Video Gaming Growth

In Consumers
Global Gaming Market

In my most recent position as Chief Traffic Officer for a major online Technology News publisher, I had a major role in researching consumer demand.  During my tenure I became very interested in product and product category trends.  There are three categories that were most interesting to me were VR, drones and gaming.  Gaming took front and center because it was at the root of a large portion of the content that we were creating on a daily basis.

Gaming and entertainment in general have become, from a content perspective, incredibly important to the Technology-News vertical.  Back 8 or 10 years ago, there was still a thrill when a new piece of technology came out and all of the interesting things that it could do.  Some recent product category launches include wearables like Smartwatches and Fitness Trackers, but also the aforementioned drones and VR/AR.  This doesn’t really seem to be the case much anymore outside of the real hardcore segments of the market.  What’s become much more important, at least for content publishers is the use of these products.

From a pure traffic perspective, Gaming and Entertainment have growth to be between 7 and 12% of the traffic generated from search on such sites as CNet, TechRadar and similar sites.  The part of this trend that I wanted to understand was whether or not this was due to focus on the part of the publisher or was this trend due to product category growth.

According to Transparency Market Research, the global gaming market has achieved some incredible growth recently, growing from $70 billion in 2011 up to $118 billion in 2015.  This is an annual growth rate of 13.7%.  Many analysts would say that this is not what would be considered a growth industry (where this measure would be around 15%), I on the otherhand think that this is a very interesting market.  A lot of this market still comes from gaming consoles and physical game disks, but a lot of the growth is coming from and will come from mobile and online gaming.  According to Statista, roughly $11 billion of this is coming from online gaming like smartphone/tablet games, downloadable games as well as internet gaming platforms in the United States alone.  This represents 10% of the global gaming market.  China is ahead of the US with $14.4B in annual revenue.

Global Gaming Market
Global Gaming Market Map, 2015

The annual growth rate is expected to slow down but will likely exceed $13B in revenue (in the US) by 2020.  The 4 year growth expectation of 15%, while not stellar, is also an indication of a slowdown in penetration growth currently of 63% expected to increase to just under 65%.  It’s anticipated that the growth in the US market will be equally distributed between online games, downloadable games and mobile games.

From a demographic perspective, this is a really good market.  Gamers tend to be fairly young with an average age in the mid 30s, but the chart below indicates that most demographic groups will see growth over the next five years (with the strange exception of both male and female 45 to 54 year olds.

Gamer Demographics
Changing demographics anticipated for gamers

The two largest demographic groups in the study above (from Statista), are the male and female 16-24 and 25-34 year old age groups.  Not only are these groups larger, they are also more inclined to play more frequently with nearly a quarter (24%) of male college students playing multiple times per day and another 17% playing daily and 16% of female students in both categories.  Nearly half of male college students and 32% of females play every day with another 39% (male) and 36% (female) playing weekly.

The demographic profile could lead you to a number of conclusions.  First, in order to be a fairly avid gamer, you need to have free time.  Second, the free time that you have you spend playing games, not something else — like watching television or some other passive entertainment.

In the next several years, it is highly likely that the gaming market will change a bit more than this study would anticipate.  The market and the growth of this market is likely going to be changed with the continued emergence of Virtual Reality and Augmented Reality, it’s really a question (to me) whether the market will be considered to be gaming (with active engagement) or it will be a passive market much like movies or television viewing.

From a content creation perspective, it’s a good time to be a reporter covering gaming, VR/AR as these trends are not likely to slow down — but it’s possible that this could become a form of passive entertainment, but that’s another topic.  [But to help you think more on that subject, here’s a link.]

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