The World Health Organisation’s original stance on playing video games has certainly shifted over the past couple of months. In previous reports, the WHO had warned the masses away from playing too many video games. However, since we are recommended to stay at home to limit the virus being spread, the WHO have turned on their heel and are now actively encouraging consumers to pick up the controllers, turn on the video games and #PlayApartTogether.
When lockdown was extended, consumers were on a mission to combat the boredom in any way they could - driving a huge increase in sales of streaming services, video and board games. Japanese video game company, Nintendo, released Animal Crossing: New Horizons, (low-stress, distraction style game play) and sold over 11 million copies in March 2020; the “highest spending on videogame products for a March month since 2008”.
Traditional games also saw a significant increase, as people realised they were being confined to their homes for the foreseeable future… there’s only so much screen time one person can cope with!
We are chuffed to report on the performance achieved by our Gifts, Gadgets and Gaming clients, who have really made it to the next level throughout 2020.
The initial peak, seen in April, coincided with the extension of the original 3-week lockdown - when consumers began to realise that this would continue for a lot longer than originally anticipated, and cabin fever set in. Following this, we watched sales hit their ultimate peak (YTD) in July 2020.
In stark comparison to July’s performance, sales decreased in August and September, below the previous years’ performance. We expect that a combination of factors contributed to this dramatic shift in the trends seen this year so far:
Gyms were reopened at the end of July and after some initial uncertainty, after being ‘stuck’ indoors for so long, fitness fanatics returned to the gym to battle the boredom and to maintain their mental wellbeing. Additionally, shielding was also lifted in early August, meaning those who had previously been confined to the same 4 walls, were now allowed to carefully re-integrate into normal life.
In mid August, theatres, casinos and bowling alleys had restrictions lifted and consumers were allowed to return to more traditional methods of entertainment, those of which they had been denied for so long. In addition to this, the imminent release of the Playstation 5 could also be contributing to a decrease in sales, with many people holding off buying any new games or hardware as they have plans to upgrade their machine in line with November’s UK launch.
Looking further into this sector split, it appears that while virtual and traditional gaming has been soaring, the gifting industry has struggled to see growth of the same magnitude - though has still seen growth, nonetheless! Since consumers have been forced into varying levels of isolation, physical gifting became less of a priority as people were wanting to come up with alternative gifting methods so they didn’t have to hand over physical items - shifting their focus to vouchers or e-gifting.
What’s next for gifts, gadgets and gaming?
As we head towards Black Friday, we expect that gaming sales will peak once again; it’s predicted that most retailers will run at peak from early November due to delivery availability. On top of this, avid gamers may be holding off on purchasing any new games until later November when the Playstation 5 is released, which could put a further increase on already inflated sales.
Additionally, as the UK is subjected to varying tiers of lockdown (and as we head towards the traditional ‘flu season’), consumers will once again turn to distraction (both virtual and physical gaming) to beat the lockdown boredom.
There's one thing for certain: Christmas this year is going to be different than any other. Consumers are going to want to make their loved ones happy this year, whether this be with physical gifts or virtual vouchers.
Action points retailers can take:
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