Nintendo Switch Game Console Tops 15 Million Unit Sales in North America

Nintendo continues to spearhead the sluggish North American video game industry as market rivals Microsoft and Sony ready next-generation consoles launches a year from now.

Nintendo Oct. 17 disclosed it has sold 15 million Switch and Switch Lite consoles in North America since the device’s bow in 2017. The console has sold another 10 million units in Europe, which combined reportedly top PlayStation 4 console sales.

The Japanese hardware manufacturer’s Switch platform has led The NPD Group’s monthly game market research data for more than 10 straight months.

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The company said Switch titles have average more than 1 million unit sales each, including four that have surpassed have surpassed 6 million unit sales: Mario Kart 8 Deluxe, The Legend of Zelda: Breath of the Wild, Super Mario Odyssey and Super Smash Bros. Ultimate.

 

NPD: Consumer Electronics Revenue to Increase 3% Annually Through 2021

Increased consumer demand for big-screen televisions, wireless headphones, speakers and over-the-top video, consumer electronics is projected to grow 3% annually through 2021, according to new data from The NPD Group.

“Steady single-digit growth is notable in a mature market where consumers are not replacing or repurchasing items at the same rate they did in prior years,” Stephen Baker, VP, industry advisor for The NPD Group, said in a statement. “While some categories offer new, greenfield growth opportunities, the majority of revenue growth will occur from trade-ups and average sales price (ASP) increases, as opposed to rising unit volume sales.”

The movement to large screen TVs is raising category revenue, despite  expected flat unit sales overall. By 2021, more than 25% TV unit sales will be for a screen size larger than 65-inches, and those will account for 60% of the category’s sales dollars.

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Audio, true wireless headphones have become the format of choice for consumers and are expected to see tremendous growth over the forecast period. NPD said true wireless headphones will hold three-quarters of the headphone market dollar share by 2021.

“True wireless earbuds have evolved into virtual must-have mobile phone accessories, and many products now offer features such as hands-free digital assistant access and touch/tap controls for interfacing and controlling smartphones. This bond between headphone and smartphone will help drive new sales in the future,” added Ben Arnold, executive director, industry analyst. “Headphones is just one example of a mainstay category that is driving growth through new feature sets, we expect brands in other segments will take a similar approach to find growth in this competitive environment.”

While smart home technology will begin to slow compared to recent years, NPD expects it will remain an area of strength as decreases in ASPs will make products more accessible and drive acceptance among consumers. Home automation revenue is expected to grow 40% from 2018 to 2021.

During this timeframe NPD says smart display dollar sales are expected to triple as they become more available and serve both as a smart home interface device and a point of modern convenience.

 

NPD: August Video Game Sales Declined Double Digits

Retail sales of video games and hardware continue to suffer in an age of online gaming and lack of new-edition consoles.

The NPD Group reported that overall game sales fell 18% in August to $666 million, compared with $812 million in the previous-year period.

Through Aug. 31, total game spending for the year is down 6% to $7 billion, from $7.4 billion in 2018.

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With major console manufacturers Sony and Microsoft not releasing new-edition units until 2020, consumers are holding back purchasing hardware.

Console sales dropped 22% to $167 million, from $214.1 million, while game sales plummeted 24% to $257 million, from $338.1 million. Accessories slipped 6% $242 million, from $257.4 million last year.

Software sales were the lowest since 1998, according to analyst Mat Piscatella.

“That’s not great,” Piscatella said on the NPD podcast.

Nintendo Switch remains the best-selling hardware platform, with August and year-to-date sales up compared to 2018. Indeed, the Japanese manufacturer continues to buttress the entire gaming industry with half of the top-selling titles in August playing exclusively on the Nintendo platform.

“It was a really weird month,” Piscatella said.

Football continues to be gaming draw with EA’s Madden NFL 20 the top-selling tile in August as it has been for the past seven years. The title, which includes select college features for the first time since litigation with the NCAA was resolved.

Madden NFL 20 is the third-best-selling title in 2019 and remains the best-selling sports title in U.S. history.

It came in ahead of Mojang’s Minecraft, the highest-ever ranking for the title, and ahead of Take Two’s perennial top-selling franchise Grand Theft Auto V in third place.

Minecraft has had an exceptionally great summer,” Piscatella said.

‘Godzilla’ Is King of the Sales Charts

Warner Bros. Home Entertainment’s Godzilla: King of the Monsters debuted at No. 1 on the NPD VideoScan First Alert chart, which tracks DVD and Blu-ray Disc unit sales, and the dedicated Blu-ray Disc sales chart the week ended Aug. 31.

The sequel to 2014’s Godzilla, which was a reboot of the classic Japanese monster franchise, earned $110.5 million at the domestic box office, and sets up next year’s Godzilla vs. Kong.

Another new release, Universal Pictures’ The Secret Life of Pets 2 debuted at No. 2 on both charts. The animated sequel earned $158.1 million in U.S. theaters. Overall, it sold about 76% as many copies as Godzilla: King of the Monsters.

