Augmented Reality as a Business Solution

Augmented Reality used to look like a toy. Snapchat Lenses first went viral with fun and entertaining experiences in the form of vomiting rainbows, dancing hotdogs, and gender-swapping selfies, but Augmented Reality is becoming more than that - it provides utilitarian experiences for consumers and drives impact to the bottom-line for businesses. With a projected value of $1.2 trillion by 2030¹, AR simply cannot be ignored when it comes to business planning for brands. 

Today, commerce enablement is a small fraction of revenue relative to advertising and marketing with mobile AR, but is expected to be a fast-growing segment through 2026². As players like Shopify in the commerce enablement tech space start to showcase how interactions with AR experiences lead to 94% higher conversion rates³ and 40% decrease in returns from 3D visualization⁴, incorporation of AR across the business becomes a necessity.

 

 

At Snap, we believe in the power of AR and have invested in tools to help brands enable enterprise AR, which goes beyond paid channels into that of brand-owned and operated channels like eCommerce websites, apps, social profiles, and physical retail spaces. 

For example, our Camera Kit SDK can help brands plan for AR integrations across the entirety of their business channels. Our 3D Asset Manager can facilitate the development of a 3D asset library. And finally, AR creation tools like Lens Web Builder and Lens Studio, as well as a rich ecosystem of creators and creative agencies lets brands start to experiment and build knowledge of successful AR applications, today.

To further quantify the impact that enterprise AR can have on consumer behaviors, mindsets, and shopping outcomes, we partnered with Breakthrough Research to conduct an innovative research study that utilizes the power of storytelling to help study participants imagine what a world filled with AR can look like.

In trying to understand how consumers think and feel about the prospect of future developments in AR, we’ve often found that simple, one-line descriptions of the possibilities fell short in providing a deep enough description of what that experience truly is. To solve this, we utilized Breakthrough Research’s GIDE technique - a Guided Immersive Decision Environment - that helped to immerse study participants in the context of varying AR shopping journey scenarios via storytelling. We then compared this set of participants to a matching set that were immersed in a typical shopping journey of today, without AR. 

Across 7,500 respondents in US, UK, DE and covering shopper journeys within the Auto, Beauty, Entertainment, Fashion Retail, and Travel verticals, we uncovered how consumer attitudes and behaviors towards brands shift when they imagine themselves going through a shopper journey with AR as a part of it. 

 


The results were clear - AR makes an impact on the bottom line⁵. Starting with Beauty, we estimate an increase of $24.9 billion a year in sales across US, UK, and DE amongst personal care/beauty consumers aged 13-40. In fact, Snapchatters believe that AR can help them make faster decisions and purchase more, significantly more so than non-Snapchatters, which shows how primed they are to benefit from AR experiences already.

 

Similarly, within Fashion Retail, an increase of $11.2 billion a year is expected. With AR, Snapchatters are likely to spend more on clothes/accessories than they normally would, along with completing more purchases online vs. simply adding to cart. They report doing this at higher rates than non-Snapchatters.

For Travel, Snapchatters expect to spend more than they typically would when AR is a part of their travel planning journey. This is because AR helps them be more confident in making decisions about the trip and ultimately planning longer trips by adding travel excursions or other add-ons to the itinerary.

Additionally, we saw similar ways in which AR is able to enhance the purchase experience for other categories like entertainment and auto as well.

While 91% of brands think that the primary use case for AR is for fun, just 53% of consumers think of it this way⁶. Although Snapchat first created Lenses because they were a fun and entertaining way to enhance the way we communicate with our friends and family, the technology has evolved from being just a toy to a fully utilitarian tool that brands can leverage to drive impact for their businesses. So let’s partner together to achieve the future of AR.