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Gaming in the Interactive World - US

Published by: Mintel International Group Ltd.

Published: Jul. 1, 2009 - 117 Pages


Table of Contents


SCOPE AND THEMES

What you need to know

Definition

Data sources

Sales data

Consumer survey data

Advertising creative

Abbreviations and terms

Abbreviations

Terms




EXECUTIVE SUMMARY

Hardware launches drive sales cycle

New competition from the web and multifunction devices

Software to fuel near-term sales

Dedicated stores, web play key roles in sales and marketing

Uncertain economy, aging population could retard sales

PS3 not living up to competing seventh-generation consoles

Gaming is for the young

Purchase model prevails

Gaming as a new way to socialize




MARKET SIZE AND FORECAST

Key points

Launches drive sales

Figure 1: Total U.S. sales and forecast of gaming hardware and software, at current prices, 2004-12

Figure 2: Total U.S. sales and forecast of gaming hardware and software, at inflation-adjusted prices, 2004-12




COMPETITIVE CONTEXT

Online games

Figure 3: Online entertainment usage, by age, February 2009

Figure 4: Online, MMORPG, and social networking game usage, by key demographics, March 2008

PCs move from work to play

Figure 5: Use of video games on home PCs vs. consoles, by key demographics, April 2007-June 2008

Gaming on the go

Figure 6: Ownership of handheld gaming devices and game play on MP3 players and cell phones, by age and HH income, October 2007-December 2008

Figure 7: Flight control iPhone game, image




SEGMENT PERFORMANCE

Key points

Software to drive near-term revenues

Figure 8: U.S. sales of gaming products at current prices, by segment, 2006 and 2008




SEGMENT PERFORMANCE—GAMING HARDWARE

Key points

Proprietary model drives prices

Figure 9: Pricing as of launch for major gaming consoles, 2000-06

New functions could help drive sales

Hardware sales and forecast

Figure 10: U.S. sales and forecast of gaming hardware, at current prices, 2004-12

Figure 11: Total U.S. sales and forecast of gaming hardware, at inflation-adjusted prices, 2004-12

New risks for portables




SEGMENT PERFORMANCE—GAMING SOFTWARE

Key points

Software sales roughly track console launches

Figure 12: Top 10 console games, by U.S. sales, 2008

Figure 13: Rockstar Games’ Grand Theft Auto IV image

Secondary market, competing platforms could dampen sales

Software sales and forecast

Figure 14: U.S. sales and forecast of gaming software, at current prices, 2004-12

Figure 15: Total U.S. sales and forecast of gaming software, at inflation-adjusted prices, 2004-13

Growing the audience for gaming

Figure 16: Video games played, by genre, by age, October 2007-December 2008




RETAIL CHANNELS

Gaming benefits from relatively broad distribution

Figure 17: Channels through which video games are purchased, 2008

Secondary market plays an important role

Downloads take hold




MARKET DRIVERS

The recession

Figure 18: U.S. unemployment, October 2008-June 2009

Figure 19: Disposable personal income and personal consumption, October 2009-May 2009

Households with children

Figure 20: Gaming hardware ownership, by children in household, October 2007-December 2008

Empowered consumers seek control over content

Figure 21: Desire for video content storage and recall, by age, November 2008

An aging U.S. population

Figure 22: Population, by age, 2004-14

Health and safety concerns




LEADING COMPANIES

Key points

Three players compete for hardware dominance

Figure 23: Gaming console ownership, by brand, October 2007-December 2008

Software a wider but narrowing field




BRAND QUALITIES

Electronic Arts

Microsoft

Nintendo

Sony Electronics




INNOVATION AND INNOVATORS

Project Natal

Spore

WildTangent

Traditional advertising

Figure 24: Advertising spending, by leading gaming brands, 2007 and 2008

Figure 25: Advertising spending, by leading gaming software and retailer brands, 2007 and 2008

In-store promotions and bundled/special-edition products

Online marketing

Licensing partnerships

Television advertising

Apple iPod touch

Figure 26: Apple iPod touch television ad, 2009

Nintendo DS

Figure 27: Nintendo DS television ad, 2008

Gaming in the Interactive World Nintendo Wii Fit

Figure 28: Nintendo Wii Fit television ad, 2008

Sony PlayStation 3

Figure 29: Sony PlayStation 3 television ad, 2008




OWNERSHIP

Age more relevant than income in determining usage

Figure 30: Trended ownership/usage of video game consoles and handheld devices, by key demographics, January 2006-October 2006 and October 2007-December 2008

