As the nights are beginning to bring some frosty chill and the days are becoming depressingly shorter, we are reminded that winter is on its way here. Yes, we still have fall to get through, but it will not be long before we trade our shorts and t-shirts for jeans and sweaters. And as these days get colder and shorter, people will find less to do outside than in the past 4 months. Unfortunately for most Americans, not everyone lives in sunny Florida, so people will soon have to find ways to entertain themselves without having the luxury of going outdoors. Given the unlikelihood the country will be fully open anytime before 2021, people will probably look back on what they did during the early months of the pandemic, mostly in March and April, to find out how to survive the boredom of staying at home. This should make the gaming industry smile a bit larger.
When the Covid-19 pandemic first made waves in the United States and forced the country to shut down, there was little for people to do considering the weather had not yet changed for the better. So where did people turn? To video games. Consumer spending on video gaming reached a unprecedented record of $11.6 billion in the second quarter (April-June), which was a 7% increase over the first quarter (which was also a first quarter record of $10.9 billion), and a 30% increase compared to last year’s second quarter (NPD). Literally every category related to video games saw a huge increase in sales. Everything from video game consoles to accessories saw increases from 28% up to 57% (NPD). The numbers were staggering. With people stuck inside, there was little entertainment to turn to besides video games. What was already a successful industry saw a huge boom. And this trend could just be the beginning.
As much as we all hope a working vaccine could be ready to be distributed by next month, there is a distinct possibility that it won’t be ready till at least near or at the end of 2020, which means that the majority of states in this country will probably stay closed for the remainder of the year and into early 2021. Movie theaters will be operating at limited capacity for the rest of the year as will restaurants in the states that actually have them open. As winter approaches, outdoor dining will become more difficult and people will find themselves spending more time at home than they have the past 3 months. People will have no choice but to turn back to home entertainment, and video games might be right at the top of that list. That was the case this year in early and late Spring, and there is a good chance it will be again come late fall and early winter.
Furthermore, both Sony and Microsoft have announced the release of their two new respective game consoles come this fall. Sony will be releasing the PS5, or PlayStation 5, while Microsoft is countering with the Xbox Series X releasing in November. Both PlayStation and Xbox are massively popular video game consoles and every time there is a new product release, it flies off the shelf. Considering these new consoles will be releasing near the holiday season, combined with a pandemic that will be mostly confining people to their homes as the season gets colder, both Sony and Microsoft could be in for a huge 4th quarter. Their sales boomed last time during the height of the pandemic in the spring which saw increase of up to 30% from last year. Imagine now, as we begin to enter the fall season and then, near December, the winter season. People will be stuck at home once more, with very little to do.
With the PlayStation 5 and Xbox Series X releasing, people might be more than inclined to spend some money on home entertainment that could get them through late 2020 and early 2021. The video game industry saw a huge spike in sales during the spring, thanks to massive home confinement from the Covid-19 pandemic—and they could see an even bigger one come this fall and winter.