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Forums - Sales Discussion - December NPD 2020: Switch 2.1 million, PS5 800K, XBS 700K

i think 40 million for Switch in USA is in the bag, the real challenge is 50 million.



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Ryng said:

i think 40 million for Switch in USA is in the bag, the real challenge is 50 million.

50m should be doable. There's still demand for traditional consoles in the USA.



Legend11 correctly predicted that GTA IV (360+PS3) would outsell SSBB. I was wrong.

A Biased Review Reloaded / Open Your Eyes / Switch Shipments

RolStoppable said:
Ryng said:

i think 40 million for Switch in USA is in the bag, the real challenge is 50 million.

50m should be doable. There's still demand for traditional consoles in the USA.

It could become the best-selling console of all time in the US as long as Nintendo supports it for another few years before replacing it in 2024. 

  1. DS - 52.78m
  2. X360 - 45.14m
  3. Wii - 41.70m


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Shadow1980 said:

And as for beating the DS, forget about it. The Switch's 2020 was an anomalous year, and shouldn't automatically be taken as any indication that it will set any sort of new records in terms of absolute numbers for post-Year 4 sales.

And it doesn't need to set any new records! It's doing perfectly fine. In fact, it's doing better than fine. It's doing great. It is absolutely no slight against the system if it sells "only", say, 42M instead of 47M or 50M or 55M. 

The DS is currently the top seller in the US, but it's perfectly fine if the Switch outsells it.  In fact the DS has done better than fine.  It's done great.  It is absolutely no slight against the system if the Switch outsells it.



The_Liquid_Laser said:

The DS is currently the top seller in the US, but it's perfectly fine if the Switch outsells it.  In fact the DS has done better than fine.  It's done great.  It is absolutely no slight against the system if the Switch outsells it.

Your snark is misplaced. In the past, people have accused me of downplaying the Switch's success or otherwise being too negative regarding the system, all for daring to suggest things like that it probably won't become the new #1 system of all time, as if it failing to do so would be a disappointment or something. My commentary was a preemptive rebuttal to anyone who would again suggest that I'm somehow insufficiently bullish on the Switch.

Last edited by Shadow1980 - on 01 February 2021

Visit http://shadowofthevoid.wordpress.com

In accordance to the VGC forum rules, §8.5, I hereby exercise my right to demand to be left alone regarding the subject of the effects of the pandemic on video game sales (i.e., "COVID bump").

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Shadow1980 said:
The_Liquid_Laser said:

The DS is currently the top seller in the US, but it's perfectly fine if the Switch outsells it.  In fact the DS has done better than fine.  It's done great.  It is absolutely no slight against the system if the Switch outsells it.

Your snark is misplaced. In the past, people have accused me of downplaying the Switch's success or otherwise being too negative regarding the system, all for daring to suggest things like that it probably won't become the new #1 system of all time, as if it failing to do so would be a disappointment or something. My commentary was a preemptive rebuttal to anyone who would again suggest that I'm somehow insufficiently bullish on the Switch.

I do think you are still insufficiently bullish on Switch.  It's currently selling about even with the DS and yet you say the chance of it outselling the DS is "nil".  That is overly pessimistic.  If a system sold like that once, then it definitely has a chance of selling like that again.  The DS's legs from here on aren't even terribly impressive.  It had another 1-2 good years and then sales plummeted hard.  You really think Switch has no chance of outselling DS?  Really?

About a year ago, you were saying that Switch peaked in 2019 and it would decline in 2020.  Instead, Switch sales skyrocketed in 2020.  You were overly pessimistic in the past.  You weren't even remotely close.  Perhaps, you still are overly pessimistic?  You might want to consider that.



Switch just wrapped I think the 5th best year all time without a big holiday game, at full price - everything they shipped seems to have already been sold to end-customers, in the US people will get additional checks and COVID will continue. Bowser's Fury & Monster Hunter Rise are two of the biggest games launching during the first half of the year, there is a pretty long list of other third party games hitting the system before the end of the summer including exclusives like Olive Town, Bravely Default 2, SMTV, Disgaea 6 - meanwhile I don't really know any exclusives on the PS5 and XSX especially while both console makers just struggled to supply during the peak sales months of the year... Mindshare is key and I think Bowser's Fury and Rise will maintain momentum heading into the second half of the year, in large part to other software launches. We don't know much about anything beyond May from Nintendo but hopefully Breath of the Wild 2, new Pokemon and Bayonetta 3 finally launch. 



