If you Neglect Augmented Reality,

You Neglect Your Margins!

Why Augmented Reality is the biggest transformation in marketing since the Internet?

Section 1. Introduction

Two years ago, I was sitting in a Rolls-Royce. At that time I worked in the Product Marketing department of Rolls-Royce Motor Cars. As anyone who ever experienced a Rolls-Royce from the inside would know, these cars have a lot of details and intricate features. As a member of the product team, I knew every single one of them. However, that day I spotted a new feature that I wasn’t familiar with. It was a small device planted just below the windshield of a magnificent Phantom EWB. Turns out I was looking at a simple AR device that shows a holographic image of the speed and other metrics to the driver. And there I was, sitting in a $300k+ piece of art and thinking about this $100 gadget on the windshield. This is how my research into AR began. 

The entirety of my next year was spent researching the various uses of Augmented Reality. I fell in love with the concept of combining the virtual with the real. It did not even seem as futuristic to me as it seemed practical. Yes! Practical! And not in the sense of “in about 10 years this will be practical”. I am talking about solutions currently on the market that can provide some serious innovation. 

Delving deeper into the subject matter, I started discussing it with my marketing colleagues, friends and academic contacts that had an interest in marketing. What we found is that at this point, one of the strongest tools a marketer can have in their pocket is AR. This text will try to illustrate all of the enormous value found at the intersection of marketing and Augmented Reality.

This resulted in us creating Takeaway Reality, a firm which at its core wants to be the messenger telling the average small and medium business owner that AR is no longer exclusively for innovation labs of big companies. Small, Medium and Startup businesses can finally tap into the great marketing potential that AR offers.

Section 2: What is AR/VR/XR?

We understand that our role is also to educate, so this small paragraph will be used to explain the terminology used in this field. Feel free to skip it if you are comfortable with these terms.

We ought to start with VR. Virtual Reality is currently the most widespread and famous technology. It occurs when all of your visual fields is filled with computer-generated content. For now, you might think it is just used for video games, but already VR is used for much nobler pursuits such as treating PTSD as well as educating the public about certain disorders. However, due to its impracticality for public use (you can’t see your surroundings), it is never predicted to reach the level of popularity (and marketing usefulness) that AR will have. 

On the other side of the spectrum, we have Augmented Reality. This is the technology most useful to your present (and future) marketing. This technology is basically virtual objects (such as 3D models) superimposed and interacting with the real world. This can easily be used in everyday life and in the workplace. We will talk a lot about its use in marketing in this text.

If you research this subject you might come across the word XR. The “X” is a variable that can represent any letter. It’s a fancy way of saying XR represents the spectrum from VR (full virtuality) to reality (zero virtuality). Basically it is an umbrella term that encompasses all of the technologies mentioned above. 

Now that you are equipped with state-of-the-art knowledge, get ready to augment your marketing strategy!

Section 3: Innovation=margins! 

In my experiences of consulting small and medium companies, there was often a sentence that caused my hairline the most damage “Why would we change [insert outdated process/technology/channel…] it seems to (barely) work?”. The answer was always the same. And it was the same as for the question “Why would you create Apple Computers (which deals with innovation) instead of opening a print shop or a neighbourhood bakery? Because of a simple rule of microeconomics – innovation increases your margins!

Smart Business leaders understand that getting stuck behind the times means death for your business. This is why you are seeing self-service checkouts in your local supermarket or why your favourite restaurant is on Uber Eats. However, many often neglect the value of innovation in marketing. This can be the sword with which you slay your competitors! (Metaphorically of course, as I strongly disagree with using murder as your marketing strategy.) If you are now wondering whether this is really true or not, just think of the last time you clicked on a banner ad and where your business would be if you still used those. 

