Decline of physical entertainment market slows - but DVD, CD and video game sales still slide

 
Kasmira Jefford
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CD sales continued to fall (Source: Getty)

Things seemed to be looking up for physical entertainment market. Although fewer people are buying video games, CDs and DVDs, the rate of decline has slowed in the last quarter, while several major retailers even recorded an increase in sales.

Figures released this morning by Kantar Worldpanel show that the physical entertainment market shrank by three per cent in the 12 weeks to 5 July as consumers increasingly opted to download or stream films, music and games on their phones and laptops.

However, this was a big improvement on the seven per cent decline recorded the same time last year, with retailers Tesco, Amazon, GAME and Argos all enjoying an increase in sales.

Games have been the strongest performer thanks to software sales for Playstation's PS4 and Microsoft's Xbox One.

“Performing particularly well is GAME, which has increased its market share within the sector to 31.7 per cent from 29.1 per cent last year. It continues to be the preferred choice for owners of the Xbox One and PS4, taking 36.5 per cent of their combined software sales,” Kantar’s strategic insight director Fiona Keenan, said.

The video sector has also seen a pick-up in demand, with a 3.6 per cent decline in value compared to a drop of 9.5 per cent in the last quarter.

Amazon and Tesco were the major winners, taking 42.5 per cent of the market between them thanks to new DVD releases including The Hobbit: The Battle of the Five Armies.

HMV was left lagging behind in third place despite being ahead of Tesco last year, after its market share declined by 1.1 percentage points, leaving it with 14 per cent of the market.

The retailer, which was rescued out of administration three years ago by restructuring firm Hilco, relaunched its online store in June, which it is pinning its hopes on to boost sales.

Sales of music CDs fared less well and this was particularly felt by the grocers Asda, Morrisons and Sainsbury’s, who collectively lost over £3m in value year-on-year.

This was one area where HMV performed better than its supermarket rivals and did not lose market value thanks to new releases, including English Graffiti by The Vaccines.

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