Incongruent, but I Get It! How Narrative Transportation Drives Engagement in Virtual Reality Advertising

ABSTRACT Virtual reality (VR) is a promising new technology that has gained attention from industry and academia, focusing on immersing consumers in simulated services and experiences and, more recently, on recognizing the emerging trend of video watching using VR headsets. The growing importance of VR and emerging behaviors highlight two understudied topics: the role of VR in consumer engagement and which product categories are most effective for advertising in the VR channel. This study addresses these gaps in the context of VR 360° video watching by investigating whether the immersive capabilities of VR can boost consumer engagement, the psychological process underlying VR product ad viewing, and the role played by product typologies (i.e., hedonic–utilitarian, and search–experience). Grounded on information processing and narrative transportation theories, our multi‐methods approach—five studies, blending experiments and secondary data—reveals that VR bolsters consumers' engagement when watching 360° content through narrative transportation, influenced by the processing of incongruent information triggered by exposure to products with incongruent typologies (e.g., a utilitarian–experience product). Such incongruence decreases engagement when ads are viewed in a low‐immersion 2D channel. Counterintuitively, the immersive nature of VR can offset this decline, restoring engagement to levels observed with congruent typologies.