War Stories
business
gaming & entertainment

How The NES Conquered A Skeptical America In 1985

Today on War Stories, Ars Technica is joined by Gail Tilden, the visionary marketing mind behind Nintendo of America's triumphant launch of the NES in 1985. 35 years ago, Nintendo knew they had a winner on their hands with the revolutionary Nintendo Entertainment System. However, following the early-1980’s collapse of the U.S. video game market, skeptical retailers and consumers alike would prove a difficult obstacle in bringing their product to the masses. Learn surprising details about the ups and downs Gail and her band of colleagues overcame in making the NES the cultural icon it is today, the methodology and partnerships that went into convincing doubtful retailers, and how Nintendo ultimately persuaded millions of families to open their living rooms to more than "just the next fad." If Gail's interviews for "High Score" on Netflix left you wanting more, this episode has you covered.

Released on 10/29/2020

Transcript

00:00
Right now at the beginning of this year,
00:01
one out of every five homes had Nintendo.
00:03
By the end of this year, one out of every three homes
00:05
in America will have Nintendo.
00:07
That's how fast it's growing.
00:08
How long did it take you to get blinking again after that?
00:10
I don't know. [laughing]
00:11
You look at yourself, you realize you're a zombie
00:13
staring into that screen, playing.
00:14
It's scary stuff. Unbelievable.
00:16
[digital musical motif]
00:18
One time the salesperson said they went in
00:21
to talk about the terms of the sale
00:23
and that someone [laughing] pulled a gun out of their drawer
00:27
and set it on the table in front of them
00:30
to show them how serious they were about not taking a risk.
00:35
Was definitely a rough chapter.
00:40
I'm Gail Tilden.
00:42
I was the advertising manager for Nintendo in 1985.
00:46
And this is how I helped bring the NES to America.
00:51
[light hip hop music]
01:00
When I started at Nintendo, July 11th, 1983, 7-11,
01:05
it was really a arcade game company,
01:08
but also we did Game & Watch, little handheld games.
01:12
My favorite one was called Flagman.
01:15
We also had some tabletop games.
01:17
They looked like mini arcade games.
01:19
So right after I started,
01:21
I had my first trip to New York to work with Dentsu,
01:25
our ad agency back there
01:27
and make a commercial for Mario's Cement Factory.
01:32
At the time, I think there were about 70 people
01:34
at Nintendo of America, in a way.
01:37
It was a very, very small group.
01:40
Famicom came out, not too long after that.
01:44
We were focused on, I think, Donkey Kong 3 arcade game,
01:47
right when I started.
01:49
But in Japan, they launched the Famicom.
01:53
We got to see the games, which were really exciting
01:56
'cause they seem like they looked like the same quality
01:59
we had in the arcade.
02:00
Of course, the design changed when it became the NES.
02:05
It was really awesome from the beginning.
02:08
So in 1985, we were dealing with the situation
02:14
that the video game market had just crashed.
02:17
There was really a lot of oversupply at retail.
02:21
And so things were being heavily discounted.
02:24
You would just walk through the mall
02:25
and see these bins of closeouts of cartridges
02:28
that consumers were really seeming to say
02:31
that they were tired of it,
02:32
that the games maybe didn't have enough diversity
02:34
between different games.
02:36
The over promising of the marketing
02:39
was leading to things like ET came out
02:42
and there was this huge folklore or urban legend
02:45
that when it came out, that there was so much oversupply
02:49
that it ended up going into a landfill
02:52
somewhere in New Mexico.
02:53
But actually I think not too long ago,
02:56
someone actually dug them up to prove that it was true.
03:00
And the retailers really had suffered
03:03
from over investing in inventory and oversupply.
03:08
And so the whole market just kind of had collapsed.
03:11
It was at that point that we were trying to reenter
03:15
with what we thought was clearly a better product,
03:19
really coming in at a time when both the consumers
03:22
and the retailers felt like video games
03:25
had been a fad and it was kind of over.
03:27
So our approach to kind of coming back
03:30
into the home video market was,
03:34
we decided to launch in New York only.
03:37
Kind of biggest city,
03:39
if-you-can-make-it-there type of thing.
03:41
So we started in September of 1985
03:46
in New York only, and really focused on a deluxe system
03:51
that had the zapper and it had ROB the Robot
03:55
before finally rolling out nationally
03:59
in the end of '86, or Holiday '86.
04:02
And at that time, when we launched nationally,
04:05
we also had a Base Set, which included Mario
04:09
and the Deluxe Set that we originally had.
