Britain goes mad for Mario again! As Nintendo struggles to keep up with demand for its Switch console, LEE BOYCE takes at look why
- Nintendo has seen a huge surge in sale of its Switch consoles
- Six of the biggest 10 selling Switch games last year involved Mario
- Consumer Trends asks: Why are people gravitating to gaming during lockdown?
On the list of essentials that have cropped up in the coronavirus pandemic have been clippers to trim unruly hair, huge bags of pasta, streaming TV services and - for many - a return to computer gaming to escape reality.
And amongst all that, it's Nintendon turn to rise again. It has been one of the main beneficiaries with a surge in popularity for its games console as if the 1980s and 1990s never left us.
A large chunk of my youth was spent playing Nintendo consoles. First a gateway Gameboy, followed by a Super Nintendo and finally, an N64, with superb controllers and 3D graphics.
(Editor, Simon Lambert, who has a few years on me, also feels the need to give an honorary mention to the original NES here.)
I still have the first and third on my list, but unfortunately, I lost the SNES somewhere down the line: a shame, in my non-expert gaming opinion, it's the most enjoyable console to ever have lived and I occasionally pine after it.
Mario time: The lockdown has seen a surge in Nintendo Switch gamers, as a way of escaping reality
But Nintendo - a Japanese gaming giant – lost its way a little bit. In the early 2000s, Gamecube was overshadowed by the Playstation 2 and the Microsoft Xbox.
Yet, like all great stories, Nintendo has bounce back. Repeatedly.
The Wii was briefly hugely popular in the late 2000s, then people lost interest in the gimmick of being the controller.
Meanwhile, Nintendo was also instrumental in the phenomeon of Pokemon Go - a craze that burnt brightly, sent its share price briefly soaring, and then somewhat fizzled out.
A year later, at a pressure point in its history – squeezed by its Sony and Microsoft rivals, which had embraced online multiplayer gaming - in 2017, Nintendo launched the Switch.
Nobody really knew whether Nintendo would pull this off, but in various forms, it has already outsold the SNES. By the end of 2019, it had shifted 52.5million consoles - and this is likely to be up a fair few million since.
It's fair to say, the Switch has been a huge hit and could well end up being its highest selling console of all time. And, now, in the middle of the coronavirus lockdown, the Switch is doing even better than before.
The USP is that it can be played on the go as a handheld console (not a must need for most right now) and also at home plugged in through the TV, with games saved in-between so you don't lose progress.
It has been one of the great success stories of the coronavirus lockdown. They are largely sold out across Britain and other countries - with listings on online marketplaces at up to three times the original price.
Amazon UK, for example, had fresh stock on Thursday. Within hours, it was gone.
And it's not just Britain. A friend of mine in California says he recently sold his Switch, with two games and a Ringfit device (which adds an exercise element to the Switch) to a buyer desperate for the device for $700, having amassed all the elements for $400.
Meanwhile, as manufacturers around the world cut back, Nintendo has had to upscale production in a bid to keep up with demand, which has been tricky given the fact the majority of the consoles are made in China.
What is driving this surge towards gaming and Nintendo? Consumer Trends takes a look.
Popular: How the Nintendo Switch soared in popularity in 2019 - could this year and the lockdown mean even stronger sales?
Nintendo is family friendly and simple to play
Last year, on my stag do, my best man brought his Switch – and after a huge night out, we got back in and played Mario Kart.
It instantly transported me back to my childhood. Late nights, as a teenager, playing Mario and university years playing Mario Kart with friends. It is likely it has the same appeal to those in their 20s, 30s and 40s currently snapping one up.
Mario Kart is a classic – and I must have played it on five different Nintendo machines.
The appealing thing, to me, is that it is cartoonish and a complete escape from reality. In contrast with the realistic shoot em' up games that dominate other consoles.
It is also quick to load and if you've played it in any format before, you can just jump straight back in, without an explainer on controls, the concept, or what on earth is going on.
This is where I think Nintendo has capitalised on lockdown.
It is family friendly – you don't have to worry so much about young children playing it and they tend to be simplistic games, but challenging.
Ideal for those looking to dispel boredom while off school.
Games like Mario and Animal Crossing, its latest hit, are fairly silly – they transport players to worlds that are less scary than ours at present. It's a way to switch off.
I don't really play computer games anymore. Mainly as I don't have the time, even in lockdown. But this week, the Association of Investment Companies explained the rise in popularity.
It said: 'Lockdown will have seen many former gamers dust off old consoles, as well as giving hardened regulars more time to play.
'We may be confined to our homes, but once a gamer sits down at a console they enter a new world.'
I must admit, I've been tempted to bust out the N64 for the first time in a while. Play Mario, Goldeneye and Diddy Kong Racing, transport me back to easier, carefree days.
I've even entertained the idea of buying a Switch, as a way of staying social with my best man - but it is incredibly hard to get hold of one.
As the AIC points out: 'Even before Covid-19, the expansion of digitisation and processing power has been helping to fuel the growth of gaming worldwide.'
