Survey 411...
US Only
18-44 M/F
N=420
December 23, 2020
It was the late 90’s when a mysterious new product had Silicon Valley investors in a frenzy. Only the most notable investors had been given access and they held firm in their word to keep it confidential. After evaluating the product Steve Jobs, doing only what Steve Jobs can do, sent the country into a tailspin when he remarked “cities will be built around it”. Venture capitalist John Doerr said that “it might be bigger than the internet” after he invested millions and the inventor quipped to Time magazine that it "will be to the car what the car was to the horse and buggy."
Was it a personal helicopter? Perhaps a vehicle that hovered?
America was convinced that the age of The Jetsons was upon them when they tuned in on December 3, 2001 to see the reveal of this mysterious, world changing product on Good Morning America, the most watched morning show in the country. All of America leaned into their TVs as the curtain was drawn away to unveil…a scooter.
Not just any scooter though. It was “the world’s first self-balancing human transporter”. Consumers now had the unique opportunity to pay $4950 for a scooter that would not tip over and from which the rider would not fall. And with that Americans gave a chuckle, then turned its back on the product forever.
In defiance, inventor Dean Kamen told Time magazine, "It won't beam you to Mars or turn lead into gold. So, sue me."
It’s hard not to think of product launches like the Segway when analyzing the rollout and release of Cyberpunk 2077. Eight years of amazing graphics, stories of new technological frontiers, and finally Keanu Reeves was just too much for CD Project Red's perspective group of consumers to bear. Players wanted the game, and they wanted it now. By October of 2020, our estimates put 10.8M US gamers in the bucket of "players who were ready and willing to buy the game". That's a gross revenue market opportunity of approximately $648M in the US alone.
This was to be the greatest game launch in video game history. Then, well, you know the outcome.
THE FALLOUT
In our predictions for the final months of 2020 we estimated that Cyberpunk 2077 would reach at least 5M units in the US by the end of year, but by the time we completed our follow-up analysis over the holiday break we were having difficulty understanding claims of more than 2.1M-2.3M US units sold.(1) We then turned our attention to returns. If we're being honest, this was what we were curious about the most. A promise of returns on a global scale is unprecedented. For the US, the results aren't pretty. Our analysis places total US returns at roughly 1.03M units, an incredible hit to CD Project Red's bottom line.
From December 10, 2020 through December 21, 2020, approximately 1.03M US gamers 18-44 requested a refund for their purchase of Cyberpunk 2077.
CD Project Red lost roughly $61.8M in gross US sales in less than two weeks.
Compounding the tragedy of revenue lost to returns is the money CD Project inadvertently left on the table. Based on our analysis roughly 786K potential Cyberpunk 2077 players chose to wait for reviews before purchasing. It’s difficult to say how many would’ve actually purchased the game had the reviews been stellar across the board, but CD Project Red missed out on roughly an additional $45.4M in December alone. All told, Cyberpunk 2077 would have potentially added $107M in gross US 2020 sales had the game simply worked.
No one outside the most senior leadership roles at CD Project Red will ever truly know why they moved forward with releasing a game that was clearly not functional, so we aren’t going to speculate on why they made the choice they did.(2) It clearly had consequences and the consequences are now theirs to work through.
SLIVER OF HOPE
Poor release decisions aside, all is not lost for Cyberpunk 2077. Based on our research no less than 58% of players who were able to actually play the game said Cyberpunk 2077 exceeded their expectations in everything from Storytelling to World Immersion to Combat Experience and more. Quite frankly, if you have the hardware to play the game and enjoy RPG’s, we're willing to wager you will very much enjoy Cyberpunk 2077.
This is incredibly positive news for Cyberpunk 2077. While future units will probably be relegated to sales at discounted prices, the game will eventually be profitable. Our estimation is that current PS4 and Xbox One owners will hold out until they upgrade to a PS5 or XBX before purchasing the game. CD Project Red’s latest mea culpa has updates and improvements through Q4 of 2021 which gives console players the to chance to wait for Sony and Microsoft to get next generation consoles back on the shelves. Expect your friends to be talking positively about the game around November’ish of this year.
NAILED IT!
Quick side note we’re quite happy about, in our rather bold 2020 prediction post we estimated that the PS5 would sell 1.5M-1.7M units and the Xbox Series X would sell 1M-1.1M US units by the end of 2020. Results are in…PS5 looks to be at roughly 1.4M units and Xbox Series X landed at a respectable 1.27M units by the end of December. Yeeaaahhh…we’re flexin about now.
HERE'S TO A GREAT 2021! WE HOPE IT'S HAPPY AND PROSPEROUS FOR ALL OF YOU!!
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