Building Business Models Around  E-Commerce and Augmented Reality
<ul><li>Snapshot:  We’re an interactive marketing agency with a passion for emerging  media and technologies </li></ul><ul...
State of E-Commerce
 
 
Online Retail Sales Continue to Rise…
Web-Influenced Retail Sales Rise As Well…
Peers Continue To Influence Purchase Decision  <ul><li>Eighty-three percent of online shoppers  said they are  interested ...
But What’s Missing?
Shopping Offline Is An Emotional and Social Experience
Online…Not So Much
<ul><li>The “consumer experience” has made very little progress in the last 15 years  </li></ul>Amazon 1990’s Amazon 2010
Abandoned Carts 45% of U.S. online shoppers abandoned shopping carts multiple times over a span of three weeks. (Paypal & ...
Low Conversions Conversion rates are low, with the “gold standard” being between 2% and 3%
High Return Rates The average return rate for online clothing retailers is about 20% but goes as high as 50% for some. (Fo...
What Are Brands Doing To Evolve The E-Commerce Experience?
E-Commerce Innovations – Social Media
<- Zappos Interactive Product Videos <- Sales increased from 6% to 30%  when product had video associated with it E-Commer...
YouTube & Video Chat Generation <ul><li>36% of Skype-Skype calls included Video </li></ul><ul><li>Chatroulette had 960,000...
Projected Webcam Growth <ul><li>Markets for webcams at $1.8 billion in 2008 are anticipated to reach  $3.2 billion by 2015...
This Changes Everything… Augmented Reality Experiences Through Standard Consumer Webcams
E-Commerce & The Augmented “Product” Experience
Augmented Reality Shopping – Ray-Ban
Augmented Reality Shopping – Ray-Ban
Augmented Reality Shopping - Tissot
Augmented Reality Shopping - Tissot
Augmented Reality Shopping - Fashionista
Augmented Reality Shopping - Fashionista
How Do We Use AR To Enhance The  E-Commerce Experience For The Consumer?
Focus On Utility
Integrate Social Media
No Software Downloads
Building Business Models Around  E-Commerce and Augmented Reality
<ul><li>Virtual Worlds </li></ul><ul><ul><li>Second Life </li></ul></ul><ul><li>Social Media </li></ul><ul><ul><li>Faceboo...
<ul><li>What’s the ROI?  </li></ul><ul><li>Will Consumers Actually Use It? </li></ul><ul><li>What Other Brands Are Using A...
So Where Does That Leave AR?
<ul><li>CPM ads  (“cost per thousand views”; banner ads online and regular ads in print, TV and radio) </li></ul><ul><li>C...
Most AR Companies Offer a Software Based Revenue Model
How Do We Target Areas Like  E-Commerce?
“ Augmented Reality is a solution looking for a problem…”
Problem : Bridge The Gap Between Offline and Online Shopping Offline Shopping Social  but time consuming Online Shopping C...
Solution : Augmented Reality Webcam Social Shopper Demo At Booth #114
Thank You! Matthew Szymczyk CEO, Zugara [email_address] twitter.com/kobrakai facebook.com/Mhszymczyk
Market Data <ul><li>In 2009, 154 million people in the U.S. bought something online, or 67% of the online population (4% m...
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Building Business Models Around E-Commerce and Augmented Reality

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This was a presentation Zugara CEO Matthew Szymczyk gave at ARE (Augmented Reality Event) on June 2, 2010 on building business models around e-commerce and augmented reality.

