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Augmented Reality and the Future of Marketing

While we may not operate flying cars or have the ability to teleport, don’t be fooled — the future is here. Augmented reality (AR), which some still think of as a far-off technological advancement, is actually used daily by the majority of Americans.

The backup camera in your car with lines that show your path. The yellow line of scrimmage that marks the first down marker on Monday Night Football. The widely popular mobile game Pokemon Go. All of these are excellent examples of AR. But what does this have to do with marketing?

In this article, I’ll answer several common questions regarding AR and demonstrate why it will be a key component of marketing in the coming years:

  • What is AR?
  • How does it work?
  • Why utilize AR in marketing?
  • How are best-in-class companies using AR already?

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So what is augmented reality and how does it work?

Basically, augmented reality is any general overlay of digital filters or features onto an enhanced image viewed on a screen. It is different from virtual reality because it does not create a virtual world with no bearing to reality; rather, it adds entertainment or information to an existing reality.

While there are hundreds of components and processes that power augmented reality, there are four main elements of AR technology.

1. Cameras: The camera’s role is to examine your surroundings and pinpoint different objects in an effort to catalogue what it sees.

2. Sensors: There are three main sensors that have the biggest impact on creating an augmented reality image: gyroscopes, accelerometers and magnetometers. Gyroscopes track the orientation of your device. If you tilt, rotate or move your phone up and down, the gyroscope sensor tracks this gravity-based acceleration and movement. Accelerometers record all non-gravitational movement: forward, backward and side-to-side. Magnetometers provide geographical location by acting as a compass, measuring Earth’s magnetic strength and field.

3. Processors: The processor is essentially the brain that makes augmented reality work. It takes all of the information provided from the cameras and sensors, digests it, adds whichever aspect of augmented reality that it has been programmed to add, and sends it to the device’s display for viewing.

4. Projection: However you view the live feed sent from the processor — whether it be a mobile device, smart glasses or a heads-up display — this is where all the information and new image is displayed to the user.

Why Utilize AR in Marketing?

While there are certainly a multitude of reasons to incorporate AR into any marketing strategy, I’ve boiled it down to the three most pertinent.

Buzz

AR is a brand-new and foreign technology to most people, so any marketing that incorporates it is likely to be exciting and fresh to many individuals. In fact, a study by Retail Perceptions found that 72% of customers have purchased items that they weren’t planning on buying because of augmented reality.

For a real-life example, we’ll go back to the Nintendo’s Pokemon franchise. Prior to Pokemon Go, many consumers hadn’t seen a well-done augmented reality video. Because of its effective use of storytelling combined with exciting new AR technology, Pokémon Go’s revenue was the highest ever of any mobile game in its first month: $207 million (Guinness World Records). Don’t underestimate the power of integrating technological progress with marketing.

Gamification

Everyone knows that customer engagement and sales revenue are positively correlated — when one goes up, so does the other. In fact, a study by Gallup found brands that successfully engage their customers realize 63 percent lower customer attrition and 55 percent higher share of wallet.

A hot trend in today’s marketplace to increase customer engagement is gamification. Through AR, potential customers spend more time interacting with your app or marketing campaign — whether it be looking at a 3D model of a product or watching a movie trailer that appears when you point your screen at its poster.

Customer Convenience

According to Pew Research, 79% of Americans are now shopping online — and why wouldn’t they? Online shopping is the most convenient way to get what you want without having to leave the comfort of your home or workplace. One of the industries that has utilized augmented reality most effectively is the B2C industry. Being able to see how a product looks and fits in a real life space saves time and provides more convenience for the customer. It is important for retailers to provide innovative and exceptional online solutions to customers because, according to USA Today, brick and mortar stores are closing at a rate of 7,000 per year as online shopping takes over the market.

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How Are Best In-Class Companies Utilizing AR?

  1. Sephora: The cosmetic and beauty product conglomerate out of France created an app that allows individuals to virtually try on different products and provide different makeup tutorials. In a joint study conducted by cosmetics market research company Poshly Inc. and digital makeup app Perfect365, 78% of millennial women said they would be more inclined to purchase makeup online if they could virtually see what a product looks like on their face before buying it. Because of their response to the needs of their clientele, Sephora’s AR app helped them grow 10% in 2018.
  2. IKEA: With their IKEA Place mobile app, this Swedish furniture giant allows customers to select and place exact 3D virtual replicas of furniture in their room to see their sizing, look and fit. Because of the app, customers can say goodbye to tape measures and ordering oversized furniture. Six months after its release, the app had over 13 million downloads — definitely effective!
  3. Pepsi: In 2014, Pepsi created a viral marketing campaign involving a local London bus stop and an HD video screen. Through the screen, onlookers saw a live view of what was going on behind the wall (with a few surprises). Audio and video was recorded to display crazy things happening in the background, such as an alien invasion and a charging tiger. Pepsi’s video of people’s reactions has reached over 8 million on Youtube, in addition to dozens of international news reports!

Final Thoughts

A recent study by UK-based Purch discovered that 72% of marketers are planning on using augmented and/or virtual reality technologies. Another study by Deloitte found that almost 90 percent of companies with annual revenues of $100 million to $1 billion are now leveraging AR or VR technology. The list of studies that back up the increasing necessity to incorporate AR technology into your marketing strategy can seemingly go on forever. With all of its strengths, why not implement AR? Don’t get left behind.

 

 

Carson Crocker
Carson Crocker
Carson is a Content Marketing Intern at Belo + Co, primarily assisting with internal marketing projects. He is a student at Vanderbilt University working toward a degree in Human and Organizational Development.