A study on Augmented Reality as a Marketing tool By, Mridul Dohutia PGDM, First year Sec- B, Roll No. 31 Unitedworld School of Business, Ahmedabad 2012-14
A Study on Augmented Reality as a Marketing Tool 2012IntroductionAugmented reality is the latest form of Virtual reality. Virtual reality is the term, used to describea computer generated, 3D environment, which simulates physical presence in physical places inreal world and in imaginary worlds through sight, sounds and touch. Entering into a shop and gotto see a product in a computer screen with 3D system, installed with a webcam, through whichwe can point to the product and it will move according our direction. What an unforgettableexperience! This type of new emerging technology has changed the world of marketing, thescenario of advertising in the last three to four years, which is known as Augmented Reality(AR).Augmented Reality Experiential Marketing (AREM) is beneficial for companies and brands increating customer satisfaction. It also leads to increase in customer loyalty, their intention torepetitive purchasing and positive word-of-mouth, which creates greater market share. As aexperiential marketing the use of AR is increasing simultaneously in the last few years. It is notlimited to being a promotional tool; it also became a tool for creating brand-customerrelationship. Many companies began to use AREM as their main tool for future in introducingnew products or services with creation of brand image.The idea of virtual reality first came in the article of L. frank Brawn in 1901. After which in1957–62, Morton Heilig, a cinematographer, creates and patents a simulator called Sensoramawith visuals, sounds, vibration and smell. In 1966 Ivan Southerland creates the window forvirtual worlds by inventing the Head mounted display. The creation of first commercial businessin virtual worlds was done by Jaron Lanier in 1989. In 1990 Tom Caudell coins the phrase‘Augmented Reality’ while at Boeing helping workers assemble cables into aircraft.The way in which AR has been used in marketing campaigns can be seen as a form ofexperiential marketing because it focuses not only on a product/service, but also on an entireexperience created for the customers (Yuan and Wu, 2008; Schmitt, 1999). This is furthersupported by Tony Effik (CSO at Publicis Modem) who argues that “AR has the potential toprovide consumers with an experience they want and they will tell their friends about”(Benjamin, 2009, p.41). (1)
A Study on Augmented Reality as a Marketing Tool 2012Here are some of the companies who are using Augmented Reality – 1. Ray-ban: - Although many items of apparel can be bought online, sunglasses are one of those tricky products that you really need to try on to ensure you look more chic than geek. Ray-Ban’s Virtual Mirror lets you virtually try on glasses. The software lets you move your head around to see how the shades look from different angles. Depending on the opacity of the glass, you can even see your eyes through some of the shades. Seeing this app in action makes us think this could be where the real commercial future of AR lies. 2. BMW: - BMW is also using the AR technology to marketwise their products. By downloading AR software and with a print-out of the 3D design we can virtually drive the BMW cars. 3. AMAZON.COM:- Its simple, using Amazon’s augmented reality and A9s "continuous scan technology," the application allows users to buy, as well as get extra information on products such as video games, books, toys, DVDs and CDs through simply using ones Smartphone camera. 4. McDonalds: - McDonalds recently introduced a new dessert McFlurry in India, a global icon for the brand. While the product launch is not the big news, the interesting thing about McFlurry is the use of augmented reality (AR) for promoting the brand on digital media.With the launch of the first experiential marketing campaigns incorporating AR technology,brands and agencies have been rushing to explore the possibilities of augmented reality in a bidto catch the consumers’ attention (Clawson, 2009). Big international companies like Procter &Gamble or Wal-Mart have been using this technology to promote their brands (Farhad, 2009).And this trend is not expected to stop - according to ABI Research (2009), the total market forAR marketing applications is projected to grow from $6 million in 2008 to more than $350million in 2014.This research paper aims to explore the influences of AREM in Marketing at creation ofcustomer satisfaction with customer experience. CISCO is the brand chosen for this research (2)
A St Study on Augmented Reality as a Marketing Tool 2012because it is one of the few compani that uses AR as an ongoing marketing process Based on nies ess.the aim of this research paper and on the literature review, three measures of the perc rceived valuehave been chosen - convenience, enjo njoyment and brand attitude.SWOT analysis of Augmented Reality ted 12 1234562789 12 1234556789A637BCCDE97F89BE 2 2393 2 23E9D63BD78 2 236)76E8973867EB(B2 2 837FE3!63F7D963!3 23 ABBC32D5E2E489 9 9A6637BEDC62 123 EEBAF89BE 23#BD783FE36A9763 F45488489489 6$FE9BE 123*6F89A63 23%F6BA6 SWOT 7BE86E8+9EF77DF7,3F 7,3F398393 F3D6)6E6F86 F863 23F689E37FEE6(2 867EB(B2 23 83!6E65983F((38F6)
