The US and global presidents of Nintendo’s global talk about Switch, Animal Crossing: New Horizons, and the company’s ventures into theme parks, movies, and other endeavors. Fast Company/Harry McCracken
Even as Nintendo’s entertainment empire grows, the focus is still on the games.
Exclusive: Nintendo’s presidents for the world and the United States discuss the company’s expansion into theme parks, movies, and other areas—as well as the value of avoiding distractions.
Nintendo revealed in June 2019 that Animal Crossing: New Horizons, a highly anticipated game for the Switch system, will now launch on March 20, 2020. The brand pleaded with customers to wait. It had no way of knowing that the timing of the game’s appearance, in the midst of a global pandemic that left millions of people stranded at home and feeling more than a little stressed, couldn’t have been better.
Except for the players, who are depicted as cheery tiny humans in Animal Crossing: New Horizons, all the characters are happy little animals. They live on pleasant islands and lead calm, relaxed lifestyles that unfold in real time as opposed to the frenetic pace of most computer games. The game never ends and there is no clear objective. Importantly, the game’s support for Nintendo’s online service enables users to hang out with friends who are also playing it. This social interaction helped the game’s fantasy islands feel more normal during lockdown than it did real life. The game became a phenomenon, outselling every other Switch game in history with the exception of Mario Kart 8 Deluxe, and users’ joyous experiences overflowed onto social media feeds.
Even Shuntaro Furukawa, the 131-year-old global president of Nintendo and a 27-year veteran of the Kyoto, Japan-based game developer, was taken aback by how strongly New Horizons struck a chord. When we spoke recently, partly through an interpreter, he said that because it was the most current entry in the two-decade-old Animal Crossing brand, “to a degree, we did have a certain expectation that sales would do well.” But “the rate of sales for this title was really quick last year, just before release. And that is something we did not anticipate.
Animal Crossing: New Horizons has been described as a calming beam of hope during a trying period in history. It’s also really traditional Nintendo. The company’s inherent goodness evokes memories of earlier times in an era when internet companies’ reputations are at an all-time low. Questions about it and its goods are rarely more contentious than whether Tom Nook, the endearing Animal Crossing raccoon/entrepreneur, is a kind guy or a cutthroat businessman.
Nintendo is on a capitalistic roll of its own, despite the popularity of several of its products. A long history of prematurely writing off the company during its periodic downturns led pundits to advise it to stop making hardware and concentrate on creating games for other companies’ devices after the Wii U console from 2012 failed to gain traction. After that, its main character Mario and other characters appeared in games for Android and iPhone, including Super Mario Run and Animal Crossing: Pocket Camp. Instead of giving up on its own hardware, Nintendo came up with the Switch, a brilliant convertible TV console/handheld that won over fans and appeased detractors.
The Switch is still in good health, despite having reached middle age in terms of consoles; NPD research shows that it was the best-selling gaming console in the United States for the first quarter of 2021. Nintendo sold nearly 80 million Switch units worldwide between its March 2017 launch and the end of 2020, putting it within striking distance of the Wii’s 102 million-unit sales total. Despite being a legendary success, the Wii had already reached the end of its useful life.
According to Nintendo of America President Doug Bowser, the fact that the four-year-old Switch is still going strong “really challenges assumptions on what a video game console cycle can be.” However, Nintendo and the gaming industry as a whole have benefited from the fact that so many people have been cooped up for more than a year. Will the Switch start to age when the pandemic fades and we go outside more and more often?
The executive director for games at NPD, Mat Piscatella, disagrees. The Switch should continue to enjoy a few more years of high sales as it transitions into the latter stages of its lifecycle, according to him, as long as the hardware is still readily available and occasionally encouraged with refreshes or promotions. If that happens, it will be especially noteworthy considering that the Switch will be up against the Xbox Series X and Sony PlayStation 5, both of which were recently released last November and are newer and shinier.
Nintendo’s own vision of its future does not solely depend on keeping people glued to Switch displays, whichever post-pandemic life develops. It has been secretly developing a strategy to use key intellectual property, like Mario, Animal Crossing, and The Legend of Zelda, outside of video games for years. The corporation lists merchandising expansion, mobile expansion, theme park activation, and visual content as its four new investment areas.
Not just kid-friendly items like Mario Hot Wheels sets and Zelda dolls, but also partnerships with well-known companies like Levi’s, Puma, ColourPop, and others, merchandise is, well, merchandise. Smartphone apps are mobile. The first Super Nintendo World area at a Universal Studios park debuted on March 18 in Osaka, but it closed again on April 25 due to an increase in coronavirus infections in Japan. Theme parks are the company’s Super Nintendo World locations. And visual content includes the next Super Mario film, which Nintendo is presently developing with Minions vendor Illumination.
That’s a lot of action that isn’t typically Nintendo’s cup of tea. However, Furukawa makes a point to emphasize that Nintendo video games played on Nintendo hardware remain at the core of the company’s goal while discussing Nintendo’s ambition to deploy its intellectual property across new media.
