Virtual reality is finding a multitude of uses, but how effective is it at generating revenue?

Written by: Robert Kendal | Published:

There’s been a lot of talk around the novelty value of VR. Novel is good and VR creators across the world are continually rolling out ever more ingenious ways of bringing the medium to life for everyone to enjoy in the comfort of their armchair.

When it comes to using VR for business, however, novelty alone doesn’t cut it and to prove itself as a long-term fixture there must be a return.

Several years ago, the rapid rise of the smartphone led to the hasty commissioning of ‘killer’ mobile apps. The problem was the vast majority of these apps had no obvious value to customers. They were novel but not useful; clever but not compelling. Worse, they didn’t solve real customer problems.

Marketing, development and design teams worldwide are currently being tasked with investigating VR. This is because the immersion VR allows is going to represent a significant change to the way people perceive services and buy products. Lazy content will only lower the bar and create experiences with no value. Taking the time to think through great content that serves a need is absolutely worthwhile. In fact; VR content has been shown to deliver 27% higher emotional engagement and 34% longer engagement than 2D content; and the average response rate with VR experiences is 15% compared to just 1% through direct marketing.

Make it useful… again and again

For anyone looking to boost their return on a VR investment, it is important to bear in mind the return on investment (ROI) formula of benefit of the investment divided by cost.

Based on this, it stands to reason that, as VR can be expensive to create, the more uses VR content can have, the better chance it has of driving positive returns.

VR content can give and give. Investments can be amortised over multiple uses that might include demonstrations at events or trade shows. These could range from publicity on a company website or social media platforms to arming sales teams with a rich portfolio held in their pocket on a mobile device.

Content can be used across numerous consumer-facing touch points and with that, the value it has and returns it delivers become far more meaningful.

Not all content should be VR

A slideshow of still images does not make a movie and, in my experience, putting a VR label on content not created for, or useful within the medium has very limited value. Head of Stanford’s VR lab, Jeremy Bailenson put it best when he said: “Most things don’t work in VR. If you show me 20 ideas, I’ll say 19 of them would be better in another medium.”

For VR truly to make sense to a business and deliver a return, the content must be considered, ideally be of high visual quality and inherently useful.

As a guide, VR comes into its own when virtual experiences are able to make real:

  1. Things that are too far away to be experienced first hand
  2. Things that do not yet exist
  3. Things that are too large, expensive or complex to model

Make applications that matter

When environments, products or buildings can be created and experienced virtually before a single prototype has been created or brick has been laid, there are opportunities for businesses to generate considerable ROI in the virtual sphere.

The automotive industry has put VR through its paces in several ways such as using the technology to whet the appetites of potential customers by taking them through exhilarating experiences in virtual high-performance cars.

Audi, is using virtual technology to encourage people to come back to its physical showrooms – an activity that has fallen out of favour as consumers become more used to researching new vehicles online. With hundreds of millions of possible configurations of models and specifications, VR has enabled Audi sales centres to demonstrate every single one to visiting customers versus only the handful of examples dealers might have housed in their showroom.

Ford designers and engineers have begun using VR to test elements of new cars, estimating a saving of $8 million in one year alone and Volvo is working on virtual test drives of cars that are not yet on sale.

Taking the lead in using VR where the real thing is simply too complex (or unsafe) to model, UCLA surgeons are using VR headsets to test run highly technical and sensitive surgeries before they operate. In doing so they are perfecting techniques and pre-empting potential issues without any lives being at stake.

Numerous businesses are now experimenting with the power VR has to bring people and their products together in meaningful ways.

  • The North Face stores now use VR to transport their customers to a virtual Yosemite National Park, where they can virtually experience products in some of the most majestic and inspiring environments in the world.
  • Carnival Cruises created a VR experience that gave people the chance to virtually explore its cruise ships and vacation destinations.
  • Sotheby’s International Realty has been enticing potential buyers using VR to host open houses to sell luxury homes across international destinations.

In each of these cases, the immersion being delivered via VR would be impossible using another medium. VR is the difference between seeing and experiencing. These experiences deliver real, tangible value to users in a way that has been proven to make them more responsive, more receptive, more engaged and more loyal. With benefits like that, finding ROI from VR should be easy.

Author profile:
Robert Kendal is managing director of Yulio Technologies


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