Company’s position themselves with consideration of the characteristics of a market and possible internal competitive advantages (Daniels, Radebaugh, & Sullivan, 2009). Some considerations they face are:
1. Degree of Specialization: the degree to which they should focus efforts in terms of the width of product lines, the target segments, and the geographical market served
(Daniels, Radebaugh, & Sullivan, 2009).
2. Brand Identification: the degree to which they should seek brand identification rather than competition on price and other variables achieved via advertising, sales, etc.
3. Technological Leadership: the degree to which they can compete to produce technological innovations.
4. Cost Positioning: the sales strategy they should choose, such as low quality, low cost; or high quality, high cost.
Nintendo's Strategy
In the current generation of video game consoles Nintendo has released the Wii. Nintendo very boldly announced they would not be competing with Microsoft and Sony when releasing this console. The console incorporates low specialization in hardware but high specialization in software (Datamonitor, 2008). A new style of game play has been incorporated with fully motion sensing controllers, dubbed “wiimotes.” Software is targeted towards a wide variety of ages and many markets. Nintendo recognized internal advantages of software development aimed at multi-player settings to be enjoyed by all age groups and certain niche markets.
Furthermore, Nintendo successfully incorporated a low cost strategy that has helped to encourage massive unit sales. Released at $250 in North America making it the most affordable console of the three, the Wii has sold the most units today (Gruener, 2006). Perhaps more impressive the Wii is the only console of the generation to be sold above production cost at
release.