We have always had the same goal, he claims. To engage and amuse more customers with Nintendo IP in an effort to pique their interest in the world of our specialized video game experiences By doing this, we hope to establish a connection that goes beyond a specific console generation, game, or platform.
Nintendo might aspire to develop new revenue streams even if it continues to be as committed to video games as ever. A successful platform like the Wii or Switch will boost the company’s fortunes for years, but it takes time to bounce back after a failure like the Wii U. The video game industry is highly cyclical. A larger product portfolio ought to aid in achieving equilibrium.
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It’s not only about the rides; it’s also about the overall attraction experience.
According to Colin Sebastian, a senior research analyst at Robert W. Baird & Co., such brand extensions “may be a tough path, and not all games are ideal for crossing over to other types of entertainment.” In contrast to other video game properties, Nintendo has a large number of distinctive trademarks and characters and a devoted fan following, which makes this technique more appealing.
The chance is available. The problem is that Nintendo normally succeeds by inventing things that no one else could have thought of, like the Switch and Animal Crossing: New Horizons. The business is very aware that saturating the market with products that don’t feel as unique as its own platforms and games could harm the brand it has so meticulously built.
Despite the fact that there are more methods we are extending our intellectual property, Furukawa says, “We are very, very careful about where and how our IP is licensed.” We aren’t only using our characters and worlds to gain more publicity for ourselves,
Nintendo’s dominion has long extended much beyond video games, unless you have entirely ignored popular culture for decades. Super Mario Happy Meals, Super Mario TV cartoons, and Super Mario pajamas were all available to children in the 1980s. A live-action film starring Bob Hoskins that was released a few years later is well-remembered by Nintendo fans, if only for being awful. Bob Hoskins portrayed the itinerant plumber in this film. Nintendo NY, a two-story store in Rockefeller Center that is crammed with toys, clothing, and other items inspired by the video game, has been open since 2005.
Furukawa claims that roughly 10 years ago, however, the business made a real commitment to enhancing the originality, excellence, and overall Nintendo-ness of its presence outside of the gaming industry. One of the first significant indications of this strategy was the announcement of its partnership with Universal Parks & Resorts in 2015. Super Nintendo World at Universal Studios Japan is said to have cost up to $578 million to construct; further outposts for Universal’s parks in Hollywood, Orlando, and Singapore are in the works, but opening dates and other information are still to be made public.
Those who visited the Osaka attraction during the days it was open before its current shutdown have left positive reviews. Furukawa claims that Shigeru Miyamoto, Nintendo’s Senior Managing Director and Creative Fellow, actively participated in bringing it to life. Miyamoto is not only the man behind Donkey Kong, Super Mario, and The Legend of Zelda; he is also video gaming’s most enduring, visionary genius overall. The creators of theme-park attractions are not specialists, he continues. “Therefore, I believe having a terrific relationship is quite crucial.”
Super Nintendo World flips the script by introducing well-known game components into the real world. Nintendo games have traditionally felt like theme parks in digital form. (You might have to enlarge photographs to be sure they aren’t game screenshots because the attraction looks and feels so authentic.) You race along a circuit in the signature Mario Kart: Koopa’s Challenge ride while donning an augmented reality display installed on your visor, creating a surreal experience. You can also compete with other park visitors to acquire digital coins, stamps, and keys if you spend the money for a Power-Up Band, a wearable that syncs with the Universal Studios smartphone app.
Nintendo of America President Bowser claims that the attraction has “Easter-egg moments” scattered throughout it. It’s not just about the rides; the attraction’s overall experience is more important. Thanks to “continuous management of the brand and of the IP all the way through the park,” it is “so genuine to the Nintendo experience.”
With the impending Super Mario animated film from Illumination, such stewardship will be even more important. The movie, which was officially revealed on February 1, 2018, is still largely in stealth mode, with its title, precise release date, plot, and aesthetics all being kept a secret. The only thing we are certain of is that Nintendo’s Miyamoto and Illumination’s Chris Meledandri are coproducing; otherwise, fans have been hard at work creating fantasy posters and trailers.
A Super Mario theme park attraction is less risky from a creative perspective than turning it into a movie. Hollywood, after all, seeks to portray tales about heroes who, by the time the closing titles appear, have experienced life-altering events. The fact that Mario always comes back to life in the same condition despite having perished incalculable billions of times in game-ending mistakes over the previous 40 years is one of the secrets to his worldwide appeal. Mario is kind-hearted, enthusiastic, and competitive, but he isn’t a particularly well-defined character—which is helpful when you’re supposed to represent players all over the world, but isn’t necessarily a good thing for moviemakers.
Visceral anxiety fills Furukawa as she worries that the video game heroes of Nintendo would become constrained by their new extracurricular pursuits. He emphasizes that “we must make sure that the results are genuine to the players’ experiences, and that they would never preclude Nintendo’s developers from producing another original game with the same characters” when discussing offshoots from Nintendo games in general.