The_Liquid_Laser said:

I do think you are still insufficiently bullish on Switch.  It's currently selling about even with the DS and yet you say the chance of it outselling the DS is "nil".  That is overly pessimistic.  If a system sold like that once, then it definitely has a chance of selling like that again.  The DS's legs from here on aren't even terribly impressive.  It had another 1-2 good years and then sales plummeted hard.  You really think Switch has no chance of outselling DS?  Really?

About a year ago, you were saying that Switch peaked in 2019 and it would decline in 2020.  Instead, Switch sales skyrocketed in 2020.  You were overly pessimistic in the past.  You weren't even remotely close.  Perhaps, you still are overly pessimistic?  You might want to consider that.

Nobody expected the Switch to sell what it did. If anybody actually did predict that, and did so prior to the pandemic, they are an outlier (and I would challenge them to prove themselves). As I said, the most optimistic estimates for U.S. Switch sales in 2020 at Era were below 7M. I don't believe we had a comparable thread here at VGC, but I don't recall the general consensus a year ago being the Switch would sell well anywhere close to 9M units in the U.S. in 2020. Even NPD's Matt Piscatella predicted that "All in-market hardware should see declines throughout 2020."

And why was that? Why did everyone underestimate the Switch? Because 2020 was not a normal year. The Switch showed unprecedented growth last year because we live in unprecedented times. There hasn't been a pandemic like this since long, long before video games were a thing. It's almost like people refuse to accept the fact that the Switch benefited from external factors like the pandemic and resulting increase in spending on at-home entertainment, which was further aided by stimulus checks. Even though the whole market clearly benefited, lots of people were like "No. It was Animal Crossing that did all that," even though there's no evidence that that was the case, or even that, in the abstract, a single game could, directly and by itself, propel significant YoY growth for months on end. It's been clear for months that a lot of people have thought I was wrong for even daring to suggest that the Switch's success in 2020 might be due largely to external factors, even though that's what the evidence clearly indicates. Presumably, the very idea is seen as implying that the Switch somehow didn't fully "earn" its sales, and is therefore seen as some sort of slight against the system.

Well, I don't have a dog in this race. You ought to know by now I'm a multiplatform guy. I don't have any bias towards or against any of the Big Three. I don't have any reason to downplay anything. I simply look at the numbers in context and try to draw what I think is the best conclusion possible. Based on all the data I've seen, everything indicates that, absent the pandemic, the Switch would have sold considerably less in 2020 than it did. For the first two months of 2020, the Switch was slightly down. Every indication was the the Switch was likely going to be at best roughly flat for the year, which is what most of the optimistic predictions from a year ago were assuming.

Then March happened. COVID caused everything to start to get shut down. People cooped up inside with no where to go except the grocery store. People started spending more money on things like video games. The whole console market started to grow, and while AC did indeed provide a boost that month, it was clearly not the only factor (and AC's own success, which is well in excess of the series norm, may itself be due in large part to the pandemic). Then stimulus checks started arriving in April and we saw even bigger spikes for the PS4 & XBO and the Switch remaining flat in terms of weekly average sales. Overall demand for consoles remained elevated afterward, well beyond the norm, with stock being the only real limiting factor. Hell, I even admit the Switch could have done even better in 2020 if stock was better. Every system would have done better than their actual final totals for the year, especially the PS4 & XBO, which were hit with stock issues way worse in relative terms than those affecting the Switch (only November was down YoY for it). They were doing far better than they had any right to be doing even after the initial spring spike, but fell off a cliff once stock was exhausted with no major restocks planned.

The story of the console market in 2020 was one of artificially increased demand driven by unusual circumstances. And because 2020 was not a normal year, when things do get back to normal the external factors artificially increasing demand for consoles will likely go away as people's spending habits change again. I believe that this will result in a reduction in Switch sales. It's not like COVID opened the floodgates and now this is the new normal for Switch sales in the near future regardless of all other factors. If the pandemic continues well into 2021 and we get yet another round of stimulus checks besides the one currently in the works, then yeah, this year could potentially retain at least most of the momentum of last year.

