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To gain a competitive advantage in the video game console segment, a company needs to adopt strategies that will enable its devices to stand out and therefore appeal to a larger portion of the market. Current market analysis indicates that casual gamers prefer video consoles that are innovative, affordable, and simple to use. On the other hand, hardcore gamers prefer devices that are technologically advanced with high definition displays and affordable. First-time players prefer simple, innovative devices that are less intimidating and also affordable.

Therefore a company that wishes to achieve a competitive advantage in the video console segment must be able to adopt strategies that will ensure that its devices appeal to all the three market segments and should also appeal to both young and mature players in all the three segments. An analysis of the third generation consoles produced by Microsoft, Nintendo and Sony, shows that both the Xbox 360 and PS3, were powerful ad technologically advanced compared to Nintendo’s Wii.

However, Nintendo sold more units of the Wii, although it had poor graphics and had only a standard CD drive while its rivals had powerful devices with high definition graphics and HD blue-ray drives. The Wii’s success can be attributed to its innovative controller, motion sensors, and affordability. This enabled it to appeal to the first time gamers, casual gamers, and hardcore gamers.