Augmented and Virtual Reality: Leveraging and Monetizing the Technologies
How can we use AR and VR to make money?
This article will introduce both the technologies of Augmented Reality and Virtual Reality to later discuss how businesses can leverage such technologies to strengthen their business, or harness their benefits as part of their business development strategy. Moreover, the article will share insights on how we can monetize such technologies to introduce new revenue streams for businesses.
Augmented Reality, commonly referred to as AR, as the name suggests, is a reality that adds to, not replaces, the one we see and interact with. This is usually done by taking elements like sounds, texts, and images superimposed with what one sees in the real world. To better understand this technology, try to think of the interactivity we see in science fiction movies such as The Matrix or Agent of Shields, or better yet, Star Trek.
The technology, nowadays, is seen as somewhat futuristic, despite the presence of some of its elements in our current world and everyday use. For instance, we can refer to Pokémon Go or Apple’s virtual measurement app that allows you, using AR, to measure objects with extreme ease and precision.
Augmented Reality, the term, was first introduced in 1992 by two researchers at Boeing. Their names are Thomas Caudell and David Mizell. The first industrial use case for Augmented Reality was for the assembly of aircraft parts. During the years that have followed, many labs, research facilities, and universities have worked and collaborated to create applications for AR, and bring it to our lives.
Augmented reality made its way into our lives mainly through wearable devices, and mobile phones and tablets. Thanks to these two mediums, we are now able to see some AR applications. Mind you that AR’s full potential has not been reached yet, whether because of political reasons, or technical issues arising in the development process. However, this is another topic.
AR's usage in wearable devices such as Google Lenses, or AR glasses allow the user to enhance their observed reality by mixing it with some computer-generated elements. To illustrate this think of Google Glass, and its main features when it came out. Mainly the Google Glass allows you to see information such as text or images, and sometimes videos, through a small projector, on your lenses’ screen.
But, AR’s main introduction to the end consumer was not through wearable devices such these. It was, indeed, through mobile apps.
Mobile apps integrating Augmented Reality applications in them have taken the consumer market by storm. To exemplify, take Instagram or Snapchat filters. The filters add to your screen certain computer-generated objects, and mix it with what already exists on your screen, so you can take cool pictures, and share them with your friends on your social platform. This is just something quite basic to help you see how AR is already present in our world. But there is more to see than just life-like filters.
Augmented Reality has seen a lot of use cases in the world of gaming, specifically mobile games. The mobile game Pokémon Go, in 2016, has known unparalleled success when it first launched counting almost 100 million users at its peak. The game is mainly a real-life version of the famous Nintendo games of Pokémon. Essentially, users can take their phones and go hunting Pokémon, which they can find around them. When you interact with the small creatures, you can activate the AR mode, which allows you to see the Pokémon superposed with real life surroundings. Nowadays, the game’s popularity dropped compared to its initial launch, but that did not prevent them from making two billion dollars in revenue, according to Forbes.
Another example of a mobile game with AR features taking the world by sensation is Harry Potter Hogwarts Mystery. The game has 10 million downloads on the Google Play store, and over 45 million downloads in total. The game allows the users to live the life of a wizard inside the walls of Hogwarts. You can live your childhood dream while learning spells, mastering potions, and discovering the magical world of Harry Potter. The game has generated about 110 million US dollars on IOS and Android stores.
Be advised, though, that apps on mobile and tablets will not be the only platforms on which we can see AR use cases. Researches are trying to integrate AR functionalities on more wearable devices like contacts and glasses. The long-term goal of AR is to create an environment in which the immersion is quite natural and intuitive. Additionally, there is research being conducted in holography by physics research institutes to bring AR applications to the next level.
This means that mobile and tablet apps are going to be slowly replaced, in the future, as the main venue for Augmented Reality.
But AR isn’t the only technology to have a very promising, disruptive potential. Virtual Reality, a term commonly referred to as VR, is a separate technology, often mixed with AR, with an interesting prospective.
Virtual reality is, first and foremost, an immersive technology, perhaps even the most immersive reality technology known to us.
Virtual reality is a realistic, computer-generated image, or artificial environment presented to the user in such a way that what is observed is accepted as a real environment in which the user can interact with its components similarly to real-life.
To better understand VR, it’s wise to comprehend first what we mean by a total immersive technology.
When a user’s sensory experience feels very genuine, and life-like to a point where the user forgets it’s an artificial world, we are talking about total immersion. In laymen terms, your senses get fooled by the virtual world presented to you to the point where you start interacting with it as if you would in a real-life environment. But, a synthetic artificial world does not always display properties of the real world. In other terms, you can get immersed in a world that mimics everyday life situations in which case your brain is pushed to think that it is dealing with reality, or you might get immersed in a world where the laws of physics are completely broken. A spectacularly built virtual environment should be able to fool your brain in both cases.
Virtual Reality is present under different types, and they vary, mainly, in the level of immersion in question.
