[Super Mario Run] enjoyed a strong start in the App Store, topping download charts in several countries. Yet it was less of a moneymaker for Nintendo than might have been expected, due to the pay-once-and-play model. Revenue from the game "did not meet our expectations," Nintendo President Tatsumi Kimishima said.
Nintendo's smartphone cash cow is instead "Fire Emblem Heroes." "Heroes" is a "freemium" game that lets players pay to unlock random characters -- a format known in Japan as gacha. The smartphone game market is fiercely competitive, and even the use of popular characters does not guarantee success. Yet "Fire Emblem Heroes," an entry in the popular "Fire Emblem" series of strategy role-playing games, led sales rankings from its debut, underscoring the power of Nintendo's library of intellectual property.
Even so, Nintendo has no intention of switching focus to freemium games. "'Heroes' is an outlier," a senior company official said. "We honestly prefer the 'Super Mario Run' model."
Nintendo aims to do more with its smartphone games than make money. The Japanese company seeks to bring its games and characters to a wider audience and create synergy with game consoles such as the new Switch.
The problems with the gacha model, such as the large amounts of money often required for success, risk undermining the value of Nintendo's characters, which in turn could dent the company's bread-and-butter console-game business. Nintendo's apparent goal with smartphone games is to attract more users even if the company loses out on some profits in the process.
[Super Mario Run's] true value will be measured by how much it expands the ranks of Nintendo fans and helps sales of the Switch.
