Marketing of Virtual Goods Predicted to Increase

As consumers spend more time online and interacting with their friends through social networks, a  related industry is growing quickly and generating revenue for savvy marketers. It’s all about virtual goods. When consumers are playing online games or posting updates to their personal pages, they present a ready market. Operators such as Zynga are selling real-​world pre-​paid game cards that consumers can use to customize their online places.  And then there’s always the option to buy an e‑birthday greeting or e‑flowers for friends. Analysts note that this industry was worth $1.6 billion in 2009.

A new survey jointly released by Frank N. Magid Associates, and PlaySpan, shows that about 13% of U.S. consumers purchase virtual goods. In 2010, consumers who make these purchases will spend about $99. This is a 14% increase from the average $87 that was spent in 2009.

Here’s a demographic snapshot of consumers most likely to purchase virtual goods:

  • Males ages 18 to 24 (31%)
  • Males ages 8 to 11 and 12 to 17 (both at 23%)
  • Males ages 25 to 34 (21%)
  • Females ages 8 to 11 (16%)
  • Females ages 12 to 17 (15%)
  • Females ages 18 to 24 (14%)

The industry is expected to grow rapidly in the next few years, especially as consumers have more ways to make purchases. For example, increased use of smart phones will lead to more interest in virtual goods according to Mike Vorhaus, President, Magid Advisors.

Here’s where consumers are making these purchases:

  • Free, web-​based game (37%)
  • Social network site, other than a game (31%)
  • Free multiplayer computer game (29%)
  • Game on a social network site (29%)
  • Connected console marketplace (21%)
  • Paid, subscription based multiplayer game (18%)
  • Online virtual world (11%)
  • Other (6%)

Look for more businesses to promote both virtual goods and prepaid cards as interest in this sector grows.

[Sources: Zynga Game Cards Available at Major U.S. Retailers. Zynga Blog. 25 Mar. 2010. Web. 3 Jun 2010; 2nd Annual Survey on Virtual Goods. Magid Associates and Playspan. 27 May 2010. Web. 9 Jun 2010] 
Kathy Crosett
Kathy is the Vice President of Research for SalesFuel. She holds a Masters in Business Administration from the University of Vermont and oversees a staff of researchers, writers and content providers for SalesFuel. Previously, she was co-​owner of several small businesses in the health care services sector.