Non-Immersive Virtual Reality:
As the name suggests, non-immersive Virtual Reality are the less immersive and engaging systems of VR. The technology typically uses desktop or laptop screens to project the virtual environment to the user. The platform does not fully fill the user's field of view, which in turn does not give the user the sense of being present in a virtual world.
Semi-Immersive Virtual Reality:
Semi-immersive virtual reality allows the user to experience virtual three-dimensional environments, while remaining connected to real-world surroundings. This means that the visual experience, as well as the auditory one, and smells, are being lived in the real world. Additionally, the user keeps control over physical objects. With semi-immersive VR, you can see what’s going on around you, and interact with the objects you need. However, for immersion to be as high as possible, your focus should be on the digital image.
Fully-Immersive Virtual Reality:
Fully-immersive VR provides the most immersive experience that virtual reality as a technology can offer. In this case, hardware, and motion detecting devices are used to trigger the user’s senses. Fully immersive simulations can provide realistic user experiences by delivering a large field of view with a high resolution, increased refresh rates, and high levels of contrast into the user’s HMD.
As showcased, one can think of VR technology in different ways, and not simply focus on one view. This is, arguably, one of the benefits Virtual Reality has over Augmented Reality. But, let us not be hasty.
Aside from the theoretical aspects of VR, we are witnessing real-life applications of the technology. As one would expect, VR applications are more frequent and present than AR.
Video games are, obviously, the venue in which we can see VR most. At first, VR HMDs were developed for entertainment with a focus on games. According the Grand view research, the VR gaming market will have a 25 percent growth rate. And that’s not the only interesting figure. By the year 2025, the market is going to exceed 25 billion dollars (US) in revenue. To get a clearer idea about the VR games market, here are some examples of game genres that you can play using the immersive technology:
- Casino and gambling games
- Adventure Games
- Tabletop Games
- Arcade Games
- Horror Games
In addition to this market, VR has many other applications from which I will mention the military aspect. More specifically, we will talk about the aviation training use case of Virtual Reality.
In the case of aviation, VR is used for training. Pilots must go through extensive training before they can fly any kind of aircraft. Before VR technology became something that can be potentially used for pilot training, pilots had to be trained with replica cockpits, and computer screens.
The old method had its inconveniences. The first was that each aircraft training required its own kind of cockpit. The second was the difficulty of building those cockpits, and their limited use. With VR technology promising numerous experiences, the aviation industry could save billions of dollars.
With Virtual Reality technology, all a pilot-in-training would need is a headset, a joystick, and possibly a throttle. The rest can be generated by the VR technology.
An example of an aircraft simulator run on VR technology is the BISimulator by Bohemia Interactive and Boeing’s hard flight simulators. This has made the training of pilots a lot easier and more cost-effective.
With all these amazing features of both technologies, it would be quite lackadaisical from decision-makers, entrepreneurs, or business owners not to be informed about AR and VR.
As technologies continue to be developed on a daily basis thanks to research labs, big companies, and universities, businesses need to keep an eye on them to know how they can incorporate them as part of their business development strategy. On such note, Augmented Reality and Virtual Reality can be very beneficial to business across the spectrum of industries.
Augmented Reality in Business
Augmented reality is going to drastically change the way businesses operate in their different, respective spheres, and the change is coming shortly. With that in mind, understanding how AR can be an improvement to your main business's core activities is essential in order for the implementation to be successful.
With new technologies come great opportunities for a vast amount of markets. Among these markets we can mention banking, real estate, and even manufacturing. Let’s look into some use case.
Augmented Reality can help facilitate the acceleration of the building processes. Project managers will be able to easily monitor progress in real time thanks to AR markers present on equipment. It will also save a lot of time as the technology will allow a gesture as simple as pointing a device into a location to show how a piece of a machine will fit the final construction.
Augmented Reality brings myriad possibilities for teaching and learning processes. It also provides a cognition path with immersive real-life simulations. AR helps the user get an authentic experience, which gives genuine psychological and physical experience that can be learned from and used in the real world. Medical students can now try their first surgeries without injuring patients, and astronauts can get ready for the next space mission without any hardships.
Travel and Tourism:
GPS mobile apps with AR can show tourist routes and directions to desirable destinations, translate the signs on the street, and give information about sightseeing.
Augmented reality is not simply beneficial to your business in terms of your main business sector. It can also bring huge value—added for your marketing team. Here are some benefits that can be of great help to your brand using AR:
- Augmented Reality can be a viral for new customer acquisition.
- Augmented Reality offers a lot of room for personalization.
- Augmented Reality offers a content-quality step up.
- Augmented Reality helps with client retention.
Virtual Reality in Business:
Virtual Reality has a very strong presence in the business world, as well. Despite its strong correlation with the gaming industry, the technology has interesting applications in the different spheres present in the numerous industries.
