Game Marketing Tips, Analysis, and News

Friday, August 12, 2011

July Game Sales Worst Month Since 2006

July 2011 physical game sales, carefully plotted.
The latest figures from NPD are in for July 2011, and once again it's bad news for physical game sales. Overall game sales (hardware, software, accessories) were down 26% to $707 million, the lowest monthly total since October 2006, according to NPD. When you add it all up, 2011 so far is down 4% over last year's sales, which means the third year in a row of sales declines for the classic physical retail sales channel.

Hardware sales were down 29%, and software sales were down 17%, and accessories dropped only 8%. Once again the Xbox 360 grabbed the lead position, with 277,000 units sold, though that's a decline over last July. Here's some perspective for you: Apple is selling around 7 million iPhones per month, and another couple million iPod Touches on top of that; Android phones are selling about 18 million per month. Apple's selling about 5 or 6 million iPads per month, too. Is it any wonder publishers and developers are looking at smartphones and tablets as a market?

NPD notes that digital sales could help make up for the decline in physical sales. What they don't say, though, is specifically how much digital sales could help. Probably because tracking digital sales is an enormous problem compared to tracking physical sales; NPD has their work cut out for them to come up with good numbers for things like subscriptions, DLC, in-game item sales, and the like.

We can already see the impact that the continuing sales decline is having on publishers dependent on traditional retail sales channels.

"New physical retail sales of software saw a 10 percent decline in unit sales versus last July. There were substantially fewer new releases this year, and the top selling games, with the exception ofNCAA 12, didn’t perform as well as last year’s top sellers did. Looking across PC, console and portable game sales, 19 titles sold over 100K units last July, while this year, only eight titles peaked 100K units," noted Frazier.

While you may have record sales for new releases like Modern Warfare, the reality is that most titles aren't hitting the kind of numbers they used to hit last year. This is why companies like THQ are having layoffs, and shifting development resources to social and mobile games. This is distressing to longtime console gamers, who fear a lack of the kind of titles they like. Markets are changing, and publishers are having to change with them... whether they like it or not.

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