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Retail

US game sales drop 25% in October

US game sales drop 25% in October

Thu 08 Nov 2012 11:30pm GMT / 6:30pm EST / 3:30pm PST
Retail

NBA 2K13 was the top title, outselling last year's game by over 60% in both dollars and units, but it didn't help offset steep declines overall

The NPD Group has issued its October retail sales report, revealing a 25 percent drop in total industry sales to $755.55 million, as software sank 25 percent to $451.8 million, while hardware plummeted 37 percent to $187.3 million. The only category to see a slight increase was accessories, which rose five percent to $135.6 million thanks mostly to Skylanders-related items.

NPD was sure to remind us once again that the entire retail spend is only around 50 percent of the total consumer spend on games. The firm will release in February its full Q4 Games Market Dynamics: U.S. report, which will shine a light on digital and other spends.

As for October, Take-Two's 2K Sports labeled enjoyed occupying the top selling spot in software as its NBA 2K13 outsold last year's version by 60 percent in both dollars and units.

Activision's Skylanders phenomenon also continues. Liam Callahan, NPD industry analyst commented, “Skylanders Giants software performed well, breaking into the top 10 title ranking, and selling over 160 percent more units than last year's Skylanders title did in its debut month at retail.”

“Unfortunately, other sequels new to market this month did not perform as well compared to prior iterations. This, combined with poor comps against the launch of hits like Battlefield 3 and Batman: Arkham City in October 2011 led to the decline in software sales," he added.

And while October was another pretty miserable month, NPD remains optimistic about 2012 finishing strong with a good holiday performance in November and December.

“While October was another month of steep declines in retail sales, we are looking forward to November 2012 with the results of Assassin's Creed III, and Halo 4, which were positively reviewed, as well as the results of Call of Duty: Black Ops II. These software titles, along with the Wii U launch on November 18, will provide a much needed boost to retail sales,” Callahan said.

Callahan also observed some encouraging signs in hardware during the month: “While we saw declines in hardware unit sales across all platforms year-over-year, when looking at average sales per week versus September, several consoles realized higher sales: the 360, PS3, NDS and 3DS. This is a sign of increasing momentum as we move into the holiday season.”

The top 10 selling games chart for October is below.

1

14 Comments

Bruce Everiss
Marketing Consultant

1,716 598 0.3
And so the 25% year on year decline in the market continues.
Lots of consoles are now gathering dust.
And it isn't the depression/recession. People buy more entertainment in bad times, Hollywood had its best years during the great depression.
$60 is too much money for a console game compared with the entertainment alternatives.

Posted:A year ago

#1

Tom Keresztes
Programmer

632 223 0.4
NPD's result only include retail sales. Digital is yet to be published.
Hardware sales might down in money, but MS sold more 360s this year than the last.

Some figures

Posted:A year ago

#2

Daniel Hughes
Studying PhD Literary Modernism

410 455 1.1
Oh look, it's Bruce making the same old arguments!! Hooray!! Wouldn't it be nice if we could have a constructive, open debate about this?

Good point Tom. We can't use NPD to gauge how much money people are actually spending on their consoles any more; as Bruce so often reminds us, digital is a bigger and bigger part of the market across the board, and that includes being a bigger part of the console market that NPD is trying to track here. Even Nintendo's latest platform (traditionally a weak spot for digital revenues in the industry) has 70% of its users online and buying digital content.

It's no surprise there's less money being made at retail. We're at the tail-end of the console cycle, console prices have fallen dramatically compared to 2008 (Wii is half the price and selling at less than half the rate, for example) and the only system showing yearly growth is 3DS--because it's a new machine at the right price with the right games and services. We can't expect sales to grow until more new machines hit the market--'machines' not 'machine', for when Bruce inevitably points to Wii U being unable to offset the declines of three consoles single handedly--and we can't expect NPD to be an accurate indication of the health of the console market when its figures don't include full digital downloads, digital exclusive games, downloadable content and subscriptions into its figures. This is essentially incomplete data, and as usual, Bruce is drawing the conclusions that fit his narrative.

The retail games industry likely won't hit the peak of 2008 ever again (otherwise 2008 WOULDN'T BE A PEAK: a peak is the highest point, remember?), but that doesn't mean the console market won't grow, that doesn't mean it won't attract new and existing customers in years to come, and it doesn't mean that people are drifting away to alternatives never to return; it definitely doesn't mean there's no future for consoles. We should expect to see these figures right now, because we are in the transition from seventh to eighth generations, and we are at the tail-ends of the life cycles of three home consoles and we are in the dying throes of two portable consoles. I can't stress that enough.

Edited 1 times. Last edit by Daniel Hughes on 9th November 2012 10:01am

Posted:A year ago

#3

Rolf Moren
Freelance Marketing Consultant

36 22 0.6
So, is it really plausible that overall hard-core games sold is really declining this much year over year when the hard core platforms ( 360, PS3, NDS and 3DS) are selling more than last year? Me thinks there is something fishy in these numbers. No numbers are trickling out from the giant online stores (Steam, Origin, Amazon and some more) and if you look at the number of registered users to each and every one of these, you easily understand why retail sales are down. Why should anyone buy a game in a store when you can buy it online? Store retail game selling is simply not a feasible model any more and just like the music stores they will soon exist only as worn down and yellow tinted memories of our past youth. These numbers are just not worth looking at any more when it comes to undertand game sales since they simply only can reflect one thing, the replacement of an outdated phenomenon in lieu of another and more modern one.

