AR & VR - Germany

Germany

In Germany, revenue in the AR & VR market market is projected to reach €1,812.0m in 2024.
This revenue is expected to exhibit an annual growth rate (CAGR 2024-2029) of 9.29%, resulting in a projected market volume of €2,825.0m by 2029.
The largest market within Germany's market is AR Software, with a market volume of €580.6m in 2024.
While most revenue is generated the United States, in Germany is also expected to contribute significantly to the AR & VR market market.
By 2029, the number of users in the AR & VR market market in Germany is anticipated to amount to 50.4m users.
User penetration in Germany will be 57.5% in 2024 and is expected to reach 60.8% by 2029.
Additionally, the average revenue per user (ARPU) in Germany is expected to amount to €37.8.
Germany's AR & VR market is increasingly driven by innovations in automotive and manufacturing sectors, enhancing training and design processes significantly.

Definition:

Augmented reality (AR) and virtual reality (VR) make it possible to combine the real and virtual worlds. AR is generally accessed via mobile phones and primarily relies on lenses. AR effects can be created by using lenses in social media apps, for example. AR is also used for displaying digital 3D objects in our surroundings, e.g., in gaming or eCommerce apps. Meanwhile, VR technology allows users to dive into the virtual world, and, unlike AR technology, it requires a headset device which enables the creation of virtual worlds.

Structure:

The AR & VR market consists of six different markets: AR Advertising, AR Hardware, AR Software, VR Advertising, VR Hardware, and VR Software. AR Advertising covers mobile advertising that is displayed in the most prominent social media apps. AR Hardware comprises AR headsets and glasses. AR Software is divided into three different application types, namely social media, gaming, and eCommerce applications, which can be accessed via the most prominent app stores. VR Advertising covers in-game advertising as well as advertising in VR videos. VR Hardware comprises both tethered head-mounted displays (HMDs) and stand-alone HMD headsets. Lastly, VR Software covers VR games and VR videos, which require headsets.

Additional information:

The market comprises revenues, users, average revenue per user, and penetration rates. Revenues are generated through in-app purchases, advertising spending, and consumer spending on apps, games, and hardware such as headsets or glasses. Sales channel data shows both online and offline revenues, which include VAT. The market only displays B2C revenues and users for the above-mentioned markets and markets; B2B and B2G revenues are not included. Additional definitions for each market can be found on the respective market pages.
Market numbers for VR headsets are also featured in the Consumer Market Insights, namely in the Gaming Equipment market of the Consumer Electronics market. Unlike the VR Hardware market in the Advertising & Media Outlook, the Gaming Equipment market also covers smartphone VR devices.
Key players in the market include companies such as Meta (Oculus VR), Microsoft (HoloLens), Snap Inc. with different lenses, and Nvidia, which offers computing hardware components.
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Analyst Opinion

The AR & VR market in Germany is experiencing significant growth and development.

Customer preferences: Customers in Germany are increasingly interested in immersive experiences and interactive technologies. They are looking for innovative ways to engage with content and are willing to invest in AR and VR devices and applications. The demand for AR and VR products is driven by a desire for more realistic gaming experiences, virtual travel and exploration, and enhanced training and education opportunities.

Trends in the market: One of the key trends in the AR & VR market in Germany is the increasing adoption of these technologies in various industries. Companies are recognizing the potential of AR and VR to improve productivity, enhance customer experiences, and drive innovation. In sectors such as automotive, healthcare, and retail, AR and VR are being used for product visualization, virtual showrooms, and training simulations. This trend is expected to continue as more businesses realize the benefits of integrating AR and VR into their operations. Another trend in the market is the development of more advanced and affordable AR and VR devices. The technology has become more accessible to a wider range of consumers, with a variety of headsets and devices available at different price points. This has led to increased adoption and consumer interest in AR and VR applications.

Local special circumstances: Germany has a strong technology and manufacturing sector, which has contributed to the growth of the AR & VR market. The country is known for its engineering expertise and precision manufacturing, which has resulted in the development of high-quality AR and VR devices. German companies are also at the forefront of developing innovative AR and VR applications, particularly in the automotive and healthcare industries.

Underlying macroeconomic factors: Germany has a stable and prosperous economy, which provides a favorable environment for the growth of the AR & VR market. The country has a high disposable income and a strong consumer market, which allows for increased spending on AR and VR devices and applications. Additionally, the government has been supportive of the technology sector, providing funding and incentives for research and development in AR and VR. In conclusion, the AR & VR market in Germany is experiencing significant growth and development due to customer preferences for immersive experiences, the adoption of these technologies in various industries, the development of more advanced and affordable devices, the country's strong technology and manufacturing sector, and the underlying macroeconomic factors of a stable and prosperous economy.

Methodology

Data coverage:

The data encompasses B2C enterprises. Figures are based on the AR & VR market. AR and VR enable consumers to experience a new dimension, using either a headset or installed units, as they combine the real and virtual worlds. Consumer revenue figures refer to revenues relating to AR hardware, AR software, VR hardware, VR software, and spending on AR and VR advertising. Both digital and non-digital revenues are included.

Modeling approach / Market size:

Market sizes are determined through a top-down approach, building on specific predefined factors for each market market. As a basis for evaluating markets, we use annual financial reports of the market-leading companies and industry associations, as well as third-party studies and reports. In addition, we use relevant key market indicators and data from country-specific associations, such as consumer spending, internet penetration, 4G coverage, and historical developments. This data helps us estimate the market size for each country individually.

Forecasts:

In our forecasts, we apply diverse forecasting techniques. The selection of forecasting techniques is based on the behavior of the relevant market. For example, the S-curve function and exponential trend smoothing are well suited for forecasting digital products and services due to the non-linear growth of technology adoption. The main drivers are level of digitalization, adoption of technology, GDP per capita, and internet penetration.

Additional notes:

The market is updated twice a year in case market dynamics change. The data is modeled using current exchange rates. The impact of the COVID-19 pandemic and the Russia-Ukraine war are considered at a country-specific level. In some cases, the data is updated on an ad hoc basis (e.g., when new, relevant data has been released or significant changes within the market have an impact on the projected development).