Building Business Models Around Augmented Reality


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This was a presentation I gave on Building Business Models Around Augmented Reality at the Augmented Reality Conference (part of Ecomm) on April 21, 2010. More info here on Ecomm site -

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Building Business Models Around Augmented Reality

  1. 1. Building Business Models Around 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: </li></ul><ul><li>Blog: </li></ul><ul><li>Facebook: </li></ul><ul><li>YouTube: </li></ul><ul><li>Twitter: </li></ul>PROFILE HELLO… WE’RE ZUGARA
  4. 4. “ Augmented Reality is a solution looking for a problem…”
  5. 5. Really?
  6. 6. <ul><li>To date, most AR executions have been branded as gimmicks – and some definitely are </li></ul><ul><li>Advertising & Marketing </li></ul><ul><ul><li>Cashing in on the </li></ul></ul><ul><ul><li>AR hype for quick PR </li></ul></ul><ul><ul><li>and brand awareness </li></ul></ul>Is AR Technology Itself A Gimmick?
  7. 7. <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>Past Emerging Media & Technologies Have Been Monetized…
  8. 8. <ul><li>What’s the ROI? </li></ul><ul><li>Will Consumers Actually Use It? </li></ul><ul><li>What Analytics Can You Share? </li></ul><ul><li>How Much Can You Discount Your Fees Because We Have Alot Of Future Work For You… </li></ul>And Initially Had The Same Questions and Challenges…
  9. 9. So Where Does That Leave AR?
  10. 10. AR is a Unique Technology that Crosses Multiple Media Channels and Industries
  11. 11. <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>And Will Continue To Evolve 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
  12. 12. Most AR Companies Offer a Software Based Revenue Model
  13. 13. <ul><li>Real-Time Advertising / Couponing </li></ul><ul><ul><li>Most likely for mobile </li></ul></ul><ul><ul><li>ecosystem and location </li></ul></ul><ul><ul><li>based services </li></ul></ul><ul><li>Lead Generation </li></ul><ul><ul><li>Most likely to cross all major media channels </li></ul></ul>Opportunities Will Exist to Build Other Revenue Models Around AR
  14. 14. <ul><li>Sponsorship </li></ul><ul><ul><li>Brand / Marketing opportunities </li></ul></ul><ul><li>Subscription </li></ul><ul><ul><li>AR based services direct to consumer (i.e. Gaming, Shopping, etc.) </li></ul></ul>Opportunities Will Exist to Build Other Revenue Models Around AR
  15. 15. How Do We Target Areas Like E-Commerce?
  16. 16. “ Augmented Reality is a solution looking for a problem…”
  17. 17. Problem : Bridge The Gap Between Offline and Online Shopping Offline Shopping Social but time consuming Online Shopping Convenient but not social
  18. 18. Solution : Augmented Reality Webcam Social Shopper Demo
  19. 19. Thank You! Matthew Szymczyk CEO, Zugara [email_address]