Virtual Reality & Dating Industry:
This was inevitable as the technology is knows for its immersive capabilities. A company known as VR Dating now allows men to choose their dates, and practice their dating skills anywhere in the universe, meaning that you can choose which planet is most suitable for your date.
As VR dating technology continues to grow, we can expect couples to be able to create their own custom VR dating experiences, complete with a choice of music, food, and their preferred drinks.
What is the market for VR dating services?
- inexperienced daters who want to develop basic dating skills
- person who may wish to get to know someone (discretely)
- person who wish to get to know someone within the safety of an online experience
- disabled or homebound people
Virtual Reality & Marketing:
One industry that swiftly adopted VR is marketing. While agencies have struggled to get beyond 360º video, VR technology can provide much more. These are some opportunities for entrepreneurs and innovators, interested in VR, to tap into:
- VR Advertisement
- VR integration in Social Media
- Cloud-based VR-marketing platforms
- Immersive Product Description
Virtual Reality & Clinics:
The power of VR to transform industries is not limited to commercial enterprise. It is a valuable tool in the medical field. VR has been proven to be very useful in the diagnosis and treatment of certain psychological disorders. The therapy is known as, and referred to as, Virtual Reality Therapy.
Considering the number of people suffering from mental disorders, the need for development in this area is quite evident. Immersive therapy can help doctors treat numerous conditions from which we can list the following:
- Post Traumatic Stress Disorder
But, applications are not the only thing of interest for entrepreneurs and business owners. Monetization is as important as the applications of these technologies. Revenue is an essential part of business, and it is, most arguably, the driving force of said business, regardless of the industry.
The good news, however, is that the technologies of Augmented Reality and Virtual Reality have impressive monetization power. Let’s break down the potential ways, as a business, you can monetize these technologies, and generate additional revenue channels.
Monetization of Augmented Reality:
It goes without saying that the following part about monetization refers to the monetization of AR apps. As the main Augmented Reality venue, for now, is mobile and tablets apps; it makes a lot of sense to consider apps as the principal source of monetization.
One can say that e-commerce and augmented reality are the best mix to ever exist. Essentially, thanks to its power to over impose objects into perceived reality, AR can help customers see different products as tables, chairs, TVs, sneakers etc. in real life before making the decision to purchase them. A more interesting feature, besides product testing, would be the ability to purchase them on the app. In-app purchases is a huge trend in mobile app development. Whether these products are yours, such as Ikea’s AR app, or can be purchased on other’s websites (affiliate program) a one-click purchase would be a complementary strategy to your app’s AR characteristic.
Freemiums are the most classical business revenue model. As the name suggests, a freemium offers a certain free aspect to the users to get them hooked on the functionalities of the app, so they can later on convert easily. To bring the discussion back to Augmented Reality, you need to make sure that the AR feature you are offering is riveting, and solves a problem for the user. And knowing the exclusiveness of AR, hooking the user on is quite the easy part. What rests on your shoulder is providing the users with an app that solves (one or more) their problems.
These are not the only business models that one can use to monetize an AR integrated app, however they are the most commonly used. We invite you to come up with your own model, and do a lot of testing.
Monetization of Virtual Reality:
Virtual Reality has more potential in terms of monetization, as it is more present in the world of mobile apps.
Freemium monetization strategy is ubiquitous when the application distributes digital content directly to users. This pricing strategy implies an approach in which the application can be downloaded for free, but the money is charged for additional services or features that extend the app’s functionality.
This model will likely bring you some profit, especially at an early stage, or when you first enter the market. Moreover, most VR apps can be developed as cross-platform apps, which are significantly cost-effective, and make the VR experience available for a broader audience.
As the most effective business monetization strategy—in-app purchases—are immensely adopted in the virtual reality world. For example, Public Speaking VR, a company that uses VR to train people in public speaking and helps them acquire presentation skills.
As most would guess, certain features of training are free, but the more advanced ones would require a payment, so the user can access them. When implementing this strategy, it is important to think about whether your company would like to offer a subscription model, or target individual purchases.
As more people are taking advantage of virtual reality apps and their features, advertising on this platform is becoming a wise decision to be considered for monetization. Product placement is an emerging solution that offers to replace pop-up commercials, which are a source of nuisance and distraction for the users.
This monetization model is interesting, because of two main reasons. Firstly, it helps brands in their narratives, which is exactly what consumers love most. For instance, brands will be able to show their customers how to use their product, how to benefit from it. Second, it will help developers spread more of the free content, instead of a paid one, supported by advertising revenue.
Augmented Reality and Virtual Reality are in-development futuristic technologies that you need to experience to fully grasp their gist. If you are doubtful, at worst, you will not be disappointed as you were expecting the technologies to not deliver. But if you are optimistic, you will not disappointed.
But before we condemn such technologies, and deem them as worthy or unworthy to have in our lives, it is very wise to keep an eye on their promising development, which promises to deliver unwitnessed features to the user.
But most importantly, we need to remember that it is not easy for complex and powerful technologies to acquire a place in our visually-dense lives.