Most companies still think using Virtual Reality for training is very expensive. But that’s because there are a lot of things that are not taken into consideration. The most important attribute looked at for any investment, is the Return on Investment of Virtual Reality (ROI of VR).
When you actually do the math, you realise that not making use of VR is actually more expensive for your business in the long run. This realisation comes after asking the important question of if there are any returns from VR training investments.
It is not easy to calculate the exact returns for investing in VR training. This is because every situation is unique and there are many variables to take into account.
First of all, let’s simplify and compare with the most used training method in organizations today. That is the classroom training. Let’s break it down by taking a look at the costs of creating training material, recurring training costs and costs for operational disturbance.
For instance, a retail lifestyle chain with 200 stores and 1000 local sales employees. All these employees go through a full-day sales and customer interaction classroom training once every two years.
Training Material Creation Cost
Assuming the training material for the classroom training is already made, no investment is required. Creating VR training scenarios requires an upfront investment. Let’s assume the creation of multiple VR training scenarios, that cover everything said in the classroom training costs €100.000,-. Bear in mind that this investment is only required in the first year.
Training Resources Annual Cost
Resources are also required apart from creating training material. For the classroom training, that is the trainer, location and even travelling expenses. To simplify the comparison, let’s only consider the expenses for the trainer. With 20 employees a full day in a classroom and everyone being trained once in 2 years, you will need 25 training days. Hiring a single trainer for those days will cost you €16.000,-.
On the other hand, resources for the VR training, you need a VR platform like Smart VR Lab and a VR headset. The typical price for 1000 employees playing 6 scenarios would cost around €13.500,- per year. Purchasing 20 VR headsets with a depreciation of 3 years will cost around €3.000,- per year. This makes it a total of €16.500,- per year for VR training.
Cost of not working
Finally, let’s consider the cost of not working. When the trainees are in training, they cannot contribute to the business directly. Using a €40,- internal hourly rate and employees only training once per 2 years, the classroom will cost €160.000,- Assuming the VR training is done 6 times a year and requires 15 minutes per training, the VR training will cost €60.000,-.
The Return on Investment of Virtual Reality (ROI of VR)
In conclusion, adding up all costs will bring the classroom training to €176.000,- per year. The VR training requires a first-year expense of €167.000,-, which is almost the same. But the following years will only cost you €77.000,-.
In this example, the ROI of VR training is reached within the first year. After that moment, training with VR will only get more cost-effective.
To learn more about VR for business, you can read what we can learn from failed VR Projects and how to avoid failure. And also learn the benefits of VR integration to E-learning.
Smart VR Lab develops and produces training content for businesses across multiple industries. To transform your business, simply contact Smart VR Lab for a demo and set up a meeting with our team. If you have questions on anything related to VR, you can always send us a mail to email@example.com