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Gamers in the U.S. spent around $15.39 billion on video games last year, according to NPD Group, a leading game market tracker. As a result of shift from packaged media to digital distribution and mobile games, the market only grew 1% year-over-year despite of increasing interest towards games in general.

The NPD Group estimates that in addition to the $6.34 billion spent in the U.S. by consumers on new physical video and PC game software during 2013, the total consumer spend on other physical forms of content (used and rental) reached $1.83 billion, and content in digital format (full game and add-on content downloads, subscriptions, mobile games and social network games) generated $7.22 billion.

Particularly strong growth for full-game downloads and downloadable content on consoles, PCs and portable devices, along with growth in mobile games, were more than enough to offset an 11% decline in new physical sales, leading to a 1% annual growth for total content spending.


A screenshot from Call of Duty: Ghosts video game by Activision


 

“Growth in digitally distributed content is vital to overall industry health. Since this is such a topic of high interest to the industry, we recently conducted additional in-depth research into consumer behavior with regard to digital content acquisition, and found that 36% of the U.S. population ages 13 and older was playing games acquired digitally, with incidence highest among teens and young adults.  Interestingly, however, there is no particular point after age 25 where incidence declines significantly,” said Liam Callahan, industry analyst at the NPD Group.

The strong performance of hardware seen in the fourth quarter led to a positive year for the category, which ended the year 5% higher than 2012.  Content growth, coupled with hardware growth led to a 2% increase in overall consumer spending over 2012.

“The bottom line is that the overall games market is growing. NPD reported declines in content and hardware spending in both 2011 and 2012, so the growth in 2013 is a positive indicator for future market growth as we enter the first full year with all three new consoles on the market,” said Mr. Callahan.

While the dollar sales is a very important metrics for the industry, unit sales can show whether the market is expanding in terms of population or not. It is well known that games for consoles tend to get more expensive with each new generation, which means that as a result of a scheduled shift from one generation of systems to another, overall spending will increase even if the number of gamers decreases slightly or the number of titles they purchase drops. Furthermore, dollar sales also increase as a result of growing prices of PC games and releases of DLCs; today, popular titles can boost revenue per-user/per game to $100/€100 without problems with the help of DLCs and special-edition versions. What is interesting to know is how many gamers are there, how many games they purchase and how does their behavior change as the market evolves.

Still, it is good to see that the market of video games is not stagnating and is growing, albeit slowly.

Tags: NPD

Discussion

Comments currently: 1
Discussion started: 02/19/14 12:24:33 AM
Latest comment: 02/19/14 12:24:33 AM

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My brother just spent $350 on a PS3 with a ton of games (At an Australian EB Games Store).. ^__^ the old gen consoles would account for ALLOT of the gaming sales as they offer more games at a much better value point.
0 0 [Posted by: vid_ghost  | Date: 02/19/14 12:24:33 AM]
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