The CMO Show: Ariel Shimoni on the state of VR marketing

How do you get audiences excited about your branded virtual reality content? VR expert Ariel Shimoni tells all.

Even though everyone’s carrying around a little virtual reality device in their pocket, VR is awkward.

It’s not enough to just have the app on your phone, you’ve got to carry around the glasses. You’ve got to be in a place where you won’t get robbed while you zone out, and have an internet connection good enough to stream high-frame rate, 360 degree video without buffering.

It’s a hassle. So how do you make customers care?

Ariel Shimoni, StartApp’s Director of Virtual Reality, says you don’t need to, at least not at first. While there are some really compelling branded experiences out there, he says, it might be better to think in terms of advertising, when dealing the nascent VR scene.

“When you bundle your ad experience within an existing VR experience – so the user is already immersed in VR when the ad appears – that’s a more kind of ideal scenario,” he explains.

“That’s where I want to see most of my ads running.”

Ariel’s experience has shown that 360 degree video is VR’s current ‘leading ad unit’, offering the greatest cross device compatibility and user accessibility, while still delivering “a pretty thrilling experience”, such as Mini Cooper’s car chase spot Backwater.

For content creators, Ariel argues that VR can offer the ‘evolution of video analytics’, by tracking how long each user spends looking at a given product, call to action or logo.

While there may be 15-20 million VR headsets in the market, Ariel cautions, brands shouldn’t branch out into the space expecting millions of views. Instead, they should view VR content is a future investment in their own capability, so that when VR does take off, they’ll be ready to provide amazing experiences.

Join hosts Mark Jones and Nicole Manktelow for a journey into the future of content creation, advertising, analytics and awesome experiences on this week’s episode of The CMO Show.

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Producers – Tom van Leeuwen & Candice Witton

Audio Engineers – Jonny McNeeDaniel Marr & Adam Slade

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Transcript

Participants: Hosts: Mark Jones and Nicole Manktelow

Guest: Ariel Shimoni

MJ:   Well thank you for joining us on The CMO Show today; our guest is Ariel Shimoni, from StartApp – Director of Virtual Reality, if that’s…

NM: It’s the coolest job title I have ever heard – and I’m so jealous.

MJ:   Yeah. So – well, we should start there. How did that happen?

NM: Yeah – how do you become a Director of VR?

AS:   So it’s sort of self-proclaimed, right? When I came up with this job, our CEO pretty much asked, “What sort of title do you want to have?” So I was like, let’s go with “Director of VR.”

NM: Mark, you’ve never asked me that. What sort of title do I want.

MJ:   Well you know what, my title here is CEO and Chief Storyteller, and it’s exactly the same thing, right? Someone said to me, “Where did that come from?” And I said, “Well, I just decided.” So you can do that.

NM: I want to be Vice President of Tim Tams. But you know.

MJ:   this is a conversation about virtual reality, and I’d like to hear you locate that within the marketing universe, because we also hear VR and AR used interchangeably, and we also hear it interchanged with AI, too, right – and mobiles

AS:   What we’re trying to come up is solutions specifically for brand advertisers on how to navigate and how to tell their story inside immersive environments. Which is a completely new challenge, or a completely new medium where old rules and old creative are pretty much non-existent, and you need to reinvent how you tell a brand or an ad story inside these virtual reality spaces.

MJ:   I have a practical question, which is just explain to us how it might work. What would it look like? Where would you advertise? Give us a scenario.

AS:   So I can speak about what we’ve done so far, what we explored with; and then maybe what I’d like to see, or what the future I think holds. The experience that we’ve had so far is really working with a single brand to either create some sort of a virtual reality or a 360 experience with them; and then finding a handful of willing VR publishers or developers that have VR apps or content, and work simultaneously on how to tailor the ad inside. Now, the way I see a virtual reality advertisement, it has to be in 360. You have to immerse the user inside an experience that talks the brand in 360. So while there are options to put maybe a 2D banner or a 2D video inside a 360 or immersive experience, I think taking the full advantage of this is really taking the user into a full experience around a product or brand.

MJ:   So are we talking like a 360 degree banner that just never stops?

AS:   That sounds like a horrible experience.

NM: I’m sure there are some ad managers out there who think that’s just dandy.

MJ:   I know, exactly – that’s just where the brain goes, and it’s probably a really bad idea, as you pointed out.

AS:   Yeah. So the leading quote-unquote ad unit so far has been a 360 video, filmed with a 360 camera, and picturing some sort of experience. For example, Mini had a great narrative story-based 360 experience that they distributed through New York Times where you’re in the back seat of the Mini, and you’re in a car chase, and then you go to the driver’s seat – you really feel like you’re driving the car. So these type of ad units are what we’re seeing today, out there.

