Popular games labels rev software brands list - computer software - 1994 Power Brands, part 2 - Industry Overview

Discount Store News, Oct 17, 1994

Consumer preferences in entertainment software brands predictably followed the market penetration curve of the two leading entertainment companies, Nintendo and Sega. Together these two brands have penetrated well over 60% of U.S. households, easily outscoring computer-related brands, which have a penetration of about 35%.

Computer Software: Consumer Brand Preference

(Among consumers who shopped discount stores in the past year)

                       All Discount

Power Brands(1)           Stores      Wal-Mart   Kmart   Target
Nintendo                    25%         22%       26%     27%
Sega                        21          19        21      20
Microsoft                   13          14        14      13
IBM                         8           6         9       4
Quicken                     5           7         6       6
3M                          2           2         3      5
Apple                       2           3         1       5
Packard Bell                2           1         2       4
Sony                        1           1         1       --
  Rank by
Store Managers(2)
Nintendo
Sega
IBM
Packard Bell
Game Boy
Microsoft
Apple
Magnavox
DOS
Genesis

(1)Based upon discount store consumers' response to the question: "If you were shopping for (product) in discount department stores, which brand of that product would you want?"

(2)Based upon store managers' response to the question: "What are the best performing brands in (department)?"

Source: DSN/Leo J. Shapiro & Associates, July 1994

Life stage analysis: Computer Software

(top brands by age group)

      Busters               Boomers            Empty Nesters


     (Under 35)             (35-49)            (50 and over)

Nintendo       36%   Nintendo      19%   Quicken     33%
Sega           27    Sega          17    Sega        17
IBM            10    Microsoft     16    Nintendo    12
Microsoft       7    IBM           8     Microsoft   10
Packard Bell    5    3M            5

Source: DSN/Leo J. Shapiro & Associates, July 1994

However, computer products are closing the gap. Microsoft finished a strong third on consumer's Top 10 list of preferred brands to the 16-bit behemoths.

Intuit's Quicken, a single software product, finished fifth due to extremely high awareness among consumers over 50. Quicken has become a major industry by itself, but its results with older consumers --33% called it a preferred brand--are nevertheless startling.

Nintendo and Sega dominated the brands lists of Baby Busters, with nearly two-thirds of those with a brand preference citing one of the two systems. But the two were also relatively strong with older shoppers, with about one-third of both Boomers and Empty Nesters preferring either Nintendo or Sega, probably because they buy the software for their children or grandchildren on occasion.

There were few large variations on a chain basis apart from a slightly higher mention rate for Sega among Kmart shoppers and Quicken among Wal-Mart and Target shoppers.

As is the case with computer hardware, a lot of consumers start getting confused about brand names after the top three or four. 3M and Packard Bell were mentioned frequently, but neither makes entertainment or computer software. Sony, which does make software, finished ninth, but probably more for its dominance of the consumer electronics industry than for the relative popularity of its computer games.

Such brand confusion by retailers and consumers resulted in one of the largest concentrations of Power Brand products in the survey. This year, the Power Brands list includes Nintendo, one of the highest rated Power Brands in the survey, IBM, Sega, Packard Bell and Apple.

Consumers and retailers agreed on six of the Top 10 brands: Nintendo, Sega, Microsoft, IBM, Apple and Packard Bell.

While consumers' lists included Quicken, Scotch/3M and Sony, retailers said their best performers also included Game Boy, Magnavox, DOS and Genesis. Overall, 75% of consumers had a brand preference in this category, a relatively high figure that probably reflects loyalty to Sega and Nintendo.

Content--rather than brand name--generally drives sales in computer games, where a tiny publisher like Id Software, the creator of Doom, can hit the top of the charts.

However, with so little software available through discount stores, shoppers are not very confident of finding their preferred brands. In fact, one-third of all respondents said that when they shop for computer software they look for a brand other than the labels specifically identified in this survey. Among Boomers, nearly half mentioned a brand not specified in this report.

Those titles were not specifically identified because they received too few mentions overall to merit a specific breakout.

On a scale of one to nine (nine reflecting the highest degree of consumer confidence), consumers scored their confidence level 5.74, and only 18% of survey respondents said they are sure, a nine, of finding what they seek.

Only computer hardware scored a lower confidence rating than software.