Why AR, VR Is Giving Birth To The New Buzzword: The Experience Economy

Let’s pretend you’re in the market for a brand new, never lived in, NYC apartment in Manhattan’s swanky Chelsea neighborhood. Let’s pretend you’ve got a an easy $4.95 million to $50 million to spare for your new pied a tierre. The Zaha Hadid apartment at 520 West 28th that sits adjacent to the popular High Line park sounds right up your ally. But you’re very busy skiing the Swiss Alps at the moment, so you don’t have time to fuel up your private jet and head to the real estate office but you’re looking to secure your city spot ASAP. Luckily, immersive computing has allowed savvy marketers in the real estate field to explore new VR and AR technologies that can bring your new home to you whilst sipping your hot coco apres ski in the lodge.

Then you wake up in your one bedroom ground floor apartment in midtown to the sound of garbage trucks on trash day and you realize it was all but a dream. Well, except for one detail at least. You might not be a multi millionaire, but you are able to view an apartment for sale from anywhere in the world through the use of AR technology. Just ask marketers who attended our GDS CMO Summits.

“My new world is luxury real estate,” explains Kevin Thompson, CMO at Sotheby’s International Reality, “and there’s the Zaha Hadid building in NYC where they’ve created this all encompassing environment that customers can walk into and they have projected images of the apartment inside the sales office.”

Hadid’s 135-foot-tall building at 520 West 28th Street on Manhattan’s far west side is an

11-story building with 39 condos, including two $50 million penthouses with floor-to-ceiling windows, that was marketed to willing buyers through the use of fairly new XR, a term used to describe the plethora of immersive computing devices meant to place individuals into the experience economy, such as VR, AR & MR.

Joanne Popper, a digital strategist who has done much research on the way XR is impacting CMOs and brands, explains succinctly the differences as such: “Virtual reality is when you’re completely immersed in a headset and you’re a captive audience in that digital world. Augmented reality is a combination, when you are still in this world but you have a digital overlay on top of it. Snapchat and Pokemon are great examples of this. Mixed reality is a combination of this world with a digital overlay where you can’t discern between the two.”

So with this this new layer, a shift has occurred, and the attention of marketers has a new focal point.

“I’m kind of obsessed with idea of connecting with consumers in the experience economy,” says Thompson. “It’s the new buzzword. We’ve gotten away from Omnichannel. And all that its overplayed. But I love the psychology of connecting with consumers in a more meaningful way to tell brands’ stories.”

It’s a new layer of the omnichannel strategy that Thompson describes as perhaps THE layer. The frosting you scoop off the top when leaving that bland vanilla sponge cake behind kind of layer.

“This idea of brand as experience and creating this all enveloping atmosphere that draws consumers in is an important transition in our strategy,” he explains. “You’re talking to them almost more about who they are and how they live their lives than the product you’re trying to sell them.”

Rather than handing customers a glossy look book, or see tiny models displayed on tables, this is a way to immerse people and communicate how it’s going to feel to live there.

“That’s the core to the success of the transition in the marketplace,” says Thompson. “People are looking for ways to know what it’s going to be like to live there.”

The shift seems to be creeping into the psyche of not just the marketers but the general consumer population as well. Popper says 51 % of consumers believe brands using VR are more innovative, 60% believe VR creates a positive view of brands and 60% believe VR can help create engaging experiences. This has certainly been the consensus among executives at Meet the Boss events and GDS Summits.

Yet despite this feeling of a shift, Popper also says only 8% of brands are planning to use VR in their advertising in 2017.

“We are on the cusp, and at that watershed moment.”

So, feel free to get lost in day dreams of a life filled with wealth and luxury, but head to the Zaha Hadid building next time you’re in NYC to actually see the apartment of your dreams through AR technology in their real estate office. Just ignore the price tag if possible.