10 Interesting Predictions About Advertising in VR & Trends We’ve Seen in 2022
By, Nicole Gomez
We’ve seen it time and time again. As technology progresses so do more opportunities for advertising and capturing data. It seems like every time there is a new gadget, marketers hope there will be a breakthrough space for new advertisements. However, few new gadgets live up to that expectation. When Google Home & Amazon Alexa were released, advertisers went stir crazy thinking of the possibilities. While these devices help capture insightful third party data & provide a new space for audio advertisements they never made the explosive breakthrough many had imagined. As Virtual Reality (VR) takes off, advertisers and brands are equally as hopefully about advertising in this new space.
VR is a growing space offering users immersive experiences. Not only does virtual reality allow users to integrate themselves into gaming more realistically, but it also simulates interactions with the digital version of the “real world”. This could be very beneficial to brands that want to showcase their products in a digital environment that mimics real life where users can walk, grab and open objects, etc.
Advertising in Virtual Reality started in the 2010’s with luxury and future focused brands but is sparking interest for all types of products in the 2020’s. Though VR is not new it has gained momentum over the last few years and is expected to grow exponentially by 2024 per Forbes. Statista predicts the VR market to reach $12 billion dollars by 2024, from just under $5 billion in 2022.
XR Today believes two factors are making VR a bigger opportunity for advertisers now more than ever. The first is that VR headsets have become more affordable and accessible, some costing even less than a smart phone. Second, Facebook giant Meta launched the Metaverse, creating a place for VR content to live from a familiar brand. All these factors further the idea that VR will transform advertising for good.
Here are the 10 most interesting uses & predictions of advertising in Virtual Reality:
Seamless Insertion of Ads- When we think of VR, gaming is top of mind. Brands can partner with VR gaming companies to include their ad placements in games showing off products, apparel, feature billboards, and even in-game micro-stores.
This could help brands similar to how Pokémon Go was used to lure consumers to retail stores such as Best Buy which capitalized on the trend in 2016.
Via Storefront
Product testing and training- VR users can not only try out products, but also receive training on them. Vendors can simulate real-life uses, helping the buyer experience the product in action digitally prior to purchasing. VR is also useful for services and causes that are difficult to explain, such as non-profits. VR advertising can create digital experiences that feel real to drive empathy. Stanford took this approach in a 20-minute VR experience they created that explored the impact of racism in healthcare environments. Almost all of the audience (94%) agreed that VR was an effective tool to understanding the impact of medical biases.
Creating ‘Real Life’ Experiences- VR content could be a game changer for tourism and travel. Hospitality brands could recreate travel experiences through VR. From virtual scenic views, to sunsets, & historical landmarks— VR travel use cases are endless.
For retail, VR can allow customers to see products at their real size and scale, such as Cadillac which created a virtual showroom.
Via Design Milk
Interactive Video- VR can help reach consumers in unique ways. Interactive video can help many industries especially health and pharma and may break through the clutter to reach younger demos.
Wendy’s joined the Metaverse by launching a virtual restaurant, the Wendyverse. Here users can ‘order’ their own virtual fries and in the plaza they can play Wendy branded games. Wendy’s also allowed users to win discounts to use at their real brick and mortar stores. Meta was happy to announce Wendyverse success at their NewFront in Spring ’22. They boasted that the campaign which included in-stream ads, Reels, Instagram Stories, and AR ads, drove people to Wendyverse and saw a 9.1 lift in ad recall.
Wendyverse Town Square Central / Ketchum via The Drum
Less Ad Interruptions- When users are active in VR they wear headset glasses and are fully focused in the setting. This is unlike other existing platforms where users can scroll by, change the channel, or get distracted by what is going on in their surroundings. This focused experience may offer a greater opportunity to reach consumers.
Substitute for In-Person Interaction- In today’s world, plagued with pandemics and lockdowns, VR can help substitute for in-person interactions, allowing brands to continue to reach consumers through a simulated real life setting. As more and more consumers shop online, VR can also help reach consumers who don’t get out to stores as often such as busy moms and younger generations.
Online Events- Virtual Reality tech has the potential to make attractive online events such as concerts, virtual exhibits, and more.
At the 2022 MTV Video Music Awards in August, Eminem and Snoop Dogg performed virtually from the Metaverse, further fusing VR and entertainment.
Eminem and Snoop Dogg’s Virtual Metaverse performance at the VMAs via The NYPost
The MTV VMAs also introduced a new award category, best Metaverse performance. The nominees included Ariana Grande’s “The Rift Tour" (Fortnite), Blackpink's "The Virtual" (PUBG Mobile), BTS (YouTube), Charli XCX (Roblox), "Justin Bieber — An Interactive Virtual Experience" (Wave) and the "Twenty One Pilots Concert Experience" (Roblox).
Black Pink ended up taking the award for their virtual concert, pictured below:
Screenshot of “Black Pink- The Virtual Concert 2022” via Minka House’s YouTube channel
New Online Communities- VR will likely birth new online communities where users can interact with one another and even engage in networking. This may provide opportunities to financial and career focused brands.
New KPIs- VR is expected to change advertising. New KPI metrics will likely be established, as advertisers will focus more on tracking immersion and in-experience engagement.
Potential for Higher Video Conversion Rates- VR interactive ads that allow customers to engage with products/places would likely have higher conversion rates. For example, a hotel advertisement where you feel you are actually at a resort on vacation, versus seeing a static picture is far more engaging. We’ve seen video ads now perform better than images; VR would be the next natural step.