Machines are getting more powerful. Gamers are connecting globally. It is a far cry from the early days of solo gaming, or, having friends over for multiplayer, a concept in the current climate is impossible
Big hit: Animal Crossing has been a huge success for Nintendo since launching in March 2020
Bank of Nook cuts interest rates
I raised my eyebrows in the week when I saw Animal Crossing was featured on the front page of the Financial Times.
It is strange times we're living in, but for the FT to have a feature on something called the Bank of Nook took the biscuit.
This is a game, which is set on an idyllic island, seeing players do calming tasks, such a collecting shells.
Last month the title sold 5million digital copies, the most digital copies of a console title in a single month and there are more than 12million players.
The Bank of Nook, which has a raccoon-like manager, Tom Nook, allows players to sell items, such as turnips, at an inflated price to continue unlocking things in the game.
The FT story revealed how savers at the Bank of Nook were mimicking global central bankers, by making cuts in interest rates – from 0.5 per cent to 0.05 per cent. Reality mimicking art and all that, especially given Japan's near two decades of near zero interest rates.
The total interest available on any amount of savings has now been capped, with a Reddit forum revealing player meltdown.
The move was made to stop players being able to defraud the game and to keep it 'realistic' – in the loosest form of the word.
All of this reminds me a little of the Pokemon Go craze, which, when it came out in 2016, created one of the shortest lived frenzies I can ever remember.
For a few odd weeks, zombie smartphone users walked around staring at a screen hoping a Pokemon would jump out that they could collect.
It remains to be seen if a game like Animal Crossing will also be a fad that burns out and disappears when the novelty wears out.
At that time, a number of experts recommended buying Nintendo stock. It was on its way up - but the trouble was, Nintendo struggled to make money from it.
It is listed on the Tokyo Stock Exchange. It reached an all-time high of 70,500 yen in November 2007, before the financial crisis.
It dropped below ¥10,000 in 2013, before riding a bit of a Switch wave from 2016 onwards, peaking at nearly ¥50,000 in early 2018. It dropped off a bit, before a recent surge has put it at around ¥45,000.
This is still some way off the 2007 peak - a peak it has never been close to reaching since.
Searches for Nintendo Switch in the UK in the last year shows a spike before Christmas - with the lockdown creating a second wave of interest
The investment case for Nintendo
Buying shares in Nintendo is fairly straightforward with share dealing websites - but the big question is, should you?
Alexander Windsor-Clive, analyst for Lindsell Train Investment Trust, said: 'Covid-19 has been a mixed bag for the operations of Nintendo.
'On the plus side, the lockdowns that have been implemented across the world have fuelled greater engagement with video game content; Animal Crossing is a Nintendo title that has performed particularly strongly in this period.
'On the other hand, the increased demand has met some issues with supply, given the effect of the outbreak disrupting global supply chains, thereby hindering production and distribution of Nintendo's Switch console and games.'
'We believe that Nintendo will continue to flourish in the long term, driven both by trends in the industry and the enduring resonance of its ubiquitous intellectual property, which has entertained quite literally hundreds of millions of people across the world over a multi-decade period.
'Companies like Nintendo with dominant intellectual property are best placed to capitalise on the digital shift and future innovations in the sector.
'Developments in cloud gaming, virtual reality, augmented reality and e-sports are still nascent but have the potential to fundamentally reshape the industry.'
Will the Nintendo trend continue after lockdown?
Nintendo is the current global market leader, selling more consoles than Microsoft or Sony. This is a turn-up for the books, even in the soap opera world of gaming console success.
One of the key things to consider is the end of that comment from Alexander. VR gaming and e-sports, in-particular, are not what the Switch is about. That is more of a market for its rivals.
So, where are they? Well, Microsoft and its Xbox haven't launched a new console since 2013. But, it is likely its Xbox Series X will arrive before Christmas 2020.
For Sony and Playstation, it's a similar story. The PS4 arrived in 2013 and the PS5 is expected to battle it out with the new Xbox for festive sales.In short, the Switch is likely to be benefiting from those holding out for the new consoles from Microsoft and Sony. This competition is likely to push Nintendo to the side.
But, if launch dates are pushed back because of the pandemic, and Nintendo continues to release escape from reality titles that keep players coming back for more, it could continue to thrive. It is also likely that these new powerful consoles will offer a completely different gaming experience to the Switch.
A drive even further to realism, realism that Nintendo game players are leaving behind. It just depends if the novelty wears off.
The Switch console itself is likely to remain under the price of the new Xbox and PS5, and when the world returns to a bit of normality, the portability of the Switch will come into its own once more.
Nintendo will release unit sales during its next earnings call which is scheduled for May 7 - it is likely that it has sold excess of 2million consoles in March alone, according to analysts.
Will Mario & Co continue to be an essential item after lockdown? It remains to be seen, but the plucky plumber has definitely helped gamers forget the world's woes for a while.
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