Wii Innovate. How Nintendo created a New Market through the Strategic Innovation Wii

Bachelor Thesis from the year 2009 in the subject Business economics - Marketing, Corporate Communication, CRM, Market Research, Social Media, grade: 1,3, University of Applied Sciences Bielefeld, language: English, abstract: In the year 2009, Nintendo was placed fifth in the BusinessWeek's ranking of the world's most innovative companies. This confirms Nintendo's significant rearrangement into an innovative design powerhouse that redefined the predominant business value factors of the video game industry. However, a few years ago no analyst would have anticipated that Nintendo would develop in this direction.

Until the mid-1990s, the global home video game console industry was dominated by Nintendo, a Japanese video game hardware and software manufacturer. Rivalry in this industry only marginally existed. This changed when Sony entered the market in 1994. By offering a console that was technologically superior, Sony outperformed the then-Nintendo console. Thereby new challenges arose for the Japanese company.

Nintendo lost its long lasting market leadership to the new entrant. Despite several trails to recapture market leadership during the end-1990s, Nintendo was stuck in second place. Instead of regaining market share, the opposite was the case when Microsoft, a computer software giant, joined the market in 2001. Nintendo's market share slipped dramatically because they were not able to keep up the technological progress of its competitors. The former market leader fell back to the third place of the industry. Analysts of the video game entertainment industry even recommended that Nintendo withdraw completely from the highly competitive console market in order to concentrate on developing software.4 However, Nintendo refused to surrender, but they were in biggest need to recover market share.

Nintendo had a very different approach to strategy than Sony or Microsoft. Instead of competing for core gamers, Nintendo tried to expand the market and to win new cus