04:11
So ultimately we took advantage of that killer app
04:14
with Mario for the national launch.
04:17
Every game and the hardware came with this big poster.
04:22
It had ROB's head.
04:23
And surrounding it was a screenshot of every game
04:26
divided into categories.
04:28
We kept that poster in there for a long time,
04:32
till probably the initial library
04:34
had 15 titles plus the pack ins.
04:38
Until we probably had over 30 titles,
04:41
we continued to put that in.
04:42
Another element that we put in was a card
04:46
that actually emphasized the quality seal
04:49
and that Nintendo guaranteed the quality of the product
04:53
from both an entertainment value
04:55
and the workmanship of the product.
04:58
That quality seal at the time, my boss, Ron Judy
05:01
he's like, What could we do that would be more like
05:04
the Good Housekeeping Seal of Approval?
05:07
And that Nintendo Quality Seal,
05:09
it still appears on every box and on licensed products
05:13
from lunchboxes to whatever.
05:16
So that is something that stayed with Nintendo.
05:20
So when the NES launched,
05:22
the launch titles being Duck Hunt and Gyromite.
05:27
Those games were fun.
05:28
Certainly took advantage of the accessories.
05:31
And Mario was definitely a killer app.
05:34
I really liked NES Golf
05:35
'cause I had played that in the arcade version,
05:38
but I also liked a little kind of puzzle type game
05:42
called Clu Clu Land.
05:43
Another game with a sunglass wearing polar bear
05:46
called Ice Climber.
05:48
A lot of people love Clu Clu Land.
05:49
Clu Clu Land, where are you?
05:52
[light hip hop music]
05:57
When it came to trying to find out
05:59
what you as consumers would think about the NES,
06:03
we did a few different focus groups.
06:07
I would sit behind the mirror
06:08
and I was the only one who knew how to play.
06:10
So I would have to come out
06:12
and demonstrate the product to the kids.
06:14
And the kids were age range from 8 to 12 or 8 to 14.
06:21
They seemed interested, like they wanted to see.
06:24
They wanted to see me demo the robot
06:27
or the zapper and seemed to me, they were happy and excited.
06:33
And then we went to New Jersey and one of those sessions,
06:37
the Nintendo executive team came
06:40
and watched from behind the glass as well.
06:45
Did the same thing. And the kids are reacting.
06:48
And some kid who was very unruly,
06:51
he drew a picture of a joystick
06:52
that looked like a penis and held it up to my face
06:55
on the mirror, he said, I know you're behind here.
06:59
[laughing] Anyway, so the Nintendo executives come,
07:02
they're watching the kids,
07:03
the kids seem enthused, et cetera.
07:05
And at the end they ask the moderator
07:08
what he thinks about the chances for success.
07:12
And he said, kids are always enthusiastic about a product.
07:18
So that's not the best way to gauge it.
07:21
And they said, well,
07:23
what should we imagine that our success is?
07:25
He said, well, I've never seen anyone go ahead and launch
07:29
with this type of result.
07:32
It was a little worrisome
07:35
that what we were interpreting as positive,
07:39
the moderator was interpreting as neutral at best.
07:43
When the NES came out, even in New York,
07:47
the retailers had really been burned
07:50
through all of the close outs of the prior generation.
07:53
So they were not very receptive to taking in the product.
07:57
And that really was probably one of the more difficult goals
08:02
was to get the retailers, to give it shelf space,
08:05
to have them not be concerned that they won't want to have
08:08
a lot of markdowns or be stuck with product
08:11
that they couldn't sell, that they had taken a risk on.
08:14
So it was really one of the bigger challenges
08:17
and trying to get them to include the NES
08:21
in our advertising for the holidays.
08:24
So the kinds of retailers
08:25
that we had to work with in the early days,
08:27
especially since what had happened in the prior generation,
08:32
a lot of toys stores and that type of retailer
08:36
were really concerned about working with video games.
08:41
So a lot of people these days
08:44
look at that iconic imagery,
08:45
the way that packaging is that looks old fashioned,
08:49
like pixels, like graph paper, the way we named things,
08:52
we made sure not to call it a video game system,
08:54
that of thing.
08:56
So when it came to these challenges
08:58
of trying to get away from the prior generation,
09:01
there were challenges as related to retail.
09:04
My challenges were more related to kind of make sure
09:07
that the consumer and the parents who were purchasing
09:11
didn't think that it was just more of the same.
09:15
A group of us went back, there was a group of five or six,
09:19
and then they brought like five more people back.
09:22
And, living in temporary apartments, that kind of thing
09:26
in New Jersey and renting cars and vans and running out
09:31
and trying to install these big ROB displays at retail
09:36
and to deliver product to them.
