Ramit Sethi at I Will Teach You to Be Rich once wrote about something he called the "failure of the last mile," which simply means that it's the last contact with someone that's the most important. In business terms, it means this: Every company makes mistakes. Bad companies make it hard for their customers to get those problems taken care of. Good companies make it easy. What matters isn't so much what was wrong, but how -- and whether -- it was made right. Ramit cites the peak-end rule: "…we judge our past experiences almost entirely on how they were at their peak (pleasant or unpleasant) and how they ended. Virtually all other information appears to be discarded."
I bring this up because all three current-gen console manufacturers have shown how they run the last mile. Microsoft and Sony have both stumbled a bit along the way. Nintendo hasn't. Recall all of the problems that have accompanied the Wii. First, the wrist straps were breaking. Then the Wii Remotes themselves were. Then it turned out that leaving the Wii in Connect24 mode for too long caused the hardware to overheat. Then a significant number of units couldn't read the Smash Bros. discs. In each case, Nintendo got out in front of the problem.
Rather than let the drumbeat of customer complaints reach a crescendo, as soon as it became clear that the wrist straps weren't strong enough, Nintendo announced that they'd be replacing everybody's straps free of charge. Just go to the web site, fill out a form, and you'll get yours in just weeks. Same thing with the new padded jacket that now comes standard with all Remotes, and the GPU overheating issue. I happen to dislike the feel of the jacket and don't use it, and never took advantage of the graphics card repair, but it's the principle of the thing: Public outcry hadn't reached uproar status in either case, but the company stepped up, said it was their fault, and upgraded everybody for free.
And that's what they did with the Smash Bros. snafu. What am I going to remember about this incident six months from now: That my Wii was unable to read a particular game, or that Nintendo repaired my unit for free and returned it to me within a week?
Contrast this to the way Microsoft and Sony have handled similar (and similarly inevitable) problems. When reports of Xbox 360 hardware failures started popping up everywhere, Microsoft took a page from the Bush administration playbook and denied that anything was wrong at all. That only made the problem worse, so they took the next logical step: Attacked the people making the complaints. Microsoft claimed the reports of an epidemic were exaggerated, a vocal minority was making them look bad, and so on. When they later extended their manufacturer's warranty to three years, this was seen in the community less as good customer service and more as a grudging admission of guilt. Although these days you can get your 360 repaired pretty easily, and usually free, peak-end theory still applies: What people remember is the arrogance, and the denial of any widespread problems in the first place.
The PlayStation 3 hasn't experienced even a fraction of its competitors' problems on the manufacturing side. But on the marketing side -- hoochie mama! Sony's PR pronouncements from Bizarro World have been well chronicled here and elsewhere, so I'm not sure it's worth rehashing all of them. But just consider their spin on the missing rumble support from the SIXAXIS: "Rumble is dumb. Only fags want a controller with rumble." (I am paraphrasing slightly.)
In the meantime, educated consumers were aware of the pending lawsuit against Sony by Immersion Corporation, claiming patent violation. Once the lawsuit was resolved, Sony magically decided once again that rumble was the smartest and most heterosexual controller feature anybody could ever offer. The Dual Shock 3 goes on sale on April 15. Will they follow Nintendo's lead and offer a free Dual Shock to those of us who bought their system before it was available? Just after they admit that Xbox Live blows the doors off the PlayStation Network, I'd imagine.
Although the problems ranged in severity from Sony's boneheaded community outreach to Microsoft's catastrophic hardware failure, in every case what customers end up remembering is how each company dealt with what had gone wrong. Nintendo seems to be alone among the hardware manufacturers in understanding the value of a little humility. It's yet one more reason why the Wii is running away from the pack in this console generation.