Online shopping allows consumers to easily access a massive global marketplace, and businesses can sell to customers worldwide while reducing overhead expenses. The downside is online customers can’t physically interact with products—which can increase the barrier to purchase and make it difficult for companies to deliver memorable brand experiences.
Augmented reality marketing technologies can help. “When people have the intent to shop without physically being able to touch and see a product, the more options you can give them to create that confidence [the better],” says Sarah Sheldon, senior director of global ecommerce and digital at fashion brand Rebecca Minkoff.
To replicate the in-person shopping experience, the fashion retailer uses augmented reality, which encourages engagement and boosts conversion rates. “Customers can examine our products from every angle,” Sarah says. “The option to view products in augmented reality helps them get a better sense of quality, size, and other details that matter.”
Learn about augmented reality marketing, how it benefits brands, and how innovative companies are using it to increase conversion rates and deliver memorable brand experiences in digital spaces.
What is augmented reality?
Augmented reality (AR) is any technology that layers digital elements over a physical environment. Users view AR information on a screen (such as a mobile device’s camera viewer) or through smart glasses or an AR headset.
Augmented reality is similar to virtual reality (VR), but it’s not the same: While virtual reality immerses users in a fully digital environment, augmented reality technologies combine digital information with real-world inputs. For example, you can use VR to access the metaverse, and AR to layer an image of a couch over footage of your living room.
Benefits of using augmented reality in marketing
- Greater brand recognition
- Increased engagement
- Higher conversion rate
- More informed purchasing decisions
Augmented reality marketing is the practice of using AR technology to support a business’s marketing efforts. It can boost brand value, increase engagement, and drive sales. Here’s how adding AR into your digital marketing strategy can benefit your business:
Greater brand recognition
AR experiences create buzz, which can help digital marketers reach new potential customers
and improve brand perception among target audiences. One 2022 study found AR campaigns tripled brand awareness compared to traditional marketing tactics.
Increased engagement
AR technologies can also boost customer engagement and encourage shoppers to spend more time interacting with brand materials. In 2023, GUESS Eyewear launched an AR campaign that included a virtual try-on feature that increased the brand’s engagement rate by 44%.
AR marketing strategies can also improve customer experience, which can encourage referrals and boost sales: Research shows that 93% of consumers want to use AR to find and purchase products and 40% are willing to pay more for the products marketed through AR.
Higher conversion rates
AR technology can support every stage of the sales cycle—but tools that replicate in-store shopping experiences are particularly effective at the conversion stage. AR applications like virtual try-ons and in-room viewing can encourage customers to spend more time with products and increase purchase confidence, raising conversion rates and driving sales.
For example, fashion brand Rebecca Minkoff found that consumers were 65% more likely to purchase a product after interacting with it using AR technology.
More informed purchasing decisions
AR technologies can also help customers make better purchase decisions, which can boost customer satisfaction and decrease returns rates. AR can be a particularly valuable tool when a purchase requires a customer to visualize a product in a certain space or relative to another item.
Gunner Kennels, for example, saw a 40% increase in conversion rates and a 5% reduction in return rates after incorporating AR technology that helps customers pick the right kennel size by displaying selected products next to pictures of customers’ dogs.
Ways to use augmented reality in marketing
- Virtual try-ons
- Augmented branding materials
- Virtual in-home visualization
- Augmented showrooms
- Experiential marketing
Technological advances are making AR marketing more flexible and cost-effective—and companies are leveraging AR capabilities to provide exceptional experiences to customers. Here are five common marketing use cases:
Virtual try-ons
Augmented reality solutions allow users to virtually try on makeup, hairstyles, and clothing items—and research shows that over half of consumers across all age groups want this type of AR experience.
For example, makeup giant Sephora lets customers demo products through its Virtual Artist app. Virtual try-ons can also eliminate the need for brick-and-mortar stores to hold large physical inventories at multiple locations: Customers can use AR applications to try products in colors or styles that aren’t in stock at the location they’ve visited.
Augmented branding materials
You can also use QR codes to add virtual components to your marketing material, such as a business card or brochure. You can attach QR codes to brand collateral and prompt interested users to scan printed materials for additional information.