Posted:A year ago

#4

Tom Keresztes
Programmer

632 223 0.4
No numbers are trickling out from the giant online stores
So people buying boxed copies of games through an online retailer (like Amazon) are not included in this survey ?

Edited 1 times. Last edit by Tom Keresztes on 9th November 2012 10:50am

Posted:A year ago

#5
We'll have an update on US sales numbers shortly (for a handful of titles).

Posted:A year ago

#6
Doesn't include digital and DLC. The economy's a mess. We're at the tail end of the console cycle.

Bruce, you REALLY need to get out more.

Posted:A year ago

#7

Jim Webb
Executive Editor/Community Director

2,210 2,049 0.9
1. Digital not included which accounts for 50% of sales.

2. 4 consoles actually saw an increase in sales over last month.

3. Bruce preaches doom and gloom.

4. Wash, rinse and repeat.

Posted:A year ago

#8

Rolf Moren
Freelance Marketing Consultant

36 22 0.6
A tweet that just came:

Dan Teasdale
@deliciousbees
NPD claims 114k for XCOM. Steam peaks at 70k CONCURRENTLY playing the weekend after launch. Screw ballpark, that's not even the same planet.

As we see, these numbers aren't even close to being true.

Posted:A year ago

#9

Keldon Alleyne
Handheld Developer

422 361 0.9
And it isn't the depression/recession. People buy more entertainment in bad times, Hollywood had its best years during the great depression
“Yes and no,” says Karie Bible, box office analyst for Exhibitor Relations. “People always say, ‘Everyone went to the movies in the Great Depression to escape their troubles,’ but really there was only one studio [MGM] in the black back then. Everyone else was bleeding red.”
Though box office rose in 2009 after the economic collapse in late 2008, studios across the board have clearly felt the pain, suffering layoffs, and cutting back on more risky big-budget pictures to maintain fiscal austerity. (MGM, coincidentally, has struggled to remain in existence.)

Edited 3 times. Last edit by Keldon Alleyne on 9th November 2012 5:45pm

Posted:A year ago

#10

Rolf Moren
Freelance Marketing Consultant

36 22 0.6
I am an avid listener to podcasts that game journalist seems so fond of doing and I must confess that I am fond of listening to. This time of year they start circling around the subject of Game of the Year. It seems a unison observation amongst all of them is that, much to their surprice, there actually are very few AAA games that are in the running this year. Smaller games from indie studios are much more talked about. I hear titles as Journey, Fez and the likes mentioned but they seem to have a hard time in finding a quality AAA game to nominate.

This is one of the reasons that we find ourselves in this situation with lower sales. The quality and innovative hight is abysmal in the AAA titles and the sales become disappointments for everyone involved. The big titles used to rack up huge sales no matter the quality but now we can find quality and freshness in the smaller titles. Name is not good enough any more, you need quality in the games to get the sales. I end this post with two words in proof. DUKE NUKEM.

Posted:A year ago

#11

Greg Wilcox
Creator, Destroy All Fanboys!

1,993 902 0.5
One word rebuttal (go play it): Dishonored. Innovative, fun and AAA to boot.

Posted:A year ago

#12

John Bye
Senior Game Designer

477 434 0.9
You know, I will agree with Bruce on one thing - $60 is too much for most games. But as usual he's twisting the data to suit his own agenda. These results show yet again that a big established franchise (NBA) is booming, with sales significantly up year-on-year, just like FIFA, Madden and Assassin's Creed in recent weeks. Halo 4 will probably follow suit. That's not a market in terminal decline.

I think the problem is that in the midst of the worst recession in decades, people just aren't willing to risk $60 on a game they don't already know, so they're falling back on established blockbusters which they're likely to get tens if not hundreds of hours of entertainment out of. Compared to any other form of entertainment, that's great value for money. The problem is that even a low budget game with only a few hours of gameplay is still trying to stiff you for the same $60.

Add to that the fact that the number of big new releases is down as we near the end of the current console generation and publishers start devoting resources to next gen launch titles, and in this month particularly unfavourable comparisons with last year (Battlefield 3 vs Medal of Honour: Warfighter, Batman: Arkham City vs Dishonoured, a new IP) and it's no surprise sales are well down overall.

Plus, as others have noted, with its focus on boxed retail, NPD is increasingly out of touch with what's actually happening in the games industry. Digital sales are booming, World of Warcraft is still raking in millions a month, and extensive DLC is doubling revenue from some games.

Posted:A year ago

#13

Mariusz Szlanta
Producer

28 22 0.8
Bruce, can you try harder please.

I refuse to admit that your formula is running out and these nice exchanges (greetings Fran) are coming to an end.

Posted:A year ago

#14

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