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  • It’s utilitarian and provides no emotional satisfaction. Conversion rates are low, with the “gold standard” being between 2% and 3%. Cart abandon rates are high. 45% of U.S. online shoppers abandoned shopping carts multiple times over a span of three weeks. (Paypal &amp; ComScore) The average return rate for online clothing retailers is about 20% but goes as high as 50% for some. (Forrester Research) &amp;quot;If I&apos;d asked people what they wanted, they would have said a faster horse .“ – henry ford
  • Building Business Models Around E-Commerce and Augmented Reality

    1. 1. Building Business Models Around E-Commerce and Augmented Reality
    2. 2. <ul><li>Snapshot: We’re an interactive marketing agency with a passion for emerging media and technologies </li></ul><ul><li>Services: Interactive Video, Social Media Marketing, Mobile Marketing, Website/Application Development </li></ul><ul><li>AR Products: Webcam Social Shopper / Fashionista, Cannonballz, ZugSTAR </li></ul><ul><li>Founded: 2001 </li></ul><ul><li>Location: Los Angeles / New York </li></ul><ul><li>Web: www.zugara.com </li></ul><ul><li>Blog: www.weareorganizedchaos.com </li></ul><ul><li>Facebook: www.facebook.com/zugara </li></ul><ul><li>YouTube: www.youtube.com/zugara </li></ul><ul><li>Twitter: www.twitter.com/zugara </li></ul>PROFILE HELLO… WE’RE ZUGARA
    3. 3. State of E-Commerce
    4. 6. Online Retail Sales Continue to Rise…
    5. 7. Web-Influenced Retail Sales Rise As Well…
    6. 8. Peers Continue To Influence Purchase Decision <ul><li>Eighty-three percent of online shoppers said they are interested in sharing information about their purchases with people they know </li></ul><ul><li>74 percent are influenced by the opinions of others in their decision to buy the product in the first place. </li></ul><ul><li>(Manage Smarter, September 2009) </li></ul>
    7. 9. But What’s Missing?
    8. 10. Shopping Offline Is An Emotional and Social Experience
    9. 11. Online…Not So Much
    10. 12. <ul><li>The “consumer experience” has made very little progress in the last 15 years </li></ul>Amazon 1990’s Amazon 2010
    11. 13. Abandoned Carts 45% of U.S. online shoppers abandoned shopping carts multiple times over a span of three weeks. (Paypal & ComScore)
    12. 14. Low Conversions Conversion rates are low, with the “gold standard” being between 2% and 3%
    13. 15. High Return Rates The average return rate for online clothing retailers is about 20% but goes as high as 50% for some. (Forrester Research)
    14. 16. What Are Brands Doing To Evolve The E-Commerce Experience?
    15. 17. E-Commerce Innovations – Social Media
    16. 18. <- Zappos Interactive Product Videos <- Sales increased from 6% to 30% when product had video associated with it E-Commerce Innovations – Interactive Video Samsung Live Video Customer / -> Product Support
    17. 19. YouTube & Video Chat Generation <ul><li>36% of Skype-Skype calls included Video </li></ul><ul><li>Chatroulette had 960,000 unique U.S. visitors in February </li></ul>Sources: GigaOM – Skype By The Numbers. It’s Really Big Comscore – Chatroullette Takes The College Crowd By Storm
    18. 20. Projected Webcam Growth <ul><li>Markets for webcams at $1.8 billion in 2008 are anticipated to reach $3.2 billion by 2015 , growing in response to decreases in unit costs and increases. </li></ul><ul><li>(Wintergreen Research - Worldwide WebCam Market Shares, Strategies, and Forecasts, 2009-2015) </li></ul>
    19. 21. This Changes Everything… Augmented Reality Experiences Through Standard Consumer Webcams
    20. 22. E-Commerce & The Augmented “Product” Experience
    21. 23. Augmented Reality Shopping – Ray-Ban
    22. 24. Augmented Reality Shopping – Ray-Ban
    23. 25. Augmented Reality Shopping - Tissot
    24. 26. Augmented Reality Shopping - Tissot
    25. 27. Augmented Reality Shopping - Fashionista
    26. 28. Augmented Reality Shopping - Fashionista
    27. 29. How Do We Use AR To Enhance The E-Commerce Experience For The Consumer?
    28. 30. Focus On Utility
    29. 31. Integrate Social Media
    30. 32. No Software Downloads
    31. 33. Building Business Models Around E-Commerce and Augmented Reality
    32. 34. <ul><li>Virtual Worlds </li></ul><ul><ul><li>Second Life </li></ul></ul><ul><li>Social Media </li></ul><ul><ul><li>Facebook, Twitter </li></ul></ul><ul><li>Mobile Marketing </li></ul><ul><ul><li>Admob, iPhone Apps </li></ul></ul><ul><li>Online Video </li></ul><ul><ul><li>Brightcove, YouTube </li></ul></ul><ul><li>Blog Networks / Advertising </li></ul><ul><ul><li>Gawker, AOL </li></ul></ul>Monetization of Prior Emerging Media & Technology
    33. 35. <ul><li>What’s the ROI? </li></ul><ul><li>Will Consumers Actually Use It? </li></ul><ul><li>What Other Brands Are Using AR? </li></ul><ul><li>What Analytics Can You Share? </li></ul>Questions and Challenges
    34. 36. So Where Does That Leave AR?
