Reggie on Yo-Kai Watch, amiibo supply/exclusives/pre-orders, toys-to-life partnerships, more
IGN has posted its full interview with Nintendo of America president Reggie Fils-Aime. When the two sides met at E3 2015 last week, Reggie discussed things like Yo-Kai Watch, amiibo, toys-to-life partnerships, and the Digital Event.
We have a number of excerpts from the interview below. You can read the full talk on IGN here.
On Yo-Kai Watch…
Reggie Fils-Aime: Nintendo is quite involved. This is a game that literally sold millions in Japan, and it helped drive a lot of hardware especially with younger kids. So we view this as a very strategic title for us. The team at Level 5 is driving a lot of the localization. We’re playing a bit of a consultation role, but we’ve had a lot of deep conversations around the need for the anime to be out in the marketplace, and to establish the importance of key partnerships in the toy space.
We believe this game could be a very strong hardware driver for us, especially with younger consumers. We think the pairing of this game, especially with our 2DS business, can be quite strong. And we’re very excited about it coming this holiday.
Fils-Aime: We’re working on the timing. I would not say that it’s all going to happen together. The toys especially are a long lead-time. That’s something that has challenges from a timing standpoint. But the goal is to sequence the anime on broad scale TV, the game, and the toys as a one, two, three-type of implementation.
On whether Yo-Kai Watch will remain 3DS/Nintendo exclusive for the next few years…
Fils-Aime: The partnership is very strong with Level 5. I think the Level 5 team has seen how Nintendo creates the handhelds of choice, especially for younger consumers. I think for both companies there’s a clear belief that this has the potential to be a strong, long-term relationship much like we’ve done with Pokemon.
On how Nintendo can convince Level-5 to keep Yo-Kai Watch on Nintendo platforms versus smartphones…
Fils-Aime: Here’s the reality: There’s not a lot of five to seven year-olds walking around with smartphones. Even in the tablet space, mom and dad might hand over their tablet for short periods of time. But with this game, much like with any battle-trade-share type of game, the kid consumer is going to spend a lot of hours. The benefit of doing that on a dedicated device is very strong.
On why Nintendo didn’t talk about mobile gaming at E3…
Fils-Aime: E3 is a console gaming show. And I say that despite all of the mobile entrants that are here. I say that despite mobile content that a number of publishers show. Like many folks, I watch a lot of the conferences. And you can hear the groan when a particular company talks about mobile in their presentation. That’s not what the media and the attending consumer at the show really want to hear about. And so that’s why we’re focusing on console gaming here. We’re focusing on our Wii U business and on our 3DS business. There’s going to be lots of opportunities to talk about mobile, NX, and our IP expansion. We just don’t feel that it’s the proper venue to do that at the show.
Fils-Aime: What I’m saying is that, from Nintendo’s perspective, at E3 we want to focus on console gaming – handheld and home console – and, in our view it’s best to focus on a tight window, essentially from now until early 2016. That’s our mentality. I’ll grant you that it’s a different approach than other people take. People will come to this show and showcase concepts that aren’t going to hit the marketplace for three years. This is not what we believe in.
On Nintendo’s digital business vs. retail business…
Fils-Aime: Here are a number of points. First, our digital business is growing very strongly. That’s because the content that we offer in our eShop goes beyond simply what you can get at retail. Yes, we have what we call dual-distribution titles. These games are sold through the eShop and retail. But we also have Virtual Console, which is content you could only get through the eShop. And we also have content specifically designed for the eShop that you can’t get anywhere else. That combination has created a very effective, growing business for us.
Second point: both the Wii U and 3DS, in the Americas, are effectively 100% connected devices, meaning the consumer has setup a [Nintendo Network ID]. They connect to a Wi-Fi network. For us, that’s a very effective means of not only driving our eShop business, but also driving a number of other ways we connect with our consumer. GamePad alerts are one example. The level of connectivity is the strongest in the Americas. That’s something that, from a business standpoint, we can drive very effectively here.
The third point is that the actual sell through of physical versus digital really depends on the game. Let me give you two examples. A very large percent of Animal Crossing, and in that same genre Tomodachi Life, sold digitally. Why is that? Well these are games that the consumer wants to always have with them. They want the five to ten minute opportunities to open it up, visit the island, and do something fun. They don’t want to deal with swapping out game cards. It’s a very quick experience.
On the other hand you have games like Super Smash Bros. The Smash Bros. player does not want to invest literally 100-plus hours and, even in the back of their mind have a sense that something might go wrong and lose the time invested. Not that it would happen, because our systems are very robust. But what I’m talking about is what’s going on in the minds of that consumer. And so the digital percent for Smash Bros. both on Wii U and 3DS is lower than average.
We’ve learned that it is game-by-game how the digital percent equates. We’ve gotten to a point where we can estimate pretty effectively what that mix is gonna be.