Marvel’s Avengers: Endgame, distributed by Disney, dropped to No. 3 on both charts after two weeks in the top spot.

No. 4 on both charts went to another newcomer, Paramount’s Rocketman. The Elton John biopic earned $96.4 million at the domestic box office.

Warner’s Pokémon Detective Pikachu dropped to No. 5 on both charts after taking the second spot the previous weeks.

Lionsgate’s new Apocalypse Now: Final Cut 4K Ultra HD Blu-ray re-release was No. 10 on the overall chart, and No. 6 on the Blu-ray chart.

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Blu-ray Disc formats accounted for 67% of first-week Godzilla: King of the Monsters sales; 4K Ultra HD Blu-ray comprised 18% of total sales, while 3D Blu-ray made up 1%.

The Secret Life of Pets 2 had 58% of its total sales from Blu-ray, with 6% of its total sales from 4K Ultra HD Blu-ray, while Rocketman had 64% Blu-ray sales, 13% from 4K.

On the Media Play News rental chart for the week ended Sept. 1, Godzilla: King of the Monsters also debuted at No. 1, with Secret Life of Pets 2 at No. 2.

Universal’s The Hustle dropped a spot to No. 3, while Rocketman debuted at No. 4 and Avengers: Endgame slid to No. 5 after spending the previous week on top.

Top 20 Sellers for Week Ended 8-31-19
Top 20 Rentals for Week Ended 9-1-19
Top 20 Selling Blu-ray Discs for Week Ended 8-31-19
Top 20 Blu-ray Market Share for Week Ended 8-31-19
Sales Report for Week Ended 8-31-19
Digital Sales Snapshot for Week Ended 9-2-19

Early ‘Madden 20’ Football Release Helps Jumpstart July Video Game Sales

The early release of Electronic Arts Sports’ annual NFL video game, Madden 20, helped boost July video game sales from the previous-year period, according to new data from The NPD Group.

Total sales topped $762 million from $759 million last year. Software sales skyrocketed 34% to $340 million from $253.7 million — largely due to football.

Hardware sales continue to suffer as consumers await pending new edition consoles from Sony and Microsoft. Console revenue fell 22% to $169 million from $216.6 million. Accessories fell 12% to $254 million from $288.6 million.

Through July, game revenue is down 4% at $6.4 billion from $6.6 billion last year.

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The annual football video game featuring former NFL coach John Madden was released in July instead of August in part to its inclusion of select college teams.

NCAA-sanctioned games have been shelved in recent years following litigation from some players regarding lack of compensation for their likeness or name featured in games and marketing.

The NCAA reached a $20 million settlement in 2014 with plaintiffs, who included lead plaintiff and former UCLA basketball player Ed O’Bannon. It was also the last licensed year for college-themed sports video with NCAA 14.

Madden 20 features a new segment, “Face of the Franchise: QB1,” showcasing elite quarterbacks beginning with their collegiate careers.

EA reached license agreements with 10 colleges: Clemson, Florida, Florida State, Miami, LSU, Oregon, University of Southern California, Texas, Oklahoma and Texas Tech.

NPD: June Video Game Sales Declined 13%

Anticipation of new hardware in 2020 continues to undermine the video game industry in 2019.

New data from The NPD Ground found that total industry sales dropped 13% in June to $959 million compared to $1.1 billion the previous-year period.

Hardware revenue plummeted 33% to $235 million, while software dipped 1% to $386 million and accessories fell 7% to $338 million. Half-year revenue is down 4% to $5.6 billion.

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Lone bright spot: Nintendo Switch, which saw the highest monthly sales and continue to deliver year-over-year growth.

Top-selling titles in June included: Super Mario Maker 2, Crash Team Racing: Nitro Fueled and Mortal Kombat 11, which remains the top-selling title of year.

Other top-selling titles included: Grand Theft Auto V, Minecraft; Super Smash Bros. Ultimate, Marvel’s Spider-Man, NBA 2K19, Mario Kart 8 and Days Gone.

Video Game Sales Continue May Decline

Sales of video game hardware and titles dropped 11% to $641 million in May compared to sales of $720 million during the previous-year period, according to new data from The NPD Group.

The decline was spearheaded by 20% drop in consoles to $149 million from $186 million, and 13% drop in software sales to $262 million from $301 million last year.

It was the worst May for software sales in six years. Sales of accessories and game cards remained flat at $230 million.

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Analysts contend the slowdown is largely due to consumers waiting for pending new edition – i.e. Microsoft’s Project Scarlett – consoles in 2020.

“Console makers will likely ensure that physical discs exist for at least one more console cycle, which could reverse negative comp trajectory,” Wedbush Securities media analyst Michael Pachter wrote in a recent note.

Indeed, Pachter doesn’t expect the next console cycle to eliminate physical discs altogether. He says consumers still value physical games for their portability, ease of gift giving and the ability to trade them in at retailers such as GameStop and Best Buy.

“Notwithstanding dire pronouncements about the imminent demise of physical media, our covered game publishers still sell over 50% of their console games in physical form,” Pachter wrote.

