Music & Games

Strategic approach needed to win with VR

Virtual reality can add new revenue to an amusement center, but operators must allocate sufficient operational and marketing resources and know how to price it, noted a panel at the Amusement Expo International.

Lef Peterson, Oleg Churgel and Andy Dunn discuss ways to maximize VR during the Amusement Expo International in Las Vegas.

April 17, 2023 by Elliot Maras — Editor, Kiosk Marketplace & Vending Times

Virtual reality attractions are bringing more variety to amusement and entertainment centers, but reaping the full benefits requires a dedicated focus, according to a panel of amusement center operators who shared their insights and experiences with VR during the recent Amusement Expo International show in Las Vegas. The education sessions were held at the Westgate Hotel next to the convention center.

"If you're doing it because everybody else is doing it, stop," said moderator Bob Cooney, a VR consultant.

Cooney said a strategic approach is needed to expand into VR, one that includes an understanding of why you are doing it. When he asks operators why they are using VR, they often say they didn't think about it.

"I've seen a lot of people buy VR [solely] because they think they need VR," he said. "That's not the reason to buy VR."

Dedicated staff

Cooney cited the importance dedicating staff to VR attractions.

"The reason they are being profitable is because of the staff, it is being marketed and given attention to," Cooney said. "You can't treat an attended attraction like an arcade game. Market it as an attraction and hire a manager who's got P&L responsibility over that attraction," he said. "You probably have a bowling manager if you have bowling leagues. You probably have a food and beverage manager if you're running a restaurant."

In support of Cooney's point, panelist Chuck Taylor, formerly VP of entertainment at Dave & Buster's, said the biggest complaint he's had from customers about VR is that they didn't have a good time because they simply did not understand how to play the experience.

"That is the number one complaint by far," he said. It's hard to address this issue unless you are staffing the VR correctly.

How to market VR

Cooney called on panelist Oleg Churgel, CEO and founder of FireLoop VR, an FEC in Irvine, California, to describe how he turned his VR attractions into a customer destination.

Churgel, who features two VR attractions, Hologate and Vex, said "word of mouth" marketing has been the most effective tool so far, as it accounts for 40% of his business.

This has largely been accomplished with the help of social media. Employees ask permission to record photos and videos of guests, along with encouraging customers to take and share their own social media photos and videos.

Guests who share their reviews are entitled to enter a raffle, regardless of what they said in their reviews.

"What they need to do is share their review and then attend a raffle at the same time, so they show us that they shared a review, either it's one star or five stars, it doesn't matter … they draw the raffle ticket," Churgel said. "That's created initial buzz to our websites, to our social media."

Fireloop was able to grow its social media followers from 300 to 4,000.

Advertising on Yelp also brought in another 30% of the customers, Churgel said. The remaining 30% came from walk-in customers.

"You can't just do one thing," Cooney said. "You have to do all of those things to be successful."

Pricing and packaging

Pricing and packaging are another important part of VR success. The panelists agreed that VR attractions should be priced higher than traditional games but should be offered separately.

Churgel sells his VR attractions in bundles of five games.

Panelist Leif Peterson, CEO, Hologate, agreed that bundling is a good sales tool.

"Bundling is a huge opportunity and is not used enough, plus, online pre-booking," Peterson said. He said venues can bundle VR attractions exclusively or in combination with other attractions.

Panelist Andy Dunn, head of attractions and production at Two Bit Circus, a Los Angeles-based FEC, has also used bundling, pricing his VR attractions separate from his arcade games. He offers a $35 package base bundle and usually gets an average spend of $50, thanks to upsells.

Taylor agreed VR should be priced separately from other games. If a venue includes the VR as part of a card that includes other games, the VR cannibalizes the other sales.

"The VR experiences which are premium experiences do cost more (and) drain that card relatively quickly," Taylor said. "You can package that in lots of different ways without really messing with your core game room card system."

Taylor said he used "entitlements," a different currency, for selling his VR attractions.

"Separate it from other games so that it is clear that it is different," Peterson said. "You could even do time-based access, it doesn't have to be per play. You can really be creative with how you get access to that premium content."

The entitlement system is also good for group sales, he said.

Cooney said a lot of operators think people won't pay the higher price for VR, but operators who have increased the price have found very little price resistance.

What about ROI?

Peterson said time to ROI with VR attractions is usually under a year, in some cases, a few months.

Churgel, who gets 500 unique VR customers a month, said VR is profitable, although he hasn't yet broken even.

Immersive entertainment does drive business, Taylor said in response to a question about why to invest in VR.

What about IP?

With the upcoming release of a Ghostbusters movie this year, the discussion moved to using movie studio intellectual property.

Peterson said he produced games with Ghostbusters, for which he needed some approval from Sony. He said it is challenging to get the approval.

"The fan base is just 'ginormous,'" he said. "If you're not leveraging that in some way, you're crazy."

The studios spend $150 million producing a movie, Cooney said, and an equal amount in marketing it.

"This is a really unique opportunity that I just want to point out for everybody in case it's not obvious," he said.

"You don't get free license to use the intellectual property however you want," he said.

Hosting a Ghostbusters theme party, Taylor found out that Sony did not want its license used in combination with other products without their permission. Sony needs to know how their IP will be grouped with other parts.

"There's a line in the sand, and it's hard to define without asking specific use cases," Taylor said.

Photo: Networld Media Group.

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