How to Leverage Augmented Reality for Marketing


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  • P. Connolly, C. Chambers, E. Eagleson, D. Matthews, and T. Rogers Purdue University, Department of Computer Graphics Technology - Augmented Reality Effectiveness in Advertising
  • How to Leverage Augmented Reality for Marketing

    1. 1. Seema Gupta Assistant Professor Indian Institute of Management Bangalore
    2. 2. So What is Augmented Reality? © Seema Gupta
    3. 3. Introduction to Augmented Reality • Augmented reality (AR) is the augmentation of the real physical world that we live in with virtual objects through a technological medium. Meaning © Seema Gupta
    4. 4. Introduction to Augmented Reality(contd.) •High customer interactivity & engagement level •Customer behaviour can be monitored •Point of sale promotional tool •Form of Experiential Marketing Relevance © Seema Gupta
    5. 5. Introduction to Augmented Reality(contd.) Augmented Reality is an emerging tool that is growing with digital revolution © Seema Gupta
    6. 6. Why use AR? © Seema Gupta
    7. 7. Applications of Augmented Reality Augmented Reality has applications across fields and marketing activities © Seema Gupta
    8. 8. Applications of Augmented Reality Promotion & Product launch Shoppers Stop Promotions © Seema Gupta
    9. 9. Applications of Augmented Reality Brand communication Mahindra SUV © Seema Gupta
    10. 10. Applications of Augmented Reality Online sales Macy’s online sale © Seema Gupta
    11. 11. Applications of Augmented Reality Gather Customer Intelligence Geo Guides Tourist Application © Seema Gupta
    12. 12. Applications of Augmented Reality Industrial Application Metaio Engineering Solutions © Seema Gupta
    13. 13. Applications of Augmented Reality Education Layar Browser © Seema Gupta
    14. 14. Applications of Augmented Reality Entertainment Avatar Toys © Seema Gupta
    15. 15. Literature Review Effectiveness of AR • Consumers exposed to AR advertisement had more incentive to view the manufacturer’s website after viewing the advertisement • Print media was more effective in delivering factual, especially text-based, information for later recall • Need for an integrated marketing communication program Augmented Reality is effective in getting the attention of the user but not in conveying information Source: © Seema Gupta
    16. 16. Literature Review Three measures of the perceived value AR manages to create short term ‘wow factor’ but may not create long term brand attitude Source: Yuan, Y.E and Wu, C.K (2008). “Relationship Among Experiential Marketing, Experiential Value and customer Satisfaction”, Journal of Hospitality & Tourism Research, Vol 32(3), pp. 387-410. © Seema Gupta
    17. 17. Is Augmented Reality Beneficial for Brands? © Seema Gupta
    18. 18. Augmented Reality Enhancing convenience Influencing enjoyment Relevancy of idea Ease of interaction WOM (Word of Mouth) • Time saving and practical • AR apps are very enjoyable and different for the consumer compared to other marketing tools • The WOW factor. • Depends upon interaction of the culture and psychographics of TG with the product category and level of detail required at the time of purchase. • The effectiveness of AR depends upon how personalized and interactive the execution of AR is for • the user. AR in online space has the potential to go viral on social networking sites by sharing of videos and photos and can also generate positive Word Of Mouth for the brands. © Seema Gupta
    19. 19. Interviews with Industry Experts Synergy Concerns • How will this new communication technique gel with existing marketing communication by the organization? • Will not this new technique confuse the existing customer base? Financial Concerns • • • • What would be the cost of having an effective AR strategy? Will it be reusable for future offerings as well? Would I be able to justify the cost of experimenting with this new tool? Will I be able to reduce my existing marketing budget or will AR be an add-on? Strategy Concerns • • • • How sophisticated AR technique should be for my product? Can this give me a competitive advantage over the competition? How can I leverage AR by using other communication tools in tandem? What would be the conversion rate of the reach generated by this tool? Marketers are concerned about the financial, strategic and synergy implications of AR © Seema Gupta
    20. 20. A Customer Centric View of AR Sensorial AR Example Cognitive AR Experiential AR Lifestyle AR Used for product demonstrations to test the look and feel of the product Customers engage with designing and see unique, customised products come to life involves one’s affective system i.e. their moods, feelings & emotions; generate word of mouth publicity transcends the use for a particular product for communicating socialising and other daily activities. Primarily low involvement products like FMCG goods Medium level involvement, Lack of perceived customization High involvement products Personal Care products, New product introduction Gesture control Lifestyle applications Dark Fantasy AR based mall activation Ray-Ban Virtual Mirror Online Custom Apparel, Interior designing Axe effect- Angels falling down Google glass/IWatch Affects the senses and aims to provide good sensorial experience Product Category Pragmatic AR AR offers different degrees of user engagement, enhancing the customer experience © Seema Gupta