If your mind still isn’t set on why you need to innovate in marketing, let’s consider some examples. Consider Gymshark, a Birmingham based sports equipment design company. Their Founder Ben Francis was still studying at Aston University when he created a brand that initially produced fitness clothing focused on gym-goers. The biggest reason for the success of Gymshark was their early focus on Social Media Marketing. Especially Instagram. This sentiment was echoed by their Chief Creative Officer Noel Mack, who stated that Instagram is a huge part of their story because of the community they have created. From looking at Gymshark, it might be reasonable to conclude that if they used the same marketing tactics as the traditional fitness clothing brands, they would have been one of the thousands of failed sports attire brands instead of being one of the rare European unicorns they are now.

And they are not the only ones, brands such as RedBull or Virgin have succeeded primarily because of their constant innovation in marketing. Quite honestly, the case for innovating your marketing makes itself. Now the question is if AR is the next big marketing innovation?

Virgin and Red Bull certainly think so! These brands are among the many investing heavily into AR. For Example, Virgin Atlantic has created an AR experience that allows their customers to experience their plane in a new reality, while Red Bull is going so far to create branded AR video games .

Section 4: Is AR The Next Big Innovation?

Now that we established that innovation can seriously help your marketing and the lack thereof might even kill your company, we have to ask ourselves if Augmented Reality is the next big innovation? Well, let’s just say that evidence shows that our future reality will be an augmented one! Even the king of business strategy, Michael Porter, stated that: “Every organisation needs an Augmented Reality strategy!” 

There are various arguments for why AR will be one of the leading technologies of the future. So let’s look at what we believe are the top 5:

a) A better way to tell stories.

Most marketers would agree with me that storytelling will be the key to marketing success in the 2020s. Recent research from temple university back this sentiment up with clear data showing that storytelling in marketing is more effective than traditional forms of marketing (although it only looks at the tourism sector).

However, as many marketers know, getting users to read long stories is hard. Very hard! This is why we achieve better results once we tell that story with audio, and even better with video. But there is an even better method – AR. Imagine if they could step into the story instead of having to look at it from a distance, even better what if they could interact with the objects and change the outcomes of the story. This types of immersive storytelling experiences are not the exception in AR, but the standard. One of my favourite projects at  Takeaway Reality is when we use AR to create engaging stories and narratives. The projects that come out of this are usually something truly revolutionary and tend to leave people in awe of your brand. 

b) 3D data is more useful than 2D data.

The argument here is simple. Since we live in a 3D world, 3D data is more useful to us than 2D data. Porter gives the simple example of how fixing an office copier with a 3D model would be faster than with a 2D manual. This also works in the marketing sense. If you have a physical product, imagine how much more the potential customers would remember your brand if they can interact with a 3D model of your product. Vans did something similar to great success with their custom shoe configurator. 

Let’s move away from the customer and towards your own desk. On the other side you have Data Visualization, imagine how much more informed you would be if you could see the data from your latest marketing campaign in 3D presented right on your desk in the morning. This 3D data would not only contain one dimension of data more (which means you can compare 3 different axes) but would also update in real-time. AR truly allows for some amazing solutions. In the future, you will be able to use your 3D glasses to see this, but in this article, I specifically want to avoid talking about the future to illustrate what is available right now! And companies such as Takeaway Reality are creating 3D AR Data Visualization that you can use on your phone now.

c) More confidence in the purchase.

Has it ever occurred to you that you see a product which looks exactly like something you (think you) need and even has a low price. But there is that voice at the back of your head reminding you of all the countless times you ordered something that didn’t look like you expected. Well, that can be over as a 3D model of any physical product can now easily be presented to you in real size, shape and colour. The best thing about it, you might even discover new features/colours or other upsells that you might like.

Imagine buying a phone. And you are able to visualize the size and design of it. And as you swipe to see the different colours, phone cases start being recommended to you. What might happen is that you visit the site looking for a mobile phone, but end up buying a phone as well as a phone case and maybe even a set of earbuds that “really match the colour”. There is truly nothing more powerful to differentiate you right now if you have an online business.

d) We have more data, we need more dimensions.

