What Really Caused The Retro Gaming Market Crash!
While there’s been a lot of speculation as to the causes of the recent fluctuations in retro game prices in recent years, most critics are clearly overlooking many important facts. At present, many point to a quote, “retro gaming bubble” as the term to explain what has now become a consistent plunge in the prices of many retro titles, while others continued to climb. So, what’s causing these wilder than ever pricing fluctuations, what appears to be a subsequent crash, and what can we do to overcome it? Well, first we need to look at the factors that really matter; including economical conditions, supply and demand, and technological advancements that hinder the sale of used games. While there’s likely a number of additional factors involved, the ones I mentioned here are probably the most profound.
For starters, and contrary to popular belief, it’s not just the retro games market that is stuck in a bubble, but the entire used gaming market as a whole! I know this because I bought and sold games for a living on ebay, and over the past few years I watched prices continuously plummet during that course of time. The beginning of the 2015 seemed to mark the day of reckoning for the used gaming market, as I watched prices consistently plunge throughout the course of that entire year. By September of 2015, used PS2 and original XBOX games that went for $25 at the beginning of the year, were now going for like $6 or $8 at best. It was truly a nightmare, and one that literally destroyed my business.
Currently, a lot of speculation points to gamers not wanting to collect, or collectors getting tired and merely dumping their collections to seek other fortunes. Yet, none of this is true. In fact, despite the current bubble, it’s more likely economical factors will prove to be the biggest issue currently affecting the industry. Which we’ll touch more on shortly.
1. Supply and Demand:
Just as with any product, video games typically rise and fall in value based on their consumer demand. When less copies of a game are in circulation, and its a game that is noteworthy among gamers and collectors alike, the prices will typically rise. The problem is, the market as a whole appears to be flooded with copies galore. So many in fact, that price wars seem to have erupted on platforms like ebay and amazon, where online gaming retailers often battle it out to win over buyers, and ultimately make their desired sales. With sellers being broke in the face of dismal used game sales, many started to sell for rock bottom prices. The lower I posted my prices, the lower my competitors did as well. This is part of what sent the used game market in a downward spiral we can’t seem to get out of.
The over saturation of used games also had a lot to do with the release of the XBOX One and PS4. Throughout the course of 2015 alone, I can’t count how many listings I read on ebay or Craigslist where the seller stated they were dumping their old school games to get one of the new consoles. Yes, people were ditching their old school games to get their hands on the new ones, and this caused the supply to quickly outdo the demand.
Another thing to consider is that when it comes to consumers, there’s two very different types of typical buyers. The ones who are looking to collect, and the ones who just want to play. The differences may not seem like much, but they’re actually quite huge when it comes to buying patterns.
For one, the collectors often want complete games, in mint condition, while the everyday gamer just wants to buy a game that’s in working order. So, how is this a concern to the used gaming market? Well, the market isn’t just flooded with people dumping their old consoles for new ones, but also with counterfeit reproductions. The problem is, the everyday gamer doesn’t care if a game is fake or not, they just want to play, and they’re often willing to pay less if it means getting what they want, albeit a working game.
Without a doubt, the used game market as a whole has seen a huge influx in the amount of counterfeit games that are now traversing the market place online. Being I often purchased games by the lots, I was used to ending up with tons of counterfeits, with Gameboy Advance titles being among the worst. In fact, it was so bad that literally 1 in every 3 GBA games I received was literally a total fake. For this reason, I refused to pay much of anything for them.
Then you also had the issue with people dumping their old collections to get their hands on new gear. I’ve watched games like Jurassic Park: Operation Genesis plunge from the $200 mark mint, down to just $100 or less today. Other titles like Dakar 2, an old school racing game on the original XBOX drop from the $45 mark it held just a few years ago, down to a paltry $6 with free shipping on ebay today.
In fact, it’s not odd for people to dump old titles for new ones, and being the popularity of the XBOX and Playstation consoles, it comes as no surprise people wanted in on the action.
2. Economical Conditions:
Just as consumer buying habits can dictate the supply and demand of products, so does the economy, and it’s a huge factor that’s been heavily overlooked in terms of the dismal sales of used games. While I can’t speak for every other country, I can safely say that the average American is now flat broke, and this helps to explain why so many are dumping their once massive collections on ebay and elsewhere. Whether anyone wants to admit or not, tens of millions of Americans have done lost their middle class livelihoods over the past 2 decades. Millions of what were once considered good middle class jobs, are now being replaced with subpar wages that no longer cuts the bills.
People aren’t just dumping their collections either, but consumers as a whole are buying less and less. For the working poor, these people are lucky to begin with if they can manage to get their hands on one of the new consoles. And, those who do, can’t necessarily afford to buy every game they want. When it comes to consumer spending, people are not just buying less, they’re getting pickier about what they buy as a whole.
Even as a gaming retailer, I realized that a huge portion of the games I purchased actually came from failed gaming retailers who went bust. Once you factor in the fact that the retailers themselves were failing in mass, its no wonder why the market got flooded, and prices fell off a cliff in the process.
3. Technological Advancements:
Modern advancements in gaming technology have also played a huge role in the demise of the once thriving retro and used game markets. For one, why would anyone want to buy an old school PS2 or original XBOX game, when they can buy the same titles for less as a digital download through XBOX Live and PSN? While the collectors will still insist on only buying the real thing, the average gamer will swoop for the online special and buy the same games for even less. Let’s face it, with digital downloads there’s no waiting for a game to arrive in the mail, no shipping fees, and one doesn’t have to worry about scratching or accidentally losing/destroying their physical games.
As more of these classic games become available as digital downloads through platform’s like Steam and others, consumers will continue to shift gears in their buying habits, and many will opt for the quicker and often cheaper downloaded title.
Just as with any fluctuating markets, there’s winners and losers in the world of retro/used games. While prices of many PS2 and original XBOX titles have plummeted, the prices of Game Cube and Sega Saturn games have risen sharply in recent times. Original arcade hardware still appears to be in a upward swing as well, expecially when it comes to SNK related merchandise. But as long as the current economic climate continues to persist, the majority of game prices will likely continue to drop as gamers unload their collections in hopes of covering their unpaid bills.
Conclusion:
All being said, when it comes to used games, it’s a buyers’ market for sure. Whether or not things change any time soon will likely heavily depend on the economic conditions, as well as current and future trends in gaming. If the economy were to improve throughout 2017, its more than likely prices of classic and used games will drive right back up again. After all, the demand for video games used and new is huge, but in America there remains very little money for consumers to spend on such a form of entertainment. Beating the retro gaming bubble before it bursts will depend not just on demand from buyers, but rather their ability to purchase the games they want. Until then, only the most sought after titles and hardware will continue to hold their top-dollar values.
Written and published by Daniel Imbellino, co-founder of Gamers Bay! Connect with us across the web to stay up to date with honest gaming news, reviews, and online games!
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