NPD: March market suffers 17% sales slide

The North American video game market has been dealt a heavy yet expected blow as the latest NPD figures show year-on-year declines for March.

The US market generated a total of $1.43bn in March; a significant 17 per cent fall from the same period last year, and a slight trim from the $1.47bn achieved in February.

Year-on-year losses were fairly balanced across hardware, software and accessories. Hardware sales made a total of $456m for the month – an 18 per cent decline – while software ($793m) and accessory sales ($186m) had fallen 17 and 15 per cent respectively.

These wholesale losses will inevitably raise concerns over the stamina of the US game market – a sector that has hitherto shown impressive buoyancy – but NPD analyst Anita Frazier gave a prompt warning about linking the March sales slide with broader economic troubles.

"While it might be tempting to jump to the conclusion that the sky is starting to fall on the video games industry given this months results, it’s important to remember that two very big things are different this year than last,” she opened.

First, Easter fell in March last year whereas it fell in April this year, and [secondly], last March included the release of Super Smash BrosBrawl, which went on to become the fourth best-selling game in 2008.”

Frazier added that the market boost which the Easter holiday brings should not be overlooked, claiming that 8 per cent of industry unit sales were purchased for the Easter occasion last year. This means that Easter brought an extra $121m to the US market in 2008.

We expect that most of Easter sales this year fell into the April reporting period and we’ll see that reflected in next month’s data,” she added.

However, there is a chance that such an Easter boost will be somewhat hidden in next month’s NPD results, with any potential year-on-year growth being challenged by last April’s release of Grand Theft Auto 4, a game which proved to be extraordinarily lucrative for the video game market.

If Grand Theft Auto 4 does manage to push April’s earnings into a year-on-year loss, then there will be further concerns that the industry is in embarking on a downward trend, rather than a blip.