"The average purchaser of video games is 39 years old - proving that video gaming is attracting a much broader audience," said Senior Analyst with IBISWorld, Mr. George Van Horn. "In fact, 67 percent of household heads play computer or video games; and besides the rapidly growing number of women taking up the hobby, 24 percent of game players are aged over 50.
"When video game consoles began to appear in the 1980s, they were dismissed as a short-lived craze, or at the very least, the domain for awkward adolescents," said Mr. Van Horn. "How astonishingly wrong we were. Our research has revealed that the teenage boys that played Atari back then are still playing video games now, largely being drawn in to new, advanced electronic gaming that simulates real-life interaction that their kids love as well."
"And while we're not suggesting the market for teen and young adult men is not a strong market, men between 18 and 45 still represent 37 percent of the game playing market - it's the other demographics which are posting significant growth," added Mr. Van Horn.
New Formats For New Markets
"The average American gamer has been playing for 12 years, and is now, on average, 35 years of age," said Mr. Van Horn. "When comparing today's industry climate with that of 20 years ago, there is a marked shift in the sector's target client base. It is apparent that women and many adults are no longer shunning the fun."
Mr. Van Horn added, "Companies are frantically at work developing games for what they hope will be expand into fresh, new markets." For example, the major players in the gaming segment are working on games that will appeal to older adults and women of all ages. Nintendo's new console format - Wii - and Microsoft's Xbox have been a major factor in changing the landscape of the gaming industry. With these games' party-style format, and innovative products, such as the phenomenally successful Wii Sports, IBISWorld believes the major market players such as Sony and Microsoft, are sitting up and taking notice that there is an untapped market which could substantially enhance the industry's current and future growth.
Fortunately for the gaming industry, its broadening appeal suggests the industry's robust growth is set to continue for some time yet. "Until those original gamers cease playing, either due to death or physical incapacity - losing interest appears unlikely - meaning new gamers entering the market will not be replacing those leaving, they'll just be adding to the swelling numbers worldwide."
Tomorrow's Gamers
The percentage of female gamers has increased from 33 to 38 percent in just five years as women flock to purchase not just Nintendo's Wii Fit, but interactive group games such as Singstar, Rock Band, and Lips, as well as The Sims, The Movies, Nintendogs and NeoPets. Games targeting girls, such as Bratz Rock Angels and Dora the Explorer have also succeeded in introducing a new generation of female gamers to the console format.
"Wii Fit is the perfect example of how recent developments in game design and marketing are opening up female gamers as the potential growth market in the industry, and the fact women comprise 38 percent of game players indicates the level of growth available to the industry, as there are still very few titles designed specifically to target that demographic. Wii Fit shows the attention women can expect to receive as manufacturers and developers actively chase the female dollar," predicted Mr. Van Horn.
As the young male demographic is comprehensively served by existing game titles, and the female market is the latest focus, IBISWorld expects one of the remaining markets ripe for the picking is older gamers.
Until recently, the teenage pioneers of video games 25 years ago were under 40 years old. Today, those gamers are approaching their mid-to late- forties. In order to retain those original fans, games are being designed specifically to appeal to older players are most likely the next, and perhaps final frontier for developers and publishers to cross. This has already begun, with Nintendo's DS 'Brain Age' testing games, and IBISWorld anticipates it will continue as the industry faces a diminishing number of potential new customers in the longer-term.
"Parents also fall into the 'older gamer' category, and the sheer number of them playing games with their children is another factor driving industry growth," said Mr. Van Horn. "Some surveys (NPD) suggest that 93 percent of parents playing video games have children who are playing too. In fact, nearly half the games sold in 2006 held an 'E' rating, and with 39 the average age of a game buyer, that would suggest the Mom and Dad market is a major one."
Future Forecast
According to IBISWorld, the gaming industry is somewhat "recession-proof," with the sector expected to grow 9.5 percent this year to generate total industry revenue of around $38.9 billion, despite flagging consumer sentiment and lower disposable incomes.
Today the video games industry, including development, production and retailing, is a $40 billion business, with more than 34 million consoles sold in the U.S. last year alone. It seems the spotty teens who originally took to gaming never grew out of it, and today's youth adopt next-generation consoles with even greater vigor than their parents.
"The result is a healthy balance sheet for the video games industry," said Mr. Van Horn, who forecasts growth of 10.2 percent per year to reach $63.2 billion by 2013." He adds, "This is an industry in an enviable position with a loyal client base regularly topped up by a fresh generation of users with older players failing to desert the sector at the age originally expected. Around a third of American households have a gaming console, which means the industry can still achieve considerable growth, spurred on by constantly evolving technology."
IBISWorld predicts, as long as older players remain unwilling to give up gaming, the industry's future will be unambiguously upbeat. By
attracting children with family-friendly games and the latest technology, drawing in women with fun communal games, retaining the key male
demographic, and expanding the offering to aging gamers, IBISWorld sees no limit to the growth in the gaming industry in the foreseeable future.
