Marketing Insights Podcast

November 14, 2022

Transcript: 

Mark Johnston:

Welcome to the Marshall Johnston Marketing Management Podcast. I'm Mark Johnston.

Greg Marshall:

And I'm Greg Marshall.

Mark Johnston:

And we're here today to talk about a huge trend in marketing, augmented reality marketing. So to get us started, Greg, let me ask you, what is augmented reality marketing?

Greg Marshall:

Augmented reality or AR for short is an emerging trend in marketing and sales strategies. AR allows brands to give customers unique experiences that are convenient, smart, and also accessible. And it gives marketers another very cool tool when it comes to driving sales and enhancing brand value. So the big picture is, augmented reality is one of the biggest and best tech trends in marketing at the moment. And experts say it's only expected to rapidly increase. Typically, the integration of a customer's mobile device is essential to maximize their opportunities with AR. So Mark, what's the difference in augmented reality and virtual reality?

Mark Johnston:

That's a great question Greg, and they are very different applications. Augmented reality overlays content in the real world directly inside a camera experience. Typically this would happen through your phone, a tablet, or maybe a desktop or even a headset. Virtual reality does not interact with the real world. It creates a whole new virtual experience that mimics real experiences. This is usually done via a headset. The key for marketers is that augmented reality puts the power into the customer's hands via their own device. Greg, let me follow up here on some of the things we're talking about. Has the pandemic and the resulting bunkering of customers inside their homes for long periods of time, has this really sought to accelerate the development of augmented reality?

Greg Marshall:

Oh Mark, no question about that. The pandemic has undoubtedly accelerated AR investment by marketers, driven by the need for companies to deepen customer relationships via digital platforms. So within the context of marketing, AR allows brands to offer unique and still immersive digital experiences in the safety of the customer's own desired environment. And yet to still really engage customers in a memorable way, that's the beauty of it, websites and "traditional" ecommerce is still to this day very stilted, very passive, not very engaging. In contrast, AR allows for remote customer experience building but in a customized and really active way. So let's get down to details if you don't mind, Mark. What is an example of AR marketing that has been successful?

Mark Johnston:

Well that's a great question. Let me give you an example from a U.K.-based online fashion and cosmetics retailer ASOS which is short for As Seen On Screen, which is kind of a cute acronym, right? This company is no stranger to mobile innovation. They've been at the forefront of integrating visual search into their apps for a long time. If you go all the way back to 2019, it seems like a long time ago now, ASOS got fully on board with augmented reality, augmented reality marketing, launching an experimental feature called Virtual Catwalk, which was designed to be used inside their existing application. The result was a huge increase in their traffic and success because what it did was it enabled the user to go inside the app and actually try on different clothes, different sizes, see how it looked, and it really propelled the growth of their app and their overall success and they've been expanding the use of that inside their app since 2019 and in 2020 they rolled out an even broader, much more expansive approach to this, which they called See My Fit, which again allowed customers to really get inside the clothes and experience what it would look like if they purchased them. It's been a huge success for the company. But Greg, can you give another example of augmented reality marketing success?

Greg Marshall:

Oh, sure thing. Here's a different example. How about SPACE10, spelled just like you hear it, S-P-A-C-E-1-0. This is a research and design lab that's based in Denmark and it is entirely supported by and dedicated to IKEA, one of the great brands in the world. This SPACE10 is on a real mission, and their mission is to enable a better everyday life for people and the planet. Very IKEA-esque, and they focus on researching and designing innovative solutions to some of the major shifts expected in the years to come. An ongoing project right now is called the IKEA Studio, which is an IOS exclusive app that works by capturing 3-D room plans and measurements using the lidar sensors featured on the iPhone 14 Pro and the iPhone 14 Pro Max. Another little partnership there, hmm, with Apple. Put simply, this new technology creates a mesh scale that's capable of identifying surfaces, objects, and the geometry of your own real-world environment, resulting in a much more realistic AR experience.

IKEA Studio can identify windows, doorways, existing furniture. If the app detects any real-world objects in your room, it will automatically place a white box over those items, allowing you to focus on your redesign and change wall colors, arrange new furniture, decorate your space with a wide range of products. Absolutely incredible functionality. In fact, you can also stick digital furniture on top of each other, like placing a lamp or a potted plant on a shelf. Amazing technology, and a big step forward in the home furnishings industry. So finally Mark, what is your prognostication for the future of AR marketing?

Mark Johnston:

Well, the future for augmented reality marketing is exploding. It's going forward in a big way. Estimates are that the field will grow to around $200 billion by 2023 next year. So the question you might be asking is if everyone's using augmented reality, what's going to happen to traditional retailers? Well the answer to that is traditional retailers that are able to incorporate successfully an augmented reality strategy into their marketing communications and into their online experience are still going to be successful and I think Greg the example you gave of IKEA is terrific because IKEA is a retailer with brick and mortar stores, but they've embraced the augmented reality technology to enhance their experience in the store. People can go online and experience what it would look like if they did this or that to their home and then actually go buy the stuff at IKEA. So the key to many things in terms of like what's the future of augmented reality is companies successfully incorporate an AR strategy into their overall marketing communications.

Greg Marshall:

Well thanks for that Mark. That prognostication undoubtedly is going to be accurate and what a future there is ahead for augmented reality marketing. Well I want to thank everybody for joining us for this podcast, and for now, signing off, this is Greg Marshall -

Mark Johnston:

And Mark Johnston.

Greg Marshall:

We'll see you soon.

Mark Johnston:

Bye bye.