So, have you heard of the new Nokia N-Gage phone? No?
There’s a ton of money in the video game industry these days, especially in the mobile gaming sector (i.e. handheld video games). Currently, there’s somewhere around $600,000,000 to be made in that market, and it’s expected to grow to over $4,000,000,000 within the next few years. A lot of money, a huge opportunity, but only one company is really competing for it so far. The mobile gaming industry has pretty much been monopolized by Nintendo for years, as their Game Boy and Game Boy Advance line of products has clearly dominated the market. Kids love Game Boys, parents love Game Boys, young professionals love Game Boys… everybody seems to enjoy getting their quick fix of Tetris or Mario. So if I’m a businessman in the technology sector, I’m looking at that four billion dollars and I’m thinking to myself: how can I get a piece of that pie?
Now, enter Nokia, best known for their U.S. market leadership in another related area: mobile phones. The N-Gage was the brainchild of their marketing department, a brilliant idea really, no doubt hoping to capitalize on the brand loyalty so many of us feel for our Nokia phones. The N-Gage is an admittedly cool-looking little gizmo that is both a cell phone and a handheld video-game player. And we’re not talking simple little video games like Snake (although everyone seems to love Snake, I haven’t heard of any plans to bring it to the N-Gage), we’re talking titles like Sonic the Hedgehog and Tomb Raider, if those two names mean anything to you. The N-Gage was meant to break into the lucrative professional, casual gamer market, and it was meant to be more friendly to females than the somewhat-gender-specific Game Boy. Sounds like a pretty good idea, right?
It is a good idea: leverage your strength in one market to attempt to compete in another related market. It’s how Microsoft got into the Internet, Britney got into the movies, and how Disney got into… well… just about everything. However, even the best of plans can fall through, and at least so far, the Nokia N-Gage is one of the biggest hyped failures of the tech industry’s recent history. The phone has received terrible reviews from both mobile phone reviewers and video game reviewers. Sales are reportedly lukewarm, and in a move that’s a clear indicator of how retailers feel about the product, major sales channels like GameStop and Electronics Boutique slashed the price of N-Gage by a hundred bucks just two weeks after the phone/game’s launch. If two of your biggest retailers see a need to cut the price of your product by a third within a month of its release, then you’ve got huge problems.
However, I stand by my first statement of the last paragraph: combining mobile phones with games through the established market leader really was a good idea. Unfortunately for Nokia, the launch of the N-Gage was so poorly planned and disastrously executed that it would be completely unreasonable to expect the new gadget to succeed. The good news for us, though, is that there are several lessons we can learn from it about how to launch a new product in a competitive field. Here, then, are some simple rules on how NOT to launch a new product, service, or idea, as taught to us by the good folks at Nokia (who make darn nice phones, really):
Develop a product that is obviously inferior to its competition. Nintendo’s Game Boy, which has sold over 150 million units in the last 15 years or so (so they must be doing something right), has a significantly bigger screen than a Nokia N-Gage. The Game Boy also shows a much larger variety of colors on its screen than the N-Gage. And the Game Boy has much better battery life than the N-Gage. That may sound like no big deal to a lot of us, but to the gamers who were expected to buy the N-Gage, those three facts are big no-no’s. On the mobile phone side of the N-Gage, actual phone reception is weak compared to regular phones, and again, battery life is pretty inferior. Combining two products into one useful gadget is a great idea, but only if you can maintain a certain level of quality. Most people would rather carry a good phone and a good game device, than carry one combination device that doesn’t do a good job of either.
Charge way more than your competition. Over the Christmas season, I found a neat Game Boy Advance gaming device on sale for $69.99, and I found good mobile phones for free at almost all of the major cell-phone providers. The Nokia N-Gage, on the other hand, costs anywhere from $200-$300. Nokia states that it believes customers will be willing to pay more for the convenience of having phones and games together; consumers, at least so far, have responded by saying we’re not quite that lazy. If you’re launching a new product and your product is over twice as expensive as your competitor without offering any real quality advantage, you’re going to fail.