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Mr. Miyamoto is actively involved in every aspect of this film’s production.
Even if cinematic Mario has no negative effects on Nintendo’s own inventiveness, there are still plenty of potential pitfalls. As an illustration, after Sonic the Hedgehog fans reacted negatively to the trailer, Paramount decided to postpone the release of the film by three months in order to change how the Sega character looked. Nevertheless, there is reason for optimism this time around for Nintendo fans who have never ceased being incensed by the 1993 live-action Super Mario Bros. movie’s almost complete rejection of video-game canon.
Furukawa clarifies, “It’s not that we’ve asked Illumination to manage everything. Mr. Miyamoto is “very, very hands-on” in the movie’s production. It has also been underlined by Illumination, whose Lorax and Grinch films diverged significantly from their Dr. Seuss sources, that Miyamoto is the expert. Meledandri stated to Variety in 2018 that “We are keeping him front and center in the making of this film.”
Whatever happens with the film, it doesn’t appear likely to be a one-off experiment. Nintendo franchises may appeal to younger audiences than Marvel and DC superheroes, but it’s not hard to imagine them serving as a similar source of inspiration for Hollywood: a high-profile Zelda theatrical adventure here, a Kirby Netflix series there. Beyond just one Mario film, Furukawa sees potential: “Animation, in general, is something that we are looking into, and not just this series,” he declares.
Allocating mental capacity
Furukawa admits that when Nintendo’s goals grow, the firm can become overly dispersed. As much as it values quality assurance, “what we really made sure to avoid was that we cut into the game development resources on our side when being engaged in this IP extension outside of game production,” he says. “And to actualize that, we made sure that we keep the number of individuals involved to a minimum, even while those who truly understand the characters and the game are involved.”
You can see why Nintendo might be concerned about too much of its talent leaking into other initiatives. Its sustained success in the game industry depends on a constant flow of innovative concepts—and, eventually, a new platform that surpasses the Switch as it did the Nintendo systems that came before it. (According to rumors, a Switch Pro that is 4K ready and with an OLED screen may be released by year’s end.)
Comparable to questioning Tim Cook about Apple’s interest in cutting-edge technology is asking Furukawa about Nintendo’s perspective on current issues like the possible influence of VR and AR on gaming. Neither chief will divulge any upcoming intentions. Even yet, they take care to avoid sounding overly enthusiastic about technology. Instead, the focus is on the outcome as seen in products that are uniquely the company’s own.
Nintendo does not plan its future on “virtual reality, augmented reality, or any sort of technology that is going to actually become popular in the industry,” according to Furukawa. What matters more is how we can leverage technology to truly give customers and players a brand-new, never-before-seen experience. One recent example is the Switch game Mario Kart Live: Home Circuit, which lets you drive a real camera-equipped remote-control Mario Kart around real and virtual obstacles in your home. A small Upstate New York firm named Velan Studios developed the underlying technology, serving as a reminder of how Nintendo has traditionally benefited from collaboration with other parties in the gaming industry.
The San Francisco-based developer of Pokémon Go, the genre-defining augmented reality game that was inspired by the Pokémon franchise, which Nintendo co-owns, is one of Nintendo’s most well-known collaborations. Niantic revealed in March that their upcoming augmented reality smartphone game would be inspired on Nintendo’s Pikmin, another well-known Miyamoto product with tiny creatures that resemble plants. According to Furukawa, such phone-based experiences are effective marketing tools rather than deterring users from purchasing Nintendo hardware: “We have found, as we planned, that our mobile experiences are driving individuals to acquire our Nintendo Switch hardware and software.”
Despite how often Furukawa tells me that Nintendo’s new uses of its intellectual property are intended to increase sales of Nintendo games on Nintendo platforms, the business is also eager to build relationships with fans that go deeper than simply moving merchandise. To that purpose, it has been emphasizing the fact that 200 million Nintendo Accounts have been created by consumers, a figure that skyrocketed in September 2019 after Mario Kart Tour became available for iPhones and Android phones. Customers in nations where Nintendo doesn’t even sell its own hardware are included in that number.
It’s unclear exactly how Nintendo plans to use those 200 million accounts beyond their existing features, which include letting users manage software purchases and parental settings. However, it appears to have several concepts in mind, some of which might link the established and novel applications of its intellectual property. In the end, it’s a long-term partnership, according to Bowser. “It all comes down to how long-lasting that connection is. And moving forward, that will be the real cornerstone of Nintendo’s corporate strategy.
Nintendo may have an exceptionally clear idea of what it wants to be, but it is prepared to communicate that idea in novel ways. It will be challenging for our creative vision to materialize unless we extend beyond the realm of video games, adds Furukawa. That vision will need to astound fans—and perhaps even Nintendo itself—for the business to continue winning.