NM: Sounds like the car chase out of the Bourne Identity.

AS:   Yeah, yes – something of that sort. Everybody has masks on their faces… it’s an exhilarating experience. And even at this level, where it’s a very passive experience – you’re just sitting, and you can look 360, but you can’t really do anything – even at that point, it is a thrilling experience.

MJ:   So that’s branded content.

AS:   Yeah, you can call it that, sure.

MJ:   I mean, because you’re talking about an ad unit equivalent, but ostensibly, it’s a… you’re buying a video product – is that right? I mean, I’m just trying to think about how this is being understood from a marketing nomenclature.

AS:   So from a marketing point of view, I think there are a lot of familiar aspects to this, where you need to create some sort of a creative, if you will – just need to rethink that creative. And then you need to find a distribution partner to make sure people view this creative. So that is a very familiar landscape for marketing managers.

NM: I think it’s… well I guess, Ariel – correct me if I’m wrong – but I think half of that story challenge would be not just to present your 360 video or however you want to do that brand story, but also to convince people to put their headsets on to participate in the first place – you probably have to start telling that story before you get to the 360 degree video. You’ve got to get them to want to participate. Am I anywhere near warm?

AS:   No, you’re completely correct. That is a massive challenge when approaching distribution in VR. So I guess you can think about this as two roots, right? You can create your own standalone experience around your product, or your brand, or whatever creative you created; put it on some sort of distribution platform, and wait for people to download this experience, or experience it somehow out of their own will.

Alternatively, you can put in on YouTube as a 360 video, and hope that people go there and put on their headsets and switch to VR mode. These are all… just me talking about it, it sounds very cumbersome and not a very straightforward experience. But there is an alternative, where when you bundle your ad experience within an existing VR experience – so the user is already immersed in VR when the ad appears – that’s a more kind of ideal scenario. That’s where I want to see most of my ads running.

NM: So that would be inside games or entertainment.

AS:   You nailed it. I mean, it could be games, it could be entertainment; it can be one of those very popular apps – kind of VR video apps, sort of like the YouTube of VR. People really love those 360 videos, so you put on your headset, and there are a bunch of 360 videos. You know, you can be a guy jumping off a plane, or diving with sharks, and here’s an opportunity to do something very familiar, which is a pre-roll of a 360 video, which is sponsored content, basically.

MJ:   Is the parallel in-app advertising?

AS:   You can definitely look at something like in-app advertising to compare it to; and you know, it makes this very, very easy to comprehend.

MJ:   Well, as you’ve been speaking, I’ve just been thinking… do you remember Second Life?

NM: Yes.

MJ:   And you know, brands jumped into Second Life…I remember IBM and others, they created these worlds within Second Life, and the problem was, you don’t sort of walk along through Second Life and go, “You know what, gee, I’d really love to hang around with IBM.” Like… people don’t… it just didn’t work.

MJ:   Well, you know, actually I remember going in there just sort of perversely, to… you know, “What the heck?” But you sort of go in there, and then you turn around and walk off. And I guess I’m wondering, then, what will an authentic experience look like, from a brand story perspective? So how do we get to that sort of level of authenticity, so that we don’t find VR heading down the Second Life path?

AS:   That’s a good question, and that comes down to really understanding the medium; understanding your own brand, and then how those two match.

NM: I really want to know – is the audience there, yet? And in what spaces?

AS:   If you look at the landscape today, we are talking about – the estimates are about 15 to 20 million devices or headsets in the wild  

AS: – Everything has to do with mobile virtual reality. It makes sense that mobile VR will be the leading platform to get this into the masses. It’s cheap; everyone has a smartphone; it’s a piece of plastic, you put a smartphone and a cardboard together, and you can be immersed in a very, very cool experience.

So to your question, I can’t compare this to mobile or web in terms of volumes, but the trends are looking good.

So while the audience are not there yet, they will be.

MJ:   So you’re very much at the – if you like – bleeding edge, or maybe even papercut edge – the cardboard edge – bad joke, sorry about that. No, I really appreciate that, though, because what I love about the start-up community is that if it’s going to be real in the future, it’s kind of real now. So you’re trying to figure out how to get there, right? Is that kind of a good way to position where you’re going with this?

AS:   Certainly, and this is something that when I approached brands, and I approach agencies about starting this journey into VR, this is one of the first things that I tell them – do not expect – or do not put your KPIs with volumes or making a million conversions a day, or stuff like that. See this as an experience, or as an opportunity to explore this new medium. Learn what it is you need to do in order to convey your brand story, and once the critical mass will arrive, and more and more users will pick this up, you’ll be in a position to really take advantage of this medium.