    35. 37. <ul><li>CPM ads (“cost per thousand views”; banner ads online and regular ads in print, TV and radio) </li></ul><ul><li>CPC ads (“cost per click”; think Google ads) </li></ul><ul><li>CPA ads (“cost per action”; pay only if the customer performs a certain action) </li></ul><ul><li>CPT ads (“cost per transaction”; you pay only if the customer brought to you from a media sites becomes a paying customer.) </li></ul><ul><li>Lead generation (you pay for qualified names of potential customers) </li></ul><ul><li>Subscription revenues </li></ul><ul><li>Affiliate revenues (think: Amazon Associates) </li></ul><ul><li>Rental of subscriber lists </li></ul><ul><li>Sale of information (selling data about users–aggregate/statistical or individual–to third parties) </li></ul><ul><li>Licensing of brand (people pay to use a media brand as implied endorsement) </li></ul><ul><li>Licensing of content (syndication) </li></ul><ul><li>Getting the users to create something of value for free and applying any of the above to monetize it. (Like Digg or our own Reddit) </li></ul><ul><li>Upgraded service/content ( ed: aka “freemium”) </li></ul>AR Technology Has Ability To Work With Multiple Revenue Models <ul><li>Alternate output (pdf; print/print-on-demand; customized Shared Book style; etc.) </li></ul><ul><li>Custom services/feeds </li></ul><ul><li>Live events </li></ul><ul><li>“ Souvenirs”/”Merchandise” </li></ul><ul><li>Co-branded spinoff </li></ul><ul><li>Cost Per Install (popular with top Facebook apps who can help others get installs) </li></ul><ul><li>Sponsorships (ads of some sort that are sold based on time, not on the number of impressions) </li></ul><ul><li>Listings (paying a time based amount to list something like a job or real estate on your website) </li></ul><ul><li>Paid Inclusion (a form of CPC advertising where an advertiser pays to be included in a search result) </li></ul><ul><li>Streaming Audio Advertising (like radio advertising delivered in the audio stream after a certain amount of audio content has been delivered) </li></ul><ul><li>Streaming Video Advertising (like streaming audio but in video) </li></ul><ul><li>API Fees (charging third parties to access your API) </li></ul>Source: Wired Magazine
    36. 38. Most AR Companies Offer a Software Based Revenue Model
    37. 39. How Do We Target Areas Like E-Commerce?
    38. 40. “ Augmented Reality is a solution looking for a problem…”
    39. 41. Problem : Bridge The Gap Between Offline and Online Shopping Offline Shopping Social but time consuming Online Shopping Convenient but not social
    40. 42. Solution : Augmented Reality Webcam Social Shopper Demo At Booth #114
    41. 43. Thank You! Matthew Szymczyk CEO, Zugara [email_address] twitter.com/kobrakai facebook.com/Mhszymczyk
    42. 44. Market Data <ul><li>In 2009, 154 million people in the U.S. bought something online, or 67% of the online population (4% more than in 2008). (Forrester Research) </li></ul><ul><ul><li>80% of Gen X and 71% of Gen Y internet users buy products online. (Pew Internet & American Life Project) </li></ul></ul><ul><li>Amount people spent on clothing online: $13.6 Bil. (US Census) </li></ul><ul><ul><li>Amount people spent on clothing in store: $7.0 Bil. </li></ul></ul><ul><li>83% of online shoppers said they are interested in sharing information about their purchases with people they know, while 74% are influenced by the opinions of others in their decision to buy the product in the first place. (Manage Smarter) </li></ul><ul><li>Online social network users were three times more likely to trust their peers' opinions over advertising when making purchase decisions. (Jupiter Research) </li></ul><ul><li>B2B interactive marketing spending will climb to nearly $4.8 billion in 2014. (Forrester Research) </li></ul>
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