How to build a prospective VR business model

The article was originally published on AffinityVR by Anton Zaitsev. 

Why now is the best time?

Experienced fast development surge, in 2018 VR landed on a deserted soil full of disillusionment. Apparently, non-commercial use appeared to be not so profitable as it was considered by the vast majority of VR developers. Exceptions included a few titles like Beat Saber.

No one wants to flush money down the drain. Who on earth wants to invest money in something that is not worthwhile any further? But is this the end of VR industry?

True, the very first reason to consider is AR founding. That tech seems to overlap VR bringing nothing but mixed feelings.

In 2019 our world giants, Facebook and Apple, got a grip and headed for new investigations in both VR and AR.

That might be a deal-breaker for VR. One more step. One more revival. Further on, its market offered us VR corporate training and cutting-edge developments and programs created inclusively for medical, school or enterprise use.

The gaming industry was highly boosted as well, including so-called LB (location-based) VR. By the way, the latter is declared to be one of the main sources of revenue for the last few years.  

Unity CEO also decided to steer their developers team towards a better solution. And that one had nothing to do with home use.

Alright, nowadays we have got a lot of high-end headsets. All these might be considered when creating a prioritized pros and cons list.

Let`s take Oculus, for instance, and its renowned Quest model. The company promises to create an experience being more casual but location-based entertainment (LBE) is basically about going out with friends.

Shortly after, Andreessen Horowitz invested 65 million dollars in SandboxVR. Well, that was the first huge VR investment ever. Then Rupert Murdoch appears and does his part making one more great input in location-based VR provider called the VOID.

So how do you find it now? Are you still hesitating?

Exploring business pathways

Everyone can decide for themselves when it comes to technology, space, content. Whereas I am going to stick to one characteristic in particular while describing its three different but crucial clusters.

Here I mean free-roaming VR, VR arcades, and VR escape rooms.

Free-roam provides an arena scale (also warehouse-scale) VR experiences. The main catch is that players will always need a lot of space to immerse. No doubts, such kind of games aim at growing gamers appetite. But it is also believed to be the worst as regards space efficiency.

Virtual reality arcades are popping up to be handy and space-efficient. They remind you cyber-cafes. This genre offers rather cheap content. It usually looks to cater to single players consequently meaning lack of multiplayer. Also, VR arcade is not the best choice when having corporate parties or family recreation.

And the last one here, VR escape rooms. To immerse in this experience, it will be enough to set the action in your room. There is no need in much space. VR escape game is genuinely LB-exclusive and adds multiplayer features. It will suit both casual players and fledglings.

So what is the best solution? I`m going to share with you our company experience. Choosing a business model to follow you will need to decide on the following points:

1.  What is your target audience?

Our company is called Lostroom. In 2014 we decided to open the real-life escape games chain. We presented ten games of different genres. Cyberpunk room was the first. We struggled at geek audience be tempted with mind-teasers.

Everything changed when we launched the second experience with a fairytale setting. Bookings increased drastically. We noted that our audience needs something action-packed with a low barrier for entry. They needed something light and adventurous.

Best solution: VR escapes.

2.  What is the best LB VR for events?

Since then, Lostroom started getting requests for birthdays, corporate parties and other events presupposing VR. We noted that corporate parties and large-scale celebrations became our main growing points and helped us to realize our potential in the entertainment industry. Put simply, we found ourselves to be an event management company.

Our services also include professional photos, fresh and hot drinks, catering, various performances with actors, clowns, MCs hosting quiz games for kids.

Our customers may build their own pricing ladders starting from basic, advanced and VIP packages.

Best solution: Anything will do.But free-roam VR and VR escapes suit more.

3.  What LB VR is more space-efficient?

Your core privilege is to improve revenues per square feet/meter. The more activities you set in the same place the better.

Best solution: VR escapes, VR arcades.

4.  What is the best choice in terms of capacity?

Firstly, we recommend opening at least two rooms. Hence, your customers will get two different choices, and your bookings will be increased too.

The second point dwells upon the number of players. Our traditional set included 2-4 players while other VR centers embarked on six members in a team. The latter model won.

Lostroom went deeper and opened the room for ten players sooner became one of the most loaded center in the city. Currently, we are able to host experience for more than forty people managing ten rooms.

Make large-scale games that will attract more people. The results will be forthcoming.

So what are the limits for a corporate party? A hundred players? More? Seems bigger than you can afford at the beginning.

Your core issues:

–      to decide how many stations you are able to place and where exactly,

–      to solve whether you want to take on mobility and provide events at customer`s.

Best solution: VR escape center (up to 6 players), free-roam VR (up to 8 players).

Summing up, if you are eager to get the cheapest solution, choose VR arcades. In case you want to unleash an all-out high-quality experience, we would offer VR escapes.

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