NM: Well, one thing I wanted to know is, if that’s happening in a particular… on a niche platform in a particular destination for that brand, the analytics that they’d be getting back for their return on investment for that – how do you measure that? It’s not like being able to say you’ve had X number of click-throughs or video views.

How do you handle that – reporting back to them?

AS:   So that’s part of what I’m trying to pitch to agencies and brands. What VR holds is both kind of… a little bit of the old, and a lot of the new. So these engagement metrics that you mentioned are all measurable inside VR. We can measure engagement; we can measure click-through rate. We can measure views. We can measure all of these things. But now, you’re starting to go into the new realm of what it is that we can measure, and what we can send back to our clients, with how your users experienced your experience.

For example, we can track… not necessarily where the user has looked, but where his attention was focused on. Creating, out of that, a very detailed heat map of that 360 experience. So think about the evolution of these sort of analytics. On web, you can maybe see where the cursor of the mouse is; then on mobile, exactly where people have clicked with their fingers. And now, when you’re going into VR, you can create a heat map of exactly where the focus has been of the user. So viewability – everybody’s talking about viewability, right?

With VR, this is something that you can really understand. If you put your logo on the left side of the experience of a 30 second video, and after a few thousand people saw it, I can tell you, no one is looking to the left. No one is actually looking at your logo. So we can change the position of the logo. So these types of metrics are completely new, and things that we can deliver back to the brand.

NM: I kind of wanted to know – it’s not just how long they’re looking at something; I mean, that still assumes that they’re looking at something – that still assumes that the person who’s participating in this is somewhat stationary, and that the 360 video is still just like a moving banner, if you will. I guess part of this is actually measuring how people might virtually walk through a scene, or… you know, there’s a whole different pathway of interacting with the content. If we can start to measure that as a person, rather than eyeballs. I don’t know – do you find that you have to explain that? Do you find that that’s valuable? Do you call it something different?

AS:   So in terms of new terms, you have your classic stuff, like brand awareness and stuff like that; or the clicks or the viewability that you measure – things that we kind of came up with – it was like “gaze-through rate”. So sometimes…

NM: Ooh, gaze-through rate.

MJ:   Have you trademarked that?

NM: I’m so using that at the next meeting.

AS:   I should.

MJ:   TM, yeah.

AS:   Gaze-through rateTM, yeah.

MJ:   GTR… what’s the three letter acronym? GTR.

AS:   GTR. GTR – that’s actually pretty good, GTR.

NM: We’ve got something here, guys.

MJ:   Yeah. Carry on – good. We’ve nailed that.

AS:   So a gaze-through rate would be the engagement of a user without a click. So a lot of times a click is impossible, because a lot of users are consuming VR without some sort of a peripheral that allows them to click or point at something. So they need to use their eyes – or where they’re gazing – in order to interact with something. So if for example there’s a button that says, “click here” or “go here”, you will need to gaze at it for an X amount of time in order for you to interact with it. So that is the equivalent, maybe, of a click. So we have these things. And Nicole, to your point about walking inside these experiences, that is absolutely the fantasy, right? It’s the dream.

MJ:   Just to get pragmatic for a second – what do we do about the goal aspect of this? In the mobile and online worlds, digital marketing is all about achieving goals. The calls to action, and getting people to do stuff. Is the simple act of gazing and walking around – is that the doing of the stuff?

AS:   Today, we’re kind of in a state where KPIs, or goals, are not the focus. I know it’s hard for a lot of brands and agencies to kind of put up a budget for something that doesn’t have a goal or a KPI, or even an ROI; but there are a lot of things around this, like creating a lot of buzz and a lot of press about a campaign and about the brand.

But to your point, we can still measure all of these things. We can measure click-through rate. I can create a 360 video ad; at the end of the video, I can create an interactive experience where the user clicks something, it opens a 360 landing page in your mobile browser, where you can even go from filling up a form to shopping online. All of these things are available and doable in VR. I can’t tell you that they are actually being used, yet; but they are available.

MJ:   Technically possible.

AS:   Yeah, technically possible. So you can still do these things, and measure; but going back to Nicole’s first question – is the audience still here – that would be kind of going to waste, because even if you can create some traffic, conversion rates… even with high conversion rates, you will still probably won’t hit any ROI that is similar to mobile or web. Just putting VR as a young technology that still needs to mature before we can hit and talk about these things.

MJ:   Got it.

MJ:   What’s exciting you about the future? Do you feel like you’re about to cross some sort of big threshold? What’s giving you hope that this is actually going to continue to be all that you imagine it to be?