Ignore the experts. Speaking of pricing, in a recent interview a Nintendo executive said of the mobile gaming industry, “Mainly, we find that when you go over $99, it's a hard thing to sell.” Meanwhile, the success of Nokia’s regular mobile phone division has been dependent on several factors but none more so than low pricing and a simple handheld design with high ease-of-use. The major video game websites are looking for devices where it’s easy to switch games quickly, and where the screen is large.
Oddly enough, Nokia ignored all of this expert advice with the N-Gage. As discussed in the last point, they priced the phone/game well over $100. The N-Gage does not have a simple handheld design like other Nokia phones; quite the opposite, you have to hold the phone sideways (lengthwise) against your head to actually use it, which makes the user look pretty ridiculous. Here’s what some major websites had to say about the look of the N-Gage:
CNN: “Essentially, it looks like you've had a taco surgically grafted to your head.”
Mobileburn: “Picture holding a taco to your ear and you get the picture.”
Netjak: “In fact, for the rest of this review, this product shall now be called El Taco.”
And Nokia ignored the gaming community’s desires for large screens and ease of switching games; you actually have to take the phone apart and remove the battery every time you want to play a different game. With the N-Gage bucking common sense and traditional wisdom left and right, is it any wonder it’s thus far failed?
Go for multiple and totally different target markets simultaneously. Ask a Nokia exec who they’re marketing the N-Gage to one week and they’ll say, “to the hard-core gamers, the ones who love their video games!” Ask them next week and they may say, “We’re going after the female market, the ones who are comfortable with Nokia phones and want to experiment with games.” Ask them later and they may add, “We’re marketing to the young professional, affluent and on the go.”
But here’s the problem with that: an advertisement that would be appealing to a hardcore gamer would completely turn off the mainstream female market, who would think it was too techy and definitely not for them. And an ad that catered to the young professional would be anathema if a hardcore gamer saw it; it would make them think that the N-Gage was just kids’ stuff.
Sure, some companies can get away with trying to be everything to everyone, with marketing to many different target markets. Wal-Mart, for instance. However, many high technology gadgets absolutely can’t work that way. The reason so few people have heard of the N-Gage (excepting those people who saw the too-little, too-late plethora of ads during the recent Nokia Sugar Bowl) is that Nokia’s marketing efforts were spread too thin. They wanted to be everything to everyone, but ended up being little to few. While the N-Gage may indeed have had legs in all of those markets, it might have been more effective to stagger the marketing, to concentrate on winning over one market, then on another.
Oh, and if you’re going after a female market for a video gaming device? I’m not sure Lara Croft: Tomb Raider is really the game you want to promote.
Do these rules sound obvious? Sure, they do. However, major business all over the world ignore conventional wisdom like this on an almost daily basis. One of the major keys to success in the business world (which few college classes teach) is not getting carried away by meaningless hype; keeping your head and always retaining your common sense. Businesses that enter new markets with inferior products, inflated pricing, poor features, and multiple disparate target markets will undoubtedly fail… just like the experts would have told them if they’d bothered to listen.
Want to leave your mark in the NeverTown? Earn your citizenship by leaving comments and thoughts on what you just read. Just fill out the simple form below, and become a personage of importance in the NeverTown!
Keep it relatively clean, guys - the NeverTown is a family place.
© Copyright James Lemoine, 2003-2007. Copying and stealing information from this website without express written permission from Jimmy is strictly forbidden and an indicator that you are not the kind of nobody who hangs out in the Nevertown. So don't do it. The Beyond Wonderland font is provided by Chris Hansen, one hell of a talented font designer. Some javascript appropriated from javascript-fx.com, and used only after heavy modification.
|
|
|
Mouse over the cyan text in the main article for random thoughts, links, and other annotations.
If this box is covering the text or way off to the side, make sure to maximize your browser window.
|
|
|