A Study on Augmented Reality as a Marketing Tool 2012Literature reviewBecause of a scarcity of academic literature and research studies on AR experiential marketing,this literature review will start by focusing on the little research and small number of papersconcerned with experiential marketing in general which build the rationale and the componentsof this research study.Economists posit that the contemporary world finds itself in the “experience economy” (Yuanand Wu, 2008; Pine and Gilmore, 1998) where customers do not always focus on products but onexperiential consumption “where functional utility is either taken for granted or seen asirrelevant”. At this stage, experiential marketing comes in, treating consumption as a holisticexperience and recognizing both the emotional and rational drivers of consumption (Schmitt,1999). The importance of experiential marketing is recognized as a means of creating value forthe end consumer (Pine and Gilmore, 1998) which would be the future competitive edge forcompanies (Prahalad and Ramaswamy, 2000) and will motivate customers to make faster andmore positive purchasing decisions (Williams, 2006).However, although this new marketing orientation is widely agreed to represent the future ofmarketing, (Williams, 2006; Schmitt, 1999), it is still not fully comprehended and, as such,requires a more diverse range of research methods and research studies to better understandconsumers (Williams, 2000).The creation of experiential value referring to customers’ perceptions of products/servicesthrough direct use or indirect observation has been recently demonstrated by two quantitativestudies (Chou, 2009; Yuan and Wu, 2008) focused on American brands and their customers’perceptions in the Taiwanese market. Furthermore, these studies have shown that the experientialvalue created can induce customer satisfaction (Chou, 2009; Yuan and Wu, 2008).However, more research is needed to replicate their findings on other cultures and to furtherinvestigate the connections discovered, through qualitative studies. The relationship betweenvalues and customer satisfaction is additionally supported by different research findings whosuggest that experiential marketing should deliver experiential value - emotional and functionalvalue, and positive customer satisfaction. (4)
A Study on Augmented Reality as a Marketing Tool 2012Despite a clear widely agreement on the direct relation between value and customer satisfaction,there is no consensus regarding the elements which create the customers’ perceived value, eachof the previously-mentioned studies being based on a different model of customer satisfactionindex.Conversely, many scholars believe that customer satisfaction has a crucial role in the success ofany business and it is essential in increasing the overall profitability (Yuan and Wu, 2008;Kotler, 1991). If the consumers are satisfied with a certain product, generally they “will buy theproduct again, be inclined to promote the product to other people, ignore competing brands’advertisements, and refrain from purchasing from competitors” (Yuan and Wu, 2008, p.2).However, customer satisfaction should not be taken for granted but reinforced and reassuredcontinuously and a good way of doing this would be through valuable experiences provided byexperiential marketing.Customer satisfaction is often seen from two different perspectives: transaction-specific andcumulative aspects. If the transaction-specific refers to the perceived value customers obtainafter they finish one specific transaction (Yuan and Wu, 2008), the cumulative aspect comprisesthe customers’ overall measurement of all their experiences with a company’s products at allstages of the purchase process. Consequently, although the cumulative aspect of customersatisfaction is considered a complete state only after purchase, a perceived value occurs atvarious stages of the purchase process, including the pre-purchase stage.For this research, AR experiential marketing will be considered to mainly affect the pre-purchaseStage due to the fact that, by its current nature, AR has the most impact at the pre-purchase stage.At this step, according to the buying decision-making process (Fill, 2009) the consumer isevaluating their choices before taking the purchase decision (Fill, 2009) and AR has the power to“put the product in the hand of the users” (Woodsa, 2009, p.37) giving them the opportunity totest the product as they would already own it, enticing the prospect to commit more time or eventrigger a purchase (Owyang, 2010).Therefore, this research study will focus on exploring the ways in which AR experientialmarketing determines a perceived experiential value during the pre-purchase stage of the buyingprocess, thus contributing to the development of customer satisfaction. (5)
A Study on Augmented Reality as a Marketing Tool 2012The lack of any research studies on AR experiential marketing, the inadvertences, ambiguitiesand the predisposition towards quantitative methods in the aforementioned experientialmarketing research related to customer satisfaction are only a few of the rationales behind thisresearch project. Moreover, controversies and the problem of limited knowledge arise with thequestion of “what are the long-term effects of AR experiential marketing on our business?” evenfor marketing practitioners.If some of them see AR only as a promotional tool, not an enduring marketing opportunity(Grimes, 2009 cited in Woodsb, 2009), the PR buzz being everything that some brands want(Clawson, 2009), others believe that it contributes to the development of a positive customer-brand relationship and influences purchasing decisions (Owyang, 2010; Murray, 2009 cited inClawson, 2009). Because, as previously-discussed, the AR market is expected to growexponentially in the next four years, and because “so far we have seen only 5 to 10 percent ofwhat AR can be used for”, companies need to know what directions they should follow in orderto ensure a positive outcome from their AR experiential marketing. (6)