AS:   Yeah, that’s a good question. I mean… look, I’ve been waiting for this technology since I was five years old. Since I got my first PC and played the first ever PC game, I’ve been waiting to be immersed in some sort of digital world. I imagine I’m not the only one. I cannot think otherwise – other than this thing is going to be huge. It’s going to be so important in so many aspects of our lives. Personally, if I zoom down to where I am, I really do believe that VR advertising, VR marketing, is going to be one of the most effective tools – one of the most memorable tools – to create a brand environment, or a brand message, because it taps into emotion. Real emotion.

You don’t have a screen that puts a barrier between the user and the experience. The immersion level of VR creates real emotion. If people are happy and they’re laughing, it’s as real as it is in real life. So I think brands that will understand this and will be able to harness this will… it will impact their brand like no other medium.  

NM: Well, you’re closing that distance between them and the content.

MJ:   It’s rapid fire question time. Are you ready?

AS:   Do it.

NM: Yeah? Strapped in? Ready to go? What are you grateful for?

AS:   My family.

NM: Good one.

MJ:   Do you like rain?

AS:   I hate rain.

MJ:   You’re in New York, so I’m sure it can be extreme, right?

AS:   Yeah.

NM: In the movie of your life, who would play you?

AS:   I like Mark Wahlberg.

NM: Beach or mountain?

AS:   Mountain.

MJ:   Best ever career advice?

AS:   Stop and think before you talk.

NM: Summer or winter? This is like a dating questionnaire.

AS:   I’m a summer guy.

MJ:   Who is your hero?

AS:   I’ll say my dad.

NM: If you weren’t a marketer, you’d be a…

AS:   I’d be in game development of some sort, yeah.

MJ:   Chocolate or strawberry?

AS:   That’s so easy. Chocolate.

NM: What did you have for breakfast?

AS:   I think I skipped breakfast today.

MJ:   Wow.

NM: Disaster.

AS:   Disaster.

NM: What was the last conversation you had with your parents?

AS:   We just talk about my kid, ever since she was born – that’s all we talk about.

MJ:   The enduring conversation – the best one of all. This is an important one…

NM: Very.

MJ:   …which it will be interesting to see whether you understand it – scrunch or fold?

AS:   Fold. One hundred percent. I had this conversation many times.

MJ:   Excellent.

NM: If you could change one thing about the marketing industry, what would it be?

AS:   I’d like some more open communication between… across companies, you know?

NM: What’s your greatest frustration?

AS:   Shitty Wi-Fi.

MJ:   Oh, yes.

AS:   Drives me crazy.

MJ:   Yeah.

NM: We hear you.

MJ:   Five senses – touch, taste, sight, hearing, smell – which would you sacrifice to save the rest?

AS:   I’ll go with smell.

NM: Dogs or cats? Very important.

AS:   I am a dog man.

NM: Excellent. Favourite book?

AS:   It’s still Lord of the Rings. I’m such a nerd.

MJ:   [laughing] on that bombshell. Ariel Shimoni, it’s been our pleasure to have you as a guest on the CMO show. Thank you so much for your time. All the best with pioneering the whole world of VR, and making it happen, and coming up with new, creative, clever ways to help brands reach their audiences. Really great to hear your story, and all the best.

NM: And we’ll be in touch about those trademarks, by the way.

AS:   Oh, yes. Yes – I have my legal counsellor next to me, so. [laughing]

AS:   Thank you guys, this was great.

MJ:   So that was Ariel Shimoni. What do you reckon, Nicole?

NM: Oh my god, I was so excited listening to all of the things that could be done in these spaces, but it’s quite heartening also that he’s pretty level-headed about it; he knows the audience isn’t necessarily huge yet, and he’s got to get people to jump on board and explore.

MJ:   Look, clearly there is a lot of demand for it. Certainly from a web traffic perspective, actually, in the SEO world, and some of the work that we’ve been doing – you’re seeing an incredible amount of interest in it as a topic, right?

NM: Oh, yes.

MJ:   It’s very clickable.

NM: It’s very sexy.

MJ:   Yeah, right? It’s all so hot right now. So it’ll be interesting to see how that becomes a bigger part of our normal reality, if you like, in mobile devices and so forth.

NM: Yeah, I can’t wait to start seeing this gaze-through rate become a topic of discussion.

MJ:   I think we’ve started something there.

NM: We might have.

MJ:   Well, it was fantastic. I hope you enjoyed the interview, please do make sure you subscribe on all the various channels, and send us a note…

NM: Show us some love.

MJ:   Yeah – we’d love it.

NM: We love your feedback.

MJ:   So until then, thanks very much for joining us on the CMO show.

NM: Yeah, thanks – can’t wait until next time.

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