From dancing hot dogs to hidden Mr Men and little Japanese monsters, AR connects our real-life and virtual worlds, merging the physical with the digital to redefine our experience of reality. It’s clever, it’s immersive, and it takes engagement to another level.
Take Snapchat’s AR hot dog character. Viewed through a smartphone lens, Snapchatters can walk around this virtual character and photograph him in their surroundings: perfect if you’ve always wanted to do the Foxtrot with a frankfurter, or the Cha-Cha with a chipolata.
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Heathrow Airport has rolled out its own AR game, as families use smartphones to scan digital characters from the Mr Men and Little Miss stories. Pokémon GO reached 15 million downloads in just one week.
A global phenomenon driving strategic change in enterprise
The beauty of AR application lies not just in the gaming or the virtual reality simulations, but in the ability of these digital conceptions to interact with their physical environments – instantly.
In AR applications, the technology overlays digital information onto physical objects or places, changing what users actually sees through their viewfinder or lens. Amplify this with users’ ability to capture and share their virtual experiences, and you have a global phenomenon.
Now, organisations are beginning to realise that AR has an important role to play in enterprise. As a result, they are tapping into these environments to gain a strategic advantage, to educate teams and to get closer to their clients.
Across a wide range of business functions – customer and employee engagement, manufacturing and production, R&D, planning, training and onboarding – a diversity of industries is exploring the value of AR.
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Deloitte research shows that over 150 businesses – including 52 of the Fortune 500 –have already deployed AR/VR solutions. ABI Research expect the AR Enterprise application market to ‘hit an inflection point’ in 2018, with the shipment of ‘smart glasses’ increasing at a CAGR of 227% by 2021.
Senior Analyst at ABI Research, Eric Abbruzzese says with confidence, “New AR customers will be excited by positive performance indicators across the market, with the promise of increased workforce efficiency and error reduction. 2018 will be the year all verticals experience a significant jump in AR adoption rates.”
This forecast growth is boosted by:
• a maturing consumer market;
• an increase in affordable enterprise-specific applications;
• improved understanding of the benefits;
• high-profile use cases and analytics demonstrating success and;
• customer appetite for and excitement by AR.
Enterprises are benefiting from rolling out AR in a number of different ways. These include:
• Accurate troubleshooting and accelerated fix times, as a result of hands-free access to AR applications which overlay manufacturing parts in AR into a physical environment.
• Optimised productivity, with less time spent checking and cross-checking work.
• Improved learning and education, through simulation of, and interaction with, different scenarios.
• Enhanced safety, through effective, engaging education and information programmes.
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AR applications in the real world
The relaunch of Google Glass as Google Glass Enterprise Edition is a great example of the increased understanding of AR’s value to the enterprise. The technology has been rolled out as a productivity tool for companies including Volkswagen and DHL.
Pitney Bowes’ partner GE is integrating AR into its workflows to transform productivity, piloting smart glasses which run on Upskill’s Skylight platform. Technicians assembling wind turbines, for example, use the wearables to access training videos, to consult manuals and to contact colleagues for advice.
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Defence manufacturer Lockheed Martin uses AR goggles to instruct engineers working on its F35 fighter planes. And away from the manufacturing floor, Microsoft’s HoloLens takes virtual meetings up a notch, as holoportation enables your hologram to enter someone else’s real-world life.
The role of AR in improving the customer experience
The power and impact of AR extends far beyond these applications which focus largely on operational improvements: it is beginning to be used in transforming and enriching the customer experience.
Businesses are finding smarter, creative, interactive ways to engage with their customers. They’re investing in education, in learning and training, to deliver better client support.
They’re generating innovation in product design, and embarking on digital transformation journeys to drive change. AR will influence all these areas, and businesses are currently just scratching the surface of its hugely-exciting potential, including:
• Training teams to handle detailed technical enquiries using simulation, better preparing them for questions so they can respond swiftly and knowledgeably, and ultimately drive down customer churn and boost retention.
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• Designing immersive, interactive applications for clients to trial products and services: make-up brand Sephora offers its customers ‘Virtual Artist’, which enables them to use a smartphone camera lens to project different make-up products onto an image of a customer’s face. This type of application can be used across enterprise environments, where clients can check the dimensions of a new piece of hardware by virtually placing it on site and using digital overlays to explore different options.
• Generating highly customised methods of engagement for clients, improve marketing results and ROI: Thomas Cook integrated an AR app into its brochures, for example, to give holiday hunters the chance to explore its hotels before booking.
AR as a revenue generator
As well as the strategic and operational benefits of AR, there’s one more critical area where its value is still being measured: revenue generation. The creation of new revenue streams through AR is increasing with it potentially bringing in $120 billion in revenue by 2020, as users enjoy interacting and engaging with content, boosting its popularity and achieving unprecedented levels of success.
Pokémon GO generated $600 million in AR revenue within its first three months alone, through downloads and in-app purchases. In Enterprise AR applications, revenue generating opportunities include:
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• An increase in sales through improved customer retention.
• Improved marketing results through more engaging marketing: auto manufacturer Toyota saw a 600% increase in downloads of its app following an AR campaign, for example.
• Revenue boosted at point of sale.
• In-app purchases.
• Advertising alongside AR content: a pizza restaurant in the US reported an increase of 75% in takings, for example, having paid for an in-game bonus to lead Pokemon hunters to its location.
• Physical advertising: businesses can advertise in physical locations within an AR environment, and this can be captured with the potential for widespread global social sharing.
A further significant opportunity for revenue creation through AR lies in the value of the data it generates: information on movements, interests and preferences, which can be used to generate predictive analytics, location analytics and a goldmine of behavioural information. For those collating the data, this leads to deeper, enriched customer information management to create a 360 degree view.
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It also offers immense value to third parties, who can extract meaningful location intelligence from geographic data, for example, so revenue streams from data sharing will become more common.
Businesses exploring AR would do well to heed advice from Bridget Dolan, Sephora’s head of innovation. She says, “When it comes to augmented and virtual reality, it can only be successful if it’s truly useful.”
It isn’t just about creating a buzz, or a temporary boost for your brand. It’s about finding new ways to drive engagement, exploring new revenues and ultimately getting closer to your customers.
Sourced from Andy Berry, vice president EMEA at Pitney Bowes Software
