Yet, a variety of speedbumps have limited the adoption of the technology to being a tool that is used primarily for brand promotion. The immersive nature of VR can potentially resonate with younger consumers who are increasingly seeking out new experiences.
Indeed, a Harris Group study found that 72% of millennials prefers to spend more money on experiences than on material things. With that in mind, retailers such as Macy’s have experimented with providing yoga classes, micro-concerts, and cafes to draw consumers to their stores.
Other organizations are hosting late night running races and upscale picnics. Consumers’ strong demand for experiences isn’t the only factor driving the hype over VR. In 2014, Facebook dished out $2 billion to buy Oculus VR, which offers the Oculus Rift VR headset.
Today, marketers are taking a variety of approaches to VR marketing, such as product promotion and brand awareness initiatives. Yet, the combination of the technology being in its infancy and other hurdles is creating substantial challenges for marketers. One obstacle is adoption of the technology by the general public.
According to Statista.com, there were seven million installed VR headsets last year. That number is expected to increase to 37 million by 2020. Even though the anticipated growth rate is impressive, the number of VR users seems almost insignificant when compared to social media, with Facebook alone estimated to have nearly 2 billion active monthly users.
The hefty price tag for most VR technology appears to be hindering wider adoption of the technology. Most VR headsets only cost a few hundred dollars, which is manageable for many consumers, but the most robust applications require computers that typically cost more than $1000, reports Forbes.
For some VR marketing campaigns, brands are providing VR devices at conferences, sporting events or other functions so that consumers can try out the technology and learn more about products or brands. Hiking boot company Merrell was one of the first brands to take such an approach by providing VR hikes at the Sundance film festival.
Merrell partnered with marketing agency Hill Holliday and designer Framestore to create the experience, which featured walking on a crumbling mountain ledge and hiking across a wobbly bridge. Outdoor sporting goods company the North Face has taken a similar approach by offering VR mountain outings at a handful of its stores.
Big brands with big budgets, however, have gone beyond providing VR at events and instead have been offering online experiences. Coca Cola is just one example. It built upon its strong Christmas advertising campaign by launching a VR sleigh ride in Poland that let users be Santa Claus.
More recently, Coca Cola provided soda in cardboard boxes that could be folded into VR headsets. Citi has also embraced VR with an influencer marketing campaign that allowed fans of Guns N’ Roses guitarist Slash to watch the performer’s benefit concert for the Greater Los Angeles Zoo Association.
From a longer term perspective, VR is likely to be a hit, in part because big entertainment companies are embracing the technology, which could help accelerate adoption. Sony recently announced that it was creating a VR version of the AMC hit television series Breaking Bad by teaming up with the show’s producer, Vince Gilligan. The show will be viewed through Sony’s game console.
Walt Disney & Co. is also making a big push by offering online VR tours of its amusement parks. Yet, it has also set limits on its VR offering, with Disney CEO Bob Iger recently announcing that VR entertainment won’t be offered at the company’s theme parks. Instead, the company will offer augmented reality, which superimposes images on users’ views.
