A new report from Juniper Research has found that with brands and retailers increasingly keen to deploy augmented reality (AR) capabilities within their apps and marketing materials, AR applications will generate close to $300 million in revenues globally in 2013.
The report found that while the traditional pay-per-download payment model would continue to account for the largest share of revenues in the medium term, the scale of retailer engagement with AR suggested that ad spend had upscaled dramatically in 2012 and was poised for further strong growth next year.
Crucially, it also found that many retailers now perceived AR as a key means of increasing engagement with consumers, both as a means of providing additional product information or in the form of branded virtual games and activities.
Consumer Expectations Not Yet Met. The report cautioned that while lack of consumer awareness of AR remained a key hurdle which needed to be overcome, it was by no means the only barrier to growth. It argued that technological limitations of AR-enablers such as the phone camera, GPS, digital compasses and marker-less tracking meant that in many cases, the AR experience was failing to live up to consumer expectations.
The report claimed that even some higher-end smartphone cameras lacked sufficient sensitivity to trigger an AR experience unless light conditions were optimal. Furthermore, the need to recalibrate digital compasses — allied to poor in-building functionality of GPS – means that under certain circumstances the level of location accuracy would not be sufficient for many potential corporate applications. As a result, the report stated that enterprise adoption would be limited in the medium term.
Other key findings from the report include:
- More than 2.5 billion AR apps to be downloaded to smartphones and tablets each year by 2017, with games accounting for the largest share of downloads.
- AR is increasingly being deployed in prototype wearable devices, with Google Glass the most high-profile innovation.
The “Augmenting Reality: Enhancing Mobile” white paper is available to download from the Juniper website together with further details of the full study, “Mobile Augmented Reality: Entertainment, LBS & Retail Strategies 2012-2017.” Juniper Research provides research and analytical services to the global hi-tech communications sector, providing consultancy, analyst reports and industry commentary.