Although luxury brands don’t derive a lot of revenue from digital mediums right now, this could change soon, according to a research note from Morgan Stanley published last week.
- Metaverse gaming and NFT’s could represent a 50 billion euro revenue opportunity for the sector by 2030.
- ”NFTs and social gaming present two near-term opportunities for Luxury Brands, allowing them to monetise their vast IP built over decades,” the report says. Dolce & Gabbana’s sale of 9 NFTs for $5.7 million shows the huge potential for “virtual and hybrid luxury goods,” and the bank estimates that the NFT market will grow to around $300 billion by 2030.
- By 2030, Luxury brands could expand their total addressable market (TAM) revenue by more than 10% and industry EBIT by around 25%. Demand for NFT collectibles will lead to strong demand for luxury goods in the medium term, analysts led by Edward Stanley said in the report.
- Morgan Stanley notes that luxury brands are already exploring collaborations with gaming and metaverse platforms, with an increasing number of revenue share deals, and this could add $10 billion – $20 billion to the luxury sector’s TAM.
- Kering is best placed to take advantage of the metaverse due to the “group’s brand demographics and given head start in innovative digital collaborations.” the bank said.