Meet the virtual reality ad network

With VR headsets like the Oculus Rift and HTC Vive selling out in minutes and Samsung bundling in its Gear VR with pre-orders for its latest Galaxy smartphones, the virtual reality trend is entering the mainstream.

It was little wonder the marketing community would look to jump on board — travel brands have been using VR videos to show off their destinations to would-be customers, automakers like Volvo can give people a test drive of their vehicles, and airlines are using VR as in-flight entertainment. But it’s probably more surprising that ad tech companies are jumping into VR — who wants to be served with ads when they’re fully immersed in a virtual world?

Late last year, mobile ad network Airpush launched a “virtual reality ad network”: VirtualSky. It claims to be the “first platform of its kind,” allowing advertisers to create ads to serve into more than 4,000 virtual reality apps and games. Its platform plugin is designed for game engines, so VirtualSky is confident its ads will work with every single VR operating system and hardware as it launches.

Right now there are two virtual reality ad formats on offer. There’s a kind of pre-roll, called SponsorAds, which play 5-10 second VR videos when a VR app loads up. Then there are “ExperienceAds,” which act like Interstitials and play full-length 10-30-second commercials in natural breaks during VR content, such as between levels.

Speaking to Business Insider, VirtualSky and AirPush chief marketing officer Cameron Peebles, said the platform has already received a “ridiculous level of interest” from the developer community and that “most major agencies around the world have reached out.”

The first campaigns have already launched, for charities PETA, Stand Up To Cancer, and Charity:Water. VirtualSky also has ads lined up for retailers and “an upcoming blockbuster movie.”

For advertisers, the appeal is clear: In a world where consumers are constantly distracted, experienced in becoming blind to ads, and downloading ad blockers, virtual reality offers a fully-viewable experience. VirtualSky also offers a “HotSpot” measurement capacity where advertisers can tell exactly where on the screen a viewer was looking at and which parts of the VR video they chose to interact with.

But with VR at this stage in its lifespan — and with VR headsets coming at a hefty price tag initially — the technology is likely to appeal to early adopters. Technology fans make up the largest component of ad blocker users. By entering the market early, VirtualSky risks the irritation of a hugely important user base before the technology even hits mainstream.

The dawn of a virtual reality ad blocker?

Jason Kint, CEO of digital publishing trade organisation Digital Content Next, told Business Insider: “[It] makes sense that vultures are circling this new creative — and potentially lucrative — landscape. Regardless, I would stay 100% focused on building consumer value first. I don’t know what a virtual reality ad blocker looks like but I would prefer not to find out.”

Peebles thinks it won’t be long before there’s a virtual reality ad blocker, but says VirtualSky is going out of its way not to disrupt consumers’ VR experiences. You won’t find a VirtualSky ad in a big money VR title like “EVE: Valkyrie,” for example. Instead it will focus on free-to-play apps.

VirtualSky also wants to offer as much creative counsel as possible to clients and, for that reason, the company isn’t offering self-service ad placements to begin with.

Peebles said: “Virtual reality does have the ability to create an unpleasant experience like making someone feel sick, or having too much content close to the face, so we need to police this.”

That could change further down the line, but it will be important for the industry to set standards — on areas such as the size, length, and shape of ad units — before virtual reality becomes programmatic, Peebles added.

For now, VirtualSky is charging advertisers on a CPM (cost per mille/thousand) basis at prices “close to but lower than broadcast [TV] pricing,” according to Peebles. In addition to its HotSpot data, VirtualSky will also offer data on completed views and whether the viewer opted to click through to the advertiser’s website (it’s also offering a VR browser to enable this) or download their app. Soon it wants to add a “buy this” capability too.

Peebles said: “We have reached a tipping point of momentum. Every KPI we had for adoption — look at the Samsung Gear selling out on Amazon and Best Buy, or Oculus — has been exceeded. We have learned a lot about this space but we have to be careful not to buy our own BS.”

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