although Nintendo maintains a loyal fan-base who grew up with those franchises, Nintendo is challenged to appeal to the youth market.
Nintendo admitted this in 2013 when CEO Satoru Iwata remarked at an investor’s meeting:
“Nintendo fans, for whatever reason, do not have as many children as Microsoft fans and therefore less Nintendo fans are being born each year.”
Who is this market and how do we know what they like? Social Media!
According to a recent study by NPD group, 91% of American kids aged between 2 and 17, or about 64 million people are playing video games.
Kids are not just playing games, they are using social media to immerse themselves in video game culture. YouTube has become a popular outlet for kids to watch other people play games and feel a part of the community.
According to Tubular Labs, 15% of all videos on YouTube are about Video Games.
This has created a new celebrity culture for “YouTube Content Creators” where popular personalities gain a huge following by playing and talking about games, targeting a youth audience.
The highest earning YouTube Content Creator is Pewdiepie, with 39 million subscribers (more than One Direction and Rihanna’s channels combined) and an annual income of over $4 million dollars primarily by uploading videos of himself talking about and playing video games.
This video game culture has a direct affect on sales of games. Coined the “Pewdiepie Bump”, games featured on popular YouTube channels quickly see a bump in sales similar to the “Oprah Effect“, where products featured on the Oprah Winfrey show had an increase in sales due to the endorsement.
Twitch is another big player in this social media game culture, allowing users to chat in real-time and even play the game collectively. In 2014, Twitch had 45 million users streaming 13 billion minutes of gaming per month.
So how has Nintendo adapted to this social media gaming culture?
Mixed results. Worth a deeper dive.
First the bad:
Nintendo’s long history and traditional views on controlling their intellectual property has made change slow. They clearly do not understand the benefits or wish to support this culture.
Nintendo has taken a hard stand against YouTube creators such as Pewdiepie, insisting that since the YouTube creators didn’t create the games, they should not profit from playing them.
At first, Nintendo was submitting copyright claims to either have the videos removed or claim 100% of the ad-revenue.
They later compromised by creating a revenue-sharing program called “Nintendo Creators Program”.
This program, in addition to the profit splitting, attempts to control the message through an approval process and blacklisting games that they do not want played.
From a legal and fairness perspective, it is easy to see Nintendo’s point of view. Why should others be able to broadcast footage of the their games – often from start to finish – without paying a royalty?
However, the risk in going after this revenue is having this crucial market turn against you, which is what predictably happened.
In addition to boycotting coverage of Nintendo games, many of the most popular YouTube Content Creators responded with videos and blogs distinctly negative towards Nintendo as a company.
Nintendo bought themselves bad rep and less coverage for an amount that will only drop. Why not work with Youtubers instead of against them?
By attempting to control the message, Nintendo has created a social media nightmare, effectively being shut out of the gaming conversations being had by today’s youth.
Looking at the most recent numbers available for the Top 20 Game Franchises on YouTube, only Super Mario appears on the list at #14.
Alarmingly, the major reason Super Mario is so high is because of a popular fan-made modification of the 1996 game “Super Mario 64” that Nintendo has attempted to remove from the internet.
So what are they doing right?
While Nintendo has been unfriendly to independent content creators, they have made impressive strides in their own community building efforts through social media.
One of Nintendo’s strategies is to talk directly to their audience.
Nintendo wanted customers to feel a direct connection to their brand, not just their latest game. One of their strategies was to turn their key executives into celebrities and encouraging them to interact with fans through Social Media and fan appearances in a fun but also refreshingly honest way – often apologizing for product delays and responding to negative fan feedback.
They are also not afraid to “talk smack” when challenged.
Nintendo also regularly releases short videos directed to their fans to provide updates on the development of their games and the overall state of the company. These are often done in creative ways.
For example, the continued and seemingly random use of bananas:
Why does this work?
Not having a commercial relationship but merely having a friendly relationship with the customer is intended to develop their loyalty to the product or brand. In this example, Nintendo is using their executives to speak to their fans and engage in a way that keeps the relationship fun.
In a blog post on Mashable, author Matthew Latkeiwicz had this to say about speaking to customers as friends.
“(Say it) just as you would say something to a pal. Pretty much anything goes, though the more personal the voice the better. Because your engagement with your customer is based on the friendliness of the relationship, the more natural and true to the voice of the person communicating, the better.”
We know that this approach worked from the internet reaction when in July 2015, Nintendo CEO and President Satoru Iwata passed away suddenly.
The day Iwata died, a fan photograph of Nintendo Corporate Headquarters dubbed “Rainbow Road to Heaven” was widely shared across social media.
— Amiibo Alerts (@AmiiboAlerts) July 13, 2015
All of this is remarkable for the passing of a corporate executive and shows that Nintendo has been successful in turning their customers into fans of not only the games and characters, but of the company itself.
What else is Nintendo doing?
In addition to speaking directly to the customer, in 2015 Nintendo has also encouraged social communities for each major game release.
For example, hosting an Animal Crossing Designer Contest where players can use in-game functionality to post screenshots to Twitter to show off their creations and enter contests.
Nintendo has also started to release games where the game design shows clear consideration of the social aspect of it. For example, the most recent Mario game, Super Mario Maker allows users to create their own game levels and distribute codes that can be shared on social media to solicit other users to play them.
Hey, here’s a Super Mario Maker level some people I know made. F829-0000-0066-E98B
— Jeff Gerstmann (@jeffgerstmann) September 23, 2015
They also reached out to popular game YouTube creators and game designers and provided them early access to the game to create levels and generate buzz with their fans.
Nintendo also partnered with Facebook to hold a Super Mario Maker Hackathon where Facebook employees competed to design a level that would be included in the final game. This generated buzz as videos of this event were shared across social media.
Nintendo also regularly tweets out their recommendations for fan-created levels.
— Nintendo of America (@NintendoAmerica) October 9, 2015
So did this work?
Nintendo thinks so. Super Mario Maker has sold over 1 million units worldwide exceeding the company’s expectations. This is very impressive considering that this represents 10% of all Wii-U console owners purchasing the game before the traditional holiday buying season.
Additionally, to date over 2.2 million Super Mario Maker levels have been uploaded and shared, generating 75 million plays. This shows that players are engaged with the game’s social aspect.
How much of this can be attributed to their customer engagement efforts is debatable, but clearly Nintendo is making serious strides with engaging their customers directly and building a community through social media.
Lessons for others
Nintendo demonstrate that if you talk to the customer directly, but do so in a fun and creative way, you can turn your customers into not only fans of your product, but of your brand. By allowing their executives to be spokespeople, fans feel a connection to the company like they might a sports team.
They also demonstrate how to build a product with social media as an integral component. By putting creative tools in their customer’s hands and the mechanism to share, Nintendo has turned the passive game player into an active creator with motivation to promote their efforts using social media.
However, there is also a cautionary tale of the dangers of trying to control your message too tightly. I believe Nintendo’s misunderstanding of the current social media culture, led to the heavy-handed legal tactics which damaged their brand to an important audience.
Although successful at building their own fan community – Nintendo will need to find ways to reach out to the younger audience which currently is not engaged with their brand.
Submitted By: David Pearson
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