Analyst: March a perfect sales storm

EEDAR's Jesse Divnich says strong NPD numbers show the industry is maturing, less reliant on holiday sales quarter.


The NPD Group's freshly released gaming-industry sales figures for the month of March handily trumped analysts' expectations, given that US retailers sold nearly $1 billion in game software and another $551 million in hardware.

Though the numbers have barely had time to sink in, one analyst has already pulled a few lessons from the data dump. Electronic Entertainment Design and Research analyst Jesse Divnich (formerly with the simExchange prediction market) called the month a "perfect storm" for new game releases, with something for everyone.

"Super Smash Bros. Brawl fulfilled the needs of the casual, social, and sub-13-year-old markets," Divnich said in a note to reporters. "The hardcore gamers seeking heavy action and strong multiplayer support had Rainbow Six Vegas 2. Even Army of Two played its role by attracting in consumers with its flashy marketing campaign and catchy theme song!"

The success of these games further shows that the gaming business has reached a certain level of maturity, according to Divnich.

"The industry is finally large enough to support numerous AAA titles during an off-season month," Divnich said, "and going forward, publishers need not fear a PS3/Xbox 360 title hindering their Wii title (or vice versa). March has proven that the PS3/Xbox 360 and the Wii can coexist perfectly together."

While other analysts have debated how the state of the US economy impacts the gaming industry, Divnich said an argument could be made that the gaming business actually thrives during economic downturns.

"These results only reinforce previous assumptions that the video game industry offers the best value in terms of entertainment," Divnich said, "especially during tough economic times when inflation is on the rise and gas prices continue to push record highs."

Finally, Divnich noted the somewhat stagnant sales levels of Xbox 360 and PlayStation 3 hardware, despite the strong performances of multiplatform games Army of Two and Rainbow Six Vegas 2. Divnich said that could signal the need for price cuts on those consoles because they may have reached all the consumers they're likely to reach at current levels.

"If we do not see any price cuts in the coming weeks, we can likely expect some hardware cuts once GTAIV loses some steam (before July) or if the GTAIV release significantly drives hardware sales for one console over the other," Divnich said.

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