Business of Games (BoG) is our regular series looking at the business of games from the perspective of the gamer.
The NPD Group has released the year end sales results for the board game industry and their really quite encouraging. In a year where the overall toy segment was down 3%, board games were up 6%. This has led to a rash of opinions indicating that this is part of the continued rise of board games and that they are now ready to overthrow video games or some such. Before we completely disabuse this notion, its worth pointing out that we’re all very pro-board game around here, just not at the expense of actual facts.
The fact of the matter is that the board game industry had its best year in 2006, with sales of $802.2MM – a solid 13% increase over 2005. Then, in 2007, sales slack off significantly, dropping over 9%. This is the data point that everyone seems to miss – in a year that many consider to have been one of the best in board gaming history, overall sales went down. To be honest, I have no idea what to make of this event – while it certainly corresponds to the beginning of the economic downturn (the publicly visible part at any rate), it makes the 2008 increase fairly surprising – an increase of 6% (just shy of the $800MM mark) [for those who are curious, there aren't actual numbers for the board game market prior to 2005 as far as I can tell, just the occasional estimate, as low as $400MM in 2003].
So what’s behind the oscillation in game sales? Its hard to say for sure, but I think we can rule out momentum – if board games were truly benefitting from a momentum affect, we wouldn’t see those dips (and before you bring the recession back into the equation, check out the 2008 numbers). As for the global recession, this seems unlikely to have a significant impact on overall sales either, especially given the recent interviews Tom Vasel completed as part of the Dice Tower‘s recent interview series (for those who missed it, Tom ended each interview asking about the downturn’s impact on the interviewee’s business – nearly every single person said they hadn’t seen much, if any, impact). I’m not sure the board game business is evergreen, but it does seem fairly recession resistant.
Part of me wants to say that this is a result of advertising or kick-butt work by retailers, but I’m having a hard time seeing that right now – with more and more retailers going under (see the forums at RPG.net and BoardGameGeek for evidence of this) and advertising almost non-existent, there’s little chance that either of these has played that significant a factor. Its entirely possible that the board game market may be cyclical – it certainly wouldn’t be the only entertainment segment that was cyclical in nature.
All that said, I have a feeling that the answer may be more basic – mainstream acceptance. For those who haven’t noticed, hobby board games are showing up in more and more channels – especially booksellers like Barnes & Noble, Books-a-Million and Borders. With smaller publishers like Northstar Games and Out of the Box getting distribution deals with mega-chains like Target, the number of board games that appeal to adults has never been more visible. Do I have any data for this particular position? Nope – most industry research just doesn’t get to that level of detail. However, the timing is right and given that mass market retailers are much more susceptible downturns in the broader economy, we may have a situation where there is a baseline portion of board game sales that are supported by traditional hobby channels and purchases for children/families with the fluctuations occurring because of external factors impacting hobby game purchases within the mass market channels. If this theory is correct, then the base board game business is about 700-750MM in the US (assuming some modest growth rate) with 50-100MM made up through hobby sales in the mass market channel. To put this in perspective, video game sales for 2008 were a touch over $21B in 2008, with only about 10-20% of that coming from dedicated channels (which are similar for purposes of this discussion to your FLGS [Friendly Local Game Store]).
Thanks for doing articles like this.
One thing that has caused me to buy several board games within the last couple of months has been the YouTube video series “Tabletop” by Wil Wheaton. Watching his videos has brought me into contact with board games I never knew existed.