Summary

Findings from a prototype project

In early 2017, WAN-IFRA received funding from the Google DNI fund to create a prototype ad unit in 360 video. Working with Mediahuis in Belgium as a publisher partner, we documented the entire process and created this report to address some of the challenges and provide information for others trying to build a revenue stream for future VR, 360 video and even AR projects.

Nick Tjaardstra, Director of Global Advisory for WAN-IFRA, headed up the project and wrote about the following findings.

Takeaways

More and more news publishers are experimenting with creating 360 video, VR and AR content. Some, like Euronews or the New York Times, have created hundreds of 360 videos. But none have found a sustainable ad revenue model. In the course of building our prototype in-video 360 ad units, we learned the following:

1. Realistic 3D elements including ads can be very easily layered on 360 video by internal staff with approximately one week of training.
   
   If outsourced, developers estimate no more than 1-2 days work to create a high-quality, hotspot-activated pop-up in a 360 video. This gives an affordable entry point for new interactive 360 ad campaigns.
   
   
2. Advertisers and publisher sales teams see strong potential in interactivity – even 2D video interactivity could be interesting, let alone 360.
   
   Our project partner, Mediahuis, made a demo for one of its big retail clients after we created an iOS version of the prototype. They were particularly interested in the interactive elements. In our interviews, Mediahuis’s sales team was particularly keen on the potential of hotspots – for example triggering an ad when rolling over or gazing at a sofa.
   
   
3. The potential market for 360 videos is expanding thanks to rapid advances in mobile browser technology.
   
   iOS11 now allows WebGL so modern iPhones will soon be able to run true 3D viewers like the Unity WebGL viewer we used for our project. This removes the need to persuade end users to download dedicated VR apps, or update existing news apps with new functionality. Newer iOS and Pixel devices also have AR baked in, so millions more people will have access to the technology.
   
   
4. Now is the time to experiment with new ad formats.
   
   Organise an open day and invite developers or local VR enthusiasts. As mainstream programmatic revenue declines, it makes sense to seek collaboration with advertisers on new formats in 360 or VR. Ads will work best with certain types of content, lifestyle content for example, and even better if the content is created with potential advertisers in mind.