The global video game market is on track for significant expansion. New research by Bain & Company predicts a 6% annual growth rate, pushing revenue to a staggering $257 billion by 2028. This growth trajectory means video games will likely surpass other entertainment sectors, including streaming and box-office sales, in revenue generation. In 2023 alone, the global video game market reached $196 billion, a testament to its growing popularity.
To gain a deeper understanding of this booming market, Bain conducted its first-ever Gaming Report. The report involved surveying over 5,000 consumers across six diverse countries: Brazil, Indonesia, Japan, the United Arab Emirates, the United Kingdom, and the United States. This research aimed to shed light on the habits and expectations of gamers worldwide.
“We’re witnessing a surge in global video game audiences,” explains Daniel Hong, leader of Bain’s global Media & Entertainment practice. “.”
“This growth is fueled by young people who are choosing to spend more time on games and less time on video and other media. Players express a desire for richer, more immersive game experiences, as well as the ability to move seamlessly between devices and platforms. They’re also spending more time within game environments, using them for social interaction, shopping, and even consuming other forms of media”.
Daniel Hong
Five Trends Shaping the Future of Gaming
1. Young Gamers Drive Growth:
The most significant source of future growth comes from the youngest players, those aged 2 to 18. Nearly 80% of individuals in this age group identify as gamers, devoting a substantial 30% of their entertainment time to gaming. Older players (45 and older) form a smaller market, with only 31% considering themselves gamers. They also spend less time playing games on average (2.5 hours per week compared to 9.5 hours for 13- to 17-year-olds) and primarily use mobile phones for gaming.
2. Gaming is About More Than Gameplay:
A third of survey respondents indicated that their favourite game offers an immersive experience. For gamers under 18, that figure rises to nearly half. Gamers who seek immersive experiences are more engaged, spending about one and a half hours more per week in-game compared to those playing non-immersive games.
3. Gamers are Co-creating the Gaming Experience:
User-generated content (UGC) has revolutionized various media forms, including video, over the past two decades. Gaming is no exception. Nearly 80% of gamers report playing a game with UGC elements, and one in seven have actively created content within a video game. Tools powered by artificial intelligence will likely accelerate this trend, providing players with even more power to personalize their gaming experiences.
4. Gamers Want to Play Across Platforms and Devices:
Nearly 70% of gamers play on at least two devices, and half of those surveyed desire increased accessibility across different devices in future games. This demand for cross-platform compatibility is reflected in the development landscape, with 95% of game development studios with more than 50 employees currently working on cross-platform titles.
5. Gaming IP is Gaining Traction in Other Media:
Interoperability across devices is among the top three features gamers desire. Another key factor is the wish for regular content updates to their games. Furthermore, game-related shows and movies have a significant impact on player engagement, with an average 28% increase in average concurrent users (ACUs) six months after their release.
The Rise of Device-Agnostic Gaming and Mobile Dominance
Bain’s research suggests a significant shift going on in the gaming industry: the move towards device-agnostic gaming. As technology in non-gaming devices like mobile phones, TVs, and regular PCs rapidly advances, and cloud gaming becomes more affordable and widespread, players will increasingly access games without needing a dedicated console, gaming PC, or other specialized gaming hardware.
Evidence of this transition is already visible. While console sales continue to grow in terms of total revenue, their market penetration has remained relatively flat for about a decade. This contrasts with the steady growth of the global gaming population during the same period. Mobile gamers constitute the majority of this new growth, representing slightly over half of the global gaming market.
Interestingly, although 70% of gamers report playing on multiple devices, almost all (90%) express a desire to consolidate their gaming experiences. Many indicate a willingness to pay for a more unified platform that allows them to access their games and progress seamlessly across various devices.
“For years, game console and device providers have heard predictions that their industry will become more device-agnostic,” says Anders Christofferson, leader of Bain’s gaming sector and partner within Bain’s Media & Entertainment practice.
“We’re now seeing clear signs that this transition is starting to take place. As consolidation gains momentum, a few industry leaders will likely capture customer relationships, utilizing that engagement to ultimately gain market share. Gaming companies will need to rethink their relationships with customers, competitors, and the various other players that make up the video game industry ecosystem as this shift unfolds.”
Anders Christofferson
Effective Marketing in a Crowded Gaming Market
As the video game audience becomes increasingly saturated, the importance of effective marketing strategies cannot be overstated. Bain’s research reveals that competition for players’ attention is fierce, with 67% of game players admitting to frequently consuming other media while gaming. This trend of media multitasking poses a challenge for maintaining high advertising rates, as advertisers may demand proof of genuine attention rather than simply reach. Given these obstacles, successful marketing will be a crucial factor in the success or failure of many game developers.
Compared to other software companies, game companies tend to allocate a larger portion of their revenue to marketing. On average, gaming companies with revenue under $1 billion spend approximately 25% of their revenue on marketing efforts. This is considerably higher than the 15% spent by other software companies. However, a significant portion of this spending may be misdirected due to ineffective marketing strategies in a highly competitive environment.
