AR continues to evolve and take shape. Like other tech sectors, it has spawned several sub-sectors that comprise an ecosystem. These include industrial AR, consumer VR, and AR shopping. Existing alongside all of them – and overlapping to some degree – is AR marketing.
Among other things, AR marketing includes sponsored AR lenses that let consumers visualize products in their space. This field – including AR creation tools and ad placement – could grow from $3.4 billion in 2022 to $14.5 billion in 2027 according to ARtillery Intelligence.
Factors propelling this growth include brand advertisers’ escalating affinity for, and recognition of, AR’s potential. More practically speaking, there’s a real business case. AR marketing campaigns continue to show strong performance metrics when compared with 2D benchmarks.
But how is this coming together? And what are best practices? These questions were tackled in a recent report by ARtillery Intelligence, containing narrative analysis, revenue projections, and campaign case studies. It joins our report excerpt series, with the latest below.
The Lens Leader
Picking up where the last part of this series left off – examining the AR marketing stack – we’ll now dive into the players and platforms building businesses around this opportunity. This usually requires an AR experience creation engine, as well as ways to amplify the results.
We’ll start with the lens leader: Snap. It continues to invest in AR to fuel its advertising business. It has pegged AR as a revenue driver and internalized the feedback loop of AR investment and returns. Most of these investments go towards evolving its Lens Studio AR platform.
Lens Studio empowers creators, which drives content creation that attracts users. Those users attract more developers and, in turn, more content and users. All the above attracts the real endgame: reach-driven brand marketers. This virtuous cycle is the engine for Snap’s AR business.
And it’s working: Snap sees 6 billion lens views per day and 5 trillion cumulative views for 3.5 million lenses. But it all starts with the platform whose price tag (free) and capabilities attract creators. This is one reason that Lens Studio is a central organizational priority at Snap.
All of this was on display at the recent Lens Fest, where Snap announced several updates and evolutions to Lens Studio. Chief among them was AI, including ways that creators can generate lens components on the fly through keyword prompts. This is a key evolution in AR.
Drilling down further into Lens Studio, its appeal lies in more than AR creation features. Snap has begun to prioritize business development features, such as exposure (e.g., profiles and networking) and monetization (e.g., lens-based calls to action and eCommerce).
Beyond driving traffic to their websites and storefronts, Snap has begun to open additional monetization avenues. For example, it offers in-app purchases so users can unlock premium lenses and digital goods. This could be a promising revenue stream for Snap and creators.
Snap also continues to layer in more analytics to Lens Studio. That way, creators and brands can get a better sense of what lenses perform best. They can use these signals to course correct or optimize their time – particularly the growing subset of creators that make a living on AR.
Another key theme in Lens Studio, and in Snap’s broader AR evolution, is the extension from selfie fodder to world-facing lenses. This broadens AR use cases – and correspondingly, Snap’s addressable market of advertisers – beyond things that can go on one’s face.
This shift to world-immersive lenses also primes creators to start thinking spatially. In other words, they’re developing muscles for AR’s next evolution: AR glasses. In that eventual form factor, all AR lenses are world-facing, representing one-way Snap can future-proof itself.
We’ll pause there and return in the next installment with AR marketing platform profiles and campaign case studies that demonstrate best practices. Meanwhile, see the full report here.