Konami on the Ropes as Fickle Kids’ Market deals bad hand

Yu-Gi-Oh dear!

Posted by Staff
Konami of Japan has announced that its profits fell by a staggering 78.3% in year-on-year comparisons for this financial year. Konami group profits fell to $20.74 million, from $94.64, a huge difference that might see some key Konami heads roll in the not too distant future. These poor figures were in spite of the fact that total sales for the year were up 20% at $725.48 million.

How could this have happened, you may well ask. Konami as a developer and multi-region publisher is undergoing a renaissance at present. Its brand name is stronger than ever, with gamers in Japan and - perhaps for the first time - in the States, recognising that the Konami brand is a guarantee of gaming quality.

It may well come as a surprise to you that Pokemon is partly to blame. Pokemon changed the way traditional games companies viewed the market. Nintendo demonstrated that any game-based operation could be helped along by various spin-offs and merchandising of its properties. One of Nintendo’s most profitable Pokemon sidelines was the phenomenally successful trading card game. This success did not go unnoticed by rival companies, not least by Konami.

To consolidate huge growth in its share price and game unit sales, Konami launched its own card game, called Yu-Gi-Oh, in an attempt to take a bite out of Nintendo’s massive monopoly on this latest global childhood money-spinner. Unfortunately, it did so just as kids’ collective attention drifted away from trading cards. The result was that Konami had spent millions in marketing a product that almost instantly became un-sellable.

The Pokemon Trading Card game grew organically, and was backed by the acceptance of a market that welcomes innovation, even when rehashing an age-old format. Konami has never had a great deal of luck with its (arguably) plagiaristic outings. Just look at the relative performance of Mario Kart Super Circuit and Konami Krazy Racers!
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