The video game industry is one of the fastest-growing sectors in the United States. It supplies more than 220,000 jobs across all 50 states and video games – whether they be on consoles, computers or mobiles. These impressive stats are among the new figures published by Entertainment Software Association (ESA) and NPD Group, which also reveal that 150 million Americans play video games.
In 2018, total revenue in the video game industry reached $43.4 billion, reflecting an 18% growth over 2017’s $36.9 billion. This rate of growth is consistent over the past couple of years, with revenues increasing by 18% between 2016 and 2017 as well.
Revenue from hardware and peripherals were up 15% to $7.5 billion. Making an even bigger leap, software (console, PC, portable, and mobile) which also includes in-game purchases and subscriptions, brought in $35.8 billion in revenue, representing 18% growth from $30.4 billion in 2017.
These figures take into account mobile spending data, provided by Sensor Tower, which include paid downloads and in-game purchases for mobile and tablet devices through Apple’s App Store and Google Play.
The continued growth in the video game industry does have significance to marketers. Research from PwC shows that some $1.5 billion is spent annually advertising on video games, a figure that’s expected to reach $1.8 billion in the next few years. While this represents a small slice of the overall video game market, it’s worth noting that the same research revealed that the video game advertising market is much larger than the arguably more familiar cinema advertising market.
The video game advertising market has the potential for continued growth, as consumers still spend most of their time with ad-supported content and continue to add devices to their households.
The sheer size and demographics of the audience is also an attractive factor – especially with the younger generation, as two-thirds of Americans ages 13 and older play video games. Additionally, individuals age 16-35 years old spend as much of their time playing video games as they do watching television or getting out and about.
[Editor’s note: If you’re interested in media trends, the 5th annual edition of our Media Audience Demographics report is for you! The report – available for purchase here – breaks down the audience composition of several online and offline media types by age, income and race/ethnicity.]