Gaming nearly universal among 9-14s

Figure 31: Ownership/usage of video games—kids/teens, by age and age/gender, January 2006-October 2006 and October 2007-December 2008

Figure 32: Ownership of handheld gaming devices—kids/teens, by age and age/gender, October 2007-December 2008

PS2 still the most commonly owned console

Figure 33: Top 10 consoles/portables owned—adults, by gender, October 2007-December 2008

PS2 dominates amongst 18-24s

Figure 34: Top 10 consoles/portables owned or played, by age, October 2007-December 2008

Wii the only console for which penetration increases with household income

Figure 35: Top 10 consoles/portables owned or played, by HH income, October 2007-December 2008

Kids take gaming to go

Figure 36: Top 10 consoles/portables owned or played—kids, by age and age/gender, October 2007-December 2008

Interest in handhelds declines amongst teens

Figure 37: Top 10 consoles/portables owned/played—teens, by age and age/gender, October 2007-December 2008




PURCHASE BEHAVIOR

Average annual spend on video games—$63

Figure 38: Mean annual spend on video games, by gender, age, and HH income, March 2009

Only two games purchased per year on average

Figure 39: Frequency of video game purchase/rental, by gender, age and HH income, October 2007-December 2008

Borrowing and rental rare amongst younger kids

Figure 40: Kids’ attitudes towards purchasing/renting games, by age and age/gender, October 2007-December 2008

Figure 41: Teen attitudes towards purchasing/renting games, by age and age/gender, October 2007-December 2008

Women more likely to buy games as gifts than for themselves

Figure 42: Buying to play vs. gift purchases, by gender, age and HH income, March 2009

Timing of purchase

Figure 43: Timing of new game purchases—adults, by age, October 2007-December 20008

Teens buy early but not on day of release

Figure 44: Timing of new game purchases—teens, by age and gender/age, October 2007-December 20008




USAGE PATTERNS

Xbox 360 owners most engaged

Men play nearly twice as many hours as women

Figure 45: Hours of game play—adults, by gender, October 2007-December 2008

25-34 year olds spend most time gaming

Figure 46: Hours of game play—adults, by age, October 2007-December 2008

Highest-income households spend less time gaming

Figure 47: Hours of game play—adults, by HH income, October 2007-December 2008

Boys aged 9-11 the true gaming champions

Figure 48: Hours of game play—kids, by age and age/gender, October 2007-December 2008

Children graduate from simpler platforms to more complex ones

Games too solitary for teen girls

Figure 49: Hours of game play—teens, by age and age/gender, October 2007-December 2008

Gaming in the Interactive World GAMES AS SOCIAL MEDIA

Console gaming typically more social than PC gaming

Figure 50: Who adults play games with, by platform, March 2009

Men seeking to connect via gaming

Figure 51: Attitudes towards gaming with others, by gender, March 2009

The younger the gamer, the more social the gamer

Figure 52: Attitudes towards gaming with others, by age, March 2009

Social games for high-income households

Figure 53: Attitudes towards gaming with others, by HH income, March 2009

Kids play alone or with peers—not with older/younger kids

Figure 54: Who kids play games with, by age and gender/age, October 2007-December 2008

It’s a family affair, and especially so for women

Figure 55: Level of game play and social game play, by gender, March 2009

18-34 year olds most likely to game as a social activity

Figure 56: Level of game play and social game play, by age, March 2009




AVATARS AND MICRO-TRANSACTIONS

Women virtually neck and neck with men

Figure 57: Gaming avatar usage and virtual gaming purchases, by gender, March 2009

Youngest adults most keen on avatars and virtual purchases

Figure 58: Gaming avatar usage and virtual gaming purchases, by age, March 2009




GENRES PLAYED

Action/adventure still number one

Figure 59: Game genres played—adults, by gender, October 2007-December 2008

Cards, casino games a good bet for seniors

Figure 60: Game genres played—adults, by age, October 2007-December 2008

Action/adventure tops with kids

Figure 61: Game genres played—kids, by age and age/gender, October 2007-December 2008

Interest in most genres declines among older teens

Figure 62: Game genres played—teens, by age and age/gender, October 2007-December 2008