Fils-Aime: If you look at our annual report, it shows the progression of our digital business. If you do the math, roughly, it shows that digital revenue is about 20% of the total. So 20% is the average. Animal Crossing, for example, is north of 30%. A game like Smash Bros. is less than 15%.
On the amiibo supply situation…
Fils-Aime: It really has been a production challenge. There’s two parts to that. Certainly in the holiday season, and specifically here in the U.S., we were challenged by the port situation, of literally getting the product off the boats, into our warehouse, and then back out into retail. More recently, it’s been a pure demand issue. The ports are open, we’re getting all the product in, but demand has been exceeding supply.
We made a commitment to our consumers that we would do better and we would bring more, globally, and we’ve done that. Just here in the United States, over a roughly 30 day time period during the launch of the most recent wave, we’ve sold through over a million units of amiibo. A million units of amiibo in about a 30 day timeframe. You don’t do that without managing your supply and getting a lot more product out into retail. So we’re making progress. We know that for certain amiibo that we launched during waves 1 and 2, that those continue to be scarce, and we’ve made the commitment that we will resupply those, and we will.
We want the consumer to be able to find the amiibo they want. We’d love for the completionists out there to have every single amiibo and we’re working hard to enable that to happen.
On the resupply for amiibo…
Fils-Aime: The fact is that the replenishment happens on a continual basis. Effectively, it’s happening now, as we put more various amiibo in the marketplace. We announced about a week ago that Wii Fit Trainer was out on the marketplace and it was. It quickly sold through so we have more coming in. We want to make sure that every consumer who wants a particular amiibo is going to be satisfied to the best of our ability.
On retailer-exclusive amiibo…
Fils-Aime: It is. I want to be clear on this: when we do a retailer exclusive, as we resupply, it’s gonna continue to be exclusive with that retailer. That’s a commitment that we’ve made to that business partner. So yes, we’ll be bringing in more of those retail-exclusives over the next number of weeks and months.
On amiibo pre-orders…
Fils-Aime: We’ve shared with retailers the things that we’ve seen in terms of consumer frustration. We’ve certainly given them some of our thoughts, but in the end, this is for the retailer to execute. So, I hear your point. Our role as the manufacturer and the IP holder, if you will, is to share that feedback as clearly and directly to our retail partners as we can and we’ve been doing that.
On how Nintendo seems to have a lot on its plate between Wii U, 3DS, NX, mobile gaming, Universal theme attractions, etc…
Fils-Aime: So rest assured that we are driving all of these initiatives. The one element maybe that consumers don’t necessarily have a sensitivity to is that before we make an announcement about a particular initiative, work has been going on behind the scenes for an extended period of time. It’s not like the day we make an announcement, we’re like, “Let’s get some work done!” So from that standpoint we’ve been putting resources against all of these initiatives for quite some time.
The best example of this is the new Research & Development center that went up in Kyoto. That building is already quite full with developers. Developers working on all of these projects as well as others. So we are committed to bring each of these initiatives in a way that surprises and delights our consumer. In typical Nintendo fashion, we’re going do it when we feel it’s appropriate.
On whether Nintendo could do a partnership with something like Disney Infinity…
Fils-Aime: There are a number of different things that we can do, there are a number of different things that we’re talking with different business partners about. We have nothing to share here, but to your general question, is Nintendo prepared to partner with the right company to do unique and compelling experiences for consumers? The answer is yes. We’ve got a history of doing that.
On Nintendo’s successes/what they could improve on in terms of the Digital Event…
Fils-Aime: First is that the Digital Event is one tactic, one of many tactics, and I would encourage us all to look at E3, at least from Nintendo’s perspective, as the series of events that we’ve executed over the last couple weeks, starting with the Mini Direct, where we highlighted a number of key 3DS games that we wanted to make sure would not be overshadowed if we simply introduced them today.
Case in point, Chibi-Robo! – people are very excited to play that game. Personally, I really enjoy playing that game. Something like that, with its charm – in our view – had the risk of being lost. Communicating games in advance of E3 was a key tactic for us. What we did on Sunday with Super Mario Maker, we thought was very strategic. Certainly, the excitement we’ve created for that title is palpable. That was a key thought process. Then you look at the Digital Event and how we showcased Yoshi’s Wooly World, Mario Maker, Star Fox… we think that was very effective.
In terms of opportunities for improvement… there are games where you need to have hands-on time to really appreciate. Certainly, Metroid Prime: Federation Force is one of those types of games. We anticipated that consumers would say “Where’s Samus?” and “Where’s my traditional Metroid Prime game?” We anticipated that. As I walked the floor and talked to people who were playing Blast Ball, they’re loving it. They’re excited about it, they’re excited about the controls. One of our challenges at Nintendo, always, is how do we communicate the charm and appeal of a game to people who don’t get a chance to play it? It’s always a challenge. I say with Federation Force, we may have fallen a little short in communicating what the charm is of that game. Good news: we’ll have lots of other opportunities to address that and get people to experience it hands-on. We think they’re gonna come away in the end feeling like it’s a lot of fun.
