Advertising: Mobile AR’s Juggernaut
From upper funnel to purchase, brands are increasingly turning to Augmented Reality to market their products and services online
Since the release of Apple’s ARKit and Google’s ARCore in the summer of 2017, mobile AR has made a slow and steady push into the mainstream. The introduction of the technology into the core of mobile operating systems opened up a wave of energetic experimentation across industries over the past two years, and it’s starting to find purchase in a few key sectors.
Unsurprisingly, gaming has become one of the leading categories to latch onto AR. 2019 saw a resurgence of Pokemon GO usage and the introduction of other top game titles. But somewhat quietly, brand-supported AR — in the form of sponsored content and novel advertising units — delivered consumer value and significant revenue last year, and it is projected to be the fast-growing category in the mobile AR landscape. Expect this trend to continue, and have broad implications for brands trying to reach audiences with novel and engaging ways to show off their products.
According to a recent report from market intelligence firm AR Insider, AR advertising reached nearly half a billion $US in revenue in 2019 and is expected to grow to $8B by 2023. The majority of that revenue came through social applications such as Facebook, Instagram and Snapchat, but other tech and media giants such as Unity, Verizon Media and Google have entered the market with advertising products in the last year, tapping massive audiences to deliver short-form, interactive augmented reality brand experiences.
The Rise of the AR Ad Unit
Unlike purpose-built applications such as IKEA Place or Warby-Parker’s AR try-on app, these new types of AR ad experiences are delivered as ad units or sponsored content into existing mobile apps or websites that already have sizable audiences. Apps are fine for delivering utility functionality and longer-form experiences, but the installation step introduces undue friction into the process. Unless the value proposition is obvious and the user intent is clear — such as trying furniture in your home with AR before making the trip to the showroom — the friction of an app install is typically a nonstarter for brands.
Ad units, on the other hand, provide frictionless access to a brand’s story. Like videos or “playables” — interactive brand ads built as short form mini-games — AR can now reach audiences where they are, whether they are reading their newsfeed, playing a game, listening to music or watching online videos. In 2019 we saw the deployment of several notable firsts in this exciting new category.
Branded Filters
Fast-following Snap’s AR offerings, Facebook introduced “AR Shopping” to Facebook and Instagram: AR product ads show up as sponsored posts in the feed, allowing for virtual try-on of products, and purchasing directly from within the ad unit.
Snap Landmarkers
Snap introduced its “landmarker” technology last year, allowing content creators to attach virtual objects and animations to physical places in the world. It was used with great effect in this activation by HBO that brought a Game of Thrones dragon to New York’s Flatiron district.
WebAR Experiences
Silicon Valley-based startup 8th Wall boasts over 80 AR-based marketing activations, including a promotion for Sony’s film Spiderman: Into the Spider-Verse. The campaign used 8th Wall’s WebAR technology to deliver Spider-Man into living rooms around the world with no download or install.
In-Game AR Ads
My employer, Unity Technologies, is the leading platform for building mobile games and virtual/augmented reality. We also provide an in-game advertising platform that reaches nearly 2 billion players worldwide, and about 3/4 of the US population. So it was natural that we would introduce the advanced features of AR into that advertising stream. It’s a product we are slowly ramping up; one of our early campaigns delivered a try-on experience for smartwatch maker Fossil.
YouTube AR
It should come as no surprise that Google is also pioneering efforts in AR advertising; they have announced multiple efforts in this area. 2019 saw the launch of YouTube AR Beauty Try-On, an ad product focused specifically on the beauty industry. (See image at the top of this post.) The product lets viewers virtually try on makeup while watching tutorials or product reviews, in partnership with notable influencers and brands like M-A-C Cosmetics.
Why Brands Are So Excited About AR
Without a doubt, AR is sexy and new, and marketers are always looking for new ways to stand out from the crowd. Campaigns like the Game of Thrones Snap landmarker and Sony’s Spider-Verse WebAR show just how fun and engaging brand content can be when 3D digital magic is brought into the real world using AR.
But besides the fun, there is also utility. The ability to try items before you buy promises to increase sales and reduce returns. Much of that value stems from the basic ability to see a virtual representation of a product in 3D and interact with it in real-time — something that itself is relatively new in the world of advertising and e-commerce. Add to that being able to see the 3D content in context using AR, and we have a sales tool with unprecedented power.
The following tale may be an indicator of things to come, and provide further clues as to the power of AR advertising. Last year, Miller Lite was looking to increase awareness and engagement for its brand around St. Patrick’s Day. MillerCoors and its ad agency Spark Foundry used Unity to roll out new, breakthrough AR experiences, allowing audiences to engage with Miller Lite’s iconic St. Patrick’s day character, the bearded man. The activation included two in-game AR ad units delivered on Unity’s ad platform, as well as an 8th Wall WebAR experience (developed by Trigger Global) running at select pubs on St. Patrick’s Day.
We knew the campaign was going to be exciting — a first of its kind combining in-game advertising with location-based adventure at the pubs. But we didn’t quite expect the results:
- 75% re-engagement with an AR Mini-Game experience. Let that sink in. Where else are you going to find ads that people replay?
- 25% lift in favorability — meaning people were 25% more inclined to purchase and drink this beverage after seeing the ad
- 3+ minutes average time spent on WebAR. This is a long time to be interacting with a brand story on a mobile device.
Again, it is early days for this format. Perhaps we can chalk the impressive numbers up to the novelty of AR; or perhaps there is more to it. Only time, and more data, will tell.
What’s Next for AR Ads
It is pretty amazing how far this new medium has come in just over two years. Each of the companies mentioned above had to stand up a new technology platform, come to grips with design and production processes, and work with advertisers to create meaningful campaigns with demonstrable results. Those are major achievements. And yet, it’s just the beginning.
Today, each AR ad platform uses a custom tech stack, slightly different from each other. Each platform requires custom tools to create the content, which means that creators must author the content once for each platform, creating a lot of extra work. All this, despite the fact that under the hood they are quite similar, mostly variants of each other that use HTML5, WebGL, and 3D file formats like glTF. Expect this situation to change in the next year or two, as these solutions converge toward some kind of common standard so that AR ad content can be created once and run everywhere.
We should also expect to see AR ads showing up in more distribution channels: more newsfeeds, more websites, more mobile apps, and in search engines. At their I/O conference last year, Google publicly demonstrated 3D search results in web pages. But it wasn’t until just last week that Burberry put the feature into practice to advertise products in 3D and AR— hinting that the company is getting closer to commercializing the tech.
Finally, expect to see the excitement around AR continue into 2020 and beyond. From upper funnel to purchase, AR can create great and lasting value for consumers and brands. With the early returns being so exciting and objectively successful, we will see an even broader range of interest and a willingness to experiment in the next few years.
For further reading
- Jesse Damiani provided an excellent roundup on the best AR experiences of 2020 in a recent Forbes article.
- Yahoo! has curated a list of several AR try-on apps.
- AR Insider has many insightful pieces on the adoption of AR technology across industries.
