VR Junkies is the invention of Mr. Mckay Christensen and Mr. Josh Hintze. The two technology-driven professionals were friends and had worked together as top-tier software engineers for a variety of firms in different industries. A passion for gaming and a continuous drive to develop new platforms and break ground on new technologies pushed them both to look into the virtual reality space.
First, the two worked on the operating systems and infrastructure needed to deliver a premium virtual reality gaming experience. There was a large range of virtual reality gaming developers already on the market, but very few venues for which these interactive virtual themes could be enjoyed.
The retail market for virtual reality was just in its infancy which was seen as a budding opportunity for a branded, consistent customer experience. In early 2016, VR Junkies was born with the original corporate location opening in Orem, Utah. The concept was simple, essentially a group of individual booths where customers could enjoy and interact with virtual reality gaming systems in the retail location.
The front counter greeted customers, helped them choose a particular virtual reality gaming system and then directed them to the booth where the actual game was played. The location was based in Orem mall and was an immediate success as groups of interested and excited gamers came to enjoy virtual reality gaming, many for the first time.
As the VR Junkies brand took shape and the operating model was more defined, Josh and Mckay began to develop operating systems that refined the business model further and helped provide structure, systems and a financial model that allowed for scale. The result was a game-changing technology platform that allowed the virtual reality gaming businesses to be monetized effectively at both the unit level and from an enterprise standpoint.
Through the VR Junkies system, essentially every trend and key performance indicator for the stores could be managed and monitored allowing for strong reporting and an excellent ability to manage the business from afar. As the virtual reality gaming business segment expanded, so too did the massive interest in the category from others who wanted to open businesses in the market category. VR Junkies had industry-leading technology, a strong brand, excellent leadership and a first mover advantage in the category. In 2017, the organization decided to launch a Virtual Reality Gaming franchise platform and the VR Junkies franchise emerged.
Based on the simple, low investment, high margin model, the VR Junkies franchise was one of the lowest investment options in the retail category and captured the imaginations of those who enjoyed gaming and virtual reality. The majority of the franchise marketing happened online and through digital marketing mediums driving leads and traffic from potential virtual reality franchise buyers to the VR Junkies site.
The first franchised units opened in Hawaii, Colorado, New York, New Mexico, Florida, Washington and one store in Canada. Operators came to the brand from all backgrounds and interests, but the majority had a personal interest in gaming and appreciated the concept of virtual reality as a customer.
The model scaled effectively in that it required a small labour force, about $100k in investment and had extremely high operating profits with virtually no cost of goods sold. Locations were generally placed in malls in high traffic, high visibility locations, but with temporary mall leases allowing the locations to be moved and negotiate low rents. Later versions of the model developed party rooms and allowed for more of a corporate, team-building environment.
As the system surpassed 14 units in operation including one in New Zealand, the brand began to have economies of scale and purchasing power that could be leveraged by the network and benefiting the franchisees involved and more strategic advantages emerged.
The virtual reality franchise market is a perfect example of an industry segment that is still being shaped and defined. The advantage to moving first and fast carries more weight than having a perfectly refined business model and VR Junkies was able to leverage this early market move through franchising.
Franchising allows a business to scale quickly and leverage owner-operators who focus on the day-to-day operations of the business, the VR Junkies franchise is a perfect example of this. For more information on how to franchise a virtual reality business, contact us.
FMS is a team of expert franchise consulting professionals based in Canada that provides solutions for franchise development, franchise consultation, and expansion of businesses globally.