Verizon's AOL has signed its first major virtual reality ad deal since it announced it purchased VR and 360-degree video company RYOT.
The deal, which a spokesperson for AOL said was worth seven figures, will leverage RYOT to create a branded video series, written articles, social media posts and 360-degree/VR videos in partnership with American Family Insurance and media agency Mindshare. The series will focus on heroes inside their communities overcoming their challenges. It will run from late October until the end of the year.
"This is our first big project that we've launched together with AOL Partner Studios and HuffPost where we can really flex our technology muscle and use this to bring people inside," RYOT co-founder Bryn Mooser told CNBC.
RYOT was acquired by Verizon in April, and was placed in a division under AOL's Huffington Post. Deloitte Global has estimated that virtual reality would reach $1 billion in revenue this year, with $700 million worth of headset sales.
"At American Family we believe dreams are the most important things anyone will ever own. It's why we're so excited to use 360-degree video and virtual reality to bring to life stories of everyday dreamers who are pursuing their passions" said Telisa Yancy, chief marketing officer of American Family Insurance, in a statement. "Partnering with AOL and using their innovative storytelling tech is the perfect way to spread a real, relatable message of inspiration — one that we hope empowers people to overcome their own obstacles and dream fearlessly."
Though many people have been applauding VR's ability to create immersive experiences for the viewer, the number of people who actually own headsets is still relatively low. Deloitte said about 2.5 million headsets would be sold this year globally.
But with companies like Facebook and YouTube allowing people to watch 360-degree videos without having a device, it's making it easier for anyone to watch these styles of videos, said Jimmy Maymann, AOL executive vice president and president of content and consumer brands.
"(VR) is taking off as we speak. ... What's important in our industry is not only to get the brands behind this, but the agencies," Maymann told CNBC.