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Topic: Attach Rates are Stupid and Games Don't Need to Sell Millions

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Snaplocket

Okay, I just want to get this off my chest because someone in the Switch thread mentioned that Capcom didn't intend to localized Monster Hunter XX because the Switch has only sold about 5 million so far. I just want to point out that this argument doesn't hold any water. Why? The reason is because the Wii U only sold 13 million throughout it's life and yet it has several games that sold millions. There's Mario Kart 8 which sold over 8 million worldwide. Splatoon, a new IP that managed to sell 4 million. Even some of the less mainstream titles managed to sell well like Xenoblade X which sold pretty darn good numbers, Bayonetta 2 ultimately wasn't a success but it got decent numbers as time went on (it better then the PS3 version of the first game), Tokyo Mirage Sessions did better then expected, and Pikmin 3 managed to get numbers fairly close to previous games (although it's kinda hard to tell since there is no concrete data on how it sold after its first few weeks).
The only games that outright bombed were Game & Wario and Star Fox Zero which was moreso due to the quality of the games then the install base. What I'm getting at here is that the install base means practically nothing in the grand scheme of things when it comes to sales.

Edited on by Snaplocket

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KirbyTheVampire

A smaller install base will always mean less profit for third party companies, which potentially means less support. That's why everyone always freaks out about numbers.

KirbyTheVampire

Octane

Snaplocket wrote:

What I'm getting at here is that the install base means practically nothing in the grand scheme of things when it comes to sales.

That's where your entire argument fell apart. Because it does make a difference, anyone knows that. Mario Kart Wii sold 35 million copies, that's not possible on the Wii U. Companies look at several things, attach rate, userbase, the amount of games sold per customer. Let's assume the Switch won't move any more units for a minute; 5 million sales in total. While in theory a game could sell around 4-5 million copies on that system, it is very unlikely that that would indeed happen.

I'm not sure where the part about Capcom and MHXX came from. I can only guess that because the MH sales are not impressive in the west, localising would be more expensive than the profits they would get back from it. But I've also heard that most of the game is already translated, so I don't know. It all depends on how much extra work needs to put into the localisation, shipping, and storage vs the amount of sales they're predicting currently on the Switch. Maybe they've decided it's not worth the effort?

Octane

OorWullie

@Snaplocket All those games you listed have one thing in common as to why they were a success,they were all published by Nintendo.The 3rd party games the Wii U did get all sold poorly,sad but true. Zombi U I think was the biggest selling 3rd party title with just over 1 million and that was a launch title and also came bundled with some systems.Monster Hunter 3 Ultimate only sold 700,000.We can say there's various reasons why the 3rd party games sold poorly but eventually those excuses run out,the truth is they never really have sold well on any Nintendo console.There are of course some exceptions but for the most part they just don't.

Now something like Mario and Rabbids definitely has a good chance of success for obvious reasons.Skyrim should do well also but if it didn't have the Link costume and weapons,I'm not so sure it would.Just having that in there will make a big difference I think.

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Dezzy

Install base isn't everything, but it's definitely not nothing.

Growth rate should be considered too. The Switch is selling a lot of units each week. So the install base will be fairly good down the line, and when people buy the console they'll look back at the already released games.

Also not sure where you're getting your numbers from but I don't think Xenoblade X far outsold the first. The VGChartz numbers suggest they were fairly similar.

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Snaplocket

@Octane I hope you're aware that very, VERY few games manage to go past the 5 million mark. Only super huge franchises do that with a single game. Mario Kart is one of the biggest exceptions. Yes, there's no way 8 will ever sell more then Wii. I'll admit "nothing" wasn't the right word, but it isn't nearly as much of a factor as people say it is. My point is that a large install base is in no way, shape, or form a requirement for a game to sell millions. There are so many more factors into how a game sells then just the install base. I won't deny that a large install base is A factor, just not nearly as big of one that people make it out to be.

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Snaplocket

@OorWullie DOUBLE-POST ALERT.
700,000 is honestly really good considering Ultimate was both released on 3ds and an enhanced port of a Wii game (re-releases generally don't sell well). There's also the fact that Rayman Legends, Lego City Undercover, and the aforementioned Zombi U that all sold relatively well on Wii U and were quality games. The problem with third-parties seems to be more of a factor wanting to sell several millions even when they could easily make a profit if a game (like XX Switch) doesn't sell that much. I feel like I've gone on a tangent, sorry.

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Octane

@Snaplocket What did the other Monster Hunter games sell in the west? Around 1 million for each entry? Definitely not more. Capcom probably looked at those numbers and figured if those were on a console with 60+ million units sold, you can't expect a lot from another Nintendo console that has only sold 5 million units so far. But don't ask me, I'm not Capcom, I'm just trying to figure out what their reasoning might've been.

Octane

Snaplocket

@Octane I'm almost 100% certain XX would sell at LEAST a quarter million in Western territories which honestly should be enough to make a profit. It's far more likely to sell at least half a million since a lot of Monster Hunter players owned Nintendo handhelds which the Switch more or less is. Maybe not right away, but definitely over time.

