Talking Point: An Unplanned Flash Sale Looked Like Retail Download Genius from Nintendo
Posted by Thomas Whitehead
A flash sale... well, 'flashed' before our eyes
There was a moment this week when, for a brief and glorious moment, Nintendo ran a Steam-like flash sale on retail games. It may have passed plenty of people by, especially as it was for download codes on the official Nintendo UK store, but it was a glimmer of a brave new world where Nintendo creates buzz through timed, targeted and aggressive temporary discounts. It was actually a bit exciting for those that got in quickly, before the inevitable happened. It stopped.
We have a couple of theories about what went down here in Nintendo Life HQ, and that's all we have in an absence of official statements — we have asked for comment. The optimistic thought is that the store is planning some attractive, short-term discounts to reel gamers in and shift some download codes for games past their retail prime, and that somebody simply hit the button too soon. The more likely but slightly dispiriting theory is that it was a mistake, plain and simple, and not a precursor to any imminent promotional plans. Either is feasible and was on the table as the exceptional offers disappeared one by one; we can imagine someone with a sweaty forehead frantically clicking through to adjust each individual item. It was remarkably haphazard, with most prices being adjusted but, with the first edit on The Wonderful 101, the action being to simply chop the product away entirely — chaos behind the scenes.
As a reminder, the following are the prices that were available on the eShop codes for these games, and we've added some rough estimates in Euros and US dollars.
- Pikmin 3 — £8.95 / €10.49 / $10.49
- Wonderful 101 — £8.95 / €10.49 / $10.49
- Donkey Kong Country Returns 3D — £8.95 / €10.49 / $10.49
- LEGO City Undercover: The Chase Begins — £6.95 / €8.49 / $8.49
- Mario & Luigi: Dream Team Bros — £7.95 / €9.49 / $9.49
- Animal Crossing: New Leaf — £7.95 / €9.49 / $9.49
In some respects, initial reactions at the time that the prices could be legitimate were backed by the presence of the Pokémon X & Y download code — among others — for £39.99, showing that the whole store hadn't fallen victim to price crashes. The undermining entry, however, was Animal Crossing: New Leaf, a title that still has reasonable legs in the UK retail market, owing to its continued presence in the all-format top 40 for every week since its launch. The other titles on that list are, while excellent games, past their 'retail prime'. We should also mention that the Nintendo UK store does appear to have honoured purchases at these lower prices.
It's that retail prime that matters, and prompted some initial optimism that — rather than clicking the wrong buttons — Nintendo had launched discounts before it had gotten around to doing the usual business of announcing them to customers. Once the (arguably) inevitable had happened and the pricing disappeared, we were left to consider the brief buzz that had been caused and to ponder whether those discounts had even been a bad idea.
When considering whether a game has passed its retail prime, we're ultimately applying a mix of logic, common sense and knowledge from access to very limited amounts of data. It's often said that the first week of launch is crucial for any game, as early excitement brings that initial burst of sales before the next major release arrives and steals attention. This varies, of course, and as the New Leaf example shows titles can continue to sell reasonable numbers — though not at launch week levels — for a sustained period of time. One of the greatest strengths of major first-party Wii and DS software — and increasingly 3DS games — is a certain "evergreen" quality, meanwhile. There's no fixed template across the board, but it's undeniable that as a game ages, even if only by a few months, it'll slide further away from the top of wishlists.
Trends we do see in chart results, however, are discounted games seeing brief but noticeable jumps in sales — it happened with Professor Layton and the Miracle Mask in early December (in the UK, again) due to its inclusion in some handsome 2DS bundle deals. If a title has been on your "maybe" list or you're simply short on funds, seeing it a few months or more after release at a third of the price can be hugely enticing and prompt you to take a plunge. It's just market forces at work.
