Nintendo’s Wii Fit has already become a worldwide success story at retail, selling over two million copies in Japan alone. But for U.S. consumers, finding the oblong white box is an exercise in frustration; and according to the perennially outspoken Wedbush Morgan Securities analyst Michael Pachter, Nintendo — and the weak dollar — are to blame.
While no doubt inspiring déjà vu among those who spent hours camping out for the Wii itself, shortages of the Fit seem not to stem from miscommunication, but rather Nintendo’s business savvy. Speaking to the Los Angeles Times, Pachter explained that Nintendo has intentionally imbalanced shipments towards Europe to take advantage of the Euro:
It also is shrewdly maximizing its profit by sending four times as many units to Europe, reaping the benefits of the strong euro, said Michael Pachter, an analyst with Wedbush Morgan Securities.
Pachter estimated that Nintendo shipped just 500,000 copies of the game in North America but as many as 2 million units to Europe.
The analyst went on to imply that the Wii Fit shortage may be the beginning of an industry trend towards per-unit profitability, even at the expense of trying consumer patience.
“The shortage demonstrates one consequence of the weak dollar. We’re seeing companies ignore their largest market simply because they can make a greater profit elsewhere,” Pachter said.
“They know that Americans will be just as fat a few months from now” when Nintendo will have more units available, he said.
Brutal honesty, that.
For a hot item like the Wii Fit, that is also in short supply, we’ve no doubt Pachter is on the money: if the unit sells out no matter where you ship it, then of course it makes sense to ship it to the place where it will reap the largest rewards — and when Europeans are willing to shell out the equivalent of $140 USD per copy (estimated 6/2/08, and as opposed to the U.S. MSRP of $90) we won’t be holding our breath for Nintendo to similarly pledge to replenish U.S. retail.
However, we’d argue that such intentional supply imbalancing wouldn’t necessarily work as well for products that don’t have the same sort of demand, and short supply to drive that demand. While some U.S. consumers still clamor for a Wii years after release, they apparently sit untouched in Europe and Japan. A bird in the hand…
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