Virtual in-home visualization
AR visualization can prove valuable for context-dependent purchases like paint colors, home décor, and furniture. Allowing users to display an image of an item or design choice in the intended location—such as the customer’s home or office—can decrease the barrier to purchase and lead to more informed buying decisions.
Augmented showrooms
Augmented showrooms incorporate digital components into a store’s physical location. For example, a customer might point an AR viewer at a car on a showroom floor to access AR features like virtual spec sheets or take a virtual tour of key features.
Experiential marketing
Experiential marketing is the process of using unique branded experiences—such as pop-ups, events, or installations—to meet your customers where they already are. Augmented reality experiences are a natural fit for this strategy: They’re interactive, unexpected, and relatively easy to install in high-traffic locations.
In June 2020, Seltzer company BON V!V placed QR codes on murals in downtown Los Angeles and San Diego. Users scanned the code to access a virtual vending machine that instructed them to pick their favorite seltzer flavor and provided directions to the nearest brick-and-mortar carrier of BON V!V products or let them order online. Users spent an average of two minutes interacting with the AR experience, and the campaign generated a 58% click-through rate to BON V!V’s custom-branded maps.
Examples of augmented reality in marketing
- Pepsi’s AR bus shelter
- Mercedes’ AI assistant
- Gucci’s virtual sneaker try-on
- Vodafone’s interactive game
- Arhaus
There are many ways to use AR to support your marketing and sales strategies. Get inspired with these five innovative AR marketing campaigns:
Pepsi’s AR bus shelter
In 2014, Pepsi created a branded virtual experience that transformed the inside of a bus shelter window into an AR interface, layering images of robots, asteroids, and flying saucers over the real-life London street. The Pepsi campaign generated an estimated 385 million earned media impressions (due to people sharing videos and press coverage) and corresponded with a 35% increase in sales compared to the same period in the previous year.
Mercedes’ AI assistant
Auto industry giant Mercedes combines artificial intelligence with AR, using the two cutting-edge technologies to increase post-purchase satisfaction and boost loyalty. The company’s app-based assistant, Ask Mercedes, interprets and responds to questions using an AI chatbot and functions as an augmented manual: Users can scan the dashboard to view an overlay of digital information that takes the place of the car’s traditional paper manual.
Gucci’s virtual sneaker try-on
In 2019, Gucci added an AR feature to its mobile app that enabled users to demo products from its Ace sneaker line. Customers could view shoes from different angles, and the app included a built-in photo-capture tool that encouraged them to share their images on social media platforms. The AR campaign made Gucci one of the first luxury brands to embrace virtual try-on and generated a 300% increase in online sales.
Vodafone’s interactive game
Telecommunications company Vodafone uses AR for Elf and Seek, an interactive game that doubles as the company’s holiday marketing campaign. Players use their phones to capture digital elves, and can win prizes through the Vodafone reward program, VeryMe. More ethan 245,000 people played the game in 2022, and Vodafone effectively used the campaign to create social media buzz, rewarding customers for posting with the #ElfandSeek hashtag.
Arhaus
Arhaus’s AR-powered room visualization tool lets shoppers view products in their intended locations—such as the user’s bedroom, living room, or office. While Arhaus needed to adjust the number of the furniture fabric choices (from 800 different fabrics for a sofa to 20) when they moved online, they didn’t have to worry if customers or trade clients weren’t able to visualize how furniture might appear in a given space. Coupled with the ability to meet virtually with an interior designer, the furniture company increased both sales and customer loyalty by offering an ability to use AR to place furniture in a home or office.
Augmented reality marketing FAQ
What is an example of augmented reality in advertising?
Makeup company Sephora uses Virtual Artist—an AR-powered virtual try-on application—to encourage product discovery and decrease the barrier to purchase. Customers can use the application to demo products and access customized color suggestions and makeup tutorials.
Is AR part of digital marketing?
Yes, many companies use augmented reality technology as part of their digital marketing strategies. Examples include virtual fitting rooms, AR-powered experiential marketing events, and augmented showrooms and branding materials.
How do you use AR in advertising?
AR advertising involves creating AR experiences and distributing them via paid ad placements. Examples include Warner Bros.’s 2023 Barbie Snapchat filter and Maybelline’s Surreal Falsies virtual mirror.
