Analysis: October Retail Sales Up

Once again US retail sales rose compared to last year, and once again the cause can be attributed to one thing: Grand Theft Auto V. NPD’s Liam Callahan put it this way:“This is the third month in a row where overall video game retail sales increased, up 5 percent over October 2012 due to 10 percent software growth combined with a modest 1 percent growth of accessories, while portable hardware sales minimized decreases in overall video game hardware sales.” In other words, accessories were flat, hardware was down, and software rose due to the combined effect of a new Grand Theft Auto title, new Pokémon titles, and a new Battlefield, Batman, Assassin’s Creed and Skylanders titles. With all of those new top franchises with new software, the category could only eke out a 10 percent improvement over October 2012.

You already know who the winner was for the month. “Grand Theft Auto V was the top selling game for the second month in a row, selling just fewer than 1.1 million units and representing 15 percent of dollar sales,” noted Callahan. “New launches were the main driver of software sale increases, with a 9 percent increase of sales from October 2013 launches compared to October 2012 launches during their respective launch month.”

TakeTwo had a good month to follow its spectacular September, with three different titles in the Top Ten. Activision’s Skylanders SWAP Force came in lower than perhaps might be expected, but its peak buying time is really still coming up. Activision will have an excellent November in any case with Call of Duty: Ghosts sales hitting the bottom line.

October 2013 Top 10 Games
1. Grand Theft Auto V (360, PS3)** Take 2 Interactive (Corp)
2. Pokémon X (3DS) Nintendo
3. Pokémon Y (3DS) Nintendo
4. Battlefield 4 (360, PS3, PC) Electronic Arts
5. Batman: Arkham Origins (360, PS3, NWU, PC)** Warner Bros. Interactive
6. Assassin’s Creed IV: Black Flag (360, PS3, NWU)** Ubisoft
7. NBA 2K14 (360, PS3, PC)** Take 2 Interactive (Corp)
8. Skylanders SWAP Force (WII, 360, PS3, NWU, 3DS) Activision Blizzard (Corp)
9. Lego Marvel Super Heroes (360, PS3, NWU, 3DS, PSV, PC) Warner Bros. Interactive
10. WWE 2K14 (360, PS3) Take 2 Interactive (Corp) 

Hardware sales dropped 8 percent over last October, even with strong 3DS sales to help. That’s really no surprise, given the new consoles being introduced this month. There are a number of new bundles for the Xbox 360, PS3 and Wii U being introduced this month, which should help hardware sales for November and December. “October 2013 marked the sixth consecutive month that the Nintendo 3DS led overall hardware sales,” said Callahan. “3DS hardware sales were supported by the launch of Pokémon X and Pokémon Y, as well as from sales of the newest member of the 3DS family, the lower-priced 2DS. The success of the 3DS helped lift portable hardware sales, which was the first time portable hardware sales increased since February 2012 (excluding January 2013 due to an extra week or reporting), when the PS Vita launched.”

The Accessories category has been redefined to include toy/game hybrids like Skylanders, and thus experienced a slight increase. “Accessory sales rose by a modest 1 percent due to an over 70 percent increase for sales of Interactive Gaming Toys with combined sales of Disney Infinity and Skylanders items, including those from the new Swap Force, lifting sales from last year,” Callahan noted.

It’s important to put the NPD retail sales figures in context. “These sales figures represent new physical retail sales of hardware, software and accessories, which account for roughly 50 percent of the total consumer spend on games,” said Callhan. “When taking into account our preliminary estimate for other physical format sales in October such as used and rentals at $89 million, and our estimate for digital format sales including full game and add-on content downloads including micro-transactions, subscriptions, mobile apps and the consumer spend on social network games at $491 million, the total consumer spend in October is just over $1.3 billion.”

So comparing retail sales from this year to previous years is not a very accurate comparison, as more spending is shifting to digital. This tracking problem will only get worse as new games are released day and date on digital and at retail for next-gen consoles.

Console mid-list games have been disappearing over the last couple of years, and part of the reason is the acceleration of downloadable content sales. Publishers are putting effort into more content for the top games, and that is done by removing mid-list games from the publishing schedule. The result is more higher-margin revenue for the publisher, and unfortunately it doesn’t get tracked as easily as retail sales. This shows up as declining sales in NPD’s reports.

The really difficult part about the shift to digital is that it’s much harder to track than retail sales. There’s only a few publishers and retailers to keep track of in order to get a 90 percent or more accurate picture of retail sales, and NPD has agreements in place to do that. The digital picture is much murkier, since retail is so fragmented. Does Valve share Steam sales figures with analyst firms If it doesn’t, how accurate can analyst firms be at tracking digital game download revenue That’s not even considering all of the indie publishers now selling through consoles, or selling PC content on a wide range of web sites.

NPD and other analyst firms are trying hard to overcome these problems, of course. No doubt their models and ability to track digital revenue will improve over time. However, it’s unlikely to approach the familiar accuracy of retail sales tracking. Pay close attention to whatever they tell you about methodologies used for coming up with their numbers, and weigh the results with that information in mind.

The Aaron Levenstein quote about statistics applies to game sales. “Statistics are like a bikini. What they reveal is suggestive, but what they conceal is vital.” Think about that when you look at sales figures and statistics about the game industry from any source.

‘Burial at Sea’ Begins

BioShock Infinite: Burial at Sea Episode one is here, featuring the protagonists Elizabeth and Booker DeWitt of BioShock Infinite in Rapture, the setting of the first BioShock. Check out this new adventure, filled with familiar faces for series fans.

