The less-than-expected user adoption for Meta's metaverse project indicated that the metaverse, termed the future of the internet, is not the next trend in online socializing. Even after spending billions of dollars on the development of metaverse infrastructure and ecosystem, Meta failed to gain substantial traction among users. However, Roblox has presented a different scenario altogether by reporting strong growth in user adoption over the last 12 months.
Much of this growth has been driven by young generation gamers across geographies. Made popular through games such as Jailbreak, MeepCity, Royale High, Murder Mystery, and others, Roblox has become the favored gaming platform for most young generation gamers globally. The firm’s growth has been also led by games like Fortnite, where gamers can attend concerts and hang out with friends in the metaverse.
The growth in average daily active users for Roblox also resulted in higher in-app purchases in Q4 2022. Booking figures, representing the in-app purchases made using Roblox’s virtual currency Robux, reported a growth of 17% year over year to reach US$899.4 million. This is higher compared to the US$884.71 million estimated by investors. For the 12 months in 2022, the bookings reported a surge of 5% to reach US$2.9 billion. In January 2023, the firm reported bookings in the range of US$267 million to US$271 million. This represents a growth of 19% year over year.
In terms of in-app purchases, growth has been higher among users over the age of 17. This shows that the metaverse platform is gaining traction among young adults as well, and not just among teens. With the firm gaining traction among young adults, it would mean the platform would keep recording growth in its booking volume from the short to medium-term perspective. In both January 2023 and December 2022, Roblox reported significant growth of nearly 20%. This shows that the trend is projected to continue over the next few quarters in 2023.
Along with increased in-app spending and higher daily active users, Roblox has also reported rising engagement periods. With gamers spending higher time on the platform in Q4 and throughout 2022, Roblox user engagement is a positive indication for the global metaverse market. In Q4 2022, engaged hours increased to 12.8 billion, representing a growth of 18% year over year. In 12 months of 2022, the engaged hours increased to 49.3 billion, representing a growth of 19%.
The growth in engagement hours is also a boost for the global metaverse sector, as users are spending more time engaging with the virtual worlds, even after the impact of the pandemic diminished significantly in 2022. The high growth in average daily active users, in-app spending, and engagement hours is a concern for Meta, which has been struggling in garnering traction for its metaverse ecosystem among users globally. Meta's metaverse ambitions are also facing stiff competition from global players such as Zepeto and Ifland, the metaverse platform from South Korean internet giants, Naver and SK Telecom.
Both Zepeto and Ifland have been expanding their presence in the global market and have reported strong growth in average daily active users. With Zepeto, Ifland, and Roblox gaining strong traction and growth in their metaverse ambitions, Meta is expected to feel the investor pressure, who are demanding strong results based on billions that are being invested in the sector.
Furthermore, due to the strong growth in daily active users reported by Roblox, TechInsight360 expects more brands across industry verticals to mark their foray into the metaverse space from the short to medium-term perspective, as they seek to better engage with their customers.
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