Gaming has emerged as a dominant force in the bustling landscape of global entertainment, transforming from a niche hobby into a mainstream phenomenon.
The evolution of the gaming industry is not just about the latest consoles or the most immersive graphics; it’s about a seismic shift in how people spend their time and money.
According to a comprehensive study by Visa Business and Economic Insights (VBEI), video gamers are proving to be a highly lucrative consumer segment.
Their spending habits, which extend beyond digital purchases, reflect broader economic trends and opportunities businesses can no longer afford to ignore.
The burgeoning video gamer economy
The confluence of significant economic, technological, and social forces is set to amplify the prominence of video gamers.
By the end of 2023, the global games market generated an estimated US$184 billion in revenues, a figure expected to reach US$205 billion by 2026—close to the value of a mid-sized European economy such as Hungary.
Meanwhile, video game players are expected to reach 3.8 billion by 2026, accounting for almost half the world’s population.
Several rapidly developing trends will reinforce the burgeoning video gamer economy, including the rise of the middle class, especially in more populated emerging markets like India, China, and Brazil.
The increasing affordability of leisure time, the seismic surge in the digital economy, the proliferation of high-speed internet, advancements in mobile technology, and the shift towards remote work will also play significant roles.
Asia is the epicentre of gaming
According to the latest available data, Asia is home to approximately 1.48 billion gamers, making it the largest market for video gaming worldwide.
This number is more than double that of gamers in any other region and exceeds the combined total of gamers in Europe, Latin America, and North America.
The gaming industry in Asia continues to multiply, driven by the increasing number of smartphone users and the popularity of mobile gaming.
This massive Asian gamer base underscores the gaming industry’s global reach and economic potential. Companies that tap into this market can leverage a vast and engaged audience, further driving the industry’s growth and profitability.
The diverse gaming demographic
The stereotypical image of a gamer as a young male is increasingly outdated. Today’s gaming demographic is diverse, encompassing males and females across different age groups.
For example, 38 percent of gamers in the United States are between 18 and 34, 26 percent are aged 35 to 54, and 21 percent are under 18.
gaming industry
This diversity underscores the universal appeal of video games, which now span multiple platforms, including PCs, mobiles, and streaming services, covering genres from e-sports to strategy and fantasy.
Since 2019, active gamers have surged across all key markets. In the UAE, for instance, average monthly spending by video gamers increased from US$2,014 in 2019 to US$2,536 in 2023.
Such data reveals a consistent rise in financial engagement from gamers, making them a crucial demographic for businesses to target.
E-commerce and video Gamers: a perfect match
In online shopping and e-commerce, video gamer cards outperform non-video gamer cards. Across all markets, average monthly e-commerce spending on video gamer cards is often a multiple of non-video gamer cards.
Video gamers also tend to make more frequent purchases online and on e-commerce platforms, with roughly twice as many transactions as other cardholders. Given their tendency to live online, video gamers’ higher online spending and transaction frequency aren’t surprising.
A study found that gamers spent an average of 180 minutes daily on top gaming platforms in 2022, outperforming popular social media and streaming services.
Avid gamers also often subscribe to premium content and invest in specific high-tech hardware and accessories, which is characteristic of their immersion in the digital world.
The role of economic growth
One of the driving forces behind the rise of the video gamer economy is the increase in leisure time, an essential impact of economic growth over the past 50 years.
As economies develop, average annual hours worked per person tend to decline, suggesting that people in these countries have more leisure time than they did five decades ago.
This decade is expected to feature strong economic growth, which will result in more leisure time for billions of consumers worldwide, which will translate to more time to play video games.
As the number of video gamers grows, they will become an increasingly valuable demographic for issuers and merchants. The video game industry will likely continue expanding to meet this demand, providing new opportunities for entertainment, social interaction, and even employment.
The importance of recognising video gamers
Contrary to the common belief that gamers are mostly kids, research shows they constitute an eclectic and inclusive demographic segment with significant economic and business impact. Both issuers and merchants must recognise and capitalise on this influential consumer segment.
Fintech and payment providers like Codapay, a service offered by Coda Payments, play a crucial role in facilitating the growth of the video gamer economy.
Codapay provides an API service that allows game publishers and other digital content providers to accept over 300 payment methods on their websites.
The Singapore-based unicorn raised US$690 million at a US$2.5 billion valuation in early 2022, highlighting the growing interest and investment in fintech solutions tailored for the video gaming industry.
As part of a suite of solutions aimed at monetising digital content globally, Coda Payments works with various payment methods such as carrier billing, e-wallets, online banking, cash at retail, vouchers, and traditional card payments to facilitate purchases for mobile and online games, live streaming, video on demand, music streaming, and more.
By providing seamless and diverse payment options, fintech solutions like Codapay enable video gamers to easily make purchases within their preferred gaming platforms, contributing to the overall growth and success of the video gamer economy.
These innovative payment solutions are essential in capturing the immense potential of this burgeoning market, as they cater to the unique needs and preferences of video gamers worldwide.
Moreover, integrating fintech into the video gaming industry opens up new opportunities for game developers and publishers to monetise their content effectively.
By partnering with payment providers like Codapay, they can expand their reach to a global audience, tap into new markets, and increase their revenue streams. This symbiotic relationship between fintech and the video gaming industry is set to drive the future growth and evolution of the video gamer economy.
The future of gaming
The gaming industry’s ascent as a dominant economic force is undeniable. The extensive data from Visa Business and Economic Insights underscores the substantial spending power of video gamers, whose financial influence extends well beyond digital purchases.
The integration of fintech solutions, exemplified by companies like Codapay, further amplifies the gaming sector’s economic impact.
As the gaming population grows and diversifies, the industry’s influence on the global economy will only intensify.
Businesses that recognise and adapt to this trend will be well-positioned to tap into a lucrative market, leveraging video gamers’ spending habits and digital engagement.
In this rapidly evolving landscape, the synergy between gaming and fintech offers exciting opportunities for innovation, growth, and sustained success.
The rise of gaming industry is a testament to the dynamic interplay between technology, consumer behaviour, and economic development. As we move forward, recognising the significance of this segment will be crucial for businesses aiming to thrive in the digital age.
Featured image credit: Edited from Freepik