09:39
And there were times when, they went to the Bronx
09:43
with a truckload of product and a display.
09:46
While they're loading in the display,
09:48
people are looting the car, it was crazy.
09:53
And back in 1985, New York was much less safe
09:58
than it is today.
10:00
So, park the car, get the wheels taken off.
10:04
Not only was it difficult to get retailers
10:07
or businesspeople to take a risk
10:09
on putting a video game system and cartridges on the shelf.
10:14
But parents had seen that they bought these games
10:19
for their kids and they didn't even play them.
10:22
Parents thought, I am not spending more money
10:25
on a video game when you play it for 10 minutes
10:29
and then you're not interested.
10:32
We felt like we really did have a better product,
10:36
a product that wouldn't disappoint.
10:38
And we've wanted to put all efforts into making sure
10:42
the consumer felt like they got their money's worth
10:45
and that they would want to buy another game
10:48
when we introduced more software.
10:54
Some of the things that we did to that end
10:57
were we called it the Nintendo Entertainment System.
11:01
And the advertising really focused
11:03
on the whole family playing together.
11:06
It's looks pretty corny today, but it's a 1980s family
11:10
and the dad is playing,
11:12
and the mom is excited about playing, and two kids.
11:16
And that type of advertising and positioning
11:20
was the way that we went.
11:22
Also putting ROB the Robot first
11:25
in the sale of the NES or Nintendo Entertainment System,
11:30
really gave a point of differentiation
11:33
and made it look like it was more futuristic.
11:37
And I think we also want to make sure
11:39
that we would depend on the bug factor,
11:42
which we called kids bugging their parents to get it,
11:46
but that the parent would see that this was something
11:49
that truly was new and different
11:52
and would be a good investment for the whole family.
11:55
I think in the early days,
11:57
making sure that we weren't associated
12:00
with what had gone on before, that these video games
12:04
that were just simple blips
12:06
and used a lot of licenses like ET,
12:08
like other major sports or movies, entertainment.
12:14
They would have a picture from the actual movie,
12:17
a real person playing tennis on the cover.
12:20
And then you would open
12:22
and it would just basically be advanced Kong.
12:25
You'd look at the package and then you would play the game
12:28
and it'd be a complete disconnect.
12:31
So at the time the packaging that we created
12:35
to make sure people didn't experience disappointment
12:39
between the trimmings, if you will, and the actual software
12:44
was really made on graph paper.
12:47
It was supposed to represent computer graphics.
12:51
It's quite blocky and it's kind of iconic today.
12:54
People really see it as retro, but the whole purpose was
12:58
that we didn't want to show, beautiful illustrations
13:03
or photographs of real things on the packaging
13:07
and then have people say, this game is nothing like this.
13:12
So if anything, we kind of undersold
13:16
in order to continue with this consumer satisfaction need
13:21
and not wanting to ever disappoint.
13:24
So all kids seemed enthusiastic to us
13:26
in the focus groups, but the experts told us
13:29
not to expect too much.
13:32
We used that in thinking, jeez,
13:34
we really are going to have to make sure
13:37
that they think that we present this as new and different
13:41
things like calling the games, game packs
13:44
and the entertainment system.
13:47
And coming up with ROB, your Robotic Operating Buddy.
13:51
We had a lot of the nomenclature,
13:54
anything just from the idea of using the word cartridge
13:57
was something we didn't want to use.
13:59
So we really tried to come up with ways
14:01
about demonstrating and visually representing the product
14:06
that was going to make them understand
14:09
that this wasn't what they had seen before.
14:11
So one of the tactics we used to make sure
14:14
kids could get their hands on the system
14:17
and actually see it and experience it,
14:19
that it was something new and different
14:21
was we did grassroots marketing at mall tours.
14:26
So we booked these malls around the greater New York area.
14:31
And we would go in and set up on Friday night
14:34
and through the weekend we would have the system set up
14:38
and interesting cabinets, and a big screen,
14:42
which at the time like a 40 big screen was a big deal.
14:46
Little platform and a big screen.
14:49
And on the big screen, we would play NES Baseball.
14:53
And we had some stars from the Mets
14:56
come out and play against the kids.
15:00
So they would create a line and get to step up and play.
15:04
And so the two celebrities
15:07
that we were able to contract with, one was Ron Darling
15:10
from the Mets who was really a Playboy kind of guy,
15:16
at the time was very well known and did a lot of promotion.
