The report titled “Value creation in the metaverse” collected data from 3,104 consumers over 11 countries and 448 businesses over 15 different sectors to finalize the findings.
Since Facebook rebranded to “Meta Platforms”, there has been a lot of noise in the space. Tech companies have leapt forward with their iterations of the metaverse. Brands like Adidas, Prada, Nike, and many more have launched digital outlets or have plans to do so.
McKinsey believes metaverse has tremendous value for businesses and is not a fad. It is gradually becoming too big to ignore. Companies not adapting to the metaverse might lose their edge.
The report read:
“There continue to be questions around the longevity and potential of the metaverse, with an extreme view regarding it as merely a rebranded gaming platform of little wider interest. We do not share that skepticism and believe the metaverse has the potential to be the next iteration of the internet.”
As the metaverse slowly infiltrates into daily lives, an average internet user is expected to spend at least 6 hours a day on the metaverse in 8 years. At that time, more than 50% of the live events could be conducted over the virtual space. Also, 80% of the commerce could be impacted by what people do in the metaverse.
E-commerce and virtual advertising could be the primary beneficiaries with the potential to reach $2 trillion and $150 billion in sales, respectively.
Almost 65% of the respondents indicated that they were excited about shopping in the virtual world, with 79% preferring an immersive shopping experience over the traditional ways.
Eric Hazan, the Senior Partner at McKinsey, compares the current time to Web 2.0 in 2004. At that time, people were introduced to mass interactions over the internet, and American consumerism was mostly limited to physical stores. Then came social media, and user-generated content completely transformed everyday life, from media consumption to shopping. He revealed that we are at the cusp of a great change.
The report notes that about $120 billion has been poured into the space in 2022, a 100% rise over the previous year’s $57 million.
Several banks and financial institutions, including JP Morgan, Standard Chartered Bank, HSBC, and Fidelity Investments, are now present in the metaverse, indicating optimism for the future.
Gaming and crypto will be the main drivers of the space, with 70% believing advancements in blockchain to be critical for the metaverse.
However, everything isn’t rosy on the report as 31% of all executives expressed skepticism about the upcoming investments involving web3. Some also believe the technology might not be the requirement of the hour.
Even though metaverse kicked off as a tool to curb privacy concerns, around 70% remain concerned about their safety.
McKinsey isn’t the only one to predict the astronomical rise of the metaverse. Citigroup views metaverse as a 13$ trillion opportunity by 2030, while Goldman Sachs put it at $8 trillion by the same time.