2016 china’s vr marketing trendscapital market started paying attention on vr sector from 2014 and...

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2016 China’s VR Marketing Trends

Report

2

VR

construction of

real estate

VR

medical

service

VR For Consuming and Application in Various

Industries

VR Application in

Various Industries

Application of

Consumer VR

Target B2B market and provide equipment for immersive VR interaction

system and solutions for enterprises.

Target B2C market and provide consumers with immersive VR equipment,

content, system and services.

VR lab VR training VR

education

VR tourism VR news VR social

networking

VR game VR live

streaming and

rebroadcasting

VR video

Source: iResearch.

©September 2016 iResearch Global Group www.iresearchchina.com

The VR Application in Various Industries And Consumer VR

VR industrial

manufacturing

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Types of VR Output Devices

Definition: A VR display device that uses computers, host and

other equipment to run the system.

Characteristics: It has the highest technology but it lacks

portability.

Products: Oculus Rift, HTC VIVE, PS VR, etc.

Definition: A display device that uses smartphones to run the

system.

Characteristics: It’s most portable but its technology is relatively

low.

Products: Gear VR, Google Cardboard, Baofeng Mojing, etc.

Definition: An independent VR device which combines the

content platform and display device.

Characteristics: It has high technology and it’s quite portable.

Products: Deepoon AIO VR, Pico Neo AIO VR, etc.

AIO VR

Smartphone VR

Desktop VR

Types of VR Output Devices

Note: The classification is based on products released by September 2016.


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Capital market started paying attention on VR sector from 2014 and investments soared in 2015. During the “capital

winter”, investments in VR heated up. The hardware, input device, offline distribution, panoramic photography, content

production, games, system support, etc. were the fields that attracted investment. Among them, the VR hardware

received the most investments. The number of investments reached its peak in Q4 2015 and the amount of investments

exceeded 760 million Yuan.

Over a year later, the capital market became rational. First, the capital market no longer focuses on hardware. Its layout

has spread to other fields such as content and distribution. Second, premium investment decreased sharply. Investors

attach more attention to the emerging companies. Third, currently, there are around 100 Chinese companies in VR sector,

but only about 10 of them have raised Series B funding. The capital market now have deeper thinking about the business

modes and profitability of the VR sector.

Domestic Capital Became Rational After Lots of

Investment Activities

Series A and before series

A+ 71.1%

Series B and after series B

(including being acquired)

28.9%

Stages of Investment in China’s VR Sector From Q1 2015 to Q2 2016

7.62亿元

Note: The data are calculated based on publicly available information on the internet. For details, please refer to the appendix.


84.5 92.5 93

761.5

445

241

Q1 2015 Q2 2015 Q3 2015 Q4 2015 Q1 2016 Q2 2016

Amount of Investments in China’s VR Sector From Q1 2015 to Q2 2016

Unit: Million Yuan

5

Industry Chain of China’s Consumer VR

Note: The companies are ranked in alphabetical order. 2 The map may not cover all the companies. If there’s anything wrong with the classification, please feel free to contact

[email protected].


VR output devices

Information on media

Input devices

Support technology

Industry Chain of China’s Consumer VR in 2016

Offline

VR system and SDK

… … … … …

…

…

Distribution

channels

Online

…

Content production

Video making Photography equipment

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Diversity of The Content Might Increase Sharply by

The End of The Year

Source: The data is based on the “China VR/AR Developer Survey (Part 1)” released by HTC Vive. Sample N=2800.


19.7%

8.1% 6.1%

1个月内 1-3个月 4-6个月 7-12个月 1年以上

The Time That Developers Release New VR/AR Content

Over 1 year

25.6%

40.5%

66.1% of developers plan to release next

VR/AR by the end of 2016

During the early period of VR’s development, with their first mover advantage and strong appeal, some hardware

producers, including Oculus, HTC and Sony, are in leading place in the development of the first generation of content

platform. The production of content do not need great ability of expanding channels or huge influence on the industry.

Startups and developers may find many opportunities in the field of content production. According to the survey of

developers done by HTC Vive, over half of the interviewees say they plan to release AR/VR content in 3 months. By the

end of 2016, a wave of VR content will be released.

