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Iwata: 3DS Selling Below Expectations, Company Recommitting To Promotion

Iwata: 3DS Selling Below Expectations, Company Recommitting To Promotion

April 26, 2011 | By Kyle Orland

Admitting that sales of Nintendo's new 3DS portable have slowed down worldwide after a successful launch, company president Satoru Iwata committed to turning that situation around with a renewed marketing campaign.

The 3DS sold nearly 400,000 units in its first week of American sales, along with 371,000 Japanese sales in its first two days and 303,000 European sales in its opening weekend there.

But in a recent investor presentation, Iwata acknowledged that those brisk sales have dropped off considerably in the weeks following launch, confirming analyst reports that such a slowdown was occurring.

The company announced yesterday the 3DS had shipped 3.61 million units worldwide through the end of March, below internal projections that the system would sell 4 million units in that time.

In Japan, Iwata suggested that "the great earthquake largely affected the sales," but acknowledged that March's natural disaster could not explain sales that dropped off significantly in the U.S. and Europe after a few weeks on the shelf.

In launching the 3DS, Iwata said the company overestimated the ability of the system's glasses-free 3D screen to drive sales virally.

"We originally expected that the value of 3D images without the need for special glasses would be automatically spread to some extent by many consumers experiencing the device by themselves and ... together with people around them," he said.

Iwata said the company "recognize[s] that we are in a situation where we need to step up our efforts to further promote the spread of Nintendo 3DS" and that "it has become clear that we need to do a lot more to convey the value to consumers."

To that end, the company plans an educational campaign designed to stress the importance of using the 3D slider to perfect the 3D effect for each individual user, and to explain the value of connectivity features like StreetPass and SpotPass.

The company also plans heavy promotion around the late-May launch of the 3DS eShop and expanded 3D video content, focused on encouraging 3DS owners to connect to the Internet and download the system update necessary for the new features. Nintendo will be giving eShop users a free download of a 3D update to NES classic Excitebike to help in this process, Iwata said.

Despite the slow sales so far, Iwata said he was encouraged by market research that showed many consumers interested in the system are taking a "wait-and-see" approach to actually making a purchase. He said that upcoming software releases would help push these consumers to become 3DS owners.

"There is no easy road to making people understand the attraction of glassless 3D images and making Nintendo 3DS widespread," he said. "We would like to adhere to these patient efforts."

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