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Pandora's Box: How Augmented Reality Will Disrupt Advertising

Remember the time when smartwatches were a curious novelty? In just a few years, they've become an extension of your smartphone, a popular fitness companion and an essential fashion item. It begs the question - what's the next big thing and how will it affect advertising?


Smart glasses will be the next innovation that will take the user market by storm. From new Apple patents surrounding AR to new creative 3D tools being released by Adobe, the signs point to a late '22 and early '23 mainstream consumer adaptation of AR wearables. This will kickstart global consumer adoption, changing the face of advertising in just a few short years.

Apple effect.

The revolution of smartwatches began with the release of the first Apple Watch. But just a year before its release, major business outlets and influencers were barfing up negative headlines such as “Let’s Face It: Smartwatches Are Dead” (Variety on December 5, 2016) and Wearables Are Dead.” (Business Insider on December 11, 2016). It's curious how these experts have misjudged the impending wearable boom and the pleasant surprise is largely thanks to the Apple Effect.

The Apple Effect is the accelerated adoption rate experienced in the market, whenever a cornerstone innovative product or service is released by Apple. Apple has already entered the AR market since the launch of iPhone 12 Pro and iPad Pro series in 2020 which featured the LiDAR scanner serving as an introduction to new creative frontiers in AR development.

November 2020 saw the release of the most important tech innovation in recent years - the M1 processor chip by Apple, made possible by ARM technology. In 2021 we saw a more chiselled release of the new chips - the M1 Pro and M1 Max, along with the smartphone/tablet counterpart - A15 Bionic. In 2022, we're expecting the release of new chips, which would promise a similar level of power while being more affordable.


The emergence of these powerful chips will feed directly into the release of the next-gen AR wearables, packed with sufficient processing power while having a long battery life. These areas are something that all previous smart glasses from the likes of Meta and Google failed to do in the past.


Market signalling

Compared to the smartwatch boom, we have much more proof of concept for AR wearables as an accessory that is a gateway to an AR marketplace. From new design patents and the success of multiple global marketplaces for digital goods, smart glasses will pave the way towards the development of the next disruption in marketing.


If you're looking for a total selection of signals surrounding the incoming AR tech boom, I'd look in these areas:

  • New wearables;

  • New Marketplaces;

  • Stock market reaction;

  • Creative output;

  • Search Engine Trends.

It is widely anticipated that the Apple Effect will kickstart AR with the first release of Apple Glass - likely in Q4 2022 or Q1 2023.


Creative frontier.


Whenever a new type of tech faces mainstream market entry, creative professionals scramble towards early adoption - learning the skills necessary to supply the demand for creative input.


For mobile phones we had wallpapers, ringtones and cases; for smartphones - apps; for Apple Watch and its Android equivalents - app extensions, watch faces and wristbands. In early 2022, AR creatives tend to be specialists in graphic design, 3D modelling and animation - all highly specialized and complex creative professions.


New creative tools.

When it comes to AR, the preparation is already taking place with AR experiences already being created and new tools experimented with. In 2020, Adobe has released a free AR development tool - Aero and it made full use of Apple's LiDAR. In 2021, we saw the rise of ARM technology, which made 3D modelling and animation hardware more accessible to the average creative.

Creatives are already using software tools to create AR experiences. Some of the most popular ones are Vuforia, Wikitude, ARKit, ARCore and ARToolkit. Creatives who are experienced with Adobe Creative Suite are transferring their Illustrator, Photoshop, After Effects and Dimension into the AR world as well.


The rapid development and adoption of creative tools for AR is a sure signal that the creative industries are gearing up for something big.


The NFT craze.

In early 2022, AR market growth is accelerated by the rise of NFT's. The craze is driven entirely by designers and programmers.


NFTs, non-fungible tokens, are blockchain-minted artworks with unique encryption codes which allow for verified authenticity and ownership. An NFT can be anything from a digital art piece to a song or whole music album.


VR/AR creatives have jumped in on it, creating their own NFT's. The connection between AR and NFT's may prove to be one of the defining financial motives that is leading the development of the AR marketplace.


Lessons from VR.

AR development will likely learn from lessons from the VR industry. VR's bumpy road to the mainstream market is defined by high prices for decent headsets, reliance on the gaming industry and mainstream gaming platforms.