But it's going to take more than maintaining its momentum to beat the DS. The Switch has a huge mountain to climb. I posted the charts. You see what it's up against. The reason it ever had a surplus over the DS in LTD terms was because the DS had a weak start, and it was never a huge surplus to begin with. But the Switch's lead has been declining for the past two years and is now completely gone, and that's with a brief reversal in the spring and fall last year. The DS sold 11.2M in its fifth year, so just to match that the Switch will need to manage at least 24.3% growth over last year. It will have to do that without another major system-seller of the level of AC that could push several hundred thousand additional units out the door (unless BotW2 comes out, and even that might not blow up HW sales), and, depending how well immunization efforts go, possibly without any external factors to drive up demand for much of the year. If we ignore the initial spring spike of last year and focus on the May-Oct. period, the Switch averaged 121k/week in 2020. Even if it manages that all the way from January to October this year, it's still going to be lagging behind 2020, so it may need to improve on that just to hit 9M again, especially if nothing big happens this coming holiday season.

And if it's going to actually beat the DS, it needs more than sustaining its momentum. It needs growth. Serious growth. Just to stop its decline against and keep pace with the DS it will need to average 160k/week for the entire Jan.-Oct. period, and somehow manage to sell over 5M units during the holidays (>47% more than this past holiday season). That's an average of over 2M per quarter for Q1-Q3. In fact, I'd say 2M is the number to look out for during this quarter. If it doesn't do at least that, even with the benefit of the recent $600 stimulus and tax refunds, then it doesn't stand a chance at doing what the DS did in 2009.

If the Switch is only flat this year, it will be several million units in the hole against the DS, and on worse footing that the DS was when it went into its sixth year. This would compound the Switch's deficit seeing as the DS still managed to sell 8.56M units in 2010. That means that the Switch will need to sell some 20M units between now and the end of 2022 just to regain and maintain a lead over the DS. Twenty. Million. In two years.

If the Switch drops to, say, 7M units this year, which is certainly possible, then you can forget about it beating the DS. Not only will its deficit grow even more (to over 4M units, not including the DS's launch holiday), its deficit at the end of 2022 will likely end up being far too large to ever make up for. In fact, if it ends the year down 20-25% from last year, it may not even beat the 360 or PS2 considering how quickly Nintendo's popular systems tend to evaporate later in life. Not counting the Game Boy (because again the market treated the Color as an entirely new system), the DS was the only Nintendo system to have strong sales past Year 5, and almost all of that was in Year 6. It did less than 12% of its lifetime sales after Year 6. If the Switch isn't sitting at at least 47-48M by the end of next year, then it's not likely to beat the DS. And if it isn't at at least 40M, then it may at best only tie the 360.

The only way one could conclude that the Switch has a realistic shot of beating the DS is to assume that 2020's sales figures were totally normal, not in any way contingent on external factors, and are capable of being sustained or even grown over the next two years. Beating the 360 and possibly even the PS2 is still well within the realm of possibility at this point, but even that could depend on how long the pandemic persists and how much any future stimulus checks might serve to drive sales of consoles. It's not guaranteed. Beating the DS? The odds are not good, at all. The Switch's post-Year 4 sales will have to be the best ever for a Nintendo system, and I just don't see that happen, not when it's clear that the sales its had since this past March haven't been under normal circumstances.

And that's all I have to say about that. I did plan on posting some more charts today, but this post took a lot longer than I thought it would to write up, so that'll have to wait until tomorrow.



Visit http://shadowofthevoid.wordpress.com

In accordance to the VGC forum rules, §8.5, I hereby exercise my right to demand to be left alone regarding the subject of the effects of the pandemic on video game sales (i.e., "COVID bump").

Switch was down year over year by a single-digit percentage in January and February 2020 combined. In raw numbers, that was a deficit of around 50k units. But Animal Crossing was lined up for March and it was a foregone conclusion that it would draw in more female customers on a sustained basis because that's what the Animal Crossing series does. Switch was always bound to have higher sales in 2020 than in 2019. All one can argue is that it wouldn't have been 9m because the pandemic provided an additional boost, but 7m+ were always in the cards and virtually guaranteed to happen. After all, there was a good number of people here who expected Switch to be up year over year globally, so going above 20m for the year.