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Eel

Modern games are expensive to make. Companies need money to keep going.

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Ark

They do matter...just perhaps not in the way you'd expect.

Here's the thing: install bases will always be the sales cap for any game (besides scenarios like BOTW outselling the Switch). Sales figures for Splatoon and Mario Kart 8 are legitimate success stories that would be enviable on any platform. But we can't just look at Nintendo in a bubble. Let's compare the spending habits of Wii U's 13 million owners to PlayStation Vita's owners, which are in the same ballpark (10-15mil sold).

On Wii U, 10 games sold over 2 million. If you can believe it, the best-selling Vita game is Minecraft at roughly 2 mil and everything is downhill from there. What the heck happened? Wii U has eight games that outsold Minecraft and one by four times. Why? Well, in Wii U Land, Nintendo is Michael Jackson so tons of people run to pick up even his weirder, more experimental releases. In Vita Land, there is no King of Pop. It instead has a pool of diverse indie bands competing, so everyone's game library looks different. If we flip our perspective, though, there are more successful musicians to hit 1 million sales in Vita Land than in Wii U Land.

Using Wii U as our metric again, let's look at some sales figures that would never be possible on Wii U because of its 13 million install base cap:

  • Wii has eight games (all Nintendo-published)
  • DS has seven games (all Nintendo-published)
  • 3DS has four (all Nintendo-published)
  • Xbox has zero
  • Xbox 360 has four
  • Xbox One has zero
  • PS1 has zero
  • PS2 has two
  • PS3 has two
  • PS4 has zero

What conclusions can we draw from this?
A) Across every console, almost every game to sell 13 million or higher is Nintendo-published
B) Nintendo lost out on quite a bit of cash because 0 games went above Mario Kart 8's 8 million sales, unlike 3DS, DS, and Wii, which had many do so effortlessly.
C) Nintendo systems historically have shorter lifespans than Sony, so it needs to sell more games and systems faster. Nintendo needs that fat install base the most of anyone if it wants to maximize its heavy-hitters. Third-party games don't need to worry about that.
But most importantly, D) Nintendo's best sales are an anomaly almost exclusive to it and not indicative of the game industry's profit as a whole. Some third party games can be considered explosive successes at 1-3 million depending on the game's individual situation.

Let's expand on D a little. You're a third party developer producing a fancy ol' AAA title. What platform do you release it on?
1. The platform with the highest specs, biggest/most verifiable receptive audience, long-term sustainability
2. The platform that has weaker specs, will die quicker, has less provable interest in non-Nintendo games

Most are going to go with 1. Whereas it took Wii U its entire life to hit 13 million units, the PS4 hit that threshold in about a year. Switch will almost surely surpass Wii U, but that's not saying a lot since we don't know by how much or for how long. If you're the publisher of niche games like Disgaea 5, the Switch is great. If you're Square Enix and you call Tomb Raider a financial failure because it sold 3.4 million units instead of the 6 million you wanted in four weeks, well, you're going to be a little cautious. Whether those expectations and expenses are reasonable for the game industry is another argument entirely, but this is how some companies operate. The safer bet is to wait until the host console proves itself. Otherwise, just invest in platforms that are historically proven to sell third-party games in vast quantities. This is why PS4 sold so well out of the gate with so few games - consumers expected great titles from third-parties and publishers expected consumers to buy them.

Honestly, though, I could have saved time and just written this: Part of the problem is due to a deeper, self-perpetuating cycle. Nintendo console owners don't buy as many third party games, so third-parties don't put as much effort into releasing them. When they do, they're typically late or watered down. Thus, Nintendo console owners...don't buy as many third party games. This is especially true if players already happen to own a complementary Sony or Microsoft system (in which case why would you hold out hope for a more expensive or inferior game months later?).

Unless Nintendo offers incentive, third party devs stand little to gain by helping Nintendo develop an audience for these kinds of games. The best you can do is support third party games that are worth your money and advise all your friends to do so.

Edited on by Ark

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Snaplocket

@Meowpheel Not as expensive as localizing a game that is already almost fully translated. Seriously, I don't think I even need to bother arguing.
@Ark Uhhhh... Nintendo didn't lose any money because none of their games sold over 9 million. In fact, despite the Wii U flopping it still made a good deal of money for Nintendo thanks to game sales. Also, there were several third party games that did well on Wii U (Rayman Legends, Lego City Undercover, and MH3 Ultimate (for a re-release)). I'm just saying that a low install base/growth rate doesn't immediately shoot down a game's chance of selling well. MHXX doesn't seem to be a big budget game either (it's a port after all).

Edited on by Snaplocket

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Octane

@Ark About BOTW outselling the Switch itself... Not entirely true. Those were shipped units from Nintendo, not sold through customers. The Switch was sold out everywhere, but you could find a copy of BOTW everywhere. They just shipped more copies of BOTW than they shipped Switch units. But the internet loves an extraordinary success story, so every site ran with it and nobody bothered to think about it for a minute.

Great post btw, I like the Michael Jackson comparison!

Octane

Krull

Meowpheel wrote:

Modern games are expensive to make. Companies need money to keep going.

