BMA151/251 Principles of Marketing: Nintendo Switch Case Study

This case study provides an analysis of the marketing strategies employed by Nintendo for its Switch console. It begins by introducing the concept of marketing and defining key terms such as target market, value proposition, and marketing mix. The study then delves into the purpose of market segmentation, identifying the primary and secondary target markets for Nintendo Switch using demographic and behavioral segmentation variables. It discusses the importance of a strong value proposition, highlighting the unique features of the Switch that appeal to its target audience. The analysis extends to the four elements of the marketing mix: product, price, place, and promotion, examining Nintendo's strategies for each. The case study concludes by summarizing the key marketing principles applied to the Nintendo Switch, showcasing how a well-defined strategy contributes to the product's success. Desklib provides access to this document along with a wealth of other study resources.

Running head: PRINCIPLE OF MARKETING
Principle of Marketing
Student’s name:
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1PRINCIPLE OF MARKETING
Table of Contents
1. Introduction..................................................................................................................................2
2. Purpose of Market Segmentation and target market....................................................................3
3. Marketing theory to discuss the importance of identifying and reinforcing a products’ Value
Proposition.......................................................................................................................................5
4. Product element of the marketing mix.........................................................................................6
5. Price element of the marketing mix.............................................................................................7
6. Place element of the marketing mix............................................................................................7
7. Promotion element of the marketing mix....................................................................................8
8. Conclusion...................................................................................................................................9
Reference List................................................................................................................................10

2PRINCIPLE OF MARKETING
1. Introduction
Marketing is the total activities engaged in the transfer of products or services from the
producers to the consumers including shipping, advertising, selling and storing. As stated by
Huang and Sarigollu (2014), the target market is the customer group within an organization's
available market which the organisation has decided to target its marketing efforts. Target
marketing is involved in breaking the market into several segments and the organisation
concentrate the marketing efforts on the key market segments whose desires and needs closely
match the service or products offerings. In addition, value proposition means the statement that
the organisation uses to summarises why the customers would purchase the products or service.
The value proposition is the USP or uniqueness of the organisational products and service.
Moreover, marketing mix the set of tools those are used in marketing in order to continue to meet
the objectives of the organisation.
Nintendo Switch is developed by Nintendo and it is the seventh major gaming console
developed by the organisation. Nintendo switch is known as the codename NX. This product was
released in the year 2017, March worldwide. Nintendo Switch is the hybrid console and it is
primarily is a home console to be used in the television set. Nintendo Switch can be removed
from the dock and it can be used on the outside also like a tablet or handheld gaming console.
Nintendo Switch can be used as tabletop and it can be played as a multi-players gaming console
(Nintendo.com 2018). There are Joy Cons to be attached to both sides of the console and the
software is used to support the online gaming through internet connectivity.

3PRINCIPLE OF MARKETING
2. Purpose of Market Segmentation and target market
Market segmentation is the method of segregating the broad customer or business market
that consist the existing customers into some of the basic subgroups of the customers. The
customer segments must be shared with same types of characteristics (Datta et al. 2017). There
are mainly four types of customer segments; geographic market segments are the customers who
are divided into location-based and region based. These customers can be divided into urban or
rural basis. The demographic market segment can be divided into the age, gender, socio-
economic group and occupation of the customers. The behavioural segment is the customer
wanting a value for money products or the customers can be divided with the factors of the rate
of usage, loyalty status, benefits sought and readiness to purchase something. A psychographic
segment of the market can be segregated through personality, lifestyles, class and attitude of the
customers (Osterwalder et al. 2014). The purpose of the market segment is to narrow the large
target customers into more narrowed target group. The organisations basically want to target the
specific target customers including lifestyles, demographics, usage of patterns and lifestyles of
the customers.
Among the four market segments, Nintendo Switch is targeted mainly to the
demographic market segment, narrowly to the youth age groups and the upper-middle class
people who can afford the smart gaming console. The primary target market for Nintendo Switch
is the young adults and teens to sell more of their gaming units. The young adults who belong to
the upper middle-class group with higher income can spend their money on Nintendo Switch.
The secondary target market of Nintendo Switch is behaviour segment; the individuals who like
technologies and who like to play video games. These customers mainly provide loyalty status
and usage rate of the products are high.