Ever since the invention of the internet, the quantity of data is rising exponentially. The amount of data has risen 30x in the 10 years since 2010. This means two things for marketers. Firstly, there is an unprecedented amount of noise. Secondly, you need to send out more and more information to reach customers. The solution for the first part is simple, marketing noise has always been successfully combated by marketing innovation (see section 1). The latter point is something I want to elaborate on. Some of you may remember the early 00’s. It was quite lucrative to display banner ads, ads with just a colour and some text, overall, not bigger than a few kilobytes. The first banner ad ever was created by AT&T in 1994 and had a click-through rate of 44%! Today, you would be lucky to have a single click as ad-blockers have been invented because people hate ads once they get bored of their format. As time progressed the files started becoming bigger and bigger. First, it started with images that were getting bigger and bigger, then with GIF’s and smaller videos. Now the most prevalent form of marketing is long, content-driven video formats.

In our marketing strategy department at Takeaway Reality, we often guide our clients through elaborate processes of targeted content creation such as youtube channels or podcasts. A great example of this marketing strategy would be Slidebean and their very successful youtube channel. If you opt for this (very lucrative) strategy, You would need to be uploading gigabytes of content every month. Now that we established that marketing has moved from a couple of kilobytes of data to a couple of gigabytes, it is easy to assume it will move further. The most efficient way of visualising that much data will not be in 2D video format anymore. It will be in a 3D interactive format. Because 3D simply allows for more storage space for the vast amounts of data. 

e) The most viral technology on the planet.

This is without a doubt one of the most viral ways to get your brand out there. People have a high tendency of sharing these videos. For example, Superdata, a Nielsen-owned market research company has shown in their research that 61 percent of mobile users who see AR ads regularly take the extra step of sharing them. 

These five reasons are usually what we at Takeaway Reality present to our clients when we are doing AR strategy consulting. And in most cases these 5 reasons provide enough evidence to convince even the most traditional marketing department we have encountered to invest their resources into AR marketing. 

Section 5: What is on the market now?

As mentioned earlier, We don’t want to be one of the 95% of self-proclaimed futurists who talk about AR almost exclusively in the future tense. Our mission at Takeaway Reality is to show that AR solutions are here and are even affordable enough for small and medium-sized businesses! With the right agency partners at your side and a willingness to differentiate your brand, you can create campaigns that generate incredible virality due to their innovativeness. There are 3 categories of AR products on the market right now. We will go through them right now to see which might suit your brand the best. 

1) Social Media Filters

a) What are Social Media Filters?

To put it quite simply, Social Media filters are small Augmented Reality applications for social media. They are hosted on Social Media Sites such as Instagram, Facebook and Snapchat. At takeaway Reality, we create branded Instagram and Snapchat Filters (we can even create Facebook filters, but we do not usually recommend them as they had not really flourished on the platform yet).

b) How can they benefit your marketing?

The benefits of this technology are gigantic. This is most likely why almost all big brands from Red Bull to Adidas have their own filters. One of the first to adopt this was Kylie Cosmetics, one of the biggest Instagram marketing success stories. They grew their brand to 26M followers in just a couple of years. All of the clients that we created filters for have achieved a significant increase in their reach as well as post engagement. This was mainly due to shares, as this type of content is highly viral and shareable)

Which Businesses would we encourage to use this? If Social Media plays a big part in your marketing mix, you absolutely need to invest in Instagram filters. They are quite cheap as well. If you wish to grow your Instagram or Snapchat Presence, these are essential! Luckily, you will see the results quickly as they tend to spread like wildfire. 

 

d) Which Businesses would we discourage in using this? If you are a niche B2B business that does most of its marketing on LinkedIn or uses a lot of direct marketing Instagram filters are not for you. Also, if you are doing direct low quantity sales due to your product being complex, we would recommend looking at AR apps that can help with visualising components of complex products instead of Social Media filters. 

2) Augmented Reality Apps

a) What are Social Media Filters?