Within 1 month 1-3 months 4-6 months 7-12 months

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Trends: The Content of VR Becomes Diversified

According to the report released by HTC, currently, over 60% VR developers are game developers. But the content

development of B2B vertical application, 360-degree panoramic video are under development. The content of VR in the

fields of game, videos, etc. has started to be diversified. The development of game content is relatively more mature and

covers most of the types. B2B vertical application are mainly in the education and real estate sector. 3）The main

subjects of 360-degree panoramic video are tourism and arts & humanities.

Game

62.2% B2B vertical

application

40.3%

360-degree

panoramic video

25.6%

B2C application

22.4%

Game development covers a wide range of

types

Types: shooting, action, adventure, leisure, role

play, simulation, strategy and others…

Application in education and

real estate industries is

mature

Education 55.5%

Real estate 50.5%

Industrial design and

manufacturing 42.7%

360-degree video is a

transition product

Tourism: 55.8%

Arts & humanities: 49.0%

Education: 40.4%

Extreme experience: 38.5%

Science fiction: 28.9%

Cartoon: 19.2%

News: 13.5%

Sport event: 10.6%

Others: 15.4%

Social network applications lead the VR B2C content production Social networking 44.0%; Life assistant 35.2% ...

Source: The data is based on “China VR/AR Developer Survey (Part 1)” released by HTC Vive.


Distribution of Types of VR Content Production

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VR is Mainly For Entertainment in The Short Term.

It Will Become MR And be Mass Media in The Long Run Since the real world and the virtual environment are separated, VR devices can’t be used very frequently or for a long

time. Compare to cellphone, it is less portable and is not easy to use. Limited by technology, the user experience of VR,

especially mobile VR, are not satisfying. In the future, VR will combine with augmented reality (AR) and become mix

reality (MR). It will meet various demands of people in the form of wearable devices like glasses. It will surpass the

coverage of cellphone and become a real mass media. However, it will take a very long time to achieve this target.

Development path of VR

Development path of AR

Development path of MR

Become common

Game

Tourism

News

Video and live

streaming

Communication and

social networking

Mass media

Entertainment Subsidiary Complementary Media Mass Media

VR+AR realize MR

Source: iResearch


VR Develops Towards MR And Will Become Mass Media

Next 1-2 years Next 3-5 years Next 5-10 years

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expanding the scope of research to fast-growing sectors world-wide.

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Table of Content of Full Report

1 General Description of The VR Sector And Its Future

1.1 The Definition of VR

1.2 Application of Consumer VR And Industry VR

1.3 Development of Consumer VR

1.4 Types of VR Output Devices

1.5 Global Tech Giants’ Layout of VR

1.6 Famous Chinese Companies’ Activities in VR Sector

1.7 Domestic Capital Became Rational After Lots of Investment Activities

1.8 Industrial Chain of China’s Consumer VR

1.9 Output Device Production Companies in VR Industrial Chain —— Deepoon VR

1.10 Output Device Production Companies in VR Industrial Chain —— Whaley VR

1.11 Content Distribution Companies in VR Industrial Chain —— iQiYi VR

1.12 Content Production Companies in VR Industrial Chain —— Letin VR

1.13 VR Has a Bright Future And a Long Way to go

1.14 The Diversity of The Content Might Increase Sharply by The End of The Year

2 Whether VR Will be a New Communication Media

2.1 VR is Said to be The Next Computing Platform

2.2 Principal Line of Development of Mass Media

2.3 VR Might Become Popular in Vertical Fields in The Early Stage

2.4 Trends: The Content of VR Becomes Diversified

2.5 VR is Mainly For Entertainment in The Short Term And Will Become MR And Will Become Mass Media in The

Long Run.

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Table of Content of Full Report

3 VR Brings New Method For Marketing

3.1 Virtual Drive of Volvo XC90: App + Google Cardboard

3.2 VR News of New York Times: Paid Subscription + Free Google Cardboard

3.3 Propaganda of Game of Thrones: VR Video

3.4 Branding of MacDonald: Personalized VR

3.5 Letin: My VR Boyfriend/Girlfriend

3.6 Deepoon VR: "Catch The Dream" Public Service Activity

4 Large Scale Marketing in The Future

4.1 Forecast of China’s VR Marketing Trends

4.2 The First Stage: Spreading Relies on Traditional Channels

4.3 The Second Stage: Hardware Producers Will Get a Slice of The Cake

4.4 The Third Stage: Ad Platform Comes Into Being

2016 china’s vr marketing trendscapital market started paying attention on vr sector from 2014 and...

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