This is true - but it doesn't really apply to MH XX, at least. Capcom has already made the game...

@Ark Good insight. It doesn't appear that the late and watered-down AAA third-party syndrome is going to stop any time soon for the Switch, but there is the vague hope that Nintendo has supposedly offered a simpler architecture this time around. I could definitely see a situation where the Switch gets a series of previous-generation ports that haven't previously made the jump to Nintendo. Skyrim will be an interesting test case.

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ValhallaOutcast

@Octane I bet some also bought two copies a physical in a collectors set and digital

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Octane

@ValhallaOutcast Of course, that always happens. But people didn't buy more copies of Zelda than they bought Nintendo Switches, that's what I was trying to say.

Octane

ValhallaOutcast

@Octane I get your point that if they are on shelves its not sold old like the Switch meaning less "sold" copies but all the digital copies sold count too, if digital did not exist would it be just as hard to get a copy of BOTW as a Switch right now?

I know the 1:1 Switch to BOTW ratio is a slight exaggeration but its not that far off

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Octane

ValhallaOutcast wrote:

I know the 1:1 Switch to BOTW ratio is a slight exaggeration but its not that far off

I never said it wasn't close to a 100% attach rate.

Octane

StuTwo

@Ark Great analysis! Everyone should read it.

I don’t think it’s fair to point the finger at Nintendo fans though.

A few more observations:

The demographics of Nintendo systems are different…

They’re more likely to be in the hands of younger players and families. Appealing to that audience certainly requires a different approach in marketing. That affects where (and how) you need to advertise and the types of commercial deals that get you the attention you need.

The big AAA publishers all work to a one size fits all marketing strategy (in part underpinned because of the marketing deals they strike with Sony or Microsoft that mean their platform must be the exclusive focus of marketing). That probably hurts their sales slightly on any platform for which the marketing hasn’t been optimised but it’s particularly acute on Nintendo platforms because the demographics are so different.

Another aspect of this is that sometimes the games themselves might need to be slightly different. I don’t mean that publishers have to create exclusive games to target Nintendo platforms and I’m also not saying “chuck in a Mario skin and everything will be OK”.

In another topic I raised a suggestion to @Octane – why don’t publishers create “clean” versions of 18 rated games? It wouldn’t make sense for every game but there are a number of 18 rated games where some minor editing of camera angles, removing blood and bad language could allow the game to be released as a 12 (and subsequently marketed to a different audience).

The online gaming community would be up in arms at the mere suggestion (in 1, 2, 3…) but their numbers are actually tiny and, almost by definition, they are not the target audience for such versions.

It’s common practice in the TV & film industry because it allows films to be marketed to the broadest possible audience. Honestly, for an industry that likes to style itself on Hollywood it’s astonishing that this isn’t something that the games industry does already.

…which is driven by Nintendo’s games and marketing…

Of course the demographics are different because Nintendo’s marketing drives them to be different. Because the franchises that Nintendo owns naturally appeal to different demographics to most AAA games and Nintendo needs to maximise the potential to sell their own games

20 million families will buy very different games to 20 million 20-30 year old single men.

…and Nintendo is a competitor

Honestly this is under-rated as a factor when discussing third parties on Nintendo platforms – they have to compete with a well-resourced and critically acclaimed competitor that they don’t on the other platforms: Nintendo themselves.

Aside from having to live with being compared to Nintendo’s games on quality they have to live with the fact that they’re competing with Nintendo from a position of weakness. As the platform holder Nintendo pays no licensing fees – their games are inherently more profitable than a third party’s would be. Nintendo also has access to tools to promote their games directly to owners of Nintendo platforms that third parties lack – just look at the lock screen of your Switch!

All of which leads me to make a slightly different set of conclusions. In many ways the problem is intractable because Nintendo themselves are the problem.

Not because they’re incompetent or doing anything wrong – just that the presence of Nintendo games on a platform makes third parties games less likely to be successful. If Nintendo themselves went third party then Ubisoft, Activision and EA games on PS4 and Xbox One would be slightly less successful.

Even worse the biggest things that could actually change the likelihood of third party success on Switch isn’t evangelical Switch owners buying games to “send a message” – it’s the third parties themselves. The potential for this change is unfortunately inhibited by the marketing deals that they strike with Sony and Microsoft (which is an integral part of the business model they’ve adopted).

That said I do think that there are things that Nintendo can do (other than just increasing the install base – which I think the point of this topic is to establish that that’s not perhaps as important as we sometimes project).

They can open their wallets – establish some marketing deals with third parties themselves (not exclusives - just an agreement to help market the games). They can slash license fees for third parties (since they barely sell on Nintendo platforms anyway the cost is small). They can promote third party games heavily through Nintendo owned channels – like the directs and the Switch lock screen. They can provide a repeatable framework for success for third parties on their platforms. They can provide high quality first party games that appeal to different audiences than those they typically target (so things like BoTW and Metriod Prime 4 are very important).

Oh, and although we all agree it’s not the all important factor, growing the install base never hurts either!

StuTwo

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