Switch having the best post-year-4 sales of a Nintendo system ever isn't a longshot at all when you consider how much things have changed, and I don't mean the pandemic here. It's Nintendo's only console, Nintendo reiterates that they are going for a longer lifecycle (which is supported by their actions, i.e. not issuing early price cuts) and Nintendo holds a monopoly in the handheld market which they've barely exploited up till now.

This isn't the first time that I've seen an argument along the lines of Switch being on a hard time limit, meaning it has basically just six years to sell and then it will all be quickly over. The fundamental reason why someone would believe that Switch can beat the DS is that Switch is set up to have a longer lifecycle than the DS. It isn't worrying if Switch can't keep pace with the DS when it's probable to make up a deficit in the long run. This isn't unlike a comparison with the Wii where Switch did not manage to keep pace, but by now is a lock to win the comparison anyway. The DS is a much higher bar than the Wii, but it's far from impossible.

Due to the pandemic and resulting stock issues, 2020 provides a broad range of monthly year over year comparisons. January and February 2021 should be up significantly in comparison to one year ago. Then this advantage will melt away quickly in March and April before 2021 rebounds against 2020's low stock months during summer. Nintendo launching a hardware revision in the second half of 2021 is probable. 2020's holiday quarter had a huge October, but only a moderate November and December. Since the bulk of sales occurs during the final two months of the year, Nintendo can finish strong by virtue of having a strong holiday title this year (which 2020 didn't have) and a more aggressive Black Friday deal than in the years before; so far Switch bundled with Mario Kart 8 Deluxe at $299 was as good as it got, so that's easy to undercut. 8m+ in 2021 shouldn't be too big of a challenge, although it's by no means a given.

If things were to go real bad for Switch in 2021, we'll see a price cut for its SKUs. But I don't think that's likely. Nintendo is going to reinvigorate interest with their hardware revision which at the current time I expect to replace the hybrid SKU at the same $299 price tag. In other words, a value-added price strategy instead of a price-cutting strategy. Other people fantasize about a premium SKU that will be priced above the current hybrid SKU, but I doubt that Nintendo wants to have three different SKUs concurrently this early in the lifecycle of Switch.



Legend11 correctly predicted that GTA IV (360+PS3) would outsell SSBB. I was wrong.

A Biased Review Reloaded / Open Your Eyes / Switch Shipments

I was preoccupied by other stuff yesterday and didn't get to post the rest of my charts. And I thought I had more than I did, but it turns out that I had already covered most of my charts. There's a few yearlies that I haven't updated yet, so I'll post those. I didn't update anything monthly because we didn't get any hard numbers for the PS4 & XBO. The yearly stuff does include both systems for 2020 and as mentioned in my first post with the charts is likely going to be off a bit due to using the best-guess estimates at Era. PS4 & XBO sales thus could be as much as 10% short (~300-400k units for both combined) if the actual numbers were closer to what VGC has.

Overall, the U.S. hardware market has still managed to remain relatively stable. While it's nowhere near what it used to be, it has still managed to average over 15 million units per year across all platforms since 2013. Also, it's worth pointing out that most of the losses incurred over the past decade have been because of the decline and then disappearance of "pure" handhelds from the market. While the GBA over-performed big time and the DS is the best-selling system ever (likely their third ever to sell over 40M units in the U.S.), the 3DS wasn't quite the hit those were. As a hybrid, the Switch fills the demand for both home and handheld Nintendo systems and is handily outpacing combined aligned 3DS + Wii U sales and is on track to be one their best-selling systems ever, but it's nowhere near what combined Wii & DS sales were at their peaks (over 20M combined in both 2008 & 2009, plus another 18M+ in 2010). On Sony's end, the PSP did decently, but the Vita was a flop and Sony has completely exited the handheld market. While the loss of traditional handhelds has impacted the total market, game consoles in general are doing fine.

