Xbox 360 Kinect Boosts November Video Game Sales
The video game industry enjoyed an eight percent bump in sales in November, raking in $2.99 billion across hardware, software and accessories categories. It marked the best November on record for the industry, besting the previous record, set in 2008, by roughly $30 million. Microsoft's Xbox 360 console was the best-selling console hardware system for the month, realizing a 68 percent increase over last November. "November sales represent the best November on record in terms of new physical retail sales," said NPD Group analyst Anita Frazier. "It bests November 2008, and that time frame was at the height of the music/dance genre sales."
The best-selling system overall was the portable Nintendo DS. Frazier said it was a high/low story for the DS this month with the new red SKU providing the most sales and the white, lower-priced SKU landing in second place. Frazier said it appears the DS attracted two pockets of consumers: those looking for a unique limited-edition product and those looking for value.
"All categories were up over last year with the exception of portable hardware and software," Frazier continued. "The 360 platform accounted for over 40 percent of total industry sales driven by the successful launch of Microsoft's Kinect. Xbox 360 accessories accounted for 60 percent of that categories' dollar sales this month."
Frazier said based on typical seasonality trends, new physical retail sales should come in between $18.8-$19.6 billion--the higher end of that range would essentially be flat to last year. Frazier said gains in November offset a good portion of the year-to-date declines. "We expect a big jump in sales in November due to seasonality and the influence of holiday, but the change this November over October is bigger across most platforms than it was last November," she said. "This could point to the impact of aggressive retail promotions during the critical Black Friday week."
Frazier noted that this data set represents new physical retail sales only. "We have begun to report on sales realized through other channels such as used game sales, digital distribution and mobile apps among others," she said. "In the first half of 2010, new physical retail sales at the total industry level accounted for approximately 70 percent of the total consumer spend against the industry, and while that is likely to change when full year results are tabulated, it gives some context with which to evaluate the portion that new physical retail sales represents."
The success of Microsoft's Kinect platform-a motion control sensor and hands free remote control system, led to the dramatic increase in Xbox 360 sales. NPD data showed the Xbox 360 Kinect was the best-selling accessory item in November. With one month of sales, it is the top-selling accessory item in terms of dollar sales on a year-to-date basis. The 360 platform accounted for more than 40 percent of total industry sales driven by the successful launch of Kinect. Xbox 360 accessories accounted for 60 percent of that categories' dollar sales this month, according to NPD Group data.