The Nintendo Brand - Pokémon Go, Go, Going

July 21, 2016

Apparently I’m middle aged. I don’t feel like it. I don’t think I look it. But when I make cultural references, those around me often look at me like I’m from another planet. Most recently I’ve been asked the following, “Billy Joel recorded an album in Russia?” “What are Stan Smiths?” And perhaps the most painful, “Fame is like High School Musical?”

So when companies reinvigorate the brands of my youth, I get excited. And apparently, I’m not the only one. Enter Pokémon Go. Admittedly I had just graduated college when Nintendo released the original game (okay, maybe I am middle aged) in 1995, but the reminiscence of the Nintendo Game Boy, the platform for which Pokémon was first developed, takes me back. And it is this appeal I’m certain the company was counting on the help reinvigorate the brand with its historical audience.

And to help reinforce the brand with a broader, younger audience, Nintendo smartly looked toward collaboration with game developer, Niantic. A Google-spinoff, Niantic had been known for its augmented reality capabilities. By integrating the Nintendo digital characters with a real-world view that uses our phone’s location tracking and camera capabilities, Nintendo has managed to extend the success of Pokémon into a second decade with Pokémon Go.

Impact on brand

With a regular spot on Tenet’s Top 100 Most Powerful Brands – this year at number 94 – there are three factors that portend a jump in Nintendo’s spot on the Top 100 list next year. Keep in mind, the company’s BrandPower score is determined by its Familiarity and Favorability.

From a Familiarity perspective, there have been reports that in two weeks Pokémon Go has more players than Tinder and possibly even Twitter have users, expanding the base of those familiar with both Pokémon and Nintendo exponentially.

From a Favorability perspective, Nintendo has seen consistently rising Overall Reputation scores over the last five years with more than a 13% aggregate increase. I’d venture that Pokémon Go’s success will only contribute to that steady increase in Overall Reputation.

And from a financial perspective, Nintendo’s stock has increased more than 50% in the United States as of July 15, adding around $12 billion to the company’s market capitalization. The gaming company that was previously chasing the Sony Playstation and Microsoft Xbox has now established an entirely new category and positioned the organization as the brand to beat. If Nintendo can maintain the increased stock price and convert analysts, its Investment Potential –a key piece of Favorability – will remain quite positive.

In the meantime, seeing the success Nintendo has had over the last few weeks, it seems wise to break down its two primary strategies to determine if Nintendo’s success can be sustained and how it may be replicable for other brands.

Cultural renaissance

Clearly the world was ready for a virtual reality Pokémon experience. Can Nintendo bring back its other beloved games with a similar approach or is this a one-hit-wonder? Do we want to see Donkey Kong climbing real construction sites or Luigi and Mario collecting coins, bricks and yellow super mushrooms while walking down 53rd Street? I don’t see why not, but game quality, pacing of releases, varying the approach and breaking down the walls of what is possible must continue. Other brands have certainly succeeded by looking backward to continue moving forward.

Take for example Columbia Pictures; the Sony Pictures distribution house has become known for remaking retro films and television shows originally popular with my generation: The Smurfs, Karate Kid, 21 Jump Street, and most recently, Ghostbusters. Most of the adapted films have proven consistent revenue generators with The Smurfs and 21 Jump Street spawning ongoing series. The appeal lies with both the original audience, as well as the children of those now parents.

Adidas is also thriving by appealing to its heritage. The company’s first quarter sales are up 31%, its stock is performing at a rate of +31.54%YTD and ten equities research analysts have given it a “buy” rating. Having recently purchased a pair of the same Stan Smith’s I had in high school, I can confirm that the renaissance of adidas’ vintage styles is alive and well. Take your pick between Stan Smiths, slides, Gazelles or Superstars. All four styles are on feet old and young, in cities and in suburbs. adidas is the coolest brand in sports and on the streets right now. Understanding and leveraging its heritage is a big part of that success.

And consider one of the big movers on this year’s Top 100 Most Powerful Brands list, Whirlpool. Maytag is a Whirlpool brand. In 1967 the Maytag Repairman was introduced as the “loneliest man in town” because the appliances never broke. In 2014, Whirlpool reinvigorated and reintroduced the Maytag Man as the star of a new campaign that not only appears on television, but also includes a broad-scale digital component. With more than 50-years of awareness in the character, who stands for dependability and is highly associated with the brand, Whirlpool has found a way to leverage its familiar heritage to differentiate in an industry that is known for a war of features. And according to its steady rise up the Top 100 ranking, it’s feasible that looking backward to move forward has been a successful strategy for Whirlpool.

Collaboration

Nintendo has a history of collaboration. The Pokémon Company is a joint investment by Nintendo and two other companies, Game Freak and Creatures. Pokémon Go was developed in collaboration with Niantic, a spin-off from Google in which Nintendo also made an investment. But the net out remains, Nintendo owns the brand rights to Pokémon. With those rights, the organization saw a way to extend the life of the brand to new audiences and through new mediums. In essence, Nintendo understood its core strengths and looked to other organizations to help augment its strengths. Collaborative innovation has proven a successful model.

Looking again to adidas, that company has done the same. By partnering with Palace Skateboards, fashion designer Yohji Yamamoto, R&B icons Kanye West and Pharrell, adidas has extended its brand into untapped vertical markets with valuable, long-term partnerships. In the case of adidas, such partnerships have also established a halo effect of “coolness” that is extending the brand to new markets with new potential buyers. For adidas, collaboration is less about innovation and more about reputation. However, we can project that both companies will see an impact on their bottom-line performance.

Lastly, looking at this year’s Top 100 Most Powerful Brands list, Google seems like the obvious collaboration story. With a five-point rise into the top-ten, Google epitomizes the partnership strategy. Look at the healthcare space alone. Whether through Google Lifesciences or Calico, the company has formed partnerships with major pharma players, including AbbieVie, Novartis, Sanofi and Biogen, as well as with key institutions like Duke and Stanford medical schools, and consumer brands like ancestry.com. While the partnerships are primarily intended to help find big answers, like cures for diabetes, cancer and even death – the overall Google brand is skyrocketing. Through a strategic reorganization and focused partnerships, Google, like Nintendo, is driving future brand innovation.

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