Retail Blog: Week of 12/4/2017

Virtual Reality Leads Marketers Down a Tricky Path

As we enter the modern age of new emerging technologies, the constant changes and additions in the market are promoting new opportunities, and challenging marketers with the decisions of capitalizing on these technologies or going on without them.  One of these interesting new concepts that marketers are facing is virtual reality.  Virtual reality has proven that it can be a game changer in different industries from a marketing perspective, while also being a money pit for others.  

Marketers can use this VR technology to give consumers a unique experience that they are likely not able to get anywhere else.  For example, in 2014, Dos Equis, a beer maker, created a virtual reality masquerade party where the participant could experience flamethrowers, and acrobatic dancers amongst other interesting activities.  By giving the user this one of a kind experience, the companies can provide something that others cannot provide, as well as something that the participants will likely not see in the real world.  

 

On the contrary, companies such as the e-commerce giant Alibaba have found their efforts in the realm of virtual reality to be costly and criticized.  The company had created a virtual shopping mall where participants could walk around and experience the mall on the VR headset, which was not adapted very well by users due to the fact that you can simply do it in real life with little trouble.  These experiments can be very costly if not successful considering that creating a virtual environment often starts at around $500,000, as well as a cost of $10,000-$100,000 to create a 360 video.

 

Overall, as more and more consumers adopt this new technology, the focus on VR may become more intensive and competitive and cause an increase in spending on this segment.  Depending on the use of the technology, VR can be just the boost you need in the marketplace, or it can be a company’s downfall.