Facebook enters virtual reality advertising with Oculus Quest

In 2019, Wendy’s, a popular fast food chain, decided to leverage virtual reality (VR) technology as a marketing tool. First, the restaurant chain created an avatar in the popular VR-based game Fortnite. He then released a Twitch stream where this avatar burst into restaurants and destroyed freezers, reminding the public of their constant efforts to serve only “Fresh, Never Frozen.” The campaign increased Wendy’s mentions on social media by 119% and reminded advertisers around the world not to discount RV.

According to MarketWatch, the augmented reality (RA) and virtual reality market size was expected to grow at a CAGR of 73.3 percent between 2018 and 2025. In addition, it is expected to exceed 767.67 million of dollars in 2025. With that in mind, it’s perfect for people to focus on technology for reasons like marketing. Many advertisers have gone beyond Wendy’s simple campaign integrating ads into virtual reality applications. An important participant entering this party is now none other than Facebook.

Facebook is currently dominating consumer virtual reality with its Oculus Quest 2 headphones and recently announced that it will soon begin testing virtual reality ads embedded in the headphones in Oculus Quest apps. Technology giant Silicon Valley has been using Oculus ’limited data to target advertising on its social media platform since 2019 and began posting to Oculus’ mobile app in May 2021.

Still, this test will be Facebook’s first adventure to incorporate ads into the Oculus VR platform. After testing, Facebook will expand the system and create a “self-sustaining platform” for VR development. To fulfill its aspiration to become a self-sufficient platform, Facebook needs to run ads and find profitable business options. According to the Oculus blog post, “It also helps us make innovative AR / VR hardware accessible to more people.”

So how does this work?

Source: Oculus

The image above shows how users can see a Jasper’s Market ad. The VR tool will then allow them to click on this ad and open or save the link (which will allow them to see it later in the Browsing section of the mobile app). If you decide to open the link, a landing page will launch in your Oculus Quest web browser. The blog post also reports that Oculus ads will follow Facebook’s advertising principles, which he says are intended to “build for people first.” Doing so involves maintaining relevance and quality, so the platform will include controls to hide specific ads or hide ads from specific advertisers. Users will see it in the well-known “Why do I see this ad?” and Facebook says it will continue to hear feedback to improve the ads people see.

The system will also use a user’s Facebook profile information. Facebook shared last year that it would require new headset owners to open a Facebook account to activate their virtual reality devices, a decision that sparked a major backlash. Along with this, the new advertising algorithm will also observe whether the user has seen content, installed, activated, purchased or subscribed to an Oculus application. You’ll also see if someone has seen or clicked on an ad in third-party apps.

Oculus VR was founded in California in 2012 and was acquired by Facebook in 2014. Many believe that the addition of advertising to Oculus Quest marks another move that indicates that Oculus hardware is further integrated with Facebook. While many are not surprised by this decision, they are concerned about Big Tech’s rapid involvement in advertising and technologies such as virtual reality.

When it comes to privacy and user tracking, Facebook has had a dubious background. To make matters worse is the amount of information that Oculus Quest headphones know about their users. They capture clear movements of the head and hands and require photographs of the environment using tracking cameras and microphone audio. Future innovations that allow more accurate metrics in RV may also make eye monitoring necessary. That’s a lot of biometric data.

The aforementioned blog post has attempted to alleviate these concerns by ensuring that the platform will not use locally processed and stored information on headphones to target ads. It also indicates that data processed on the device, including raw images from Quest sensors, does not leave the headset or reach Facebook servers. In addition, Facebook had mentioned that it would not use the content of conversations that users had in applications such as Messenger or user voice interactions — such as voice command features in Oculus Quest — to target ads. Despite this, fears that Facebook is increasingly inclined to use such sensitive data for advertising remain as it delves deeper into virtual reality.

These ads will be based on the data available on your Facebook profile (and now each user will have one). So how will the Facebook plan materialize with increased debate and aversion to such a personalized and potentially invasive advertising targeting?

Facebook claims it has no shady master plan and will continue to work with the help of the feedback Oculus receives about virtual reality ads. Still, criticism has caused Facebook to lose to Resolution Games, which was supposed to test Facebook ads on its Blaston game. Blaston fans were unhappy with the decision to bring ads to a game for which they paid money, prompting Resolution Games to withdraw from the testing process. However, Resolution Games had mentioned that you can still try the ads on a free title instead of a paid one.

Only time will tell the effectiveness of Facebook’s foray into virtual reality advertising, both in terms of utility and privacy. Facebook said the first ad would look like standard boxes within game interfaces, but will continue to explore other options. Facebook is now investing in unobtrusive ads as a new way for developers to start businesses. Despite the doubts, the measure clarifies that systems like Oculus are paving the way for pushing consumers ’virtual reality to be truly conventional, making the integration of advertising a notable, albeit slightly controversial, innovation.

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Mita Chaturvedi

Mita Chaturvedi

I am an economics student who enjoys drinking coffee and writing about technology and finance. I like to play the ukulele and watch old movies when I’m free.

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