Social gaming is expected to be a billion-dollar business this year, according to an eMarketer report released today. I think it is only a before you see retail store get in to this game so to speak. Say an all virtual Target or Wal-Mart store in CityVille. Maybe a Nike store even. The floodgates are closed now but it is only a matter of time.
eMarketer says that nearly 62 million US internet users, or 27% of the online audience, will play at least one game on a social network monthly this year, up from 53 million in 2010. In the U.S., consumers will spend $653 million on virtual goods in social games in 2011, compared to $510 million spent in 2010.
These revenues from virtual goods will continue to make up the majority of social gaming revenues in the past but other areas in the business are anticipated to grow. Ad spending is expected to grow to $192 million in 2011 to advertise on social games, which is a 60% increase over 2010. And Lead-gen offers will increase to $248 million in 2011 from $225 in 2010. Ad revenue is actually expected to surpass lead-generation offers as a source of developer revenues in 2012, says eMarketer.
eMarketer’s Paul Verna, author of the reports, says that the future will bring “more branded virtual goods as social gaming matures over the next two years,” with virtual good becoming more of an advertising vehicle for companies. I think now would be a good time to start investing into these companies. It will be like the Net in early 2000.