Time to Get on the AR Bandwagon: How Augmented Reality is changing the Advertising Landscape

What is Augmented Realty?

Whereas Virtual Reality (VR) gives users a 100% digitally immersive experience, Augmented Reality (AR) is technology that superimposes a computer generated visual into a user’s real-world environment. Augmented Reality is unique in that it combines the real world with the digital world, giving users a completely different experience. Due to recent technological advancements, AR is becoming more and more ingrained in consumers everyday life. It is crucial for advertisers to keep up with these advancements in order to provide the maximum benefit to both clients and consumers.

Although recently there has been a great deal of talk surrounding Augmented Reality, the fact of the matter is: AR isn’t new. In 1974, Myron Krueger built an ‘artificial reality’ laboratory called the Videoplace. “The Videoplace combined projectors with video cameras that emitted onscreen silhouettes, surrounding users in an interactive environment.” This eventually led to arguably the most notorious use of AR when in 1998 the NFL introduced the famous “yellow first down marker” during a live NFL game. Since then, AR technology has continued to evolve and can now be found in everything from smart phones to car windshield displays, and much more.

AR is growing

Global growth indicates that AR/VR markets are expected to exceed $200 billion in 2021 (figure 1). This growth curve takes into account not only advertising potential, but the potential for usage in sports, medicine, education, etc. Some industries, like healthcare, have already adopted these capabilities and are expanding. In the medical field, they use AR for finding veins, reconstructing visual tumors and even locating defibrillators in public areas with the AED app.    

When taking into account ecommerce sales, the percentage of sales that are done through ecommerce has increased by 116% since Quarter 1 of 2010 (figure 2). Due to how advertising is becoming increasingly focused on digital, it is crucial for agencies to adopt AR tactics in order to keep up with the consumer trends.

Statista AR Data

AR is a unique touchpoint

In a perfect advertising scenario, a consumer would only see one ad on a platform, click, make a purchase and instantly develop undying brand loyalty. Unfortunately, in the real world, it doesn’t work like that. Consumers are now connected to more devices and platforms than ever before, and there are thousands of brands talking to a single consumer through different touchpoints at every second of every day. This creates a cluttered ad space where brands who fail to innovate and expand are not heard, and ultimately waste advertising spend.

While there are clear disadvantages to the changing media landscape, new opportunities to reach consumers are constantly on the rise and markets must be sure to get ahead of the next wave. This is where AR Is able to differentiate itself, as it has the innate ability to take an everyday touchpoint and make it unique. By letting consumers feel like they control the environment and message they are seeing around them, it elicits an emotional connection that every advertiser seeks to create when building a campaign. The most successful creative assets are the ones consumers can connect with. AR campaigns can break down the negative connotation normal display, TV, and Out of Home ads have associated with them, because customers want to feel connected, not interrupted. Consumers want to be talked to, not shouted at. When defining a strong, committed consumer relationship, Edelman, a leading global marketing communications firm that specializes in branding/brand reputation, claims the most important aspects are: emotion, shared identity and shared activity. In an article published by Edelman, they double-down on this sentiment, stating, “consumers feel a real affection towards the brand – not just the product, but the brand itself.” This emotional connection leads not only to sales, but also consumer retention.

Brands Using Augmented Reality

AR Campaigns can reach global audiences providing an intimate and exclusive experience to strengthen the relationship while also driving sales.

IKEA recently displayed AR’s effectiveness in reaching consumers in a campaign that used Apples ARKit technology, that any consumer with an updated iPhone has access to. The campaign allowed customers to virtually place the company’s product line wherever they wanted in their home by using their smart device’s camera. This turned every consumer’s iPhone into an in-home furniture show room. Consumers were able to virtually change the furniture type, color, and positioning and see exactly how it looked in their home.

Digiday AR Experience

This campaign was tremendously successful as it gave the consumer the opportunity to interact with the brand in a way they never could before. IKEA was able to give the customer the freedom to explore the brand in their own way. Michael Valdsgaard, leader of digital transformation at Inter IKEA , “described AR sales as ‘A dream scenario’ for IKEA .” IKEA managed to have huge success through AR even though brick and mortar sales accounted for over 80% of sales in the furniture industry in 2015 (FurnitureCore). IKEA plans on reaching $5.9 billion in online sales with the help of AR by 2020. (Digiday).

AR at BCM

In 2009, BCM was involved with the promotion of Augmented Reality ads for GE. Displayed below is an example of the ad as seen on cnn.com. As you can see, the technology was extremely outdated and that was only 9 years ago. In fact, in this campaign the consumer would have to print out a piece of paper and scan the label on the page to bring the AR experience to life. Just imagine the possibilities to integrate this further developed technology today. Not only have the graphics and the ease of use significantly improved, but the general accessibility is astonishing. Anyone with a smartphone can connect to the experience, wherever and whenever.

GE Augmented Reality Advertising

There is no question that Augmented Reality advertising is on the rise. It is our duty as advertisers to remain ahead of the curve and implement these new technologies. Consumers are targeted by ads at more touchpoints than ever before, but with new change comes new opportunity and AR is quickly becoming the best opportunity to break through the clutter. I strongly urge anyone to consider how they could integrate AR based campaigns into their advertising arsenal. There will always be advancements in technology, however the key lies within the different ways to use it and connect consumers with brands. This is why we advertise!

If you’re looking to expand your advertising efforts, our doors are always open!

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