GAMING AND THE WEB

Incidence of game play connected to the web—adults and kids/teens

Figure 63: Incidence of game play while connected to the web—adults, by gender, age and HH income, October 2007-December 2008

Kids and teens more likely to play games connected to the web

Figure 64: Incidence of game play while connected to the web—kids/teens, by age and gender/age, October 2007-December 2008

Online console gaming behavior

Figure 65: Online console gaming behavior, by gender, March 2009

Youngest adults most keen on web activities

Figure 66: Online console gaming behavior, by age, March 2009




ATTITUDES AND MOTIVATIONS

Self-perception as “hardcore” vs. “casual” gamers

Figure 67: Perceived game skill level, by age, March 2009

Women want self-improvement, men like advertising

Figure 68: Attitudes toward newer elements of gaming, by gender, March 2009

Improving dexterity and brain fitness popular across age groups

Figure 69: Attitudes toward newer elements of gaming, by age, March 2009




GAMING AND VIRAL MARKETING

Men more invested in viral marketing

Figure 70: Additional attitudes towards gaming—the impact of friends, by gender, March 2009

18-24s keen on spreading the word

Figure 71: Additional attitudes towards gaming—the impact of friends, by age, March 2009




IMPACT OF RACE/HISPANIC ORIGIN

Ownership and usage

Figure 72: Gaming on handheld gaming devices, MP3 players and cell phones, by race/Hispanic origin, March 2009

Asians most keen on Wii

Figure 73: Top 10 gaming consoles/portables owned or played—adults, by race/Hispanic origin, October 2007-December 2008

Blacks spend twice as much as Asians on games

Figure 74: Mean spend on video games, by race/Hispanic origin, March 2009

Blacks and Hispanics buy and rent more games

Figure 75: Frequency of video game purchase/rental, by race/Hispanic origin, October 2007-December 2008




UGC

One in four give thumbs up to UGC gaming

Figure 76: Attitudes towards user-generated content in games, by gender, March 2009

One in three 18-34s like UGC gaming

Figure 77: Attitudes towards user-generated content in games, by age, March 2009




APPENDIX: SURVEY RESULTS FOR ONLINE TEENS

Figure 78: Dedicated gaming device ownership among teens, by age and gender, March 2009

Figure 79: Gaming as a social activity among teens, by age and gender, March 2009

Figure 80: Avatars and micro-transactions among teens, by age and gender, March 2009

Figure 81: PC gaming among teens, by age and gender, March 2009

Figure 82: Dedicated gaming handheld vs. cell phone gaming among teens, by age and gender, March 2009

Figure 83: PC vs. console game play in the past month among teens, by age and gender, March 2009

Figure 84: Purchasing habits and word of mouth marketing among teens, by age and gender, March 2009

Figure 85: Interest in UGC gaming, among teens, by age and gender, March 2009




APPENDIX: OTHER USEFUL CONSUMER TABLES

Gaming and types of games played

Figure 86: Incidence of handheld and cell phone gaming, by age and HH income, March 2009

Figure 87: Game genres played—adults, by HH income, October 2007-December 2008

Genre preferences by race/Hispanic origin

Figure 88: Game genres played—adults, by race/Hispanic origin, October 2007-December 2008

Asians more likely to play video games

Figure 89: Ownership/usage of video games, by race/Hispanic origin, October 2007-December 2008




APPENDIX: TRADE ASSOCIATIONS

Abstract

As consumers increasingly look to the web for entertainment and socializing, gaming companies have been anxiously seeking new ways to incorporate the web into their platforms—and avoid losing young consumers to the social media, online music, video, and games available through the web. Previously, the major fixed console platforms all supported remote game play and downloads of basic games and video content via web connections, but the latest initiatives go much further. For example, Microsoft has announced plans to integrate Facebook and Twitter features into its Xbox Live network offering this fall, along with support for streaming HD video and online radio.

With a new emphasis on video, audio and web content in addition to gaming, consoles are clearly striving to become a home media hub—a multifunction device that bridges PCs and TVs and serves up a broad range of digital entertainment options to the living room, If console companies can truly position their products as multifunction digital content devices, they could dramatically grow market share and also develop newer revenue streams such as movie rentals and advertising. However, many devices are fighting for this spot (including home entertainment-focused PCs, advanced set-top boxes and even web-enabled TVs), and it’s an arena that Microsoft has already failed to dominate once, with PCs powered by Windows Media Center Edition.



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