Today marks 30 years since the SEGA Genesis (known as the SEGA Mega Drive elsewhere, the name was changed in North America due to trademark issues) made its debut!
This name would turn out to be quite fitting, as the SEGA Genesis became the system that would not only make SEGA and many of its franchises household names on the continent, it would also serve as the birth place for the company’s most successful character: a blue hedgehog named Sonic!
The Genesis would receive little buzz during its initial, limited launch on August 14, 1989. The console was only launching in New York and Los Angeles, and many retailers were expecting NEC’s TurboGrafix-16, which was also receiving a limited launch just a few weeks later, to be a larger success. Though SEGA would release the Genesis more widely later in the year, and soundly beat NEC’s machine, they continued to struggle to break into the North American market.
SEGA of America’s famously aggressive marketing began with the Genesis. In an effort to set itself apart from Nintendo and target older kids and adults who were beginning to grow out of their NESs, SEGA launched their “Genesis Does What Nintendon’t” campaign. Despite this, the system only managed to sell 500,000 units in its first year, half of what SEGA had hoped for, and a paltry amount compared to the massive number of NES consoles already on the market.
This would all change in 1991. After a poor first year, SEGA Enterprises CEO Hayao Nakayama replaced SEGA of America CEO Michael Katz, who had only been on the job for a year and oversaw the Genesis’s launch, with Tom Kalinske in 1990. Kalinske was a believer in the “razor and blades” business model, which refers to razor companies giving away their razors to quickly grow a consumer base, and then selling the blades. For the Genesis, this meant getting as many consoles into homes as possible. To this end, Kalinske enacted a four-point plan: cut the system’s price, establish an American team to cater to the American market, double down on Katz’s aggressive marketing campaign, and include a new pack-in title.
This led to the Genesis’s price being cut from $189 to $149, with $100 being the eventual goal. The SEGA Technical Institute was founded, which would go on to create a variety of iconic games like Comix Zone, Kid Chameleon, and Sonic Spinball, as well as play a vital role in creating Sonic 2, 3, and Sonic & Knuckles. Finally, and perhaps most importantly, Sonic the Hedgehog replaced Altered Beast as the Genesis’s new pack-in game, ensuring every Genesis came with one of the hottest games of the year. Even those who bought a Genesis in the months before the the change could receive a free copy by sending in a proof of purchase. Things went very differently for SEGA after this.
The Genesis went head to head with the newly-released Super Nintendo during the 1991 holiday season, and won. SEGA went from having less than 10 percent of the United State’s video game market, to 55 percent. Eventually, their market share would increase to 65 percent, before SEGA eventually fell behind Nintendo towards the end of the generation, as the company shifted focus to the next generation of consoles.
The Mega Drive would flounder in Japan, much like the Master System had, coming in third behind NEC’s PC Engine (the original name for the TurboGrafix-16). In Europe, the Mega Drive would carry on the Master System’s success, as SEGA would continue to dominate the market there. In America, the Genesis lived up to its name. It was the genesis of a mascot, the genesis of a legendary dev team, the genesis of numerous quality franchises, and the genesis of a legacy that continues to remain surprisingly relevant 30 years later. The SEGA Genesis was the start of a lot for SEGA, and even though SEGA’s ascendency to the top of America’s gaming world was short-lived, it left enough of an impact that it’s American birth is still being acknowledged 30 years later, with a brand new piece of hardware set to release next month.
Whether you knew the system as the Mega Drive, or if you were born long after it died, go ahead and discuss the console down in the comments! Also be sure to stick around Sonic Stadium, as we’ll be doing more articles for the Genesis’s 30th anniversary through to the end of the month!
Steven L. Kent’s The Ultimate History of Video Games was the primary source for the behind-the-scenes information in this article. You can check it out for yourself here.
Finally, please enjoy this fun “Genesis Does” Ad!