IndustryGamers - Informing the Games Industry

Wii Strategy: Sequels Are Actually Bad?

Posted January 14, 2010 by James Brightman

The landscape of the video game industry has changed dramatically in the last few years, and the Wii certainly played a major role in that. The Wii introduced a whole new set of consumers, and many of these people have very different buying tendencies when compared to core gamers. In a recent note, EEDAR analyst Jesse Divnich wrote about "Understanding the New Consumer." Here's his interesting take on the Wii and sequels:

"All too often the economy is blamed for the recent industry contraction. In reality, decreased sales in 2009 had more to do with a lack of innovation than economic recession. The growth of our industry now rests more on innovation than it ever has before, especially since non-traditional and casual markets consist of a larger share than in previous years. No longer can developers update a few maps, design some new weapons, add a few new characters, then throw a roman numeral at the end of the box and call it a 'sequel.' That may work for core targeted games (Action, Shooters, and RPGs), but this strategy is not ideal for non-traditional and casual gamers."

"Case in point: most sequels targeted to the mainstream and casual markets actually underperform in comparison to the original, which is the opposite to what has traditionally been the case for core targeted games. If you examine the Nintendo Wii and DS platforms (the current primary platform for this audience) Boom Blox outsold Boom Blox 2 (Wii); Brain Age outsold Brain Age 2 (DS); Guitar Hero III bested World Tour (Wii); The Bigs crushed The Bigs 2 (Wii); Mario & Sonic at the Olympics (Wii) is on track to outperform its Winter counterpart; Rayman Raving Rabbids (Wii) (2006) outsold its 2007 release; and lastly the original Cooking Mama (Wii, DS) (2006) has outsold all sequel versions combined."

"EEDAR believes Nintendo understands the mindset of its consumers the best, which is why Nintendo rarely releases sequels within the same generation and, if they do, they are years apart. A good example of this is Mario Kart. Instead of releasing an annual Mario Kart title, Nintendo opts to only release one Mario Kart per hardware generation. Traditional thinking would assume that after an initial sales bump Mario Kart would simply just fade away on retail shelves—as so many others do. However, Nintendo realizes that if you can get an initial attachment rate on Mario Kart of 25% in 2008, they should be able to get the same attachment for new Wii purchasers in 2009 without having to release a sequel. To no surprise, the attachment rate for Mario Kart in 2009 was identical to that of 2008. Another example is Wii Fit. Whilst Nintendo did release a sequel to Wii Fit,  Wii Fit Plus (2009), the overwhelming majority of sales did not come from the stand-alone software edition, but rather the hardware/software bundle of the Wii Fit Plus. In other words, the release of the expansion, which likely had minimal development costs, spurred sales of a 20-month old game wrapped in new packaging."

"Of course this rule is not absolute for all casual and mainstream titles, some sequels do outperform the original, but in the overwhelming majority of cases, sequels on the Wii just cannibalize the potential sales of its predecessor. For reference, if the above examples were not proof enough, Call of Duty: World at War (2008) only outsold Call of Duty 3 by the smallest of margins and the most recent Call of Duty Modern Warfare: Reflex (2009) is currently on track to under-perform against World at War."

 "With the Wii making up the majority of the current casual and mainstream audience this finding should be carefully observed as Sony and Microsoft attempt to become more competitive in this space in future years." 

James Brightman has been covering the games industry since 2003 and has been an avid gamer ever since the days of Atari and Intellivision. He was previously the EIC of GameDaily Biz.