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Sony vs. Nintendo: It's not all fun and games

Posted: Sun Dec 15, 2024 4:07 am
by surovy33
Competitive analysis example

How do you compare to your competition? How are you similar and how are you different? This is the goal of competitive analysis. By understanding where your brand and your competitors overlap and diverge, you email marketing list will be better positioned to make strategic decisions that can help grow your brand.

Of course, it’s one thing to understand the benefits of competitive analysis, and another to conduct an analysis that produces actionable results. Don’t worry, for better understanding, we’ve provided a quick example.

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Let’s take a look at popular gaming system companies Sony and Nintendo. Sony’s newest offering, the Playstation 5, recently hit the market but has been plagued by supply shortages. Meanwhile, Nintendo’s Switch console has been around for several years but remains a steady seller, especially among teens and children. This scenario is familiar to many companies on both sides of the coin; some have introduced new products designed to compete with established market leaders, while others are looking to ensure that reliable sales don’t fall off.

Using some of the steps listed above, here’s an example of a quick competitive analysis.

1. Determine who your competitors are

In our example, it’s Sony vs Nintendo, but it’s also worth considering Microsoft’s Xbox, which occupies the same general market vertical. This is critical for effective analysis; even if you focus on specific competitors and how they compare, it’s worth considering other similar market offerings.

2. Determine what products your competitors offer

Playstation offers two versions of the PS5, digital and standard, at different price points, while Nintendo offers three versions of its console. Both companies also sell peripherals; for example, Sony sells virtual reality (VR) add-ons, while Nintendo sells gaming peripherals such as steering wheels, tennis rackets, and different controller configurations.

3. Research your competitors' sales tactics and results

When it comes to sales and marketing tactics, Sony and Nintendo have very different approaches.

Thanks in part to the recent semiconductor shortage, Sony has increased demand through scarcity — very low volumes of PS5 consoles remain available. Meanwhile, Nintendo has taken a broader approach by focusing on families as its primary customer base. This effort is bolstered by the Switch Lite product line, which is smaller and cheaper, making it a popular choice for kids.

The numbers tell the story : as of September 2021, Nintendo has sold 14.3 million consoles, while Sony has sold 7.8 million.

4. Take a look at your competitors' prices, as well as the advantages they offer

Sony has the highest price point: its standard PS5 sells for $499, while Nintendo’s most expensive offering is priced at $349. Both offer robust digital marketplaces and the ability to easily download new games or services.

Here, the key differentiators are flexibility and fidelity. The Switch is flexible: users can dock it to their TV and play it like a standard console, or pick it up and take it anywhere as a portable gaming system. Meanwhile, the PS5 has superior graphics hardware and processing power for gamers who want the highest fidelity experience.

5. Analyze how your competitors market their products

If we compare the marketing efforts of Nintendo and Sony, the difference is immediately apparent: Sony’s ads feature realistic in-game visuals and speak to the exclusive nature of its gaming titles; the company has managed to secure deals with several high-profile game developers to gain exclusive access to new and existing IP.

Meanwhile, Nintendo uses brightly lit ads that show happy families playing games together or children using their smaller Switches while on the go.

6. Analyze the level of engagement on your competitor’s content.

Engagement helps drive sales and encourages repeat purchases. While there are several ways to measure it, social media is one of the simplest: generally, more followers equals more engagement and greater market impact.

When it comes to our example, Sony enjoys a significant lead over Nintendo: while the official Playstation Facebook page has 38 million followers, Nintendo has just 5 million.

Competitive Analysis Template

Competitive analysis is complex, especially when evaluating multiple companies and products simultaneously. To help streamline the process, we're sharing 10 free templates that let you see how you stack up against your competitors and what you can do to increase market share.

Let's break down the SWOT analysis template:

Strengths . Identify your strengths. These may include specific pieces of intellectual property, products that are unique in the market, or a workforce that outperforms the competition.

Weaknesses . Here it is worth considering potential problems related to pricing, leadership, staff turnover and new competitors in the market.

Opportunities . This part of the SWOT analysis may focus on new market niches, evolving consumer preferences, or new technologies your company is developing.

Threats . These may include new taxes or regulations on existing products or an increasing number of similar products in the same market space that could negatively impact your overall market share.

What is the situation of your company?

Before you accurately compare your competitors, you need to establish a baseline. This also helps when it comes time to conduct a SWOT analysis.

Take an objective look at your business, sales, and marketing reports through the same metrics you use to evaluate your competition.

Record this information just as you would for a competitor and use it as a reference for comparison across the board.