Virtual Influencers Market: Current Analysis and Forecast (2024-2032)

A virtual influencer is an artificial character that is designated to work like a real influencer on social media platforms and react to the audiences in the same manner. These are often constructed with the help of sophisticated tools like CGI - computer-generated illustration, and AI - artificial intelligence. Virtual influencers' accounts are curated by different companies or people who can provide direction to how they seem, act, and even respond. They can advertise products, sponsor brands, and brand endorse companies, and contribute to marketing strategies via posts, videos, and/or live, online conveniences within platforms such as social media.

The Virtual Influencers Market is expected to grow with a significant CAGR of 23% during the forecast period (2024-2032). The surge in advancements in AI and CGI technologies has made it possible to develop near-life virtual influencers with human-like characteristics and appearances. Adding to this, the rising use of social media platforms such as Instagram, TikTok, and YouTube makes social media a broader market for virtual influencers and has therefore become an efficient way to market virtual influencers to consumers. According to Forbes data, in 2023, an estimated 4.9 billion people use social media across the world. With the average user accessing 6.7 social media platforms every month. As per the secondary research, popular platforms like Facebook had over 61.9% of their monthly users logging in to use social media daily in July 2024. Moreover, the growth of virtual influencers raises questions about transparency, authenticity, and ethical use. In June 2023, Hamburg launched the virtual AI influencer named KAI who posts weekly AI news on the LinkedIn job network. This unusual influencer will shed light on the possible use of AI in media and allow users to weigh up the pros and cons of the technology.

Based on the type, the market is segmented into non-human, animated human avatars, and artificial intelligence-driven avatars. The animated human avatar held a significant share of the market in 2023. These avatars, created with professional CGI and supported by various AI features, can have realistic movements, feelings, and communication with others and thus can be considered friendly by consumers. For instance, in 2022, 'Zero' - the virtual human in question - was created by Offbeat Media Group. This brand describes itself as "one of the leading content hubs for the digital generation. They provide brands with complete control over messaging, ensuring consistent brand representation without the risks associated with human influencers, such as scandals or unpredictable behavior.

Based on the application, the market has been divided into fashion and lifestyle, entertainment and media, retail and e-commerce, travel and hospitality, and other industries. Fashion and Lifestyle segments are expected to grow with a significant CAGR in the forecast period (2024-2032). This is due to their ability to bring creativity, innovation, and consistency to brand campaigns. Moreover, virtual influencers can easily match with the latest fashion trends within the shortest time, and this makes it easier for brands to evaluate assorted styles and fashions that are a reality with physical models. For instance, in 2023, Myntra introduced its first virtual influencer whose name is Maya. The company has already set up her Instagram profile under the username, "maya unlimited," where she has over one lakh followers. Myntra adds its virtual influencer that advocates body positivity, mental health, and inclusivity. She is also said to have no "physical or geographic limitations."

Based on the platform, the market has been divided into Facebook, TikTok, YouTube, Instagram, and other social media platforms. Facebook segment dominated the global market in 2023. Facebook virtual influencers, the same as human influencers, can become brand ambassadors, selling definite products, and interacting with the audience through posts, stories, and live streams. The advertising platforms and command interfaces offered by Facebook make it possible for brands to fully monitor how virtual influencers' promotional campaigns perform with targeted audiences and generate necessary KPIs. This also continues to grow its presence in such virtual and Augmented realities, which makes it instrumental in defining the future of a virtual influencer market.

For a better understanding of the market adoption of Virtual Influencers, the market is analyzed based on its worldwide presence in countries such as North America (U.S., Canada, and the Rest of North America), Europe (Germany, France, U.K., Spain, Italy, Rest of Europe), Asia-Pacific (China, Japan, India, Rest of Asia-Pacific), Rest of World. Asia-Pacific is expected to grow with a significant CAGR in the forecast period (2024-2032) owing to the rise in technological advancement in the region which enhances the development of CGI and AI technologies for the creation of complex virtual influencers. Additionally, cultural factors also find their place since Asian consumers are used to having some digital personas as new unique concepts mostly based on the future. For instance, in 2023, China's hyper-realistic virtual influencer Ayayi officially launched her eponymous brand this year. Building on years of cultivation in digital content and virtual technology, Ayayi proposes the phygital brand concept, combining physical and digital substantial presence to create a unique style and product forms exclusive to the brand. With a growing number of brands and consumers, embracing virtual influencers due to their novelty and promotional capabilities. Similar to Lipa, Ling in China of Weibo or Ayayi of Douyin which are both similar to Tiktok is gradually turning into celebrity-status virtual characters and serving as the primary promoters for brands.

Some of the major players operating in the market include Dapper Labs, Inc., CASTLEBERRY, UNIT9, Aww Inc., Vertiqal Studios, Pinscreen, Soul Machines, SUPERPLASTIC, Viral Nation Inc., NeoReach.