Gamers abandon retail stores. Sales decline in 2011.

Market Researcher the NPD Group have analysed games sales last year, focusing on December. Their report is very negative showing an overall drop of 8 percent in 2011, with December suffering from a 21 percent decline in sales.

While the focus of the report is the American audience, the figures are damning and actually rather concerning for the industry. December sales alone dropped from $5.07 billion in December 2010 to $3.99 billion in December 2011. For the full year, it dropped to $17.02 billion in 2011 from $18.59 billion in 2010.

We can look at the report and extrapolate the data. The retail market appears to be dying, with more gamers focusing on online options, such as STEAM. Social networking is also rising in popularity, due to the low costs of games. The STEAM sale in December apparently generated huge revenue for Valve, although details have yet to be released. In this sale they offered many games at up to 90% off the retail price, leaving many retail stores with vastly overpriced titles.

Venturebeat also have written a report on the research and they say “Full told, the estimated total consumer spending on games includes physical video and retail games, used games, game rentals, subscriptions, full-game digital downloads, social network games, downloadable content, and mobile games. Not counting hardware, this had estimated sales of $16.3 to $16.6 billion in 2011, down about 2 percent or so from a year ago.

Hardware sales were down 11 percent for the year, as were accessories. Software was down 6 percent. New physical retail sales of portable, console and PC games were $9.3 billion in 2011, down 8 percent from $10.1 billion in 2010. Sales grew for used games, full-game digital downloads, downloadable content, and mobile gaming apps.”

Anita Frazier at the NPD group said “Overall industry results are not entirely surprising given that we are on the back end of the current console lifecycle, combined with the continued digital evolution of gaming. Core gamers continue to be engaged and spend on established franchises across both the digital and physical format using multiple devices for different gaming occasions.”

What was the biggest selling game last year? Well no surprises that Call of Duty Modern Warfare 3 topped the chart followed by Just Dance 3 from Ubisoft. Elder Scrolls V: Skyrim took the third position. Battlefield 3 wasn't far behind, although I personally think its incredible that Modern Warfare 3 sold better.

Kitguru says: Do you still buy games in a retail store, or more online with D2D, Steam and alternatives?

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