On Social Media, Teens Lose Sway

We have begun to make it a habit of looking to teenagers as the harbingers of all things cool, especially online. Snapchat just nixed a $3 billion offer from Facebook in light of its growing popularity, largely due to its favor with the teen set. Another, and by now more familiar photo-sharing platform, Instagram, came to prominence in much the same way.

It would throw you for quite a loop if we told you that the fastest-growing demographic on Twitter is actually 55-64 year-olds. According to Business Insider, this age bracket has been adopting social media at break-neck speed, growing by 79 percent in the past year alone. In addition, 45-54 year-olds are taking to Facebook and Google+ in droves. For that age group, Facebook has become 46 percent more popular and Google+  has seen gains of 56 percent.

This inevitably means a change in how marketers interact with people online. Next time you’re crafting up that tweet or ad, you’ll have to consider a change of target– one that includes older users into the mix.

Source: Business Insider

The Strangest Truck Ad Ever

Jean-Claude Van Damme is famous for doing the splits, but this one (done between two Volvo Trucks to demonstrate Volvo Dynamic Steering) is the most epic yet, made more so by Enya’s Only Time. The most amazing parts about this ad is that there was no CG and it was done in one take; find out the full story at WSJ.com.

‘The Fall’ Concludes

This final episode of the Ryse: Son of Rome – The Fall miniseries has Marius’ mentor Vitallion telling him that he should examine the reasons he truly fights. Is Rome, with all of its corruption, really worth fighting for

All Xbox One Games Get Full Gamerscore

In the past, Microsoft had Gamerscore points divided between two categories on Xbox 360. Full retail games would have 1,000 points that users could unlock over the course of the game, while downloadable titles on Xbox Live Arcade would start with 200 points to earn – though it would eventually double to 400 points.

However, for the Xbox One, Microsoft will even the playing field. The company has announced that downloadable and retail titles alike will come with 1,000 Gamerscore points, which can be earned and added to a player’s profile.

One of the first titles to take advantage of this will be Halo: Spartan Assault, which will release on Xbox One next month, as well as the Xbox 360. PopCap Games’ forthcoming sequel Peggle 2 will also feature the higher point value.

“On Xbox One, games are games. All games follow the same policies for achievements and Gamerscore,” said a Microsoft representative.

The Xbox One hits stores on November 22nd, this Friday.

Source: GamesIndustry International

‘Candy Crush’ Sets Sweet Records

King, the publishers of the addictive free-to-play mobile puzzle game Candy Crush Saga, have announced huge numbers for the game in its first year of release. You think it’s only reaching a “casual” audience It’s going much further than that.

The company states that the game has been downloaded over half a billion times across both Facebook and mobile devices, and over 150 billion individual games have been played.

In addition, it also revealed several fun facts, including the level that players get stuck on the most (level 65) and celebrities who play the game (including Mad Men’s Jon Hamm).

As a result of its success, King will roll out new downloadable goodies for Candy Crush fans, including in-game bonus content.

“The incredible milestone of more than half a billion downloads of the game, as well as the continued enthusiasm from our community, really delights the entire King team,” said Tommy Palm, “Games Guru” at King in a statement released this morning. “Fans can look forward to even more exciting new Candy Crush Saga content over the coming months, including an exciting new twist to the game.”

Candy Crush Saga is available for download now.

Source: TechCrunch

Nintendo Buys Into Mobile

Nintendo’s been in the gaming business for over a century now, but it made a curious move this past August after purchasing a stake in a mobile content company called Dwango Co. It was curious because, well, Nintendo doesn’t really deal with mobile content, instead sticking with its own gaming hardware, like the Nintendo 3DS.

That didn’t stop the company from making good out of that decision, though. Its stock has risen 5.15 percent to close at 13,070 yen in Tokyo – the highest it’s been since August 6. Dwango’s shares also surged following the stake purchase, approximately 21 percent, according to the Tokyo Stock Exchange.

Though there are no plans to release direct mobile content to Dwango, the company is advertising through the service, according to Nintendo spokesman Yasuhiro Minagawa. This isn’t a move to get into mobile (though Nintendo does promote its games through Dwango), but rather support for a business based on the personal request of Dwango’s chairman.

Let’s hope this continues to push Nintendo out of its financial troubles this holiday season.

Source: Business Week

AAA Game Sales Will Rise, EA Says

There have been some mild concerns about where the video game market will go with the release of Sony’s PlayStation 4 and Microsoft’s Xbox One consoles, especially considering their high prices. Electronic Arts, however, isn’t concerned.

Following the decline of sales in popular sequels in the Call of Duty, Assassin’s Creed and Battlefield franchises, EA Studios EVP Patrick Soderlund assured the company’s faith in the next-gen race.

“It is always going to be difficult to sell games on an older platform when something new is coming,” he told MCV. “More now than previously, it feels like people are really waiting for something new. I think with the games we have and our competitor games, you will see a big attach rate on the next-gen. There’s a lot of people waiting for the new, just like when a new iPhone comes out, and they hold off buying an iPhone 4S before the iPhone 5 comes out.”

“I think it is that simple. There are people waiting, they will get a machine, and look at the games and say: ‘If I want a shooter and I want the best one. If I want a racing game and I want the best one. If I want a soccer game and I want FIFA,” he concluded.

He also reassured that original games would sell well also, including the forthcoming multiplayer shooter Titanfall. ““The reaction to that is telling us that gamers don’t want to play the same game every year, we have to give them new experiences. And even the games we build on an iterative basis, we have to keep on innovating and push for new things so that people have a reason to play them.”

Source: MCV UK