October 10, 2015 By Brad Phaisan
In the past few years, Virtual Reality has been received attention from many industries. In August 2015 Time Magazine published an article entitled “Why Virtual Reality Is About to Change the World.” Virtual Reality headsets are trendy. Virtual Reality apps, intended to help online audiences view Virtual Reality digital media, seem to be everywhere. Examples of VR apps used by prominent brands can be found at these hyperlinks: Volvo, Infiniti, Jurassic World, and Taylor Swift.
Here at AdsOptimal, we agree that VR headsets and VR apps are popular. But do they really drive customers to view VR ad content?
The current number of downloads of VR apps is surprisingly low. Worse yet, the average install for each VR app after it is downloaded is about 50,000 installs – at best. . Since customers cannot view VR ad content from these national brand campaigns unless they first download, then install, the related VR app, we know that few customers are viewing these VR ads. This is not good news for national brand marketers who expect to reach millions of viewers as part of a truly effective marketing campaign for national brands.
AdsOptimal researched this topic extensively and identified two major factors that limit the reach of Virtual Reality ads. We believe that if we fix these issues, Virtual Reality ads will become mainstream.
VR Ad Issue #1 – Audiences will not download apps to see ads.
Let’s consider an ad banner with a successful 10% click-through rate. Statistically, viewer rates for this ad banner drop dramatically when the ad asks the viewer to first install an app then view the ad. Most viewers do not install the app. The app install rate may be less than 1%.
Getting a VR ad viewer to install an app is a difficult process. First, the viewer must switch to the app store, then hit an install button, type in password, wait to download the app, wait to install the app, then open the app. And since the majority of cell phone browsing is on cellular data not wifi, the process can take a long time.
Here at AdsOptimal we think that audiences shouldn’t have to download apps to see VR ads. Audiences should be offered VR ad impressions directly on the websites or digital media they are browsing. Eliminating the need to download and install an app will increase Virtual Reality ad impression delivery by 10x.
VR Ad Issue #2 – Almost no one owns a Virtual Reality headset yet.
Oculus Rift has shipped more than 100,000 headset developer kits worldwide. Analysts at Piper Piper Jaffray forecasts that 12.2 million VR headsets will be sold in 2016. http://fortune.com/2015/05/07/vr-headset-launches/
These numbers are impressive in themselves, but are tiny compared to the size of the digital media audience worldwide which is in the billions. Audiences do not use VR headsets now and we cannot expect them to use them in the near future.
At AdsOptimal we want headsets to be optional for consumers who view and interact with Virtual Reality ads. Most Virtual Reality content intended for viewing with a VR headset can be rendered in 360° format which can be viewed without a headset. The best Virtual Reality ads should give the audience an option to view the ad with or without a Virtual Reality headset.
It may seem radical to propose that Virtual Reality ads should be available to mainstream viewers, but it’s possible using AdsOptimal technology. The AdsOptimal team has prepared live demos of interactive Virtual Reality ads which do not require apps or headsets. There is even more to come from the AdsOptimal team so stay in touch.