Virtual Goods Now Billion-Dollar U.S. Industry

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Apparently it really is the thought that counts, not what you buy.

ABC News reports that Americans are expected to spend $1.6 billion this year on virtual goods. The majority of this comes from money spent on social gaming sites, “where friends will buy each other ‘seeds’ to plant in their ‘farm’ or ‘dresses’ for their avatars.”

Many consumers are also starting to buy virtual gifts on sites like Facebook. For example, if it’s someone’s birthday, you have the option to spend $1 buying them a virtual cupcake or flower, which will show up on their Facebook page as a gift from you. It may sound silly, but as ABC notes, “birthday cards or perishable flowers aren’t much of an investment either.”

Then again, there clearly are some ridiculous purchases. BusinessWeek tells the story of one 38-year-old woman who claims to buy $20 worth of items from social gaming sites every month, including “virtual outfits for her cat in Pet Society and a stable for her horses in FarmVille.”

If all this real money spent on fake items sounds crazy, consider the fact that we are actually lagging behind other countries like South Korea and China, where the virtual goods market generated approximately $4 billion last year.

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