Why release another 3DS XL bundle? The green Yoshi’s New Island bundle falls in line with other mistakes from Nintendo needing to be buried by Dig Dug. Ending March 2014, Nintendo will take over a 300 million dollar loss in revenue. A Link Between Worlds bundle couldn’t carry the 2013 holiday season sales estimate forecasted by Nintendo. A Link Between Worlds was easily in the top three best games of 2013. Link is one of the greatest Nintendo characters of all time. The holidays are over, the 3DS XL system has been out since 2012, the Zelda/Mario/Pokémon bundles are already out for the few new recruits that haven’t purchased a 3DS XL. How can Nintendo’s sales forecast for the Yoshi bundle be any more accurate than their whole 2013 holiday sales forecast? The $200 Yoshi’s New Island green bundle is going swallow some of the end of the year profits the $40 Yoshi’s New Island standalone game should produce.
When you sell a product eventually your consumer’s appetite for that product will be filled. Changing the color green has no effect when a consumer’s need for 3DS XL’s has been filled. Aggregate demand is the term for final goods needed in the economy at a given time and price. We have this term because us humans don’t have quite the appetite Yoshi or even Kirby have for consumption. This type of behavior from Nintendo is wasteful on resources. A pile up on inventory creates loss, and great headlines to disparage a company that has made Little Mac style comebacks against competitors. Around five Yoshi’s New Island games will have to be sold to “break even” with the one sale of that green colored Yoshi bundle. The odds of defeating mother brain blindfolded are better than any forthcoming profit from the green Yoshi bundle. Nintendo should have just put out the game.
Nintendo won’t drop the Wii U price, but they have no problem taking a hit on inventory costs? The cost of holding goods is a real factor to the profit you make on your inventory. Warehouse costs, depreciation, insurance, taxation, and shrinkage costs all reduce the profits made for every 3DS XL that is sold. Those factors are really tedious to count, and even worse to write down in an accounting ledger.
One reason that the largest brick and mortar retail chains produce profit is the notion that all the inventory they purchase, moves quickly. Every Wharton or Harvard school of business graduate that works at Nintendo knows this. My state college went over inventory management at nauseum. Yoshi’s New Island bundle is going to lie next to a lot of Wii U inventory. Instead of incurring those inventory costs, Nintendo could have dropped the Wii U price. It’s like Nintendo’s Kyoto Japan headquarters has water coolers spiked with crazy sauce. Nintendo feels like it’s just praying for a breakeven point in the next few years for all the operating costs they’ve incurred. That will affect all Nintendo players’ expectations for new experiences from Nintendo devices, if money doesn’t start pouring in.
So what can help Nintendo besides investing in new game titles with new characters? Putting almost 30year old NES Nintendo games on mobile devices would help. Promoting the company with other forms of media could help as well. The Lego movie just made $69 million dollars in one week. People also don’t know or forget that Marvel went bankrupt in 1996 after the stock dropped 80%. Licensing movie, music, and literature rights seems more financially promising than changing colors of almost two year old devices. Nintendo’s ideas need to be refreshing. Refreshing like the Apple co-founder Steve Wozniack last Thursday reported that Apple should put their brand on competitor’s Android technology.
My gaming evolution started with an Atari console. Then, I started my collection of NES games. I still have both NES consoles in their original boxes with over a hundred games (sadly no Nintendo World Championship in my collection). Nintendo still has might and magic. I just believe that the practice of useless paint jobs or other outdated repetitious marketing strategies could eventually have Nintendo player’s saying “Mario is missing”. It wouldn’t feel natural playing Bionic Commando or Mega Man on a PlayStation controller.