Behind this success lies the story of an innovator.
hanafuda to video games
Everything started a century earlier, in 1889, when Fusajiro Yamauchi founded a small company called Nintendo Koppai to manufacture hanafuda, a type of Japanese cards. The business prospered for many decades, but when the great-grandson of Yamauchi, Hiroshi, took charge in 1949, he started to look for ways to diversify his company’s sources of income.
The young Yamauchi dropped out of university at age 21 to take charge of the family business. Soon, he understood that the hanafuda card business was limited. This was in spite of the success of his agreement with Disney to make Disney character cards for children, selling 600,000 units in one year.
So he started to try his luck in different businesses: instant rice packets, “love hotels” rented by the hour for young couples, a taxi company, etc. But he didn’t have much success. Finally, at the end of the 60’s, Yamauchi found Nintendo’s new niche when he realised that the technological advances in the electronics industry meant that electronics could be incorporated into entertainment products, given that prices were falling. He began gaining ground in the Japanese electronic games market.
A decade later, when Hiroshi saw the incredible success of the Atari company (video games and personal computers) in the 70’s, he turned his focus to the video games market. In 1977, Nintendo launched its first Color TV-Game console, selling approximately 3 million units in 3 years. It was a modest success for the company, but Hiroshi wanted more. Encouraged by the success of his video games in Japan, he launched into the US market with Radar Scope. It bombed.
Instead of walking away, Yamauchi went back to the drawing board. He wanted to think of how to create an innovative solution. So, he tasked product developer and artist Shigeru Miyamoto with creating a game that would attract Americans more and achieve the success that Radar Scope couldn’t.
Miyamoto had an advantage that other video game developers didn’t. He wasn’t a programmer. Instead of approaching the project from the perspective of what the hardware could do, like the majority of developers did at that time, Miyamoto focused on the story first.
And, after several versions, he created what we know today as Super Mario Bros.
In 1983, Nintendo (and Super Mario) launched the Family Computer home console in Japan. Domestic sales skyrocketed. After doing testing in the US market, Nintendo renamed its product NES (Nintendo Entertainment System) and redesigned it for the American market. In 1986, they launched in the US and in 1988, Nintendo had absolute dominance over the American console market.
Since then, to date, the Mario Bros. series alone has sold more than 240 million units.
A fascinating story, right?
An innovator’s vision
In this second part of the article, I want to pause and analyse Hiroshi’s trajectory.
Yamauchi, who ran Nintendo from 1949 to 2002, has been recognised mainly as a business person and not so much as an innovator.
It’s true that he wasn’t the first to develop video games, he didn’t enter the market first, nor did he propose a grand theory in the field of electronics.
But Yamauchi made key moves, such as employing the talent of Shigeru Miyamoto, who was an artist and not a programmer, to make his video games.
This vision of Yamauchi’s changed history. It was with the launch of Family Computer and NES when the innovative culture that he drew upon in the creation of his products was really brought to light:
It was the artists, not the technicians, who made excellent video games. Yamauchi knew intuitively what we know today as the “user experience”. He designed his video games with the user in mind and placed the experience at the forefront of the system.
Nintendo had such a big impact thanks to the fact that he added that vision to functionality.
Self-reflection question: Can an extraordinary impact be made without innovating?]]>