Virtual and Augmented Realities: Transforming the Landscape of Marketing and Digital Communications
In an era dominated by technological advancements, Virtual Reality (VR) and Augmented Reality (AR) have emerged as transformative tools, helping to reshape the way businesses engage with their audiences whilst aiming to provide a lasting and memorable user experience (UX) (Salari, 2023). This blog will explore the potential and future use of VR and AR in the marketing industry, looking into the unlimited possibilities and the potential impact on consumer experiences.
What is Virtual and Augmented Reality?
VR is slightly different to AR, it is described as being an “immersive experience that isolates users from the real world, usually with the help of a headset and headphones to help. All five senses are also able to be incorporated.” (Johnson, 2023). To achieve VR, software is usually connected to hardware. An example of this technology could be glasses, a headset, gaming devices and even fitness equipment. VR creates a “three-dimensional image or environment that a human can perceive as real and even interact with in realistic ways.” (Lacoma, 2023)
AR, however, combines both digital technologies with the real world, using sensors to recognise what surrounds it (Johnson, 2023). AR is often considered to be overshadowed by VR although it is said to be “quickly becoming one of the most interesting technologies in the digital space.” And is said to be “a bigger sector that virtual reality.” (Marketing Week, 2020).
The Rise of Virtual Reality in Marketing
Figure 1. Oculus Rift in action (Nafarrete, 2015)
VR was first introduced in the early-mid 1990’s, however, it wasn’t thought a useful device until Palmer Luckey, a young entrepreneur invented the idea of Oculus Rift headset. After raising $2.4m from a Kickstarter campaign, a prototype was born. Luckey’s aim was to create a whole new immersive experience for people (Medium, 2017).
Whilst VR is commonly associated with gaming, it has evolved beyond its initial purpose and is now used in various industries and fields including within marketing strategies. VR can create immersive brand experiences, allowing consumers to engage with products and services in virtual environments. From virtual product trials to interactive storytelling (Ridge, 2023). VR opens up new avenues for marketers to create immersive, personalised, impactful and emotionally resonant campaigns.
Being virtual also breaks down potential geographical barriers, meaning people can access services from different locations and with any ability. This creates opportunities for brands to extend their reach and connect with newer audiences (Ridge, 2023).
The Consumer and enterprise VR market revenue in the United Kingdom is expected to reach $1.17m by the end of 2024, gaining an increasing number of AR and VR market users which is expected to amount to 122.4m users by the end 2028. This means that there is a 12.69% annual growth rate predicted between 2023 and 2028 (Statista, 2022).
Figure 2. AR and VR - revenue by market (Statista, 2022)
Figure 2 is proof that the United Kingdom is currently experiencing a surge in AR & VR adoption, Statista suggests that this is due to “companies across various industries investing in immersive technologies to enhance customer experiences and drive innovation.” (Statista, 2022).
The Etsy House VR Campaign
Over the years, there have been plenty of successful case studies of where VR was implemented to enhance a marketing campaign. One great example, is when the brand Etsy, collaborated with a world-leading creative visualisation studio, The Boundary in 2021.
The purpose behind this VR campaign was to design a captivating and interactive experience that enables individuals to virtually explore a home filled with Etsy items, all of which are being advertised on the website.
Figure 3. The Etsy House (Etsy,2021)
Figure 4. The Etsy House (Marketing Dive, 2021)
The aim was to use “photorealistic and true-to-scale renderings, seamless navigation, and 360-degree visuals, The Etsy House transports shoppers to a one-of-a-kind virtual home filled with holiday decor and gifts.” (Doyle, 2021). Another useful addition was that the house was completely shoppable by interacting with an item virtually.
Additionally, Etsy went on to see potential with this new technology, and created a new AR shopping tool, described as helping “users visualise art, photos and prints in their homes.” (Walk-Morris, 2020), mixing our reality with a digital shopping experience without the need to leave home.
Augmented Reality: Bridging the Digital and Physical Worlds
Augmented Reality, on the other hand, seamlessly blends the digital and physical worlds and brands have only recently begun to tap into the potential of AR as a marketing tool. Using AR can enable brands to enhance the real-world environment, helping to provide consumers with valuable information and interactive content.
There are plenty of brands now adopting this technology such as Snapchat, with their popular use of lenses, Ikea, by allowing customers to virtually place furniture in their own homes and L’Oreal, who have developed their own app to assist customers when purchasing new makeup by virtually being able to try out the product on your own face (Recchia, 2018).
Beyond the use of AR on social media, AR has made notable strides in the gaming industry, and most notably due to the success of Pokémon Go. However, it’s showing promise in eCommerce with apps like Ikea Place and Sephora (Statista, 2022). However, the main difference between VR and AR is the dominance of AR software compared to the hardware available on the market.
According to Statista, the AR Hardware market in the United Kingdom is projected to generate a revenue of £58.9m by the end of 2023. In comparison, the revenue for AR software is expected to reach £318.9m (Statista, 2023).
Figure 5. AR Software - Revenue by market (Statista, 2023)
Snapchat AR Case Study
Figure 6. Brands using Spanchats Lens Studio (Sapio, 2017)
As mentioned above, Snapchat have utilised AR software on their app by creating Lenses. “Snapchat Lenses AR experiences transform the way you look and the world around you! Use Lenses while you create Snaps to add 3D effects, objects, characters, and transformations.” (Snapchat, 2023).
This engaging and entertaining approach can be a favoured by brands when marketing on their social media channels. The AR software provides endless possibilities for sponsored content to be created. Before it was thought that only brands with bigger budgets could utilise this technology, however, Snapchats Lens studio makes it accessible and possible for a smaller brand to create. Snapchat allows individuals to develop and create their own unique 3D world lenses, which they can then submit to the platform. “Snapchat will then provide a unique Snap code that anyone can scan which will unlock that lens for 24 hours. Once the filter is unlocked, they can snap and share!”. (Sapio, 2017).
Figure 7. Snapchats AR aging Lens (VentureBeat, 2023)
While the potential of VR and AR in marketing is immense, challenges do exist. The adoption of virtual reality by brands is hindered by various factors, such as the high cost and limitations in hardware.
Another struggle is making the technology fully accessible and user-friendly for everyone, ensuring that businesses of all sizes can leverage the power of VR and AR in their marketing strategies.
The future of VR and AR in marketing
In conclusion, it is highly probable that marketers will improve their strategies in the near future by incorporating VR or AR technologies. The advantages of implementing these new technologies far outweigh the disadvantages, as evidenced by the fact that 61% of consumers actually prefer retailers that provide AR experiences, resulting in an overall enhancement in customer satisfaction (MailChimp, n.d.).
The only issue that might face smaller brands is lack of budget and having access to VR and AR hardware and software. This could potentially leave these brands falling behind instead of being “at the leading edge of what customers associate with an exceptional shopping experience and separate yourself from your competitors.” and even worse “if you’re not offering AR, you’re being left behind.” (Van de Linde, 2020).
As technology continues to evolve, businesses that embrace these innovative tools will be better positioned to captivate and engage their audiences and stay ahead in an increasingly competitive landscape. The journey towards a more immersive, interactive, and engaging marketing future is underway (SVC, 2023), and VR and AR will likely be at the forefront of this transformative digital wave.