Nintendo: Beyond Pokemon Go

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Nintendo: Beyond Pokemon Go
Image Source: PIRO4D/Pixabay.com

Nintendo and Niantic Labs all struck gold with Pokemon Go, but the implications for this game go far beyond the companies that had a hand in its development. One analyst pointed out that Apple stands to rake in billions of dollars thanks to its popularity and rich users spending money through the App Store. Many others are considering what the game means for augmented reality because, while it isn’t fully true AR, it comes very close.

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Of course other games are an obvious extension, but one firm suggested that AR could be excellent for advertising.

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What is Pokemon Go really worth for Nintendo?

Shares of Nintendo skyrocketed as a result of Pokemon Go‘s huge success, despite the fact that any impact for Nintendo will be watered down as it holds a stake in The Pokemon Company and is not actually the developer of the game. Nomura analysts believe the game was made possible by combining Nintendo’s “game development philosophy,” which emphasizes the social aspect, with the strengths of developer Niantic, which was spun out of Google into a joint venture with Nintendo and The Pokemon Company.

Nomura analysts see three possibilities for how the popularity of Pokemon Go will impact Nintendo. The best case would be that the game becomes a huge platform and Nintendo ups its stake in Niantic. The standard case would be that Nintendo keeping the size of its stake in The Pokemon Company the same but other positive impacts on Nintendo occur, such as mobile game strategies and “mainstay console game operations.” The worst-case scenario would be that Nintendo’s stake in Niantic falls, Pokemon Go becomes only a “short-lived fad,” and Nintendo’s mobile and console game business either sees no impact from the game’s success or faces cannibalization.

Pokemon Go may signal a future for AR in local ads

MKM Partners Managing Director Rob Sanderson suggests that Pokemon Go could open the door for new forms of local advertising. He noted that already local businesses are paying to be identified as PokeStops, which are places players visit to uncover valuable items within the game. According to Sanderson, some of these businesses said that they’ve seen as much as 100% more than usual sales with a “relatively small allocation of spending” around the time the PokeStop lure is active within the game. Niantic also said last week that they’ve signed deals with retailers to turn some businesses into sponsored locations.

Sanderson said this means Pokemon Go could be the very first augmented reality app to create a “new traffic-generation channel for local businesses that never existed before.” As a result, he expects other developers to create more ways to tap into this.

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Michelle Jones is editor-in-chief for ValueWalk.com and has been with the site since 2012. Previously, she was a television news producer for eight years. She produced the morning news programs for the NBC affiliates in Evansville, Indiana and Huntsville, Alabama and spent a short time at the CBS affiliate in Huntsville. She has experience as a writer and public relations expert for a wide variety of businesses. Email her at Mjones@valuewalk.com.
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