Has Black Friday damaged December sales?

November’s barnstorming Black Friday week was one of the busiest seven days of sales in UK games industry history.

Almost 2m games were sold that generated around 62m in revenue. It was a huge week, with 240,000 Xbox Ones and PS4s shifted through stores.

Yet amongst the commercial success, there was one lasting worry… what did this mean for December? Has the retail games industry just moved all its sales out of Christmas and into November?

We still have one more full sales week before Christmas. So we will be able to offer a deeper analysis once the festive period has past. Yet now we are two weeks into December, we have some insight into how Christmas is performing.

All data is courtesy of GfK Chart-Track. We don’t have access to hardware sales at this moment, so these figures are all based on boxed software sales.

Let’s break it down by week

BLACK FRIDAY WEEK (Sales Week 48)

2014:
1.96m games sold
62.14m revenue generated

2013:
1.712m
60m revenue generated

2012 (Not Black Friday but corresponding week):
1.7m games sold
48.7m

2014 was by far the biggest Black Friday ever. 2012’s Black Friday was earlier in November and the retail event that year was largely just restricted to Amazon, so we instead decided to compare the corresponding sales week (Week 48).

You may initially notice the stark difference in revenue generated between 2013/2014 and 2012. The reason for this is the launch of Xbox One and PS4. Games for those two platforms are significantly more expensive than they Xbox 360 and PS3, which were the two primary platforms in 2012.

Also worth noting is that 2013’s Black Friday week coincided with the launch of PlayStation 4, hence why 2013’s figures are actually quite impressive. Black Friday in 2013 was also quite muted, with primarily Amazon and Asda offering sales, but no-one else.

CYBER MONDAY WEEK (Sales Week 49)

2014:
1.77m games sold
54m revenue generated

2013:
1.768m games sold
55m revenue generated

2012:
1.87m games sold
49.2m

Cyber Monday has existed in the UK market for several years and has been growing in popularity. As you can see, this year’s sales event was flat year-on-year (slightly up in unit sales, slightly down in revenue). Cyber Monday coming days after Black Friday gave rise to fears that this year’s Online-only sale may be impacted negatively, but that hasn’t been the case. There’s no obvious signs yet if Black Friday has had a positive or negative effect on the market.

THIS WEEK (SALES WEEK 50)

2014:
1.4m games sold
43m revenue generated

2013:
1.625m games sold
48m revenue generated

2012:
2m games sold
50.2m

Now things are looking a bit weaker. Software sales (revenue and units) are down 21 per cent week-on-week in 2014. 1.4m games were sold, which is 225,000 fewer units than what the sector managed in the corresponding week during 2013. If you look back at the Black Friday numbers, you’ll see that the difference between 2013’s and 2014’s Black Friday week was almost 250,000 units. It suggests that, as some senior execs feared might happen, rather than increase software sales for Christmas, Black Friday has achieved very little in terms of boosting the market. We will have to see what the final sales week has in store for the trade before we can say for certain, but the drop in revenue and units is not encouraging, and is something mimicked in the console hardware market, too.

OVERALL FOR THOSE THREE WEEKS

2012:
5.64m Games sold
148m Revenue Generated

2013:
5.1m Games Sold
163m revenue generated

2014
5.13m sold
159.2m revenue generated

In conclusion, it is quite tricky to accurately study the figures annually. There are several caveats to consider. This year’s software line-up is significantly weaker year-on-year (There’s no Battlefield or Need for Speed, as we are used to). Last year’s festive sales period saw the launches of Xbox One and PS4, the latter of which was in short supply. Meanwhile, 2012 was at the tail end of an entirely different console cycle.

Nevertheless, ss we can see from the overall figures for the three week period (Week 48, 49 and 50 2014 vs 2013), things are looking relatively flat. Value has declined year-on-year by 2.4 per cent, which is slightly higher than how the entire year is performing – 2014’s boxed software revenue for the entire year is currently down two per cent versus 2013. The positive figure is unit sales for the three week period, which is actually up by about half a per cent year-on-year (for the entire year, boxed software unit sales are down by 8.6 per cent).

What will prove crucial will be the next seven days. Last year, Week 51 saw 1.828m games sold, which generated 54m. If the retail sector can manage that this year, then we can say that Black Friday was a minor success for the trade.

However, if those figures are not met, then it may be worthwhile re-considering the heavy discounting that went on during Black Friday this year for the next sales event. It is positive seeing so many consoles sold through during a short period of time, but it’s important that those increased hardware sales has a positive impact on the software market, too. And so far the evidence is inconclusive.