Video Games and Consoles: Inc Impact of COVID-19 - UK - August 2020

OVERVIEW
What you need to know 
Key issues covered in this Report
COVID-19: Market context
Economic and other assumptions
Products covered in this Report
EXECUTIVE SUMMARY
Impact of COVID-19 on video games and consoles
Figure 1: Short, medium and long-term impact of COVID-19 on video games and consoles, 10 August 2020
The market
Video games and consoles market valued at £1.8 billion in 2020
Figure 2: Value of UK video games and console market, 2015-20
COVID-19 lockdown contributes to higher games console sales in the first half of 2020
Companies and brands
Game streaming platforms gain prominence as a console alternative
Google adds array of new features to Stadia after initial launch
Xbox reveals Series X specifications ahead of November 2020 launch
PlayStation also showcases PS5 ahead of holiday launch
The consumer
Growth in ownership for Nintendo Switch
Figure 3: Ownership of static games consoles, June 2019-June 2020
Around two in 10 PS4 owners have PSVR
Figure 4: Ownership of PlayStation virtual reality headset, June 2020
Over a quarter of portable console owners have a Nintendo Switch Lite
Figure 5: Ownership of portable games consoles, June 2020
Majority of static and portable console owners buy physical games
Figure 6: Use cases for static games consoles, June 2020
Figure 7: Use cases for portable games consoles, June 2020
COVID-19 causes growth in media viewing on static consoles
Figure 8: Usage of static games consoles since COVID-19 outbreak, June 2020
Online gaming growth for portable consoles
Figure 9: Usage of portable games consoles since COVID-19 outbreak, June 2020
Over half of static console owners will upgrade to the next generation
Figure 10: Intent to upgrade to next-generation console, June 2020
Next-generation consoles address consumer demand for quality and user experience
Figure 11: Purchase motivators for games consoles, June 2020
Over a third of console owners had actively tried to reduce game time before COVID-19
Younger Millennials drive purchases of in-game content for consoles
A quarter of console owners would prefer to use a streaming service for games
Figure 12: Reducing time spent on consoles and attitudes towards in-game purchases and streaming services, June 2020
COVID-19 AND VIDEO GAMES AND CONSOLES
Impact on the market
Lockdown a key driver of much higher console sales H1 2020
Financial uncertainty unlikely to affect early purchases of next-gen consoles
Impact on companies and brands
Manufacturers offer free access during lockdown 
Charity initiatives and developer support also helping generate goodwill
Impact on consumers
COVID-19 causes growth in media viewing on static consoles
Online gaming for portable consoles during COVID-19
ISSUES AND INSIGHTS
How COVID-19 is shaping the video games and consoles industry
Developers will need to take a responsible approach to loot boxes, even at the expense of game time
THE MARKET – KEY TAKEAWAYS
COVID-19 provides substantial boost to the market despite consumers’ financial concerns
Streaming-based gaming platforms have arrived but won’t replace traditional consoles just yet
MARKET SIZE AND FORECAST
Video games and consoles market to perform well despite COVID-19
Figure 13: Short, medium and long-term impact of COVID-19 on video games and consoles, 10 August 2020
Video games and consoles market valued at £1.8 billion in 2020
Figure 14: Value of UK video games and consoles market, 2015-20
Figure 15: Forecast for value of UK video games and console market, 2020-25
COVID-19 lockdown contributes to higher game console sales in first half of 2020
Figure 16: Volume of games console sales in the UK, 2015-20
Nintendo Switch sees significant growth in sales between 2018 and 2019
Figure 17: Share of UK console sales, 2018-19
Console manufacturers highlight substantial growth in software sales
Market drivers and assumptions
Learnings from the last recession
MARKET DRIVERS
Game streaming platforms gain prominence as console alternative
Growing popularity of video streaming also a plus for consoles
Early signs that COVID-19 financial uncertainty won’t dampen enthusiasm for console purchases 
Rise of social gaming venues help to take gaming out of the home
Concern grows over loot boxes and links to gambling
NHS director also critical over loot boxes
Over 30% of static console owners buy in-game content 
COMPANIES AND BRANDS – KEY TAKEAWAYS
Google developing its Stadia offering
Details of the next-generation consoles are revealed
LAUNCH ACTIVITY AND INNOVATION
Google adds array of new features to Stadia after initial launch
Support for any Android device 
Gameplay over 4G and 5G
Cross platform gaming support
Two months of Stadia Pro offered for free as part of COVID-19 lockdown
Xbox reveals Series X specifications ahead of November 2020 launch
Next-generation games Halo Infinite and Deathloop delayed due to COVID-19
Halo Infinite
Deathloop
BRAND RESEARCH
Brand map
Figure 18: Attitudes towards and usage of selected brands, June 2020
Key brand metrics 
Figure 19: Key metrics for selected brands, June 2020
Brand attitudes: PlayStation leads in consumer trust and delivering high quality
Figure 20: Attitudes, by brand, June 2020
Brand personality: Fun ranks top in consumers’ opinion of PlayStation, Xbox and Nintendo
Figure 21: Brand personality – macro image, June 2020
PlayStation leads rivals in positive consumer opinions
Figure 22: Brand personality – micro image, June 2020
Brand analysis
PlayStation edges out Xbox in being viewed as the most reliable and cutting-edge console
Figure 23: User profile of PlayStation, June 2020
Xbox is close to PlayStation across a variety of consumer opinions
Figure 24: User profile of Xbox, June 2020
Affordability of Nintendo could be important during COVID-19 financial uncertainties
Figure 25: User profile of Nintendo, June 2020
THE CONSUMER – KEY TAKEAWAYS
Static console ownership stable as consumers prepare for next-generation
Concerns over loot boxes and gaming addiction
IMPACT OF COVID-19 ON CONSUMER BEHAVIOUR
COVID-19 causes growth in media viewing on static consoles
Interest in media shows potential value of picture-in-picture
Online gaming growth
Figure 26: Usage of static games consoles since COVID-19 outbreak, June 2020
Figure 27: Usage of portable games consoles since COVID-19 outbreak, June 2020
OWNERSHIP OF GAMES CONSOLES
Growth in ownership for Nintendo Switch
Figure 28: Ownership of static games consoles, June 2019-June 2020
Around two in 10 PS4 owners have PSVR
Figure 29: Ownership of PlayStation virtual reality headset, June 2020
Over a quarter of portable console owners have a Nintendo Switch Lite
Rise of mobile gaming linked to drop in portable consoles
Figure 30: Ownership of portable games consoles, June 2020
ACTIVITIES ON GAMES CONSOLES
Majority of static and portable console owners buy physical games
Streaming service bundles can encourage take-up of new consoles
Figure 31: Use cases for static games consoles, June 2020
Figure 32: Use cases for portable games consoles, June 2020
INTENT TO UPGRADE CONSOLES AND PURCHASE DRIVERS
Over half of static console owners will upgrade to the next generation
Figure 33: Intent to upgrade to next-generation console, June 2020
Next-generation consoles address consumer demand for quality and user experience
Figure 34: Purchase motivators for games consoles, June 2020
ATTITUDES TOWARDS GAMES CONSOLES
Over a third of console owners had actively tried to reduce game time before COVID-19
Social gaming to thrive as COVID-19 lockdown eases
Younger Millennials drive purchases of in-game content for consoles
A quarter of gamers would prefer to use a streaming service for games
Figure 35: Reducing time spent on consoles and attitudes towards in-game purchases and streaming services, June 2020
APPENDIX – DATA SOURCES, ABBREVIATIONS AND SUPPORTING INFORMATION
Abbreviations
Consumer research methodology