IAB’s first report on VR/AR surveys the terrain for marketers

A mid-air pickup of Dunkin Donuts coffee in a 360-degree video. From the IAB report.

As reality becomes virtual, augmented and spherical, marketers are eager to get involved.

To help set the stage, the Interactive Advertising Bureau (IAB) is out with its first report on the subject, “Is Virtual the New Reality?: A Market Snapshot of VR Publishing and Monetization.”

The report samples how publishers and advertisers are creating virtual reality (VR), augmented reality (AR) and 360-degree spherical video. It looks at opportunities and pitfalls, offers some initial ways for measuring ad success and provides several case studies.

Some aficionados question whether 360-degree spherical video can actually claim to be virtual reality (VR), since it is a recorded experience, as opposed to “true” VR’s live, generated-on-the-fly worlds.

Anna Bager, IAB’s SVP and General Manager for Mobile and Video, agreed that 360-degree video is somewhat apart from VR but pointed out that it is similarly an immersive, explorable environment.

She told me that the report is the first step in what is likely to become a substantial effort in this field by her organization. As the report noted:

“… the IAB Tech Lab has initiated work to develop guidelines for VR and AR. The Tech Lab is in the process of drawing up initial guidelines for 360 video and photo formats — as well as more immersive VR and AR ads — with the goal of helping publishers and advertisers understand the VR formats that are beginning to see traction.

“IAB will soon make our emerging ad formats portfolio available for public comment.”

On the plus side for marketers, this kind of content offers immersive storytelling, the ability to stir emotions in a direct way, and, for a while at least, an attention-grabbing experience. Negatives include the high cost for full VR that works on computers, nausea for some users and what the report calls “the social stigma of a closed experience.”

The social stigma issue might be overcome by social connectivity, where VR users communicate with others from inside the experience. But another factor — how ads might interrupt immersive experiences — will require advertisers to create new approaches:

“Immersv CEO Mihir Shah added that data from the campaigns they’ve run thus far demonstrate that when the VR user experience is interrupted, engagement numbers drop. ‘If we put an advertiser in a queue, with a ‘Check this out’ call to action — within the user’s current VR experience, people simply hit the skip button, or they leave. You can’t just put things into a scene. A lot more work needs to be done to get the integration points right. It can be extremely jarring when you’re immersed in another world.”’

The report also summarizes a selection of marketing/advertising implementations so far. Some are “you-are-there” previews of products and services, like a virtual visit to a travel destination or a tour of a car interior. In some examples, the advertiser’s role is as a sponsor, such as Hilton and Ford’s sponsorship of The New York Times’ VR stories. In some 360-videos, advertisers have included static ads or short video ads inside the environment.

The report highlights some initial efforts to measure how well ads work in these environments. The 3-D software development firm Unity, for instance, has analytics that enable them “to check the retention of users, how many people engaged with the content, and how many installs they’ve driven for publishers.” The company has also developed a flexible event tracker for custom events and events within VR.

Retinad, a VR analytics company, offers heat map-based analytics to determine where users are actually looking, a central issue in content where users can look around an entire space as they might in reality.

But all of this is, essentially, pre-game speculation before the big game.

“Our clients are just trying to wrap their heads around how VR works,” Opera Mediaworks’ Creative Operations Specialist Andrew Scharkss is quoted in the report. “Everyone’s still playing around in the sandbox and experimenting.”

About The Author

Barry Levine

Barry Levine covers marketing technology for Third Door Media. Previously, he covered this space as a Senior Writer for VentureBeat, and he has written about these and other tech subjects for such publications as CMSWire and NewsFactor. He founded and led the web site/unit at PBS station Thirteen/WNET; worked as an online Senior Producer/writer for Viacom; created a successful interactive game, PLAY IT BY EAR: The First CD Game; founded and led an independent film showcase, CENTER SCREEN, based at Harvard and M.I.T.; and served over five years as a consultant to the M.I.T. Media Lab. You can find him at LinkedIn, and on Twitter at xBarryLevine.