NPD: 5G Consumer Awareness Reaches Critical Mass

Next-generation 5G mobile wireless network technology may be more hype than reality at the moment. But consumer awareness of the fifth-generation wireless technology successor has reached mainstream, according to new data from The NPD Group.

According to the latest NPD Connected Intelligence, 5G awareness among consumers reached 64% at the end of the second half of 2018. That represented a 20% gain from 44% at the end of the first half of 2018.

The report – based consumer panel research of 3,600 U.S. cellphone users completed in February – found 33% of smartphone owners interested in purchasing a 5G-enabled smartphone once available.

Millennials reported have the highest potential (49%) to make the move to 5G, while consumers on unlimited data plans, who NPD says value downloading and streaming video content, are slightly less eager (43%) to purchase a 5G-enabled smartphone.

Verizon late last year launched limited 5G network rollouts in Houston, Sacramento, Los Angeles and Indianapolis, while AT&T bowed service in 12 cities, including Atlanta, Charlotte, N.C., Dallas, Houston, Indianapolis, Jacksonville, Fla., Louisville, Ky., Oklahoma City, New Orleans, Raleigh, N.C., San Antonio and Waco, Texas.

“In the last several days, we’ve seen the first 5G-enabled smartphone announcements and as expected, the devices are coming with a premium price tag, due to economies of scale, and a slightly larger form factor, given the hardware needs, than what consumers have become accustom to,” Brad Akyuz, executive director, industry analyst, NPD Connected Intelligence, said in a statement. “While consumer sentiment is positive, cost, form factor, and availability of 5G services will ultimately determine whether consumers will upgrade to 5G-enabled smartphones to enjoy much faster connection speeds.”

 

NPD: Digital Movie Transactions Up 19% in First Half of 2018

Digital movie purchase and rental transactions increased 19% in the first half of 2018, compared to the previous-year period, according to new data from The NPD Group.

The research group said that as TV-connected devices become commonplace in U.S. homes more consumers are choosing to rent and purchase digital movies, according to a survey of 5,677 U.S. consumers, aged 18 and older fielded from July 30th through Aug. 7, 2018. Trend is compared to the August 2017 survey, which fielded during a similar period last year.

As of August 2018, 61 million households in the U.S. had at least one Internet-connected TV, video game console, Blu-ray Disc player or streaming media player, representing year over year growth of three million. Specifically, households with an Internet-connected TV increased 20% and those with streaming media players grew 17%.

“Growth in digital movie transactions is being driven, in part, by access to TV-connected devices as an increasing number of viewers can simply buy and rent movies right in their living room,” John Buffone, executive director, industry analyst, NPD Connected Intelligence, said in a statement. “While greater access begets consumption, certain digital movie providers facilitate ownership over renting.”

Among the top five digital movie providers, iTunes users have the highest propensity to buy over rent, because Apple’s movie consumers are more affluent and more apt to collect movies. In the 12-months ending August 2018, nearly 24% of iTunes movie transactions were motivated by a desire to build a digital collection, leading to more buying than renting, according to NPD’s VideoWatch Digital service.

Vudu customers were also more ownership focused than the average video consumer, as such 20% of transactions were motivated by collecting. In contrast collecting movies only drove 13% of Amazon Video digital movie transactions, 9% of Google Play movie transactions, and 4% of Microsoft Store movie transactions.

“It’s long been known that collectability drives ownership and that’s no difference in the digital era,” said Ricardo Solar, president of media entertainment for NPD. “Movie fans will always want to own great films, as such, provider agnostic services like Movies Anywhere are critical for enabling digital sales growth.”

 

 

NPD: Retail Websites Fighting Back Against Amazon & Co.

Amazon is the undisputed e-commerce behemoth, generating about $53 billion in revenue in its most-recent fiscal quarter — nearly five times the revenue generated by Walmart.com.

Yet, new data from The NPD Group finds 29% of U.S. online consumer electronics dollar sales were made through traditional retailer websites for the 12 months ending in June. During this timeframe, the retailer ecommerce sites gained online dollar share over third-party ecommerce (i.e. Amazon) primarily in high average sales prices (ASP) for products such as TVs, PCs, tablets, and printers.

Average online spending per purchase was four-times higher on traditional retailer websites ($233/purchase) than through pure-play online retailers ($60/purchase). However, pure play online retailers are seeing an average of five additional annual purchases, when compared to traditional retailer websites, providing more occasions to sell.

Traditional retailer websites made up 46% of online U.S. consumer electronics dollar sales for these higher ASP items, up 3% from the prior-year period. For lower ASP items they make up 13% of dollar sales, as pure play online retailers still dominate this more ‘grab and go’ segment.

“Across the retail landscape traditional retailers are finding success in bringing what they do well in store to the online channel,” Stephen Baker, VP, industry advisor for the TNP Group, said in a statement.

Baker said traditional retail is competing effectively with Amazon and others for higher-priced items by leveraging their merchandising expertise and the strong in-store product selections on their e-commerce platforms.

“This approach is clearly paying off in the CE industry, as evidenced by growing online sales across a variety of categories,” he said.