The rapid rise of advanced virtual reality technology is revolutionising consumer experiences and taking the virtual experience economy into another dimension.
When we think virtual reality (VR), we think of the future, right? Think again. The beauty of digital technologies such as VR is that they open the landscape to all kinds of experiences – old and new. When Swedish pop sensation ABBA reunites next year for the first time in more than three decades, a component of their performance will be VR.
The idea is a result of a collaboration between American Idol creator Simon Fuller and the Universal Music Group, and will allow fans, and the simply curious, to “see, hear and feel ABBA in a way previously unimagined”.
The reunion of the 1970s hit makers illustrates what’s possible in the future of live music performance and signals another leap forward for the virtual experience economy.
According to the latest Augmented/Virtual Reality Report 2016, from mobile internet advisory and consultancy firm Digi-Capital, investors poured US$686 million into these experiential technologies in 2015.
Deloitte’s 2016 Technology in the Mid-Market report showed 88 per cent of respondents were already using some form of virtual or augmented reality in their operations.
Get your headset on
Consumer investment in experiential technologies is also increasing. A report from market researcher IHS Markit predicts that spending on VR headsets will reach US$7.9 billion by 2020.
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Companies are refining their product offering in response. Last year, Google introduced its next-generation smartphone VR headset, Daydream View, and Samsung released an updated version of its Gear VR headset.
Chinese smartphone maker Xiaomi also introduced a low-cost VR headset in 2016. Within eight hours of issuing a call for beta testers, the company reported receiving one million registrations.
VR adventures in your room
The rise of the virtual experience economy can also be seen in initiatives from companies such as Marriott Hotels, which recently launched its VRoom Service. This feature lets guests enjoy virtual travel experiences in their rooms via VR headsets.
Marriott’s vice-president of global brand marketing, Michael Dail, told Fortune magazine the hotel’s foray into VR is key to its strategy for attracting more millennials. He said the brand realised a few years ago that it was not attractive enough to that younger clientele.
“So we launched a rebrand in 2013 and started rolling out these innovations,” he explained.
Virtual reality is also helping one of the world’s most famous legacy print organisations tell its news stories in different, more immersive ways.
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In 2016 The New York Times announced the release of 360-degree videos as part of its daily news feed. The Daily 360 project was launched in collaboration with Samsung, which is providing its Gear 360 cameras and equipment to the newspaper’s journalists around the world.
Smartphone users can tilt their device to expand their view, while those on desktop computers can navigate by scrolling with their mouse.
This initiative signals a further push into VR storytelling for the newspaper, which developed the NYT VR app for Android and iOS last year for its series of VR films. It also handed out one million Google Cardboard VR viewers as part of a promotional campaign.
Virtual reality is also set to change the face of e-commerce as companies look to give their customers a more involving experience.
In November last year, Alibaba unveiled Buy+, its VR shopping experience. Buy+ allows users to select products, such as clothing and fashion accessories, with help from a robotic shopping assistant and a 360-degree panoramic view so shoppers can see products in more detail.
However, Alibaba has not revealed how much it’s invested in virtual reality technology. Zhuang Zhuoran, Alibaba’s mobile technology director, has stated that commercialisation of Buy+ is still some time away. Yet for many people, a virtual reality-enhanced world is already here.
From theory to digital reality
The shift from a service-based economy to one built on experiences was first theorised by Joseph Pine and James Gilmore in their 1999 book The Experience Economy. According to the authors, it is no longer enough for consumers to simply buy a product or service and walk away. They expect a compelling experience to be part of the deal.
Experiences, delivered through VR, are also predicted to reshape the internet. Influential tech thinker Kevin Kelly, the co-founder of Wired magazine, believes experience will soon supersede information as the internet’s basic currency. In his new book, The Inevitable, he describes how artificial reality will build an “internet of experiences”.
“You’re going to buy experiences, download them and share them,” Kelly predicts.
“Virtual reality will become the most social of all the social media.”