The new digitally native consumer is spending an increasing amount of time socializing, playing, and purchasing online. As digital takes share in our daily lives, online entertainment and advertising spend, and platform e-commerce fees is likely to grow at an 18% CAGR during the next five years to $4 Trillion by 2026. The COVID-19 crisis accelerated the shift from offline to online activities.
The accelerating adoption of online platforms gives businesses and individuals the ability to reach global audiences. Today, six platforms have more than 1 billion monthly active users, and 25 platforms have at least 100 million monthly active users.
As traditional advertising declined during the Covid-19 pandemic, digital advertising gained share. By the end of 2021, global digital advertising market will grow at a 11% compound annual rate over the next eight years surpassing $1 trillion in expenditures by the end of 2029.
When implemented correctly, social commerce combines the convenience of online shopping with the network effects of social media. Social commerce gross merchandise value (GMV) is expected to grow at a CAGR of 41% over the next five years to $3.7 trillion.
Fortnite exemplifies the massive shift to social gaming. Launched in 2017, today Fortnite holds virtual concerts for millions of players and has dedicated spaces in which users can hang out. Video game content and services will grow at a CAGR of 15% with the rise of “virtual worlds” to more than $400 billion by 2026 .
The three segments are i. Entertainment Spend ii. Advertising iii. Platform E-Commerce Fees
This market is expected to grow at a 18% CAGR the next five years to $4 trillion in 2026.
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Information presented should not be considered investment advice or a recommendation regarding any particular security. Sources: US Bureau of Labor Statistics, Federal Reserve Economic Data, US-OECD, US Department of Labor, World Bank, Gartner, IDC, Kagan Research, McKinsey Global Institute and ARK Investment Management. Copyright © 2022 TOLIMA LP - All Rights Reserved.