The 2016 holiday season brought virtual reality to the masses. Shoppers were treated to a variety of options, from $20 smartphone headsets at discount stores, to high-end gaming headsets costing hundreds of dollars from Sony, Oculus Rift and HTC. A new research report from Semico, Our Future Reality is Virtual, forecasts that VR headsets will grow at a 53% CAGR from 2016 to 2021.

“There’s a lot of confusion in the market about Virtual Reality, Augmented Reality and Mixed Reality,” says Adrienne Downey, Director Technology Research. “Semico calls this combined market the Enhanced Reality market.  The segments differ in how they present, or hide, the digital world and the real world. This report focuses on the hardware types and manufacturers, along with the different use cases for each segment.”

The most recent AudienceSCAN study reported 2.4% of U.S. adults have tried a virtual reality or augmented reality experience in the past 6 months, on their smartphones or tablets.

Key findings of this new research include:

  • Virtual reality headsets will grow by more than 8x from 2016 to 2021.
  • Sony captured approximately 35% of virtual reality market revenues in 2016.
  • Mixed reality headset shipments will be significant in 2018-2019.
  • Enhanced Reality headset shipments will grow at an 81% CAGR from 2016-2021.

Advertisers wanting to reach Augmented Reality Users can try mobile smartphone app advertising or text messaging, because the AudienceSCAN survey found a whopping 54% of users took action after seeing these marketing messages in the past month!

Semico Research’s new report, Our Future Reality is Virtual, MP105-17, presents our forecast for virtual reality, augmented reality and mixed reality, with a focus on distinguishing the three segments based on hardware and applications.  Virtual reality is the segment taking the early lead in this market with excitement over the potential growth in immersive entertainment experiences.  However, in the long term, augmented reality and mixed reality may have more impact in the automotive, entertainment, industrial medical, retail and social media arenas.

AudienceSCAN data is available as part of a subscription to AdMall for Agencies, or with the SalesFuel API. Media companies can access AudienceSCAN data through the AudienceSCAN Reports in AdMall.