Global metaverse spending by consumers and businesses could reach $5 trillion by 2030, according to a recent report from consulting firm McKinsey & Company.[1] What may drive this growth in metaverse spending? How are businesses responding?
$5 Trillion by 2030
McKinsey interviewed 3,104 global consumers and polled executives from 448 companies across 15 industries in 10 countries. Based on their research, they estimate global metaverse spending by 2030 will reach $5 trillion. The study estimates the largest impact in the following sectors:
Substantial Investment in the Metaverse
Business leaders continue to signal their confidence in the metaverse space through significant investments. During the first five months of 2022, over $120 billion worth of investment flowed into the metaverse space, more than double the entire $57 billion invested in 2021.
According to the report, this growth is being fueled by the following factors:
Consumers Are Enthusiastic About the Metaverse
Consumers are enthusiastic about the functionality of the metaverse. McKinsey reports that almost 60% of consumers are excited about the transition of everyday activities to the metaverse, with connectivity being the number one driver of excitement. 59% of survey respondents said they preferred at least one virtual activity versus physical, while some 79% of consumers have already made purchases in the metaverse . The following were the most preferred activities in digital spaces versus their physical alternatives:
Company Executives Are Equally Enthusiastic
Senior executives of companies surveyed also believe in the potential of the metaverse, with 95% of respondents expecting the metaverse to have a major impact on their industry within the next five to ten years. Nearly 61% of respondents expect the metaverse to moderately change how their industry operates. Almost two thirds of executives expect metaverse technology to drive more than 5% of their revenues within five years, with 24% expecting it to drive more than 15% of revenue.
The top five uses for which company executives expect to employ metaverse technology are:
Investment Opportunity
Given its estimated growth, along with the willingness of consumers to adopt metaverse activities and the investment being made by companies, the metaverse may present an attractive investment opportunity for individuals.
[1] All data sourced from: Value Creation in the Metaverse, McKinsey & Company, June 2022
Risk Disclosure:
Investing involves risk, including possible loss of principal. There is no guarantee the Funds will achieve their stated objectives. In addition to the normal risks associated with investing, international investments may involve the risk of capital loss from unfavorable fluctuation in currency values, differences in generally accepted accounting principles, or social, economic, or political instability in other nations. Emerging markets involve heightened risks related to the same factors, as well as increased volatility and lower trading volume.