Consumer Boxed Software Sales Stabilize in 2010 - According to The NPD Group

According to NPD’s Retail Tracking Service, total consumer retail software (excluding PC games) increased 1 percent in 2010, to $2.42 billion. The slight growth comes after two years of steep declines of 8 percent in 2008 and 10 percent in 2009.

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“While industry pundits and commentators continue to forecast the death of retail software, it remains a strong and viable channel for companies wishing to get their products in front of the maximum number of customers."

Port Washington, NY (Vocus/PRWEB) March 15, 2011

There is still life in the consumer boxed software market, despite reports of the demise of the industry, according to leading market research company The NPD Group. According to NPD’s Retail Tracking Service, total consumer retail software (excluding PC games) increased 1 percent in 2010, to $2.42 billion. The slight growth comes after two years of steep declines of 8 percent in 2008 and 10 percent in 2009.

Sales of business products led the way with 14 percent revenue growth on the strength of Microsoft’s launch of Office 2010. Imaging and graphics was also a strong category with a 10 percent increase in revenue, as product launches from Adobe and Apple bolstered sales in the high-end professional segments of the market.

“While industry pundits and commentators continue to forecast the death of retail software, it remains a strong and viable channel for companies wishing to get their products in front of the maximum number of customers,” said Stephen Baker vice president of industry analysis at NPD. “While there is no doubt that 2010 saw a number of changes in in-store product distribution that will impact future sales, NPD’s research shows that retail storefronts grew faster than ecommerce in 2010.”

Microsoft was the leading publisher at retail in 2010 accounting for more than one-third of all retail sales dollars. Sales of Office 2010 drove revenue in the office productivity suites category to its highest level in more than four years. Intuit, Apple, Adobe, and Symantec were the other top publishers at retail. Together those five companies accounted for 78 percent of sales, up three percentage points from 2009.

Among the other major categories both finance and system utilities sales declined in sales. Finance software fell as tax software continued to move online. Security software revenue took a hit as major retailers, in partnership with security software publishers, continued to see value in offering basic security products for low, or no cost, with the longer-term expectation that those can turn into more fully featured suite sales and subscription revenue.

“Much of this year’s revenue increase came as a result of sales of premium products such as Final Cut, Aperture, CS5, and Office,” said Baker. However, the lower unit volume potential of these products, even as they increase in revenue importance, remains a major threat to the ongoing maintenance of sufficient shelf space in retail to keep the category viable.”

About The NPD Group, Inc.
The NPD Group is the leading provider of reliable and comprehensive consumer and retail information for a wide range of industries. Today, more than 1,800 manufacturers, retailers, and service companies rely on NPD to help them drive critical business decisions at the global, national, and local market levels. NPD helps our clients to identify new business opportunities and guide product development, marketing, sales, merchandising, and other functions. Information is available for the following industry sectors: automotive, beauty, commercial technology, consumer technology, entertainment, fashion, food and beverage, foodservice, home, office supplies, software, sports, toys, and wireless. For more information, contact us or visit http://www.npd.com/ and http://www.npdgroupblog.com. Follow us on Twitter: @npdtech and @npdgroup.

FOR MORE INFORMATION:
Sarah Bogaty
+1 516 625 2357
sarah(dot)bogaty(at)npd(dot)com

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