Nintendo: Price cuts are a mistake so buy a Wii now

November 5, 2008

Since Microsoft cut the price of the whole Xbox 360 range by a fair amount in September, and then Sony refused to follow suit, there has been a lot of talk about price cuts and the benefits of making them. One company that doesn’t seem to be budging on price is Nintendo, and that viewpoint now seems official.

I’ve spoken a fair bit on Blorge about hardware price cuts for the home consoles because I personally feel the price of a system can have a huge impact on sales and mainstream potential. Without exception (that I can remember), a console price cut has helped improve sales immensely, particularly if those price cuts take a system under the sweet spot, currently considered to be $199.

Sales of the Xbox 360 have improved massively since Microsoft took the easy option and reduced the price two months ago. Sony meanwhile has chosen to forgo the possibility of increasing sales and is instead sticking to the current price point for the foreseeable future.

Nintendo is a strange one because when the Wii was released, it was immediately affordable, costing just $199 straight out of the starting gate. This, along with the playability and control method of the Wii, has enabled it to become the market leader at this stage of the current console generation. But could the time be ripe for a Wii price cut?

Nintendo has answered that question directly with a firm no. Kotaku translated an interview given by Nintendo president Satoru Iwata to Touch-DS.jp, and Iwata makes clear his feelings about price cuts:

This is my personal thinking, but when the model’s price-tag drops over time, manufacturers are telling consumers it’s better to wait, and I’ve always thought that was a mistake.

That quote could actually be taken two ways. Iwata is clearly against the idea of price cuts because it sends the wrong message to consumers. But a more positive spin on his viewpoint is to suggest that he’s in favor of starting the price of hardware lower in order to make the price clear and consistent right from the start.

Nintendo did this to great effect with the Wii, and it definitely helped the console gain mainstream support from the start. And with sales not having slowed down at all in the two years since its launch, there’s really no need nor justification for a price cut at this point anyway.

This means that all those parents deciding whether to buy their kids a Wii for Christmas can stop fretting that the price could drop straight after the holidays. It won’t. That’s not to say they should definitely buy a Wii though, mainly because it doesn’t hold any lasting appeal, certainly not when compared to the PS3 or Xbox 360. But at least it’s cheap, and the price is guaranteed to stay where it is. Which is something I suppose.


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