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Primary target market
Demographic segment
Age Young adult and teens (between 15 and 27)
Sex Both male and female
Family life cycle Young and single
Family size 4-5 people
Income Higher income group
Occupation Student or professional
Education High school graduate, college or university students
Religion No specific religion focus
Nationality In those countries, where Nintendo Switch is available
Table 1: Primary target market of Nintendo Switch
Secondary target market
Behavioural segment
Purchase
occupation
Regular buyers of gaming console
Benefits sought Quality of the gaming, graphics
User status Potential gamers
Usage rates Medium users as they can play the games in leisure
Loyalty Status Strong loyalty towards
Readiness of usage The people must be interested and the people must be intending to buy

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Attitude towards
products
Positive and enthusiastic
Table 2: Secondary target market segment of Nintendo Switch
3. Marketing theory to discuss the importance of identifying and reinforcing a products’
Value Proposition
The new aged children are growing up with the technologies and young adults are used to
with smart gaming console. As stated by Covin et al. (2015), 72% of the teen males in US and
UK choose to spend their money on video gaming console over than any other products. The
value proposition can grab the attention of the customers because it must provide something
unique to the customers. The value proposition of the products provides values to the customers
and it creates a strong difference between the competitors in the market. Value proposition
statement attracts the customers' prospects and it increases the quantity and the quality of the
perspective of the products. Nintendo Switch is the quality product that provides the customers
to play the games in the home using television set and the users can play this gaming console by
using it as hand-held video games. This USP of Nintendo Switch can help the organisation to
gain the market share in reaching the target markets who are young adults and who like to play
games. As opined by Osterwalder et al. (2014), value proposition statement can assist the
customers to enhance the tools that can help the customers to get closer to business and improves
the operation efficiency. Value proposition will help Nintendo Switch is to define the values and
uniqueness of the product and makes the product differentiate from others as Nintendo Switch
gives the feature of dual-screen. Positioning statement of Nintendo Switch is the innocent,
refreshing and fun; the gamer can play together and it is one of the ways to being active.

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4. Product element of the marketing mix
The product is the item that is sold by the company and this product must provide a
minimum level of performance (McAlexander et al. 2014). It is vital for the organisation to make
out and plan for the stages of product life cycle. The product can solve the specific problems of
the customers and Nintendo Switch kills the boredom of the players. Nintendo Switch is a unique
type of hybrid video game console that consists of the systems featuring the switch console, Joy
Cons and Switch Docks. Nintendo describes this product as a home console that the users can
take with when they go outside. The player can play this game on TV and it provides a 3D view
to the players. The main unit of this product is the Switch and it also has a battery powered
monitor and it looks like a tablet with the LCD screen. This gaming console can be used as hand-
held devices with 6.2 inches screen and it weighs just 297 grams (Digitaltrends.com 2018). The
screen of this Switch consoles provides support to multi-touch capacitive sensing and it includes
haptic technology. This console provides the audio-jack and it has inbuilt stereo-speakers. There
is a USB port to provide charge to the console while it is out of the dock. Nintendo Switch has
the slots for game card and it also gives space for MicroSD external storage. The users can attach
the console with or without the Joy Cons on the Docking Station and most importantly; there are
three types of modes to play the Nintendo Switch, first one is the TV mode, the second one is the
Tablepod mode and the third one is the handheld mode (Digitaltrends.com 2018). There are
some games those are specified to play on specific modes only and these can be played with
multi-player mode also. Therefore, Nintendo Switch can be played in different modes and
different styles; therefore, each feature of Nintendo has benefits to the customers.

7PRINCIPLE OF MARKETING
5. Price element of the marketing mix
Price is the value of the products and services offered by the organisation and it depends
mainly on the production cost, target segment and ability of the market segment to pay for this.
According to Dutta et al. (2017), pricing can be utilised as the demarcation to enhance and
differentiate the image of the products. There are some factors of the pricing strategies, fixed and
variable costs, competition, company objectives, positioning strategies and target group. (Tanner
and Raymonds 2015), opined that value-based pricing is the pricing strategy where the
organisation sets pricing according to perceived or estimated value of the products to the
customers. The price of Nintendo Switch in Australia is $469, where the Xbox One 1TB console
prices $330. In Australia, Xbox lowered the pricing in Australia. Sony PlayStation 4 in 1TB
format is priced $499 in Australia. Therefore, it is clear that Nintendo takes the strategy of
competition-based pricing as the organisation sets the price in comparison with other competitors
in the market. As stated by Schulze et al. (2014), the firms generally have three options, lower
price, upper price and higher prices than the competitors. Switch is priced lower than Sony
PlayStation in Australia. This pricing of Nintendo can be described as the psychological pricing
as the previous product of Nintendo Wii could not take the market as storm. The seller considers
the psychology of price and positioning of price in the marketplace.
6. Place element of the marketing mix
The process of distributing the products to the customers is defined as place and this
movement is the combination of distributors, intermediaries, retailers and wholesalers. A
distribution channel is the activity and process that required moving the product or service from
the producer to the customers (McAlexander et al. 2016). There are two types of distribution
channels, in the direct distribution channel, the products go to the customers directly. On the

