Why VR needs a new playbook – and where the industry should start

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In June, when Apple announced its XR headset, the Vision Pro, it took the internet by storm, generating an endless stream of coverage and early reviews praising its capabilities. Similarly, Meta's announcement of the Quest Pro last year also shone a spotlight on the world of VR and all of its potential. Broadly, the industry has spent the last two years making VR gaming more exciting, more immersive, and early adopters who have been around since the release of the first Quest in 2019 can attest to how far we've come.

Yet, despite all the hype, the industry continues to miss the mass VR adoption many expected by now, and IDC even showed a 20.9% decline in VR sales in 2022. On top of this, executives at Meta found that owners often use their headsets for only a few weeks, unveiling a clear engagement problem.

Developers continue to place their faith in a "if you build it, they will come" approach. But the growing gap between hype and adoption is perhaps the biggest indicator that the industry needs to reexamine its approach in order to see widespread adoption.

Here are four areas that I believe will expand the market and bring broader adoption to life, setting us back on track for VR revenue to surpass $28.89 billion by 2026.

Provide developers with data

As the old saying goes: "If you can't measure it, you can't manage it!"

One of the biggest challenges developers face is an absence of data. Meta, Sony, Apple, and other major headset manufacturers must prioritize providing game developers with comprehensive analytics on their users, including accurate demographic information as well as engagement and retention metric benchmarking.

The growing gap between hype and adoption is perhaps the biggest indicator that the industry needs to reexamine its approach

As the parent company of household names such as Facebook, Instagram, WhatsApp, and now Threads, Meta is a global leader in serving tailored content to its billions of users. It does not, however, share this same data with game developers, meaning developers have a harder time creating personalized touchpoints with users and potential customers.

The ability to better understand their user base helps them make informed decisions about game design, content creation, and marketing strategies. Analytics on user interests and age demographics provide these key insights that enable game developers to tailor experiences to their target audience, create captivating and immersive content, and effectively reach potential users.

As one example, outside data revealed that VR's largest audience is between the ages of 18-24 – significantly younger than what many developers initially believed. As a result, both the games that developers create and the moderation requirements are being reconsidered.

Invest in experiential marketing

In the case of VR, seeing is believing, and too few people ever get the chance to try out a headset themselves without first purchasing it. This is why Apple's upcoming headset, despite the hefty $3,500 price tag, will enter the game at an advantage – because people will wait in line at Apple stores to try new products themselves. It's immersive, tactile experiences like this that will bring people on board and convince them of VR's magic.

Even without brick-and-mortar stores, companies like Meta can host mall installations, create pop-up shops, sponsor teacher training sessions for classroom use, or even partner with gyms to show off use cases for fitness.

Leverage connected, social graphs

So much of human connection now is virtual, whether it be sharing updates with friends on Instagram or showing an unfiltered look into your life with BeReal. From the start, Meta was one of the biggest drivers of this, using Facebook to turn disconnected users into fast networks of friends. VR, though inherently primed for that connection, still largely misses the mark when it comes to encouraging users to engage with their broader networks.

It should be easier to find friends with a headset, see who is online, and even schedule times to hop into different environments to play together. Developers who will win will be the ones who leverage pre-existing social graphs, including the ecosystems already built by companies like Apple and Sony, to enhance cooperation and engagement. That connection is key to not only growing the number of users, but for keeping users coming back.

Expanding the market and keeping users engaged

The final key area of improvement for the industry is expanding the pool of potential players – and keeping them. The reality of VR is that there's something for everyone, whether that be gaming, fitness, education, or exploration through time and space.

Every family member could utilize a headset for a unique purpose, yet there's a misconception that they're only for gamers. One way to address this is by showing new users not just a list of the most popular apps, but rather the apps a specific user is most likely to enjoy.

Moreover, developers and manufacturers need to focus on making games broadly accessible to people of all abilities, whether that be seated/laying down play or one-handed play. From what we can tell, Apple's Vision Pro won't require any physical controllers, relying instead on gestures. As exciting as I find that potential, it raises potential concerns about accessibility that will need to be addressed.

And finally, people won't opt to return to places they feel unwelcome or uncomfortable. VR's immersive nature means that players can feel violated if another person doesn't respect physical boundaries. In order for VR to truly be accessible for everyone, player protection must be central to the experience.

Opt-in virtual barriers can help keep an appropriate distance between players, while flags for players who have been banned or marked as bad actors across other titles can serve as a warning for other users. Additionally, feedback loops should be provided to the developer when a player is reported to the platform while in one of the developer's games. And finally, we need better parental controls to keep young players safe, such as requiring parents to approve friend requests.

Once player safety is addressed, the focus becomes continued engagement. In order to get these users to return, there has to be a way to build habits – tailored push notifications about new games, alerts when friends log on, ongoing challenges, etc.

VR gaming has made remarkable progress in less than three years, and I believe wholeheartedly in its potential. However, the industry still faces many challenges to broader adoption and increasing engagement. Meta should be celebrated for the 20 million VR headsets already sold, but the fact that only a small percentage use them every month demonstrates the room for growth.

With the right approach and investments, VR gaming can reach its mainstream moment and open up a world of limitless possibilities for gamers and non-gamers alike.