Customers encounter and explore vehicles in a variety of ways, and virtual and augmented reality is increasingly becoming a go-to option for car companies to introduce their cavalcade of vehicles.
Last year Volvo joined the growing list of auto manufacturers that are planting company flags in the immersive experiences space by announcing a partnership with Microsoft HoloLens to reimagine the car-buying experience.
Volvo’s union with Microsoft added a completely new layer to customized commerce and showrooming. The next-level marketing is designed to portray a human-centric approach, all while leading to new sales opportunities for the car maker to capitalize on.
Brace yourselves . . . virtual showrooms are coming. And why shouldn’t they? US car dealers spend $2.75 billion annually on interest to keep new vehicles on their lots, per Bloomberg, so brands reconfiguring medieval sales concepts in order to save a boatload of bullion is imperative. Can you remember the last time you got giddy about spending a splendid Saturday stopping at one dealer after another? Now you can have the dealerships come to you.
BMW, Mazda, Kia and Ford, among others, realize this, and are exercising their AR and VR muscle for marketing, training and research and development because the technology will not be driving off into the sunset anytime soon.
An October study says that the automotive AR market will grow steadily at a compound annual growth rate of almost 18 percent by 2020. The increased use of heads up display (HUD) in low-and-medium-range cars is largely the reason. An August report by ABI Research indicates that by 2025, more than 15 million AR HUDs will ship, with more than 11 million to be embedded solutions.
Bruno Renhult, Volvo’s senior manager of artificial reality, joined [a]listdaily to discuss the car company’s strategy in the space.
How is Volvo using VR and AR technology toward research and development?
Artificial reality presents seemingly endless cases of usage possibilities. In addition to what it opens up from a communication and marketing perspective, we’re paying attention to training, design, research and development, and other defined areas with large potential. In these areas we’re able to get a completely different dimension, in both how to teach but also, and importantly, how you are able to interact with what you learn. The same applies from a design and development perspective. By utilizing VR and AR technologies, you can experience the results directly through scalable 3D models in a real physical environment. Several people have the possibility to interact simultaneously with exactly the same object from different geographical locations if desired. Given the broad applications and potential benefits, this is an area we’re definitely experimenting with and testing out at the moment.
How was Volvo’s partnership with Microsoft HoloLens received by consumers? Looking back at it now, what worked well?
Our partnership with Microsoft and their HoloLens technology got us positive comments and attention from our peers on social platforms and in the media community. Mixed reality (MxR), as in HoloLens, has the advantage that you can mix reality and real objects with digital content at the same time as you’re also interacting with other people; this in the same room or other physical locations. In this set up, you can conduct yourself to the physical space/room in a completely different way than in VR where you must ‘track’ where you are and replicate any physical objects digitally. Over many other VR platforms, HoloLens also has the advantage of being completely wireless, and this combination gave us good leverage to put our products and features in front of our audience and potential customers, when launching the Volvo S90 and V90.
How is Volvo positioning the company for the future with immersive experiences?
We take this ‘new’ technology very seriously. In the same way we’ve encountered and worked with emerging technology in the past, we’re taking our approach and applying it to immersive experiences. As a company, as a brand, we’re open-minded, we’re agile and we’ve worked this way before. We can use our learnings and the structure we’ve applied to earlier technologies; building, testing, experimenting, to uncover new methods and applications. It’s easy to jump in this new area and pick the ‘low-hanging fruit,’ but how do we take this where it’s never been taken before? That’s where you find the outstanding, innovative experiences. You need to live with it for a while, to find the structure, processes and resourcing, and all the while not get distracted by this and take the chance to move past the generic to the exceptional. Perhaps specifically in this field, the difference and the need to approach this somewhat differently lies in the speed and scale at which things are developing. This in itself places fresh demands on how we need to act to be able to not just stay on top of things, but to lead and break new ground.
How will AR and VR change the car-buying process in the future? What are virtual showrooms/dealerships in a briefcase capable of accomplishing for car manufacturers?
It will scale things to a different level compared to today and offer accessibility to product experience that was not possible before. This opens up possibilities for our competitors also, of course. I believe we will also experience new challenges in how to compete, and break through the ever increasing media and content buzz to reach and engage potential customers and get their full attention.
Aside from HoloLens in 2015 and Google Cardboard in 2014, how else is Volvo using AR and VR for its marketing campaigns moving forward?
It is difficult to predict future applications, especially where we already see virtually endless possibilities with artificial reality technology. So far we have mainly used the technology to offer existing and potential customers the ability to experience and learn about our products in new and innovative ways. We have used it primarily as a supplement in places or sales channels where it’s difficult to demonstrate or test drive a real product. We did it for the launch of the 2014 Volvo XC90 on the Beta version of the Oculus Rift, as well as Google Cardboard, and the 2016 Volvo S90/V90 with HoloLens. Given their complexity, our product, its systems, functions and services can be difficult to grasp and fully understand through more traditional tools, manuals and information sharing methods. Here we see a great potential to overcome these obstacles with the help of VR, AR and MxR experiences throughout the consumer experience from purchase journey to ownership and beyond. Anything we can do to simplify for people, to create more engaging and effective experiences, will be beneficial.
Why is it important for brands to be at the forefront of these emerging technologies?
Brands need to do more than just be at the forefront. We, as creators, need to make good experiences and initiatives—period. Of course, doing things fast and early has PR value that translates to reach and communication impact, but we need to know why we’re doing this for consumers and to act with purpose. Innovation is so often jumping in and locking in to a specific new technology. But what’s the story? Where can we achieve bringing that story to life for our customers in a more relevant way, in a more impactful way? Taking a human-centric approach to emerging technologies will make it actionable—not just elevating the consumer experience, but producing business results.
Why is VR the major trend of the future? What does it enable that other tech simply can’t?
It is how it interacts with you as a human on both a physical and psychological level. Your brain interprets a premium VR-experience as the real deal in the way that you get a totally immersed experience. Your brain thinks it’s real and you experience it as real. To blur that boundary is a truly exciting and powerful thing. Done well, it has the potential to open us up to visceral, emotionally charged experiences that tap into how our brains work; how we receive and process information. That’s experiential. Commercial purposes aside, this can impact us on a human level. Beyond the technical perfection in the VR experience, it’s how it made you feel. That’s the difference compared to any other media experience so far and why it has the potential to be a game changer.
What kind of a role will VR have in auto industry in five years?
I personally believe it will play a central role and become a tool in our daily work. The excitement of invention is that we can sort of imagine how it will be applied, but we don’t know which executions will become reality. We’re humble in the face of the possibilities. In the past, we’ve been able to predict where certain emerging tech will lead, but I believe that with VR, it’s such a powerful tool, we can’t even imagine. That’s the thrill and I definitely believe the auto industry will be along for this journey.
Follow Manouk Akopyan on Twitter @Manouk_Akopyan