If we ignore handhelds and focus on home consoles (including the Switch), they have maintained healthy but highly variable sales. While some of that variability is due to the normal grow-peak-decline ebb and flow of each generation, most of the variability in the market has been on Nintendo's end as they went back and forth from struggling systems (the GameCube and Wii U) to bona fide smash hits (the Wii and Switch). The market for more conventional consoles has remained much more stable. The PS2 & Xbox sold over 61M units combined, the PS3 & 360 sold 70M, and the PS4 & XBO are on track to sell at least 65M, essentially splitting the difference. While that is a drop from Gen 7, it is worth pointing out that the 360 had an 8-year gap between release and replacement, the longest ever for a home console.

During the generation proper, the PS4 & XBO managed to put up some remarkably stable sales, remaining over 9M units per year combined from 2014 to 2018. During that 5-year period, they managed to sell 49M units combined, 11.1% more than what the 360 & PS3 did combined through their respective first five full years. While the PS4 & XBO dropped off somewhat more in 2019 than what the PS3 & 360 did in 2012 (~28.4% vs. ~25.8%), their LTD sales sans launch holiday reached 55.9M units combined, about 2% more than what the PS3 & 360 did combined in their first six years aligned. Taking into account this slightly shorter generation, falling 5 million units (about 8%) short of their predecessors isn't really a big deal, and shouldn't be seen as any kind of indication of a contraction in the market for conventional consoles.

Also, even though the past two years have been the worst for conventional consoles, it worth keeping in mind that A) supply issues were a concern in 2020, and B) the 360 & PS3 were more back-loaded than any other consoles to date, and C) the 360 & PS3 were coming off of a higher peak in the last two years before their replacement. Once supply issues for the PS5 & XBS are fully resolved, I expect them to perform comparably to the PS4 & XBO.

@RolStoppable. I do agree that Animal Crossing would still be a strong system-seller even had COVID not been a thing. However, I don't think it could have pushed the Switch to anything significantly over 7M without the pandemic & stimulus to aid it. Comparing YoY and, perhaps most pertinently, month-over-month sales, it seems likely that the Switch would have sold something closer to 700k in March without the pandemic, assuming that AC itself didn't also benefit from the pandemic. That would still make AC one of the biggest system-sellers ever, maybe the biggest ever in the U.S. in absolute numerical terms (I'd have to go and recalculate everything for comparing it to other games), and that March would still have been one of the best non-holiday months ever in the U.S. April would have seen a big drop-off, though, but AC still could still have had some sort of residual effect, possibly propelling it to as much as 300k that month. Past that, we shouldn't have seen any measurable effect on sales from AC, given that system-sellers never have any impact past their second month (and most never past their first). So, we might have seen a net YoY gain of around 400k for that 2-month period. Had the Switch been on average flat over the remaining 10 months of the year, it could have gotten close to 7M. But had it experienced even a modest drop for those other 10 month, say 10%, it would have been down slightly for the whole year. There's a reason why most predictions had the Switch's 2020 sales being at best flat or slightly up from 2019. Nobody, and I mean nobody, expected it to sell 9 million.

As for those "time limits" you refer to, Nintendo has a well-known habit of running on short generations, killing off even successful systems prematurely. Their home consoles have never lasted longer than 6 years before being replaced (unless you count the Famicom's run in Japan). The Wii could have lasted longer and had better legs had they not bailed on it in 2010-11 to put all their efforts into the Wii U. They released the DS when the GBA was still doing very well, which had the effect of completely sucking the wind out of the GBA's sails. They released the 3DS when the DS was doing even better than what the GBA was doing, which caused the DS's sales to decline rapidly from what was a very healthy baseline.

While I would be pleasantly surprised if they didn't repeat themselves again with the Switch, I honestly wouldn't be surprised if they did it again, because Nintendo is probably always going to do what Nintendoes (sorry, bad pun). If we don't start hearing rumblings of the Switch's successor (which I really think will be a "Switch 2"; same form factor, but with a generation leap in power) by early 2023, then and only then will I be inclined to think the Switch will be longer-lived than the norm for a Nintendo system. But realistically, I think the most likely target date for the Switch's successor will be November 2023, giving it about the same run as the DS had before it was replaced. Maybe March 2024 at the latest.

Last edited by Shadow1980 - on 04 February 2021

Visit http://shadowofthevoid.wordpress.com

In accordance to the VGC forum rules, §8.5, I hereby exercise my right to demand to be left alone regarding the subject of the effects of the pandemic on video game sales (i.e., "COVID bump").