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Everything CMO’s Need to Know About Virtual Reality

  • 28 July 2017
  • Nathan Kay

Virtual reality (VR) is a game changer for marketing executives. It’s becoming one of the most revolutionary technologies of the 21st century. The recent technological progression has opened new doors for the advertising and marketing industry.

According to Forbes, there will be 171 million VR users in 2018 and that number will grow exponentially in 2019 and beyond.

VR is Changing the Scope of Marketing

Virtual reality (VR) is the way forward, reveals Patrick McLean, executive vice-president and chief marketing officer at TD Bank. McLean tells Business Insider that modern technologies are changing the dynamics and scope of marketing and thrusting it forward at a rapid rate.

“For marketers, we've got to think about evolving the way in which we're reaching customers through those new content experiences,” McLean tells the website. “Virtual reality is like having a personalized experience with a company rep in person, but it occurs in a virtual world, whenever and wherever the customer wants,” he adds.

There’s Only One Problem

VR isn’t widely used in the marketing sphere at present. More than 60 percent of consumers believe VR is purely a gaming tool, not a technology for all, according to Marketing Week. In fact, this perception is somewhat true because a majority of VR content is produced for gaming. Experts claim the key to ensuring VR becomes a commercial success is by changing the perception and how it’s used by consumers.

A switch to a more commercial marketing perspective is already taking place. Marketing executives understand the success of a campaign is only measured by a number of people who view it. Facebook is a marketer’s dream, with over one billion users at their disposal, making it one of the best online advertising platforms on the planet. However, there is no such platform for the VR sector. Marketers can’t really justify a budget or guarantee viewers on a flimsy platform.

The Cost is Too High

The main problem is the cost of the technology. Headsets cost hundreds of dollars while the computers can cost thousands. It’s just not accessible to a wider audience and doesn’t justify the spend.

However, as technology becomes less expensive and mobile apps bring VR and augmented reality (AR) to the everyday consumer, the scope for marketing avenues intensifies. Google Daydream VR headsets along with Facebook’s Oculus Rift are inexpensive stand-alone headpieces helping to bring VR to the commercial sphere. What’s more, downloadable apps are delivering AR and VR to the everyday citizen.

AR is Just as Effective

According to The Telegraph, a UK-based company has developed an AR app that can send information to a phone when the user focuses on an object.

The Blippar visual app uses the camera on a tablet or smartphone to activate a digital search to pull information from the internet about the object in focus. The technology could lead to many possibilities for the marketing industry. “When focusing your device on an album cover the technology can generate videos of the band, a source to buy concert tickets, Twitter posts, and the latest photographs,” Boldbusiness.com states.

More Marketers Tap into VR

It is estimated that 30 percent of marketers’ plan on experimenting with AR and VR applications this year. Experts claim that even if a handful of agencies can tap into this percentage then it could drive the industry forward and lead to a new audience.

Jaguar recently powered forward with an exceptional VR campaign to market its sponsorship of the Wimbledon Tennis Championships in England. The user flies over center court, listens to Andy Murray talk about the championships, and can then “possess” his body to experience playing on the famous green grass. Not only is this an experience felt through VR headsets but also online or through an app.

Etihad Airways in the Middle East uses VR in their latest marketing strategy. Online users can experience flights, first class, and business seating through their VR tool. You will fly with Hollywood movie star Nicole Kidman and experience what it’s like to travel in complete luxury, before deciding whether to buy a seat.

The McDonald’s happy meal marketing promo is a genius. The campaign will allow users to create their own VR headset using the happy meal box, slot their phone in and become VR interactive using app programs.

There are many other successful VR platforms currently on the market, including Topshop’s catwalk experience and the Volvo test drive tool.

The AR and VR Dream

The VR/AR marketing phenomena are already proving a hit. It’s becoming a dream for marketing execs up and down the country. According to Deloitte Global, the VR sector exceeded estimates of $1 billion in 2016. Hardware sales accounted for $700 million, the rest was driven by content. The industry is set to reach the multi-billion-dollar mark before 2020 and its big business.

VR isn’t just about technology but also perfecting interaction with the consumer. The key to stimulating the consumer is by targeting three essential parts of the brain. “Our brains are wired to be influenced by VR experiences, which appeal to the three parts of the brain that are responsible for our perceptions and reaction: neocortex (higher-level thinking), limbic system (emotion, behavior, motivation), and reptilian brain (primitive instincts),” according to Advertising Age.

“While content is high and mighty when it comes to engagement, you can’t always appeal to all three of these categories at the same time. But by giving your audience a virtual experience, you can leverage these core functions to nudge them to take the next desired action. Instead of just hearing things, your prospects and customers things can see and feel them,” the website adds.

Users are Increasing

According to statistics released by Digi-Capital, 23 million Americans have tried VR through a headset or at an event. This number will grow as global VR hardware shipments are set to increase from 9.6 million a year to 64.8 million in 2020.

Be wary. Critics claim that there is the fear that VR could go down the 3-D route. Consumers don’t like wearing heavy objects on their face, they don’t like to fork out vast sums on modern technologies to seek out a niche market. Industry experts state that AR has the potential to go much further than VR right now. Marketing strategies should include an AR element today to corner the market.

The good news for the future of marketing is that current AR and VR users are growing with the technology, and the younger audiences are using the platforms on a more regular basis. The 12-to-17 and 18-to-34 demographics are the key target markets, and if you’re able to grab them early on this will most definitely help secure the future of AR and VR marketing.

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