- A recent survey has shown that the metaverse could be worth $5 trillion by 2030, with e-commerce being its biggest money maker.
- About 95 percent of executives say virtual technology will have a positive impact on their respective industries.
The metaverse could hike to a $5 trillion valuation by 2030, new research has found. Additionally, e-commerce would be the technology’s biggest consumer, with ads largely benefitting from the same.
Dubbed “Value Creation in the Metaverse,” the report was published on Wednesday by the global consultancy firm McKinsey & Company. The results within it are based on its analysis of current trends in metaverse adoption, in addition to two surveys. One survey polled 3,104 consumers from 11 countries. The other obtained data from executives across 448 firms from 15 different industries in 10 countries.
From this, McKinsey inferred that metaverse will be most significant in gaming, socializing, fitness, commerce, and remote learning. Roughly 60 percent of consumers prefer engaging in at least one of these activities in the virtual space, rather than the physical. Additionally, 79 percent of consumers that had engaged with the metaverse had made purchases in the same.
Metaverse $5T valuation will mostly be attributed to e-commerce
According to the report, e-commerce would be the biggest contributor to the above valuation, bringing in between $2-2.6 trillion by 2030. With e-commerce comes advertising, which McKinsey said would be the next big cash cow – revenues of $144-206 billion.
Investors have been keen on the new technology, placing significant bets to develop and support it. By the end of May, investments in meta-verse technology and infrastructure had risen to $120 billion. This is more than twice the amount injected in 2021 ($57 billion). Authors of the report – Lareina Yee and Eric Hazan – liken the technology to the internet, saying:
[The metaverse] is the next platform on which we can work, live, connect, and collaborate.
As for executives, 95 percent are confident the metaverse will positively impact their respective industries. A third say the virtual space will significantly alter their operations. Additionally, 25 percent say 15 percent of their total marginal growth will be attributable to the metaverse five years to come. Yee says “executives often don’t agree on very much,” but when it comes to the metaverse, most are in a unanimous voice.
Uncertainties, challenges, and benefits
Like any new technology, skepticism in the metaverse is expected. Roughly 31 percent of executives expressed uncertainty in the return of metaverse investments.
But even with the enthusiasm and hype of the metaverse on high, Hazan points out several challenges in its use. Investors will need to re-train their workforce in new metaverse-related skills. They will also need to develop experiences that are “ethical, safe, and inclusive.”
In her commentary, Yee concludes by saying that technology is still new and evolving. For this reason, individual creators and big brands need to think long-term if they want to reap its benefits.