Key Takeaways
- Video gaming is the world’s fastest-growing e-commerce vertical, with a 13.3% compound annual growth rate projected to lift the market to $633.8 billion by 2035.
- Emerging economies fuel this surge, claiming 42 of the 50 fastest-growing markets and driven largely by younger, core and lower-middle-class consumers making their first digital purchases.
Video gaming is the fastest-growing e-commerce vertical in the world, with a compound annual growth rate of 13.3% projected through 2035, going to $633.8 billion.
The findings come from a new analysis by EBANX, a technology company connecting global businesses to emerging markets through payments, based on data from World Data Lab (WDL).
Emerging economies are 42 of the 50 fastest-growing markets in the category. Among countries whose annual spend will exceed $500 million by 2035 include Kenya (26%), Turkey (21%), Ukraine (21%), Ethiopia (20%), Pakistan (20%), Brazil (20%), and Saudi Arabia (18%).
EBANX Estelita Hass on the Report’s Findings
“Rates like these come from arrival, from people making a first purchase, opening a first wallet, paying for something they could not afford previously,” says Estelita Hass, Head of Market Intelligence at EBANX, in a statement. “That is the moment a relationship begins and loyalty starts to be built, which is why meeting these players on their own terms, with the habits they already have, matters well beyond the first transaction.”
EBANX’s analysis of WDL data shows that consumers under 45 account for 5w% of the projected increase in video gaming spend across emerging markets. By income, the largest contribution comes from the Core and Lower Middle Classes, at 61%.
The Gamer Profile Varies Across Regions
The weight of each factor varies by region. Africa is where the pattern shows most clearly, with 81% of the increase coming from players under 45 and 80% from consumers below the upper middle bracket. Southeast Asia sits close behind, at 63% and 57%. Latin America is at the other end of the range, at 52% and 48%, the profile closest to a mature market anywhere in the analysis.
In the United States and Europe, by contrast, the expansion is driven by older consumers at the top of the income distribution. Adults aged 45 and over account for 54% of the projected increase in the U.S., and 901% of it belongs to the Rich and Upper Middle Class — those spending more than $90 a day. Europe shows a similar picture, with the same two groups at 56% and 63%. The U.S. CAGR sits at 12.6%, from $37.1 billion to $107.6 billion; Europe’s at 14%, from $27.9 billion to $89.9 billion.
“This concentration of growth in the wealthiest income bracket shows the American and European markets are expanding through consumers the industry has held on to for a long time. Renewal is a different job, and it is happening elsewhere, in emerging markets,” said Hass. WDL projects that more than one billion consumers in those countries will join the consumer class by 2036, against 28 million in developed economies.