    21. 21. Hypothesis for Augmented Reality High Involvement Low Involvement Informational Transformational Sensorial AR Product Category: Low Involvement: like FMCG Pragmatic AR Product Category: Medium Involvement: Experiential AR Product Category: New Product Introduction, Personal Care Cognitive AR Product Category: High Involvement: Life Style, Fashion, Industrial etc Lifestyle AR Product Category: A wide range Hypothesis: Product category and the levels of AR used for marketing are inter-related © Seema Gupta
    22. 22. Hypothesis Results Sensorial AR Sensorial AR may not be appropriate media to create brand awareness. Pragmatic AR Pragmatic AR is ideal when one wants to increase trial (aided by curiosity factor of consumers) and it also differentiates the brand from other competitors Cognitive AR Cognitive AR is able to provide the complex and multipleparametric information with clarity with use of technology Experiential AR Lifestyle AR Experiential AR utilizes the online media to spread the actual campaign in the form of video or rich media The mental barriers to personal relevance using the advanced technology underlying the lifestyle AR push it to some distant future © Seema Gupta
    23. 23. Rating levels of AR on Customer Experience Factors Involvement 1 2 3 4 Sensorial Cognitive Pragmatic Experientia l Lifestyle Informational Content 1 2 3 4 Sensorial Cognitive Pragmatic Experientia l Lifestyle © Seema Gupta
    24. 24. Wow Factor 1 2 3 4 5 1 Time & Cost of Implementation 2 3 4 5 Sensorial Cognitive Pragmatic Experiential Lifestyle Sensorial Cognitive Pragmatic Experiential Lifestyle © Seema Gupta
    25. 25. Perception (Product/Brand) 1 2 3 4 Sensorial Cognitive Pragmatic Experiential Lifestyle Each level of AR offers unique customer experience and marketer need to adopt the right fit © Seema Gupta
    26. 26. Financial Feasibility of Augmented Reality Costs Involved • • • • • • Development Cost of Mobile/ Webcam Application Graphics development Maintenance Upgrades Programming interactivity AR engine license Data licensing • • • • • Cost of Campaign in a Mall (like rental) UI/UX Integration testing Reporting fees Traffic fees Hosting Print space cost to advertise for the event Cost Distribution (for webcam AR App) CG Development Interactivity Programming AR engine license Integration Testing Source: Augmented Reality : Real World View ( December 2011/January 2012) Project Management & Maintenance Percentage of Total Cost 35-40% 30% 10-15% 5-20% 5-15% © Seema Gupta
    27. 27. Setting Target with Augmented Reality Step1 Step 5 Analyze the data after the end of a defined period and examine the AR strategy. Set new realistic goals Monitor present traffic on Facebook/youtube page and website for a month Step 2 Analyze the data, set realistic goals in terms of percentage improvement and launch AR content Step 3 Step 4 Make necessary changes on website and tailor social media activities accordingly Assess social networking participation and engagement activities, compare them with previous data 5 step framework to facilitate the marketer to generate leads on social media © Seema Gupta
    28. 28. Digital Marketing Plan with Augmented Reality Buyer Stage Exploration Key Measures: Visitors, Inbound links & Followers Decision Making Key Measures: Traffic on site, Share/comment/likes & Lead conversion Purchase Key Measures: Orders, Revenue & Average order value Advocacy Key Measures: Repeat purchase & Referrals AR can be leveraged at the Reach Stage and also sustained through other stages to convert leads © Seema Gupta Source:
    29. 29. Limitations of Augmented Reality Over-reliance on Technology Costly or inaccessible to the major target segment. Nielsen: 50% smartphone users don’t have data connection Perceived difference between AR and real experience ‘feel’ (which AR doesn't offer) of the product is considered a proof of its quality One Shot Tool The wow factor of AR exposure, a significant factor, can’t be generated on second exposure.. Compromise on Privacy Various AR applications demand personal information or location details which might compromise the user privacy. Despite it’s advantages, Marketers need to be aware of these limitations and be cautious while setting targets © Seema Gupta
    30. 30. How would you use Augmented Reality? Read more on Acknowledgement: Report on Augmented Reality by Aniket Batra, Ravali Reddy, Ravi Purohit, Arun Bagaria, Rohit Jaiswal (IIMB students) © Seema Gupta