The pioneering AR wearable will have to avoid VR's dependencies and act as an intermediary device between the user and the digital marketplace. Limited by high wearable prices and rapidly changing marketplace conditions, regular users are still slow to commit to any particular ecosystem.


VR has given shape to a new generation of gaming that is giving the players immersive, first-person perspective experiences. In the past few years, developers, such as Oculus and HTC, worked toward making virtual reality more accessible and more affordable. Previously, Oculus launched its Oculus Quest, which is a standalone wireless virtual reality headset.


Moreover, the growing pervasiveness of AI technology across VR applications is also enhancing the intelligence of virtual characters, thereby delivering a rich, immersive environment.


Google’s machine learning tools add 6DoF controller-tracking capabilities to any standalone headset, while Facebook’s DeepFocus framework makes use of AI to create focus effects in VR, and LG makes use of AI to minimize motion sickness among VR users.


The Chinese tech leaders Baidu and Tencent are also working on integrating AI and VR into mobile solutions and video games.


All of the above players have embraced the gaming industry as the primary method to enhance market adoption for VR wearables. AR is learning from this and countless other examples, such as the PokemonGO craze - gamification will surely be an element of advertising and creativity in the AR space.


Disruption.

Augmented Reality may impact the advertising industry in a similar way to pay-per-click. Here are the key areas to consider.


Augmented hospitality.

The industry that was destroyed by pandemic restrictions the most - hospitality - will be one of the primary beneficiaries of AR. The early adopters of AR will definitely see an initial increase in visitor traffic - at least until the competing venues catch up by creating competing noise.


Up till now, there's nothing that explicitly encourages the hospitality industry to invest in AR with confidence that it will pay off. The increasing popularity of AR wearables is about to change that.


When a large enough portion of users have AR capable wearables, they will be able to locate and explore the augmented. This means hospitality venues will have an additional means to attract the attention of tourists, passers-by and tech enthusiasts who are actively looking for new AR experiences.


Every high street venue puts out outdoor signage with an offer, directions or something that catches the attention of passerby traffic. With AR, this kind of signage may be modified to be extremely flashy and impressive, throwing a hard pitch at the tech consumer market, who, when compared to any other demographic, tend to have higher buying power.


Imagine going through the high street, enabling AR on your glasses and seeing literal animated dragons competing for your attention.


Tech-savvy, AR glass wearing and high spending hipsters visiting your venue because of a crazy animation... what's not to like?


Gamified tourism.

Pokemon GO: hordes of people visiting random points of interest, scanning their environment with smartphones, participating in a gamified as a community to collect virtual points for an AR game. Interacting, sharing, and immersing in places which had no special meaning until a digital token was placed to attract gamers.


What if you could manipulate that kind of traffic by creating a unique AR monument that could be unlocked by buying coffee at your venue?


The AR marketplace is likely to have a gamified system to encourage consistent traffic to venues that are registered and paying ad accounts. Essentially, that's your next gamified pay-per-click, designed exclusively for hospitality & tourism.


You're already seeing an early version of this in practice on Google Maps - you can turn on AR guidance mode to show visual cues towards your target location. It isn't a stretch to imagine the AR marketplace being integrated with Google Ad Manager and Google Maps to create a gamified way of advertising in hospitality.


The venue creates an AR point, pays to increase its value so that the AR wearable users can collect some points by visiting it. And the more you pay (just like pay-per-click), the more value is assigned to your unique token. That is a fantastic big tech wet dream and we're seeing it being realized in the next few years.


Digital property.

It's not a huge stretch of the imagination that the lease or rental agreement of a venue will offer rights to the digital space as a selling point. This may come into the form of some physical venue association with its digital NFT or metaverse counterpart.


Most likely, new AR-exclusive marketplaces will be the primary hosts of this kind of value merge between physical and digital assets. Expect high-ticket commercial property sales to dabble in AR + NFT sort of property valuation system.


Personalised fashion.

Many mainstream fashion labels have already invested in AR extensions to their physical items. At the moment, these are mostly noticed by AR and fashion enthusiasts due to a lack of AR wearable users. It's a seemingly fading novelty that will be rekindled with the rise of the first mainstream AR wearables.

