NIS America: ‘We want to be the big fish in the small pond’

NIS America is easily one of the biggest names in niche gaming.

Best known for the popular Japanese role-playing game series Disgaea, the Western arm of Nippon Ichi Software has brought many of its Japanese parent company’s titles across to the US and Europe.

In addition to this, the firm has also paired with many other Japanese developers to distribute niche genres and titles outside of the country.

This includes Persona and Trauma Centre developer and publisher Atlus, and Spike Chunsoft, the creator of popular visual novel titles 999: Nine Hours, Nine Persons, Nine Doors and Virtue’s Last Reward, as well as the Danganronpa series.

BIG IN THE WEST

Released earlier this year for the PlayStation Vita, both Danganronpa: Trigger Happy Havoc and its sequel, Danganronpa 2: Goodbye Despair, saw considerable success in the UK, with the latter game breaking into the UK retail Top 40 in its first week – a rare achievement for a Japanese visual novel title.

Takuro Yamashita, MD of NIS America (NISA), says that the game’s strength lies in the quality of its localisation for the West and its juxtaposition of its format to most other titles.

It was partially thanks to the high quality work that we did in-house,” he begins to explain. Our in-house translators and editors did an excellent job, indeed, for both versions of Danganronpa. The voice actors enjoyed the English voiceover recording, too. Such professionalism andenthusiasm paid off.

Also, BBC World News heavily promoted Trigger Happy Havoc as an alternative to violent blockbuster games,” he adds. The preference of the UK audience might be now changing and they might be looking for their own type of game, which is very unique like Danganronpa. The population of the audience who like that niche genre must be growing in Europe, too.

Beside the fact that Trigger Happy Havoc was highly acclaimed and heavily promoted by influential media in UK, I am convinced that the growing fan base of the adventure/visual novel genre helped Danganronpa 2: Goodbye Despair make the Top 40 in its first week over all formats.”

The feat becomes even more impressive when it is taken into account that Danganronpa 2 was released within less than than six months after the original Danganronpa hit UK shelves.

It was a risky move that paid off, says Yamashita.

Danganronpa: Trigger Happy Havoc on Vita was more successful than we had been expecting,” he explains. Sales, including digital sales, of the game are now approaching 100,000 units across the US and EU. This is a tremendous achievement if you consider that the game is of the quite niche adventure/visual novel genre and is on Vita.

Although we knew it was kind of a gamble because it might cause cannibalisation between the two if we released Danganronpa 2: Goodbye Despair just six months after the release of Danganronpa: Trigger Happy Havoc, we also wanted to release the new sequel while Trigger Happy Havoc had momentum.

We heavily promoted Goodbye Despair at the Animex show in Los Angeles in July, and then we released the game in August. Our strategy worked. As a result, Danganronpa 2: Goodbye Despair had an excellent start at launch.”

SMALL BUT MIGHTY

From the outside, it might be easy for an observer to dismiss NISA’s chances in the West. After all, it’s a firm that brings Japanese games in a niche genre to the West on, among others, an arguably niche platform – the PlayStation Vita.

But Yamashita highlights the Vita’s tempered market presence as a positive for the firm.

While there is the fact that physical retailers in West are not as willing to spare store space for Vita titles, the Vita market is less competitive overall because it remained too small for big Western publishers to aggressively enter. That is why smaller publishers like NISA have a big chance in there.

The end users, who already have Vitas, are very eager to play new Vita games. They are very important customers for us.

For this fiscal year, we have five Vita exclusive titles, and four multi-format titles supporting Vita. Yes, we are one of the very few publishers who are still aggressively releasing the Vita titles in EU. But our strategy is to try and be a big fish in the small pond.”

Yamashita adds that the lack of store space dedicated to Vita software is becoming less and less of a problem for publishers, as the platform quickly transitions to a digital-focused market.

Due to the high manufacturing cost, publishers cannot make reasonable margin from selling physical copies of Vita games,” he explains.

Recently, SCEE offered the price band migration program, wherein publishers can benefit from slightly cheaper manufacturing costs when the game is migrated to the lower price band of SRP.

However, it is still difficult to make a reasonable profit from retail copies on the part of the publisher. Accordingly, most publishers would rather choose to sell the digital copies at a budget price via the PlayStation Store than replenish physical copies for retailers. That is why the Vita market is becoming more and more concentrated on digital distribution.

TAXING PROBLEMS

NISA has itself invested more heavily in its digital offering.

The firm launched the official NISA Europe Online Store in July, offering consumers a more direct purchasing route for games, as well as exclusive versions of NISA-published titles.

However, the site suffered initial teething issues, with consumers used to importing some of NISA’s games complaining about the necessary inclusion of tax in the new localised store.

We opened the NISA Europe Online Store in the UK in order to more directly communicate with European users by offering the premium editions of our game titles,” Yamashita explains.

Another reason why we decided to open a European online store was to provide much better and quicker service to European users, who had been purchasing our US products via our US online store.

At an early stage, some European customers complained about our European store pricing because of the UK VAT inclusion. The EU customers, who had previously imported our products from our US online store, were able to benefit from the exemption of the US sales tax (while the import tax had to be imposed on them).So, at first glance, the products listed by the EU online store looked super expensive, compared to the US store pricing, which was exclusive of US sales tax.

Therefore, some customers criticised the store on its pricing policy. However, now, there is no such criticism from users. I hope the current level of service and the quality of the collective items provided by our European store is satisfying customers.”

Now past these early problems, Yamashita expects the online store to flourish – with the hunger for exclusive editions among players of niche titles such as NISA’s set to drive the store’s success.

The sales share of our e-commerce via our European online store is still less than five per cent against traditional retail sales in EU, while the share of our US online store accounts for more than 20 per cent against traditional retail sales in the US,” he comments.However, it must be noted that we started the European online sto