VR & Marketing: Beyond The Hype

Much has been said about Virtual Reality in 2016 after a number of companies, like HTC, Sony and Facebook, promised to bring their headset to market in the course of the year. Since then, VR has been on everybody’s lips. VR content creation platforms are mushrooming, VR ad exchanges are starting to appear and agencies have been quick to pitch VR concepts to marketers eager to show their brand is innovative.

We think it’s time for marketers to take a step back and ask themselves why they are pursuing VR: What are you gaining from it, and does it make sense for you to explore VR now? And don't get me wrong - I'm a VR enthusiast. But when it comes to VR in marketing, even I have to recognize there is still way more hype than substance. 

For certain product categories, it is clear that VR will be a game changer in the future, and that experimenting now will help take advantage of the technology as it gains in maturity. But other brands may have to accept that VR has little to offer for them in the next 5 years, and resources placed in VR could be better invested elsewhere for the time being. We’ve seen countless examples of branded VR initiatives last year that left marketers - and consumers - completely underwhelmed.

Thomas Husson and I investigated what opportunities VR creates for brands from a marketing perspective: We found that for some categories – like retail – it can be disruptive to the point of transforming traditional sales channels. For others - like automotive, hospitality and real estate - it gives brands added persuasive power, proximity and convenience, beyond what traditional marketing channels can achieve. But not every vertical, and not every company, will benefit from VR.

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Blind Pursuit Of Engagement Is Hurting Marketers

Intuitively, it makes sense that if a consumer engages with a brand’s ad or marketing message, this should count as a positive outcome. Yet, we’ve spoken to a number of marketers and measurement companies that found that optimizing for engagement ultimately did not help them drive positive business outcomes – instead leading them to waste time and media dollars on the wrong users.

 

The issue we keep encountering in discussions around engagement is that advertisers count interactions – clicks, shares, likes, comments, views – as proxies for engagement. There’s no clear link between these individual actions and what they are really trying to measure: are their messages moving consumers along their path to purchase, by driving either brand preference or sales?

 

Tina Moffett and I decided to investigate:

 

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European consumers may be active on social networks – but does that mean they use social in their path to purchase?

To understand how open customers are to receiving messages from brands in social media, the question has to shift from “How social are our customers?” to “How social are our customers in their path to purchase?” 
 
Given the amount of time consumers spend on social networks, marketers intuitively know they need to be present on social media but many still struggle to pin point exactly:
 
  • Why they need a social presence - or rather, how they can be relevant on social media,
  • How much resources to invest in social media,
  • And where to invest these resources.
 
Forrester has developed the Social Technographics Framework to help marketers address exactly these questions. Using Forrester data to analyze the social behavior of various consumer groups and their inclination to use social touchpoints in their interactions with brands, the framework helps marketers determine:
 
  1. How important social media should be to their marketing plan
  2. When their audiences rely on social touchpoints in their customer journey 
  3. What social touchpoints their audiences use, and to what ends 
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Programmatic TV and Data-Driven TV Planning: Untangling Facts From Fiction

The explosion of TV channels, on-demand content and OTT services continues to erode audiences. On the whole, Forrester’s Technographic data shows that consumers in EU5 countries (UK, FR, DE, IT, SP) watch on average as much TV in 2016 as they did in 2014. But the split is shifting in favor of online TV, in particular among millennials which will become increasingly difficult to reach through conventional linear TV media plans.
 
The fragmentation of TV content across sources shrinks audience sizes, and makes TV planning inefficient. Programmatic TV could be the answer to cross-screen, audience based planning, but the road is long and paved with obstacles. Programmatic buying is penetrating pockets of broadcaster inventory, but the level of implementation varies across countries, across broadcaster and across inventory type. The big question, of course, is whether programmatic ever makes it to linear TV advertising and becomes a viable tool to plan TV campaigns.
 
What is often missing from this discussion is the journey TV broadcasters have embarked on to collect and activate audience insights across their properties, and the wealth of data that is already available to test or experiment with audience-based buying within their inventory.
 
In the “European Marketers Get Ready For Data-Driven TV Planning" report, I break down how various TV / video inventory types will transition to different forms of programmatic over time, and explain why marketers will not have to wait for programmatic to infuse data intelligence into their TV media plans. Read the report to find out commonly missed opportunities in terms of audience optimization in TV planning.

Online Display And Social Media Advertising Will Account For Nearly A Quarter Of Total European Advertising Revenue By 2020

Combined, online display and social media advertising spend will double between 2015 and 2020, growing from €14.4 billion to €28.7 billion.
 
Among the factors driving growth, the combination of mobile and premium video advertising will drive an upsurge in demand for both online display and social advertising. Advertisers will increase their investments in video and mobile ads as media consumption evolves and targeting accuracy improves.
 
Native mobile video advertising is already proving a winning formula in the social media sphere, and publishers will take notice as they further refine their video ad offerings to provide more premium inventory, preventing a decline of video ad CPMs as supply increases. In fact, mobile ad spend will overtake PC as PC flatlines in the next five years.
 
Other developments will continue to disrupt online ad revenue in the next five years: 
  • Programmatic will become the default mechanism for trading online display
  • Ad blocking will force new behaviors on the publisher side, and a greater struggle to hit the sweet spot between monetization and consumer experience.
  • Growing rivalries between Apple, Facebook, and Google for news aggregation services will further dis-intermediate publisher mobile advertising revenue.
To find all the trends affecting online display and social media advertising in the next five years, read Forrester’s European Online Display and Social Media Advertising Forecast, 2015-2020.