For years now we have known that the original Wii was supply-constrained, but most people thought this was in order to drive demand. After all, if there are more consumers looking for a Wii than there are consoles to purchase, then it creates a very \”hot\” item than consumers want to purchase. If a recent piece by GamesIndustry is to be believed, however, Nintendo did not supply-constrain the Wii in order to drive demand, but in order to minimize losses. The article claims that each Wii sold lost Nintendo money, so Nintendo sold less Wii consoles to minimize the loss.
“Nintendo, for example, supply-constrained the Wii in its launch window; that strategy was not in order to create sales hype, as it was often accused of, but rather because the device was losing money on each unit sold. Had Nintendo fulfilled demand completely, it would have taken a huge operating loss. By waiting, it got to hang on for manufacturing costs to fall before supplying the demand in the market.”
This is a very interesting report, as this claim contradicts most others we have seen on the topic in recent years. Have any thoughts of your own on the supply-constrained nature of the Wii? Make sure to share your speculation with us in the comments section below!