To put it quite simply, Social Media filters are small Augmented Reality applications for social media. They are hosted on Social Media Sites such as Instagram, Facebook and Snapchat. At takeaway Reality, we create branded Instagram and Snapchat Filters (we can even create Facebook filters, but we do not usually recommend them as they had not really flourished on the platform yet).

b) How can they benefit your marketing?

The benefits of this technology are gigantic. This is most likely why almost all big brands from Red Bull to Adidas have their own filters. One of the first to adopt this was Kylie Cosmetics, one of the biggest Instagram marketing success stories. They grew their brand to 26M followers in just a couple of years. All of the clients that we created filters for have achieved a significant increase in their reach as well as post engagement. This was mainly due to shares, as this type of content is highly viral and shareable)

Which Businesses would we encourage to use this? If Social Media plays a big part in your marketing mix, you absolutely need to invest in Instagram filters. They are quite cheap as well. If you wish to grow your Instagram or Snapchat Presence, these are essential! Luckily, you will see the results quickly as they tend to spread like wildfire. 

 

d) Which Businesses would we discourage in using this? If you are a niche B2B business that does most of its marketing on LinkedIn or uses a lot of direct marketing Instagram filters are not for you. Also, if you are doing direct low quantity sales due to your product being complex, we would recommend looking at AR apps that can help with visualising components of complex products instead of Social Media filters. 

3) WebAR experiences

What are WebAR experiences?

Essentially, WebAR works like an app, just that it is for smaller projects (usually up to 30MB) and it can be opened through scanning one or two QR codes. There are various platforms such as ZappAR, 8th Wall, XR.+ and many more that we have worked with to create these experiences. The main benefit of these experiences is that they remove the friction of downloading an app while giving a similar if not same experience. Also, these solutions are much cheaper than apps, starting at around $250. A good example of WebAR would be Augmented Reality business cards that we produce. On the front the business card has your name, position and company logo, just like any other card would, however, at the back, there are two QR codes which when you scan them lead to an AR experience that can pack as many links to your work as you want as well as links to your company site, your social media and any other site. It can even play a video of you greeting the person. WebAR experience range in price and development time depending on what you want your experience to look like, but in general, it is on the cheaper and shorter side. 

 

Which Businesses would we encourage to use this? 

 Any business with physical packaging is ideal for this. Although this can be used on marketing materials (like flyers, posters, postcards etc.), it works best when it is on the product itself, especially limited editions of it. But overall, most organisations we worked with could benefit from such an affordable solution that works really well in attracting customers. 

 

Which Businesses would we discourage in using this? 

There are not a lot of businesses that wouldn’t benefit from WebAR experiences. The only reason why you would not choose WebAR would be if you had a specific idea that is quite advanced. For that we would advise you to upgrade to the app offering. 

Section 6: Make sure you promote your offerings well!

Many augmented reality projects are wasted because of the development agencies only focusing on the technology and not on the user experience and customer touchpoints. For every AR experience, there is a corresponding best practice promotional strategy. When it comes to creating Social Media Campaigns, our goal is always creating a viral loop. Viral marketing is key to your AR experience having organic growth and customers love sharing such innovative content. As mentioned earlier, Superdata, a Nielsen-owned market research company has shown in their research that 61 percent of mobile users who see AR ads regularly take the extra step of sharing them.

Just think about how powerful this is. Imagine if 61% of your audience would share your regular ad. This is why it is very easy to create viral content with AR. 

Section 7: Conclusion

After reading this article the formula for standing out in the marketing space should be simple. If you innovate using AR solutions you are guaranteed to be at least catching up to your competition if not leading in marketing among your industry peers. If you wish to learn more about the technology or how your company could utilize it for marketing, contact us!

About the author

Hi, my name is Mario Ramić and I am the founder of the AR marketing agency Takeaway Reality. Where I have joined my marketing and business strategy education and experience with the exciting technology of Augmented Reality. Our mission at Takeaway Reality is to create affordable AR solutions not just for big corporations, but also for small and medium-sized companies. In short, we want to show that AR should not be thought of as “the future”,  but rather a very affordable current technology that is already producing wonderful results. 

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