Personalisation is the keyword of the decade in marketing, and AR will work towards it by enabling customisable extensions to the wardrobe. Sell your personal style as an NFT or buy exclusive AR NFT's to augment your luxury fashion items. Knowing the current chaos in the valuation of NFT's, AR is set disrupt fashion in unexpected ways, with creatives and brands who fund them paving the way.


High-ticket creativity.

The main challenge of being a creative professional is to actually be paid for your creation.


Copywriting is being devalued by the rise of AI copywriting software; music is given away for free to stock sites and a majority of graphic design is done for pennies by Fiverr freelancers. That's not good news for professionals who have genuine talent in these fields.


But AR presents an opportunity to create a new golden age for digital creatives to practice their passion and be highly rewarded.


The incoming AR boom will create a demand for customized experiences, and these are known to require creatives to have in-depth knowledge and synthesis of all industry standard graphic design and motion development tools. This is much more complex than such disciplines as graphic design, video post-production or animation by their own.


With the level of creative skills necessary to create AR experiences, you should expect to see graphic design, animation, 3D modelling skills in high demand.


Next level user data.

It's on your face and scanning your field vision and merging this data with location tracking input data on all of your devices - smartphone, tablet, watch, laptop. It's connected to your smartphone, which is by itself an advanced tracking device. You can see how an ultimate user tracking system may be created.


There's one catch - privacy battles.



It is widely known that Androids are unapologetic tracking devices, that have absolutely zero regard for user privacy. Apple, however, has turned privacy into one of its core tenets. So it will be interesting to see how Apple will resist the urge to make use of the ever-advancing tracking capabilities of its ecosystem to make a profit from data collection and sales.



At the time of writing this blog, there is news that Google will implement similar privacy measures on Android OS devices. However, since the components of the Android device ecosystem are not exclusively controlled by Google, the extent of these measures is unlikely to match Apple's draconic emphasis on privacy. Think Huawei - it is naive to expect that anything related to Chinese big tech will respect privacy.


Augmented brand immersion.

When we're talking AR, we mean visual experiences.

Up till now, mainstream digital marketing practices have praised video as the pinnacle of visual arts used to bolster conversion rates when everything else fails. AR development skillset is likely to be the next tier above that.


AR will bring creative marketing thought to a higher dimension (literally) because the production level and cost for branded experiences will far exceed the value of the average videography deliverable.


Every logotype, interior design detail and item on the shelf - anything physical can have its augmented reality version. The demand for AR creativity will be plentiful in volume, with plenty of opportunities for top creators to differentiate themselves early on. This unlocks the potential for never before seen levels of brand immersion.



How to jump in as a marketer.


In a nutshell: learn the AR design skills, practice the relevant software and expand your portfolio in preparation for the Apple Effect. Here's how I started:

  1. Acquire an AR capable device. If you get LiDAR, it will be a future-proof device that will help you create and experiment with AR experiences.

  2. Learn AR development software. My go-to is Adobe Aero for Desktop.

  3. Practice 3D modelling. I started on Adobe Dimension.

  4. Practice graphic design. Graphic design easily translates into creating vectors that are used for 3D and AR assembly. A design mindset is essential for any AR creative professional. Go with Adobe Illustrator.

  5. Follow what's trending in AR. I recommend following the #augmentedreality hashtag on Instagram.

You may consider joining AR creator collective. AR creative teams are expected to have the following member requirements:

  • Deep knowledge of social/web-based content - design, creation, and utilization for a top-quality, dynamic experience from the end user’s perspective that also draws ROI; and

  • User Experience (UX) Mobile Design to really take that experience of ‘putting yourself in the user’s shoes to the next level in the sense of actually aligning yourself with their desires, needs, goals, and feelings to be able to create something truly innovative, immersive, and stimulating.


Other tools are important within this as well, including:

  • 3D Modelling for Native App Development;

  • Computer Vision;

  • Marker Detection;

  • Mobile Programming (such as iOS and Android);

  • Low-Level Programming-Language Knowledge (C#, C++, JavaSript, etc.);

  • Knowledge of Relevant SDKs (HoloLens, etc).



let's misbehave,

harry

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