Let the Era of AR Monetization Begin

Image Courtesy of YouTube (Paul Begley)

Image Courtesy of YouTube (Paul Begley)

Augmented reality advertisements are coming to a smartphone near you, and it’s happening sooner than you think.

With the number of AR companies growing by nearly 50-percent in the first half of 2018, industry giant Facebook recently made its biggest announcement to date in the augmented reality sector. The news that Facebook has begun testing AR ads in news feeds not only spells a major win for AR companies collectively, but it signifies the advancement and acceptance of the medium as a whole, which could also pay dividends for other tech and social media giants like Snap, Amazon, Shopify, and Apple, along with a wave of startups.

Going beyond its initial AR ad tests with major brands like Nike and Asus, Facebook is preparing for the upcoming holiday shopping season by expanding on the trial run, which was conducted in the Messenger app, by pushing its augmented ads into the newsfeed portion, aiming for higher social engagement with users and viewers.

Working with brands like Sephora, NYX Professional Makeup, Bobbi Brown, Pottery Barn, Wayfair, and King on AR advertisements, Facebook’s announcement is expected to result in a major boon for the emerging augmented reality market. Developers and entrepreneurs eagerly await the move.

“This is really exciting for all AR developers,” explains Ryan Isbell, CEO of LA-based Possible Reality. “We’re already using the augmented reality medium and various SDKs to create important and revolutionary technology and content. But now we also have the opportunity to use AR to sell our products. It’s a novel approach that can eventually help us collect important data and gain new insights into how consumers engage with AR content.”

Currently at work on INTARACT, an app which allows users to create lifelike 3-D avatars in seconds using a single two-dimensional photo, Isbell and Possible Reality CCO Michael Tigar embrace the Facebook rollout as a necessary means to educate the public on the commerce and monetization possibilities of AR technology. However, their own version of a dynamic AR marketplace may look at little more like Amazon’s forthcoming AR View (due out on iOS in early 2019, and on Android by late 2018) , which allows potential buyers to sample certain products through AR functionality.

Listening to Tigar, a former principal at Academy Award-winning animation studio Rhythm & Hues, he easily envisions the purchasing possibilities, although he’s more interested in how to apply these apparel and merchandising options to Possible Reality’s proprietary avatar creation technology.

“Anything that represents ourselves in a social setting is an easy entry point,” comments Tigar. “As far as other applications … I think if we had a real representation of ourselves and we could shop for clothes, I think people would appreciate the clothes being tried on a realistic avatar as ourselves.”

Focused on cosmetics and small consumer goods and accessories like sunglasses, Facebook’s big push into AR advertising has already had major impact on the tech landscape.

While Amazon is patiently awaiting the arrival of its AR View, which is expected to have major implication on online shopping, Apple’s mobile AR strategy is largely pegged to iOS 12, which can natively view augmented reality through the AR Quick Look app.

And then there’s Snap, a constant in the AR space due to its popular selfie masks.

Having just unveiled its own AR gaming hub, Snap took a huge hit following the Facebook announcement, its shares dropping a staggering 2.49-percent in one day. The significant loss, which equates to more than  $13 per share, only further highlights the back-and-forth social media war between the two industry giants. So far, Facebook is easily winning the battle of 2018, up 15.3-percent on a year-to-date basis, while Snap is down 8.9-percent. Increasingly, the fight is crossing over into AR territory.

The announcement, one of Facebook’s biggest in the AR space, is more than just an advancement and monetization of augmented reality. It’s also expected to revolutionize shopping as we know it, merging the worlds of online and offline retail.

Consider Facebook’s clients, who are hawking cosmetics and accessories. With the implementation of AR technology, consumers can now test those products through a mobile app and have a better idea of how certain colors and frame shapes will look on their face before purchasing. There’s also a direct application to furniture and homewares, where consumers can virtually place an AR product in their home or office to gain a better perspective before buying.

E-commerce giant Shopify is banking heavily on this new synergy between offline and online AR shopping for its foray into the augmented reality space. Allowing partners and merchants to create 3-D models of products using Apple's usdz format, product images are viewable directly in iOS 12, Safari, and AR Quick Look.

Facebook AR monetization Possible Reality INTARACT 3D avatars

The approaches of both Facebook and Shopify not only have the possibility of revolutionizing the entire shopping experience, but the move into augmented reality also increases the number of digital points of sale.

It’s a unique proposition that, for now, will lead directly to AR sales and monetization. However, eventually, companies will need to expand their augmented reality offerings to make sales, especially when considering more dynamic products like clothing, where consumers will need to interact with the product more to account for body shapes and sizes.

And while the Facebook AR announcement is not necessarily a landmark in the development and improvement of augmented reality technology, it is a clear indicator that AR is here, for good, and it’s also going to be profitable.


Have an opinion? Interested in alpha testing our new AR and avatar products? We’d love to hear from you and share our exciting new products. For inquiries, please contact dshapiro@possiblereality.co