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Thursday, November 7, 2013

Iwata's Concept of Price Value Vs. Ace Attorney

By LUDWIG VON KOOPA - Making connections.

Very recently, Nintendo president Satoru Iwata explained why games like Pokémon XY are the same price in a retail outlet as they are in the eShop. In his words,
" we decided that, since the contents are the same, the company would offer the software at the same price, be it the packaged version or the digital version. This is because we want consumers to value software as highly as possible and because we have been trying to heighten the value of our software whenever we produce it."
So, what does this really mean?

Iwata's position in how value of software is determined is at odds with Capcom's and many people in the Ace Attorney fanbase. Recall how Phoenix Wright: Ace Attorney - Dual Destinies is only $30 in the Nintendo eShop (hey, you should get it by the way). You can't get it at GameStop (...not that you really would want to). Capcom's goal was to get the game in the hands of the American consumer as soon as possible (probably why the localization has a notable amount of typos), which strategically means using digital distribution. Capcom passed on the cost-savings to the consumer, to everyone's benefit. It's probably important to note that Capcom had the MSRP on the previous Ace Attorney games as $30, too. Those were on the DS when most other DS games (including Nintendo's) were $35. So now they're all $40 on the 3DS, yet Capcom's price stays still. Iwata has an explanation for this, too:
"On the other hand, when we offer a new proposal to consumers, say, when we launch a brand-new IP or when we release a game with well-known characters but with brand-new gameplay that our consumers are not familiar with, it is hard for them to anticipate and appreciate the value of the content before actually purchasing and playing with it. For these titles, if we take the ordinary approach of selling the packaged software, the software might not reach its full sales potential, and even when we are able to create something interesting, the games often can just fade away without being noticed by consumers." 
This article looked depressing without any pictures, so here's Iwata telling you to buy Dual Destinies.

Iwata then discusses Darumeshi Sports Store and Wii Sports Club and its unique pricing options. To Iwata and Nintendo, price doesn't represent cost and a mark-up (although obviously it's priced SOMEWHERE above cost), but "inherent value". It also has an element of prestige. Capcom chooses its pricing based on cost factors. Of course, it's easier to get people to buy Ace Attorney when it's lower-priced (although I'd pay $40 anyway) and when there is a demo. It's NOT as well-known as Mario or Pokémon, despite having the same guaranteed quality as those two series. (Note I'm saying that from Iwata's perspective. Nintendo franchises don't always guarantee quality in reality!) So there are competition-based factors in that too.

One of the reasons why I always have liked Nintendo is BECAUSE they don't try to price-match the competition. In other words, we had $50 Wii games vs.  $60 other console games. That was one of the things Yamauchi always promoted. So does the $60 now reflect the cost of HD development, or is Iwata suggesting that Wii U games are more valuable than Wii ones, and 3DS games are more valuable than DS games? (That's certainly debatable.)

Of course, in business, there is this concept of "willing-to-pay". So while people might bitch about EarthBound being $10 on the Virtual Console, how many people at that price are REALLY dissuaded and would only buy it for $8? (EarthBound has far more value than only $10, just saying.) Maximizing profit is great. If your product IS really that great, then yes, you can charge a high price for it. And that's the real reason why Nintendo is charging the same amount for eShop as retail: They think their games are the best in the industry (and they probably are... or at least some of them). Unfortunately, we're stuck with price standardization with "free", $1, $5, $40, or $60 games. So yeah, props to Nintendo for experimenting with unique cost structures and all, but why stop at making it only for "unique" circumstances? Do it all the time! ...Or maybe they're already doing that. I dunno, Nintendo is currently trying to convince the world that Super Mario 3D World has higher inherent value at $60 than Donkey Kong Country: Tropical Freeze at $50. I have no idea why they're not the same price. What Iwata is really trying to say by stating, "This is because we want consumers to value software as highly as possible", he's saying that Nintendo is the one that determines value. Not you. Is this right? I'll analyze it in the future.


  1. (By the way, SOME in the Ace Attorney fanbase, unlike Nintendo and a lot of normal people, give a lot of value in having a physical copy. So packaging is important, not just the software.)


    1. Capcom isn't dead. They're flailing, but that's not dead.


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