Metanomics: How Generation W will create a virtual market worth US$5 trillion

Metanomics: How Generation W will create a virtual market worth US$5 trillion

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In Stanley Kubrick’s finale 2001: A Space Odyssey, the Starchild appears. From the depths of space, the superhuman newborn contemplates the earth, the blue planet being for her only a possible world in an infinite universe. This iconic scene perfectly depicts what is happening with human civilization right now.

Every day for two years – since the beginning of the COVID-19 pandemic – people are born with a perception of reality radically different from ours. I call them Generation W – “double you” – because from the moment they are born, they have a “double” identity, a physical and a digital one. Very soon, all industries and all global markets will be reshaped to suit their specific preferences. And businesses will need to be flexible, because the key value of Gen W will not simply be freedom of choice of goods and services, but instantaneous switching between different lifestyles – in effect, moving from one world to another. ‘other.

The foundations of the W economy have already been laid: at the end of 2021, the market on which virtual worlds will be rapidly created in the years to come weighed 500 billion dollars. Today, the largest segment of this market, representing 40.2% or approximately $201 billion, is games, including software and hardware. It also includes virtual goods (10.8% or $54 billion), non-fungible or NFT tokens (8.2% or $41 billion), and augmented, virtual and mixed reality (AR/VR/ MR) (5.6% or $28 billion). . And more than a third (35.2% or $176 billion) of the market is made up of other services related to metaverse development. This is where the most powerful engine for future exponential growth lies.

However widely expert the relative growth forecasts of individual segments of the W economy vary, one thing is indisputable: the balance will inevitably shift in favor of the metaverse. By the end of the current decade, the growth of services related to metaverses and the sale of virtual goods will outpace everything else, taking a cumulative market share of 82% by 2030. And this is the generation W which will be the engine of this leap.

Related: Let’s play: why Dubai is well placed to offer the MENA region its own gaming industry

Image reproduced with the kind permission of the author.

How will the behavioral patterns and values ​​of people, who from childhood are accustomed to existing simultaneously in digital and physical environments, define the new economic paradigm? I think the answer lies at the interface between information technology and marketing, in the logic of tailor-made. From the start, computer software and, later, web editors allowed for multiple choices of settings – functions, plugins and filters. At the end of the last century, according to leading new media theorist Lev Manovich, this principle applied to the entire sphere of communications, including B2C interaction. In the same way that users could optimize software for their own needs or create an avatar in a computer game, they could receive personalized goods and services, create objects from modules and use a system of personal recommendations.

But improvements in targeting algorithms and personalization of consumer items are only derivatives of a much more radical cultural and civilizational shift, facilitated by the diversity of social networks. Zoomers are constantly customizing their identity, always adding more details, specs and settings. They compile this identity from an extensive catalog, starting with basic menu choices such as origin, gender and social status, before moving on to additional options, such as vegan, K-Pop fan or life coach. I’m sure Gen W will personalize reality the same way.

The ability to customize their own environment, model their living space and, on top of that, enjoy unlimited freedom to choose from a multitude of different universes are core values ​​for Generation W. And the platform for implement this need will be provided by the metaverses. Virtual cities, offices and entertainment centers, superimposed on the physical world and the augmented material reality of digital objects and interfaces, will connect through 3D Internet networks to provide an immersive experience unprecedented for humanity. And they will create a market of up to $5 trillion by 2030.

Not only will the metaverse obliterate traditional marketing strategies, but it will also eliminate the very concept of “consumer behavior”. Generation W will not buy and consume in the conventional sense: whatever it is called, they will pay for be– pay to continue to exist within one or more favorite universes. Today’s paid subscription and game monetization services are only a vague glimpse of the business models that will emerge in the metanomics of the future.

Related: Virtual World, Real Impact: Building Sustainability in the Metaverse

Image reproduced with the kind permission of the author.

It is already clear that working with Generation W will first and foremost require the development of engagement and retention techniques. Users will assess the quality of a digital product directly inside it. The competition will take place not between physical and digital reality but between a multitude of hybrid, convergent and mixed environments. It is predicted that by 2028, the global AR/VR/MR technology market will reach $250 billion, while the usability and convenience of “gateways” to enter metaverses will also improve.

The metaverse will not become so much a way of life as a means of living: by 2030, the market for human avatars will approach $530 billion, with NFTs and digital art worth over $200 billion, and the digital mode 55 billion dollars. And, of course, the games segment will also grow significantly – to almost $550 billion. But it will undergo structural changes and find itself hidden inside the metaverse and Web3 like a Russian doll. Generation W will communicate, work, study, rest, travel and love in a digital space shaped for them by information technology companies and tech startups, while calling it their own, because personalization and settings extensive customizations will elevate each participant to the status of “co-author” of the new virtual environments – literal creators of their own universes.

With a deep understanding of these trends, I don’t consider too optimistic a prediction from global investment bank Citi that the number of Metaverse users could reach five billion by the end of the decade. After all, having created their own universes, Gen W won’t want to let them go. And following the logic of customization, they will be ready to invest in the maintenance and development of these universes. The question of how “real” cryptocurrencies, digital assets, virtual reality, products and services are will become meaningless. Human civilization will move into the metaverse, while global industries and markets will be integrated into metanomics through out-of-the-box mods.

Related: The World of Web3: A Beginner’s Guide to a Space That’s About to Change the World Like the Internet Once Did

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