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Like many analyst firms, market sizing is one of the ongoing practices of AR Insider’s research arm ARtillery Intelligence. A few times per year, it goes into isolation and buries itself deep in financial modeling. One such exercise zeroes in on mobile AR revenues.
This is one of the main subdivisions of spatial computing – others include headworn AR and VR. They’re all related and share technological underpinnings, but are driven by separate market forces such as their respective hardware bases (see methodology and inclusions).
So what did the mobile AR forecast uncover? At a high level, global mobile AR revenue is projected to grow from $10.04 billion in 2024 to $15.45 billion in 2029, an 8.98 percent CAGR. This sum consists of consumer and enterprise spending and their revenue subsegments.
Drilling down, our latest Behind the Numbers installment looks at the high-level drivers and dynamics for the above revenue figures. Who is spending what on mobile AR, considering both consumer and enterprise adoption? And what revenue categories are seeing the most action?
Head Start
Starting at the top, Mobile AR revenue is projected to grow from $10.04 billion in 2024 to $15.45 billion in 2029, as noted. In early years, this outpaces headworn AR revenues as it piggybacks on 3.6 billion global smartphones. But AR glasses could catch up due to their current momentum.
Meanwhile, Mobile AR’s hardware base doesn’t always translate to revenue. For example, consumer spending in mobile AR is muted. Though Snapchat In-Lens Digital Goods and Pokémon Go’s in-app purchases have been strong in their own right, they’re outliers in Mobile AR.
Put another way, most consumers aren’t buying AR experiences. They are however buying physical goods with the help of AR – especially Gen Z. This involves AR product visualization and try-ons that add more dimension and consumer confidence in eCommerce shopping flows.
However, this AR-guided shopping isn’t counted as AR revenue per se. That’s simply because it would inflate AR’s value to count consumer spending on furniture and footwear that was aided by AR visualization. Instead, the brand spending to enable those experiences is counted.
That last part happens to the tune of $6.13 billion in 2024, projected to grow to $11.2 billion by 2029. This AR marketing spend includes everything from 3D-model creation and management to AR experience creation software to paid amplification in social channels like Snapchat.
Greater Dimension
That brings us to enterprise spending in mobile AR, which is subdivided in a few ways. Sticking with the above thread, one flavor of enterprise AR is consumer brands that deploy AR in their marketing and eCommerce functions to demonstrate products with greater dimension.
This represents an area of AR spending we classify as B2B2C. It involves brands that utilize AR to create experiences for their customers. Put another way – and synthesizing a few points made so far – most mobile AR usage today is brand-sponsored rather than consumer-purchased.
This same B2B2C principle applies in other mobile AR categories, including AR media & games development. In such cases, the adopting entity – that which pays for the technology – is technically an enterprise (think: developers and brands), while the end-user is a consumer.
Beyond B2B2C, there’s also the more classic form of enterprise spending: B2B. In mobile AR, this involves helping industrial and corporate enterprises boost productivity through line-of-sight visualization or remote support. It’s all about giving them on-the-spot guidance.
For example, AR can help IT services companies empower their field reps to operate with greater speed and effectiveness. This enterprise productivity angle holds the most promise in headworn AR, but today remains more prevalent in mobile AR due, again, to smartphone ubiquity.
We’ll pause there and circle back in the next installment of this series with more dynamics & drivers behind mobile AR revenues…
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