See what I did there? There’s so much that can be said about the gaming industry – from the perspective of someone who was first introduced at the end of the 2nd generation of gaming consoles (my first system was a Sinclair ZX Spectrum 128k with optional tape deck, woah!).
It’s fair to say that the world of gaming, much like finance, has changed so dramatically that, had someone told me about what 2023 would look like in the 80s, I’d have been channelling my inner Marty McFly and dreaming of the potential for hoverboards, flying cars and thinking body warmers were life jackets.
Back then gaming was developing at a rate of knots, aligning itself with the latest innovations in home computing – and, whilst money was an important aspect of the sector, for consumers it was more of a single-transaction nature. Today, finance makes the gaming world go round – from funding of new startups to R&D, to hardware /software purchasing, chip manufacturing, stock market flotation, micro transactions, NFT’s, sponsorship and advertising and eSports prize money… the list is endless.
I have fond memories of waiting ALL YEAR for Santa Claus to come – and for me to find the game or console I’d been hankering after “forever” sitting under the Christmas tree on 25th December. I vividly remember my cousins coming over to “spend the day with the family” and us hiding out in my room playing Duck Hunt / Super Mario Brothers (best double cartridge EVER) and latterly having LAN Parties (remember them?!) with Team Fortress, Wolfenstein, Quake III and the likes. Halcyon days.
Fast forward to now
Where am I going with this? Well, back then – financing of gaming was merely a once or twice a year purchase amongst consumers (unless you were very lucky) and was (in the main) the domain of parents and family purchasing for their kids. Fast forward to now, and the gaming industry is a behemoth for all ages and genders – worth an estimated $249 billion in 2023 (greater than the total GDP output of all but the top 50 countries in the world).
The gaming industry may seem new for some readers, but you may be surprised just how long this market has been developing. Ever since Pong achieved its success in 1972, the market has been on the rise. Today, as the second biggest media sector, gaming is one of the fastest growing industries in entertainment, worldwide (https://www.bcg.com/publications/2023/drivers-of-global-gaming-industry-growth).
Gaming has something for everyone
Today the industry is both diversified and more easily accessible than 30 years ago. We now have mobile gaming, online multiplayer, cosy gaming, twitch streaming and global eSports tournaments – all driven by micro-transactions, DLC, entry fees and recurring subscriptions. And the way we finance our habit has evolved to match it – crypto and digital wallets, Apple / Google Pay, PayPal – not just for money in, but for secure transfers out. Security, speed, and privacy form a critical part of the mix in this regard and therefore Fintech players have identified and are beginning to exploit these opportunities in ways that traditional financial institutions have been unable to. I don’t want to lose my life savings from a hacked system – so let’s get a Monzo / Revolut / PayPal account to make these transactions. Simple, safe, secure.
Changing priorities, but evergreen passions
But as I grow older and us Millennials and Gen-Z ers grow older, have families, and settle down – we are looking for new ways to stay connected to the gaming industry, relative to our life stage and other priorities (and I don’t just mean salivating at the prospect of Grand Theft Auto 6 coming out in the near future, either!). As we get older, our priorities change, and we move to looking for financial security and thus consider investment planning, and gaming, becomes an appealing industry to invest in. This is where ETFs come in. An Exchange-Traded Fund is a type of pooled investment security that operates much like a mutual fund. Typically, ETFs will track a particular index, sector, commodity, or other assets, but unlike mutual funds, ETFs can be purchased or sold on a stock exchange the same way that a regular stock can. An ETF can be structured to track anything from the price of an individual commodity to a large and diverse collection of securities. ETFs can even be structured to track specific investment strategies.
So, for those gamers who are at this juncture in life, ETF’s such as HERO, ESPO and NERD are considerations of what might be good for their investment portfolio.
Then there’s the opportunity
For finance players looking to leverage this lucrative industry, an estimated 3.24B people worldwide play video games, and according to the Entertainment Software Association, 40% of gamers in the US are aged 35+ - which in this country alone gives an estimated audience of 86.2 million gamers who may be planning for college education, retirement, healthcare and more – giving organisations in areas such as Asset / Wealth Managers and trading platforms a fresh and unique audience to consider.
For many, this world is no longer “just about playing games” – it’s a way to be deeply involved, secure futures, invest for growth and become invested in future successes. But still… at its heart remains the deep-rooted desire for enjoyment, companionship, escapism, and competition.
But one way or another – Gamers gonna game.
2CV’s Game Changers seeks to demystify how to gain a competitive edge for brands in gaming, by understanding which brands are successful from a gamer’s perspective. Our research across 3000 gamers in 6 markets tracks brands, (including financial services) performance by gamers themselves. To find out more about this research from the perspective of your brand, get in touch with us to arrange a walk through.
*ETF – Exchange Traded Funds