A Study on Augmented Reality as a Marketing Tool 2012Framework -D8BC63 -D8BC63 F895F789BE F8898D6 14 (7)
A Study on Augmented Reality as a Marketing Tool 2012Implications:According to the issues discussed in the Literature review the main objective of this study is tolook at the ways of AR experiential marketing in creation of customer satisfaction. The ARexperiential marketing is a tool used in pre-purchase stage. The use of this tool in an organizationleads to the creation of customer satisfaction along with brand attitude.Augmented Reality is the latest and updated version of virtual reality. Second Life’s website is awidely used virtual reality business community page. Increasingly Second Life (SL) is becominga place where businesses naturally want to extend their operations to, or entrepreneurs decide totry out one of their latest ideas (Harris, 2007). According to the japaninc.com currently 80% ofthe internet users are the members of SL’s virtual community. Therefore we can say that SL isthe one of the most important marketing tool.Here are some overall benefits that an organization can achieve through Augmented RealityApplications- 1. The novelty factor of such applications will obviously wear off as more and more are created and used, but for the meantime, the onus is on brands to make the most of this exciting technology and extend it from infancy. The possibilities of augmented reality are only just being explored, and any new developments are likely to achieve further exposure. 2. The concept of uploading your own media, such as the image in the above examples, helps to create a highly personalized piece of media for the user. It relates specifically to them, which is likely to be far more engaging than a standard video or image. 3. The novelty factor mentioned above will surely enhance users’ desire to share their creation with their extended networks, and the fact that the content is personalized will only add to this. (8)
A Study on Augmented Reality as a Marketing Tool 2012 4. It’s likely that the vast majority of users wouldn’t possess the ability or expertise to create a complex video like the ones indicated in the examples above; augmented reality apps allow users to create a quality piece of content that they wouldn’t otherwise be able to create themselves. 5. As well as being high quality, the content created by augmented reality applications is highly entertaining and in many cases fun. The element of surprise that is achieved when sharing such content makes for very entertaining viewing by other users, stimulating them to create their own version and share it once again, and completing the viral loop.Cisco StyleMe™ is a proof-of-concept project created by the Cisco Internet Business SolutionsGroup (IBSG), Cisco Global Marketing and Corporate Communications (GMCC), partnersAITec and CinStore, and Cisco customers. Cisco StyleMe is designed to offer shoppers a virtualfashion mirror for trying on products using the latest augmented reality, mobile, and networktechnologies. Shoppers can use gesture-based navigation to choose from the retailer’s completeinventory, build outfits, and try on their selections virtually. They can also capture images toshare over social media and email, receive recommendations, and purchase products, with orwithout assistance.By applying this application to Cisco’s retail stores, they will be able perform the followingbenefits. These benefits will lead Cisco in creation of customer satisfaction and brand attitude.Customer Benefits: 1. The customers at Cisco, will be able to browse and select among the broad range of products at the pre-purchase stage including the products that may be in out of stock. They can choose among different colors eliminating their guesswork to select their choices. 2. Inspiration, advice, and social recommendations are instantly available. 3. Customers can order selections in the store for home delivery. (9)
A Study on Augmented Reality as a Marketing Tool 2012Retailer’s Benefits: 1. Retailers can increase basket size by offering an extended range of products and accessories in one place, and by offering expert recommendations. 2. Expert and social recommendations can boost sales conversions. In addition, the abilities to try on more styles, instantly buy online, and ship products to home increase shopper convenience. 3. Retailers gain insight into shoppers’ choices, such as their “likes,” the products they try on, and data from products purchased.Conclusions:This study is not without limitations. The researcher has collected data from some previousresearch papers and articles. Basically this is a study based upon secondary data. This study doesnot include whole things relates to the topic and experiences of the customer as it relates to theirsatisfaction. Future research can replicate this study using an experimental methodology tocompare and contrast the findings explained therein. Despite the initial thoughts, the researchproved to be more complicated and time-consuming, raising different challenges for theresearcher. Although the subject was not difficult to choose because of researcher’s interest intechnology, especially in AR, finding the relevant literature and relating it to different marketingtheories was the most complicated stage, due to the lack of research in this area. Unforeseenevents can happen due to inexperience of the researcher. Researcher hopes that this study willhelp the future researcher in doing research on this area.
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