Video Games in Western Europe

October 2021

Video games was a major beneficiary of Coronavirus (COVID-19), with sales rebounding from 2019’s decline to see dynamic growth in 2020. Home seclusion, due to lockdowns and working/learning from home, drove video games demand in 2020, with non-essential retail closures not a major problem, as consumers were happy to make their video game purchases online. Growth will remain strong in 2021, with continued lockdowns, and should remain in positive territory throughout the forecast period.

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Key findings

Console cycle will likely continue to drive the Western European market…

The Western European market is largely driven by sales of consoles, due to their high installation base. It is therefore expected that sales of video games generally will continue to be highly dependent on sales of static consoles. Following the boost provided by the release of the Nintendo Switch, late 2020 saw the most recent spike as the two other major hardware players released their new products: the PlayStation 5 and Xbox Series X/S.

…although the pandemic is a major disrupter during 2020

Limited options for social activities and travel throughout much of 2020 resulted in households being confined to their homes and needing to find ways to entertain themselves. This helped drive sales of video games in Western Europe, as disposable spending shifted from holidays and away-from-home activities to in-home entertainment. Gaming was even a way for people to indulge in joint activities during periods when individual households were in lockdown.

Shift towards digital software given further impetus by COVID-19

Although some parts of the region have been slower at adopting the move from physical sales to downloads, it is becoming increasingly clear that there is a shift in preferences, especially among the younger generations. The high level of connectivity to which these consumers are accustomed is driving growth in sales of video games software, as well as mobile gaming. The pandemic only served to speed up this trend, not least given the closure of non-essential retail outlets.

In-game purchases will continue growing

Online games and mobile games are expected to see further growth in popularity. Online and mobile titles can often be free to play, with players then encouraged to move up to a new level with in-game purchases. More free-to play online titles, which generate revenue mainly from in-game purchases, are expected, as many leading developers will build their revenue strategies around in-game purchases.

 

Introduction

Scope
Key findings

Regional Overview

Western European sales in line with global levels in 2020
Western Europe expected to see a weaker forecast period performance
The UK, already the region’s biggest market, drives growth in 2020
Hardware performance sees a major turnaround between 2019 and 2020
Video games software adds the bulk of new sales over 2015-2020
COVID-19 a major factor in the video games performance in 2020
E-commerce already dominates sales in 2019…
…with the pandemic further boosting its share in 2020

Leading Companies and Brands

Leading players have a mixed 2015-2020 period
Nintendo enjoys another good year in 2020
The UK is the biggest market for half of the top 10 players
Oculus moves up the rankings over 2015-2020

Forecast Projections

Video games to continue seeing positive annual growth rates…
…albeit at slower rates over the forecast period than in 2015-2020

Country Snapshots

France: Market Context
France: Competitive and Retail Landscape
Germany: Market Context
Germany: Competitive and Retail Landscape
Italy: Market Context
Italy: Competitive and Retail Landscape
Netherlands: Market Context
Netherlands: Competitive and Retail Landscape
Spain: Market Context
Spain: Competitive and Retail Landscape
Sweden: Market Context
Sweden: Competitive and Retail Landscape
Switzerland: Market Context
Switzerland: Competitive and Retail Landscape
Turkey: Market Context
Turkey: Competitive and Retail Landscape
UK: Market Context
UK: Competitive and Retail Landscape
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