Simply tracking the adoption rates of emerging payments isn’t sufficient to draw conclusions about future interest or potential success. While it may be true that adoption rates have been relatively low so far, it would be a mistake to assume that people won’t become more interested in these technologies in the future. That’s according to a new report by Christopher Miller, Lead Analyst in Emerging Technology at Javelin Strategy & Research.
Different Levels of Engagement in Emerging Payments
The report, “Tracking Emerging Payments Technologies: Adoption is Not Enough” points out that when it comes to various emerging technologies, especially in the realm of payments, simply knowing whether someone has tried something like the Metaverse doesn’t reveal the extent of their involvement.
“It goes beyond just asking, ‘Have you tried this?’ and involves segmenting the data,” Miller said. “Even among those who have dabbled in the Metaverse, there are different levels of engagement. From a payments perspective, the key question becomes: Have they actually made payments within the Metaverse?”
This matters to payment providers, such as processors or blockchain companies, who are looking to find out how much they should invest in these new technologies.
“If all people using the Metaverse do is video conference with their friends, the implications for payments firms are minimal.” Miller said. However, if there’s a substantial volume of transactions and they are controlled by one or more Metaverse platforms, it becomes significant for these payment providers, whether it’s payment processors, blockchain companies, or others.”
Granular Data Give a More Accurate Picture of Metaverse Use
Here’s a flavor of how this more granular data can be more helpful for getting a more accurate picture of consumer preferences.
“When we asked people if they’ve ever been in a Metaverse, we noticed a significant age difference,” Miller said. “Among those under 42, 34% said yes, while only 8% of those over 42 said yes. When we looked closer at those who had been in a Metaverse, we found that 61% of the younger group had made in-game or in-world purchases, compared to 26% of the older group. That’s nearly two and a half times more engagement in the younger group.”
This shows that, while adoption of the metaverse has been relatively low, those who use it are engaging in payments through those platforms. And that is important for payments companies looking to the future.
“It’s possible that by 2030, we’ll all have some form of interaction with something resembling a Metaverse, even if it’s called something else,” Miller said. “In the meantime, it’s crucial to keep an eye on who the key players are, what the norms are shaping up to be, and which partnerships and infrastructure developments are taking place. If you’re part of the mainstream economy, staying informed about these developments is important because you can’t just show up and plug in to this new landscape when it fully emerges.”
The report suggests that it’s important to focus not just on the current adoption numbers, but also on the direction in which adoption is heading. In other words, instead of solely looking at the size of the current user base, it’s crucial to consider whether adoption is increasing or decreasing over time. This perspective can provide a more accurate picture of the potential future relevance and impact of these technologies.