15:20
And another guy named Mookie Wilson,
15:22
And Mookie had a son named Preston,
15:24
and he would also come to the mall tour.
15:27
So sometimes he was the most enthusiastic kid
15:30
and he probably also know how to play the games,
15:32
the best of anybody by the time we were done.
15:35
But I remember going to a mall out in Long Island
15:40
where the mall manager, she just didn't want us there.
15:45
So she put us like in the basement, in the corner.
15:48
And she, and I had an all out war over,
15:52
we had booked this promotion,
15:54
but she didn't want anything to do with video games
15:57
and the negative influence that they would have.
16:01
So she wanted to hide us in the corner.
16:05
But it was a way of getting out there
16:06
and getting people to see it and play it
16:08
and see that it was better than a generation before.
16:13
And it certainly worked in terms of
16:15
kids definitely wanted to ask for it for Christmas.
16:18
And hopefully parents liked it too,
16:20
and saw that it would be fun.
16:23
So the team that was back in New York,
16:25
because it was pretty small, I think in total,
16:27
there might've been 10 or 12 people,
16:29
but when we got to the weekend
16:30
that we were going to actually launch
16:32
and the product was going to go out to retail,
16:36
night that it came in and we were ready to go.
16:39
We had Ron Judy and Bruce Lowry was the VP of sales,
16:45
Mr. Arakawa our president and Howard Lincoln, our senior VP
16:49
were all back there with us and we loaded up the truck
16:54
in the warehouse and opened a bottle of champagne
16:57
that we drank out of styrofoam cups. [laughing]
17:00
And we were in New Jersey.
17:02
And off went the truck for delivery.
17:05
So the next morning, a few of us went
17:07
and stood outside of the FAO Schwarz.
17:09
The system was all set up.
17:11
And we waited for people to come in
17:13
and make that first sale.
17:14
So someone comes in and they not only buy the system,
17:16
but they buy like every game. And it was so excite-
17:20
I was like, oh, they're, they're buying it,
17:22
they're buying it. You know?
17:25
Later we found out that it was like a Japanese publisher
17:29
who came in and bought it for samples for their business.
17:33
Later, after New York, we went to LA
17:37
and we use those same tactics.
17:38
We did mall tours.
17:40
We were starting to prepare
17:42
for how we were going to do a national launch.
17:44
It's tough 'cause we were a pretty lean team.
17:48
And at the time a guy named Don Kingsborough
17:51
had launched a company called Worlds of Wonder
17:54
with Teddy Ruxpin was their big product line.
17:58
And he was someone that we knew from the business.
18:01
And Mr. Arakawa really liked him.
18:04
And he and Ron Judy talked to Don about,
18:07
maybe there was a way that we could use
18:10
their distribution process
18:13
to get our products into stores nationwide.
18:16
At the time, there were a lot of regional chains
18:20
as opposed to national chains that we have now,
18:22
like Target or Walmart, that kind of thing.
18:25
We decided to use their rep firm.
18:29
And we went to a meeting, I believe it was before a CES.
18:32
And we went to this meeting to introduce them to the product
18:35
and show them what it was like.
18:37
And I know I was demoing the product
18:40
and that they were gonna have this big opportunity
18:42
to add this Nintendo line along with Teddy Ruxpin
18:47
to take out to retailers.
18:50
And many of them had also already been through the fall
18:54
of the video game industry and how challenging it was
18:57
when all the accounts want to return the product
18:59
or deal with markdowns, et cetera,
19:01
they were not enthusiastic.
19:04
And they were actually downright disrespectful
19:07
during the meeting.
19:08
And so Don [indistinct], he got up
19:12
and he essentially yelled at them about their disrespect.
19:17
This whole sales team of like 50 people in this room
19:22
are basically saying, [laughing]
19:23
we don't want to sell your product.
19:25
But they went on to, of course, have great success.
19:29
And many of them stayed with Nintendo
19:32
after Worlds of Wonder wasn't really in business anymore.
19:36
Or the Teddy Ruxpin fad was over.
19:38
They continued to have a good business
19:40
with Nintendo for many years.
19:47
Since my job was marketing communications,
19:50
doing things like advertising, PR, trying to get stories,
19:55
that was very difficult.
19:56
Trying to get stories about Nintendo.
20:03
We even did an event in LA
20:05
where we had a whole bunch of kids celebrities come,
20:08
like at the time Jason Bateman
20:10
was a kid celebrity and his sister.
20:14
And we had all these people, Wil Wheaton
20:18
from Stand By Me at the time.
20:20
And even with that type of what we considered
20:23
kid starpower, we had a hard time
20:27
getting pickup on public relations,
20:29
getting people to talk about it.
