Defying Economic Turbulence: Video Game Sales Remain Resilient

As 2023 begins, the UK faces significant economic challenges, including an 11% inflation rise and record-high taxes, leading to decreased consumer confidence. However, despite these headwinds, the video game industry has shown surprising resilience. Recent sales figures are impressive, with Pokémon Scarlet and Violet becoming the fastest-selling games in Nintendo history, Splatoon 3 surpassing 3 million units in Japan, and God of War Ragnarök achieving the biggest launch in its franchise history. These record-breaking sales, combined with reports of video game publishers achieving record revenues, indicate that the industry is currently thriving. The trend of sales growth has not been limited to the fourth quarter of 2022, with new game sales outpacing those of 2021 throughout the year. The top 10 new boxed games generated 31% more sales in 2022 than their 2021 counterparts, while unit sales for full game digital downloads increased by 52%. The lack of new releases after April 2022 led to speculation that the year would be poor for game sales, but the data suggests that the decrease in sales was largely due to a decline in catalogue sales, rather than a lack of appetite for new games. In fact, unit sales for new games in 2022 increased by 16% compared to 2021, almost reaching 2019 levels. The paradox of 2022 is that as fewer games were released, consumer appetite for new games increased. The industry's ability to weather economic downturns is mixed, but factors such as the shift towards live service experiences, microtransactions, and subscriptions may help to sustain growth. Historically, the video game industry has been resilient during economic uncertainty, with sales declines often resulting from gamer apathy in existing console systems rather than economic factors. The evolution of video games, with new technologies and business models, has helped to drive growth, and the increasing number of people identifying as gamers is a positive indicator for the industry's health. While the market is highly competitive, and the future is uncertain, the video game industry has successfully adapted to changing consumer behaviors and preferences, catering to a diverse range of audiences and offering value for money. As a result, the industry is likely to continue to evade economic headwinds, at least for the time being.