Imagine playing a hack and slash game. A user is not reacting every time their character is hit. They may have an initial reaction to a surprise attack that catches them off guard, but no more. There is some level of immersion but there is no level of presence. They never feel like they might be in danger and their body does not react as if it is in any danger.
Presence would be having a feeling of discomfort anytime your avatar was injured. The brain having tricked itself into thinking it is the avatar. When the avatar gets hit by a weapon, the user's body sweats and tenses up, believing it was just hit by an actual weapon.
Air-pressured tactile gloves can help develop a sense of presence. For example, pressure when grabbing a rock may trick your brain into believing the rock is real.
I wanted to focus more on the studies than the .gif. Having a mannequin stabbed and the participant's body reacting is a sense of presence and not simply a jump scare. The brain couldn't tell its own body from that of a mannequin.
https://www.youtube.com/watch?v=cML814JD09g&feature=youtu.be
(The bit with the spider webs especially registered with me as something that might be a trigger for making your brain go wonky.)
The audio cues are there - the visual cues are there. Add in some haptic feedback and maybe even smell (ie. make a room full of dead bodies and blood smell rancid) and you've hit every sense but taste. I can easily imagine it would cause a state of presence if done right.
Obviously their graphics will have to be "good enough" (although sadly it won't reach their CGI'd video editing level anytime soon :( )