20:30
As we launched nationally,
20:35
it became something where you would see it
20:38
in your personal life.
20:39
I think you feel the success when, as a regular consumer,
20:45
you walk into a store
20:46
and you really see your work right there.
20:48
It's on the screen.
20:51
It just legitimizes it so much.
20:53
And it made me feel like not only were we successful,
20:57
but it was gonna be a big thing
20:58
and that it was gonna be around a long time.
21:01
So once we launched nationally with the NES,
21:05
the company was really growing and started changing.
21:09
The marketing department went from two or three people
21:13
to dividing into different departments
21:16
and having many more layers, people with more experience.
21:22
We ended up forming our publishing division
21:25
and I got asked to move and start Nintendo Power Magazine,
21:29
which was an outgrowth of the Fun Club Newsletter.
21:35
We decided to make a full fledged magazine.
21:39
But there were other things that changed also.
21:42
At the senior level, Ron Judy left
21:44
and went to start Nintendo in Europe.
21:47
And Peter Main came on board.
21:49
He was a seasoned marketer
21:51
that Mr. Arakawa knew from Canada.
21:53
Bob Thompson, that I mentioned,
21:55
our customer service department, became huge.
21:59
And we founded Game Counseling, Customer Service.
22:02
And we had hundreds of people in that area.
22:06
Areas like licensing.
22:09
When we started licensing other companies to make software,
22:12
that area was incredibly important to Nintendo.
22:17
And to support that we had have a huge testing group
22:20
that would test all the games
22:22
and make sure the content met Nintendo's criteria,
22:27
and made sure that the programs themselves
22:29
didn't have any bugs or any glitches in them.
22:33
So that became a huge group of people.
22:36
So, really during the mid and late '80s,
22:40
the company really grew.
22:43
Maybe it just started looking a lot more
22:45
like a lot of other companies, but definitely
22:50
it grew by leaps and bounds at that time.
22:55
So along with all of the pack ins, at some point
22:59
we shifted to offering a newsletter
23:03
and it grew so quickly,
23:05
people wanting to get this newsletter,
23:07
that by the time we had the issue
23:09
called the Punch-Out!! issue,
23:11
we had about 600,000 subscribers.
23:15
So it was eating up a lot of marketing budget
23:18
to mail out this newsletter, create it, print it, mail it.
23:23
And Mr. Arakawa had seen that in Japan,
23:27
publishing about video games had grown
23:31
and become its own kind of category.
23:33
And he wanted to do that in the US too.
23:36
So he asked me if I would consider
23:40
taking on this publishing world
23:44
as a director of publications.
23:46
Then we started Nintendo Power
23:48
working with a co-publisher in Japan
23:51
who really understood how to take things like screenshots
23:56
and make all those cool maps
23:58
to show people how to play the games.
24:02
That was a really fun role for me.
24:05
Nintendo Power continued for, I think, almost 25 years.
24:10
So with Nintendo Power, one of the big purposes
24:13
was to make sure, again, that people liked the games,
24:17
make sure that they were satisfied
24:20
and they would always be ready to buy the next game,
24:23
felt it was worth their money.
24:24
So we would show a walk through of the whole game
24:28
in Nintendo Power or a Player's Guide.
24:31
But there was one policy which was,
24:33
you don't show the final boss or the final scene.
24:37
And the reason is, and I think I recall
24:40
that Mr. Miyamoto was a big driver of this
24:43
was that's the payoff for all your hard work.
24:46
You spent all this investment of playing this game
24:50
and getting to the end.
24:52
And to not let the consumer and the player
24:57
really enjoy the success of that final moment,
25:01
it was felt like, let's just keep that for them.
25:05
So when I think of the influenced Nintendo had on people,
25:09
probably the area that I am most proud of
25:12
is when you think of Nintendo Power
25:15
and the millions of readers of Nintendo Power,
25:19
the idea that we were actually getting kids to read
25:22
and getting them to study these things like these maps
25:27
and the detail, and to take something
25:29
that they loved as much as playing the game
25:32
and then want to really learn about it.
25:34
So just think how much you have to learn
25:36
when you're playing a game and how much
25:40
people enjoyed reading and poring over these things.
25:43
I think it created
25:47
a mindset amongst those people
25:51
who were involved at that time as players,
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as kids that was hopefully really valuable
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and their whole life to think
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if they wanted to know about something,
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they would go read about it, or study about it.
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And that they knew that they could expand their knowledge
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through additional information and learning.
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So I think that
26:14
that's the coolest contribution from my side.