Video game spending statistics | The Motley Fool

Amount consumers spend on video games

According to market research firm NPD Group, a total of $56.6 billion was spent on video games in 2022. This includes consoles, games, and accessories.

Considering that there are 131.2 million households in the United States, a conservative average estimate of gaming spending per household is $431. This assumes there is one gamer in each household.

Spending on video games varies depending on family size, composition, and income. For example, families with children are more likely to spend money on video games. And households with higher incomes can expect to have more cash to splurge on a new console or buy a more consistent stream of new video game releases.

That's backed up by data from the Bureau of Labor Statistics. Here's how we analyzed that data.

In 2022, families spent an average of $698 on “other entertainment equipment and services.”

The “Other Entertainment Equipment and Services'' category includes spending on video games and a variety of other products that do not fit into the primary entertainment categories, such as fees and admission fees. TV, radio, and audio equipment. Pets, toys, hobbies, play equipment, etc.

It's likely that not all of the $698 spent by the average American household in this category was spent on video games. And the data reveals that average spending in this category has increased significantly by higher-income households.

Although the category is broad, it is a useful indicator of video game spending. For example, at the height of the COVID-19 pandemic, spending on video games and time spent playing video games increased from 2019 to 2020, according to the Entertainment Software Association. increased by nearly 50% and 60% from 2020 to 2021. Significantly.

Video game spending by income

In 2022, the top 20% of earners spent $1,843 on “other entertainment,” including video games, according to the BLS. The next lowest income quintile spent $588, and the lowest income quintile spent just $88 over the course of the year. The average amount spent on “other entertainment” across all income levels was $698.

Households earning more than $200,000 in 2022 spent $2,401 on “other entertainment,” including video games.

It is logical that households with higher incomes would spend more on video games, which clearly falls under discretionary spending. Such households tend to have more disposable income to spend on categories such as entertainment.

With the prices of video games and gaming consoles soaring, and microtransactions becoming the norm across all platforms, it's not hard for the wealthiest households to spend more than $1,000 a year on video games.

Video game spending by family structure

In 2022, couples with children spent $1,244 on “other entertainment,” including video games, compared to an average spending of $698.

Video games have always been a staple of birthday and holiday gifts for kids, and they're a great way to keep kids entertained, so families with kids are more likely to choose categories that include video games than families without kids. No wonder they tend to spend more.

Video game spending (by year)

In 2022, Americans spent $56.6 billion on video games. This total includes spending on consoles, games and accessories and is based on data from NPD Group and the Entertainment Software Association.

Overall spending soared from $43.5 billion in 2019 to $56 billion in 2020 and another 3.5 billion in 2021 as Americans tried to fill their time during the COVID-19 pandemic. This amount increased by $59.6 billion to $59.6 billion.

Spending fell by $3 billion from 2021 to 2022, but it is far from returning to pre-pandemic levels.

While gaming purchases drove spending growth from 2019 to 2020, spending on consoles increased the most from 2020 to 2021.

Notably, console spending during this period was higher than in 2021-2022, the first full year when new current-generation Xbox and PlayStation consoles were launched. However, supply chain disruptions may have made these consoles difficult to obtain, hindering spending on them.

Video game sales by segment

According to PwC, global video game revenue is expected to exceed $300 billion by 2025.

Social and casual games, such as mobile games, already account for more than 50% of overall video game revenue. This share is expected to continue to grow at the expense of all other categories, while revenue from PC games, console games, and in-game advertising is expected to grow as well, albeit at a slower pace. .

Game subscriptions and cloud gaming

Two trends are emerging in the video game industry that could change the way consumers play and spend on games. Video game subscription services and cloud gaming.

Gaming subscription services work similarly to Netflix and other video streaming services. Subscribers pay a monthly subscription fee and gain access to a library of games. The most popular services are Xbox Game Pass and PlayStation Plus.

Tens of millions of gamers subscribe to these services, and this model is a steady source of revenue for Microsoft and Sony.

Microsoft reported that 25 million players had signed up for Game Pass as of January 2022, and the company said in an SEC filing covering the quarter ending in 2022 that Xbox content and services said the 13% increase in revenue was due to “first-party content and Xbox Game Pass.” September 30, 2023.

Sony reported that it had 47.4 million PlayStation Plus subscribers as of the end of March 2023.

The top tier of Xbox Game Pass also gives gamers access to Xbox cloud gaming. This allows a player to stream his Xbox games to any internet-connected device, even if he doesn't have an Xbox. If cloud models become more widespread, gaming could become more accessible and affordable for families who don't want to splurge on high-end consoles or PCs.

Best-selling video games and consoles

Best-selling video games of 2022

Call of Duty: Modern Warfare 2 was the best-selling game for PC and consoles in 2022. candy crush saga It was the highest-grossing mobile game of the year, according to the Entertainment Software Association.

Many of the most successful mobile games are free to download and play and generate revenue through in-game microtransactions, which is why PC and console games are listed as top grossers, and mobile games are listed as top grossers. . However, the PC and console games on this list must be purchased to play.

Best-selling video game of all time

all time classic Tetris Since its release in 1984, it has sold 520 million copies, topping the list of best-selling video games of all time.

Other all-time bestsellers were released after 2005, including older games such as: Mine Craft,skyrimand Grand Theft Auto V It has impressive staying power.

Best-selling game console of all time

Sony's PlayStation 2 narrowly overtook the Nintendo DS to become the best-selling video game console of all time.

Sony and Nintendo dominate the list, accounting for nine of the top 10 best-selling game consoles of all time. Please note that this list does not include PC sales, which is the platform of choice for many gamers.

Credit and debit cards for gamers

Whether gaming is a hobby for you or a classic gift for your kids, you're likely to end up spending quite a bit of change on hardware, games, in-game features, or accessories.

Even though gaming revenue exceeds movie and music revenue, there are only a few credit and debit cards designed specifically for gamers. If you find yourself regularly spending money on games and have some loyalty to a particular console, these cards might be worth considering.

The best credit card for gamers will depend on your chosen platform and the types of purchases you expect to make, including spending on hardware, accessories, games, and in-game purchases.

If you're a PlayStation gamer, the PlayStation Visa Credit Card is your best bet for making recurring purchases through the PlayStation™Store. Xbox gamers may also consider the Xbox Mastercard.

The big draw for these cards is that they earn 5x points per dollar on purchases made through the PlayStation™Store and Xbox and Microsoft Stores, respectively. However, these cards aren't as competitive in other ways as some of the Motley Fool Ascent's top-rated credit cards.

Before deciding which card is right for you, check out the full list of Motley Fool Ascent credit card reviews.