Of course, that's not always how Nintendo has operated, especially with its eShop platforms. In truth, it's entirely unsurprising and justifiable in light of its successes throughout the last-generation — copies of Mario Kart DS are still spotted for close-to-full price — and that evergreen reality for some brands. There's also Nintendo's stance of maintaining the value of video games, something applicable across the board from retail to download-only titles. Yet the times have been changing, with first-party Wii U games showing some discounts on the high street — more than would perhaps be common with the Wii — and, to the company's credit, far more dynamic eShop platforms that allow publishers to reduce prices and run discounts as they see fit.
So it's clear that Nintendo, across multiple regions, is adjusting to new pricing models — with DLC more prominent and free-to-play on the way — that will drive sales. And so that brief spell of first-party retail titles at borderline ludicrously low prices was a shock, but also pleasing. There was certainly a brief and noticeable buzz among UK gamers that spotted the anomalies, and we'd love to see whether that spell delivered a noticeable spike in copies sold.
Ultimately, if Nintendo is to pursue aggressive discounts on first-party downloads in future promotions, we'd anticipate prices more along the lines of 15-20 pounds / dollars / euros. Yet it can be argued that this is less a throwaway of potential profit but more a strategy for sales growth. Let's consider some key criteria.
- Games would have to be at least three months old
- Sales momentum must have seen it fall away from substantial weekly numbers
- First-party only
- Download codes only
- Can be through official online web stores to drive traffic (like Nintendo UK's) or simply through the eShop
The final two points are, potentially, vital in enticing Nintendo gamers with flash sales while avoiding potential damage to retailer relationships. It's an awkward dance for Nintendo — as well as Sony and Microsoft — to offer deals through its own sales platforms while trying to persuade retailers to stock products; the first-party can't undercut the high street out of the game. The rules for games being a certain age and having lost a degree of retail momentum minimises this, and also helps to avoid early-adopters feeling excessively burned.
Flash sales — with the inevitable comparison being Steam — are particularly effective at generating hype and pushing sales figures up. It's not fool-proof, of course, but it's also not hard to find PC developers that declare the vital financial importance of discount promotions on Valve's service, often seeing substantial jumps in downloads and, by extension, boosts in userbase. For established Wii U owners it's also a nice reward, and wouldn't even be unprecedented — Ubisoft has slashed some prices on the eShop stores, with excellent titles such as Rayman Legends and ZombiU having been available at fantastic prices both as permanent and temporary discounts.
By sticking to first-party games the only loser, in terms of margins, is Nintendo, although whether those such as PlatinumGames receive per-unit percentages on copies of The Wonderful 101 — for example — is something we can't definitively confirm. Regardless, if the market conditions and timing are right, these discount sales are extra units that may never have gone out the door in the first place — we're talking downloads, too, so there's minimal cost of distribution. Marketing minds better than us would deal in statistics, but we'd suggest that some games are well overdue generous flash sales to promote impulse buys — examples can include Star Fox 64 3D and Game & Wario, games which have surely already been picked up at full price by those that are willing. And all of this, let's not forget, drives traffic to the eShop stores as codes are redeemed.
The beauty of flash sales is that, for a short time, we can all have our cake and eat it. It'd be a gamer's heaven for desired, top-notch games to be under $20 all the time, so that we can buy every game we want and be happy; of course, the industry doesn't work like that, and retaining value that achieves the best results for game makers and their publishers to turn a profit is important for more games to be funded and made. Yet once that critical early period has passed there must be a statistical time when any sales, even at less than half the full price, can be considered a bonus.
If you want an extreme example of the excitement these policies can prompt, look no further than Steam's yearly Holiday sale bonanza, when it dominates social network timelines and plenty of people buy games that they wouldn't normally download. That's perhaps an extreme example that Nintendo is unlikely to ever follow with first-party games, but there are more restrained options out there. With the right price and limits on small purchase windows for one game at a time, excellent but undersold titles can be played by more players.
It's win-win, right?
Do you think Nintendo should run flash sales on retail first-party downloads? (596 votes)
Most definitely yes!
Yes, but not too frequently
I'm not sure it's a good idea, but worth a trial
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