Why Rovio Is Testing Whether Virtual And Augmented Reality Ads Are For Real

Marketers use augmented reality and virtual reality primarily for entertainment industry stunts, but programmatic AR and VR advertising are showing early signs of life.

The Finnish mobile games developer Rovio, of “Angry Birds” fame, focuses on performance marketing to drive app downloads, but the company is running pilot campaigns with the AR/VR programmatic tech vendor Adverty to experiment with branding in new channels and mediums, CMO Ville Heijari told AdExchanger.

AR and VR inventory is too limited for scaled campaigns, Heijari said, and Rovio doesn’t produce AR or VR games yet, but the game developer is keen to bring it into the marketing mix as a first step “in learning about how users interact with ads in the environment and what we can expect from VR in the future.”

But scale isn’t the only hurdle to entering programmatic.

The IAB, for instance, doesn’t have standard units or measurement specific to AR and VR ads. So Adverty embeds two-dimensional IAB units in its supply, said company co-founder and CEO Niklas Bakos, sometimes bending the creative at an axis to place it on a cylinder.

“Another challenge, especially in programmatic, is that everything is built upon conversion rates and click-through rates,” Bakos said. AR and VR aren’t equipped to handle those metrics since game developers don’t allow features that send users to other content, as websites and other apps do.

Rovio’s AR and VR advertising, however, is different from its usual mobile campaigns, Heijari said, because it’s not about capturing a short window of potential interest or based on a call to action (like clicking to download or learn more).

“At the moment we see it more as a billboard, where you need strong viewability and messaging,” he said.

The use cases within VR games ironically harken back to old-school out-of-home marketing. Signs on walls are easy to pre-set as ad units, and inventory can be manufactured by, say, erecting a water tower or billboard in the background.

Rovio games like “Angry Birds” have spawned a full licensing business involving films and other forms of entertainment, so in-game billboards work with its marketing agenda.

Measurement and viewability can be a challenge in AR or VR apps, though, because the standard verification tools, such as Moat, Integral Ad Science and DoubleVerify, don’t support the category.

Adverty has its own internal VR measurement tool to measure lighting conditions and how or if a placement is viewed in the app, Bakos said. The company also plans to work with the IAB, other trade groups and measurement companies to standardize the potential ad channel.

By the end of the year, Bakos said he expects added scale and interest to drive CPMs for AR and VR inventory upward of $100, even if buyers remain case by case and don’t trade actively in the format.

Rovio is waiting for a breakthrough in the VR life cycle before adopting it as a platform for its own game development, Heijari said, “but it will be interesting to see if we keep the niche investment going on a persistent basis.”

This post was syndicated from Ad Exchanger.