8PRINCIPLE OF MARKETING
other side, indirect distribution goes from producer to wholesaler to retailer and to consumers.
Nintendo manufactures the products and the organisation mainly takes the indirect distribution so
that the products reach to the different countries easily. It distributed Nintendo Switch through
wholesalers to retailers to the customers. Very large national accounts are dealt with directly as
the retailers buy a large volume at the initial stage. Nintendo Switch is available in High Street
retail and shops and all the gaming retailers. Nintendo Switch is also available in online mode
also via Amazon e-bay (Nintendo.com 2018). Nintendo Switch is also available for second-hand
buyers via e-bay. Distribution is getting matured for Nintendo Switch as the organisation has
been taking few avenues of distributing; not all the processes.
7. Promotion element of the marketing mix
Promotion is communication method of the business and it creates various channels for
the organisation to promote the products. The organisation targets to attract the attention of the
customers and it give the customers to get information of the products and launching of the new
products. Promotions foster the interest of the customers to motivate them to buy the products
(Huang and Sarigollu 2014). Promotional strategies are various for the organisation and it can be
done through traditional method of promotions like print, billboards and hoardings. The
organisations are taking online strategies to promote the products, SEO, PPC and social media
strategies work for the company (Nicholson et al. 2015). Promotional strategies can build the
brand awareness, create interest and stimulate the demands in the market. Nintendo Switch
began the advertisement through announcement via YouTube. This video creates sensation
among the gamers and the organisation increased the stock level compared to last year. Nintendo
Switch provides deals to the customers through online and in the website of Nintendo, there is
comparison chart from where the people can buy Nintendo Switch. Nintendo makes the deal

9PRINCIPLE OF MARKETING
with the e-commerce and they provides massive discount to the customers. Nintendo Switch sold
as bundle by the gaming retailers and people can purchase the products in discount and
separately. Nintendo Switch took the strategies of early purchasing and the people can get free
carrying case, free giveaways like T-Shirts. Nintendo started the Twitter campaign using hashtag
#nintendoswitch.
8. Conclusion
Nintendo Switch released in March 2017 and since then, this gaming console has been
creating storm in the gaming market as it provides different types of gaming facilities. The target
market of Nintendo Switch is the young adult and teens who like to play video games. The value
proposition of this gaming console lies in the inclusive play, being active, playing together,
innocent, refreshing and fun. In addition, Nintendo Switch is unique in this offering as this
product is one of its kinds. Its hardware are unique and the media support provides the features
like video streaming service and browsing. Nintendo takes the strategy of competition-based
pricing and indirect distribution to sell the products to the customers in different nationalities.
Nintendo Switch takes the promotions to increase the motivation of the customers to purchase
the products. The benefits of marketing mix give the different weight for different people and it
is important to find the unique prospects.

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Reference List
Covin, J.G., Garrett, R.P., Kuratko, D.F. and Shepherd, D.A., 2015. Value proposition evolution
and the performance of internal corporate ventures. Journal of Business Venturing, 30(5),
pp.749-774.
Datta, H., Ailawadi, K.L. and van Heerde, H.J., 2017. How Well Does Consumer-Based Brand
Equity Align with Sales-Based Brand Equity and Marketing-Mix Response?. Journal of
Marketing, 81(3), pp.1-20.
Digital Trends. 2018. Nintendo Switch vs. PlayStation 4: Which console should you buy?.
[online] Available at: https://www.digitaltrends.com/gaming/nintendo-switch-vs-ps4/ [Accessed
21 Apr. 2018].
Huang, R. and Sarigöllü, E., 2014. How brand awareness relates to the market outcome, brand
equity, and the marketing mix. In Fashion Branding and Consumer Behaviors, pp. 113-132.
McAlexander, J.H., Koenig, H.F. and DuFault, B., 2016. Millennials and Boomers: increasing
alumni affinity and intent to give by target market segmentation. International Journal of
Nonprofit and Voluntary Sector Marketing, 21(2), pp.82-95.
Nicholson, V.P., McKean, M., Lowe, J., Fawcett, C. and Burkett, B., 2015. Six weeks of
unsupervised Nintendo Wii Fit gaming is effective at improving balance in independent older
adults. Journal of aging and physical activity, 23(1), pp.153-158.
Nintendo.com. 2018. Nintendo Switch™ - Official site – Nintendo gaming system. [online]
Available at: https://www.nintendo.com/switch/ [Accessed 21 Apr. 2018].

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Osterwalder, A., Pigneur, Y., Bernarda, G. and Smith, A., 2014. Value proposition design: How
to create products and services customers want. John Wiley & Sons.
Schulze, C., Schöler, L. and Skiera, B., 2014. Not all fun and games: Viral marketing for
utilitarian products. Journal of Marketing, 78(1), pp.1-19.
Tanner, J. and Raymond, M., 2015. Principles of marketing. University of Minnesota Libraries
Publishing.