Immersion is an essential element when writing a novel. This doesn't mean that it is the most important element (which is a topic that could start a world war) but in order to have enjoyable novel-length story it is neccassary. From a slush reader's standpoint, it is one of my criteria in order to pass a story up.
It should be noted that though this is how I am currently planning my next manuscript, I have tried quite a few methods ranging from just putting my fingers to the keyboard to writing a 30,000 word reference document before I even started the rough draft. More than likely, there will be bits of my prewriting that will change, so I'd love to hear about your guys's process in the comments.