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How Augmented Reality Is Transforming Business

By Tim Scargill

You might remember 'the summer of Pokemon Go', the wildly popular game that last year had people walking around looking at their smartphone even more than usual. And although that fad came and went more quickly than an actual summer, it did achieve one important thing (apart from making money for its creator Niantic) - it awakened a large portion of the general public to the possibilities of augmented reality.

This year, it is clearer than ever that augmented reality (AR) is making big waves not only in the entertainment industry, but in the business world as well. Unlike virtual reality, which has suffered from growing pains due to the complexity and expense of the equipment required, all you need for AR is a smartphone or another mobile device - which millions of us already have. This has allowed developers to experiment with a variety of enterprise applications, with the knowledge that they have a large potential user base. 

Experts are now forecasting an augmented reality market worth $83 billion in revenue by 2021, with 'mobile' AR (augmented reality through a mobile device) being the biggest driver behind that. Here is how AR is currently transforming business, and how future developments will fuel that predicted growth.   

The use of AR to improve customer experiences is well-established in the retail sector. Since 2013 IKEA have offered an application that allows users to virtually place a piece of furniture in their own home, to see how it looks before they buy it. And as the technology advances, this 'try before you buy' feature is becoming suitable for a wider range of products, such as shoes and clothing - a number of 'virtual dressing room' apps have been developed. Helping customers buy online with more confidence is a key part of maximizing the number of completed purchases, so it's a priority for retailers.  

What's interesting is that AR is not only being used for e-commerce, but to enhance the in-store experience, making that a more attractive option as well. One of the first companies to do this was Lego, who installed AR kiosks in their stores where customers can scan a product they are considering purchasing, to see how the finished model will look. More sophisticated virtual fitting rooms and makeup mirrors have followed in high-end fashion outlets. At the more experimental end of the scale, China's biggest online grocery store Yihaodian has even opened completely virtual stores, where customers can browse the aisles using the camera on their phone.

Design and Manufacturing

As consumers expect to interact with more and more products with AR, product design must change to incorporate those features. However, AR can also aid the design process itself. 3D modeling comes as standard in CAD (Computer Aided Design) software, but AR allows us to the strip away unnecessary elements of the user interface such as menus. Designers can interact more freely with their models, stepping inside them and even combining them with physical components. All of which provides a greater level of feedback than before, reducing the need for expensive prototyping.  

Step on to the factory floor, and you can also see AR at work. Thanks to the IoT, manufacturing equipment fitted with sensors produces data on a range of parameters, from power consumption to component stress. Feed that data into an AR display, and employees can conveniently monitor the status of different devices as they walk around. Combining that with a visual overlay of maintenance instructions is a powerful way of making sure repairs are carried out quickly, reducing downtime. Finally, AR tags fitted to packages are helping warehouse workers to pick up orders in a more efficient manner, smart goggles providing a hands-free text feed and suggesting the most logical route.

Education and Training

A range of AR tools are available for use in education, and studies so far show that they are very effective. From interactive books to maps of the stars, they provide information in a novel manner which motivates students, especially digital natives. There is also a growing market for educational toys which include these types of features. 

Businesses are using similar tools when it comes to training their own staff. For example, Zurich Insurance turned to AR to help train 10,000 employees in project and people management skills. The sheer volume of people was tackled by enabling them to 'self-direct' - by pointing their phone at a poster they could access links to more training material such as videos or online courses.  

Outside the classroom, in situations where real-life training is difficult or dangerous, AR allows learners to practice in a safe environment. Companies in the oil and gas industry such as BP have introduced step-by-step guides (using interactive simulations and 3D graphics) for trainees learning new equipment. This area is showing a lot of promise, and we could see that kind of instructional AR in many more fields in the future.


In a world saturated by advertising, companies are constantly looking for new ways to grab the attention of consumers - and as a new, visually striking technology, AR fits the bill perfectly. For example, businesses can purchase branded filters on Snapchat, with the potential to reach huge numbers of normally skeptical millennials. But things really take off when objects in the physical world are used as a trigger. Point your camera at a magazine, a poster, a bus shelter or any product you can think of, and AR can bring static images to life, providing an immersive experience which engages the user.      

That experience becomes even more powerful when we consider personalization. We all know that the data we share online is used to produce targeted ads when we browse, and a recent study found that those personalized ads deliver three times as much engagement. As you are identified by your smartphone, the content can change depending on the customer, making advertisements more relevant to you. Imagine pointing your camera at the logo of a footwear retailer and a pair of shoes suited to your taste appearing - you could even interact with the image and place them over your feet to see how they'd look.

The Future

Augmented reality technology is still a work in progress, and as it continues to develop it will provide more opportunities for enterprise. Snapchat recently released 3D filters, and 3D AR is likely to become commonplace, providing more engaging and interactive experiences, with obvious benefits to marketing and education. Facebook has also recognized the potential of the technology, outlining its plans (including the launch of an AR camera platform) at its F8 developer conference this year. 

Their vision includes a partnership with Manchester United to provide AR effects at soccer matches, which raises the possibility of further applications in sport. One of the first commercial applications of AR was actually the yellow 'first down line' in NFL broadcasts, and with wearable technology already being used to aid coaches, it's not much of a stretch to imagine the data from those wearables feeding augmented reality overlays on players (similar to those you would see in a video game).

Both Apple and Samsung are reportedly working on AR enabled smartphones, which would allow users to identify real-world objects with their camera (as well as rekindling the maturing smartphone market for mobile manufacturers). This should open the door for more travel and tourism based applications, helping visitors to navigate or learn about a city. Further into the future, many of the major technology players are working on 'smart glasses' as an alternative display, though this may take some getting used to for consumers, given the failed launch of Google Glass. Either way, it seems the digital additions to our physical world are here to stay - augmented reality definitely is the new reality.

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Tim Scargill is a former IBM consultant and electronic engineering graduate, now writing about all things technology-related. He is particularly interested in how emerging technologies will affect enterprise in the future. After completing a Masters degree in Electronic Engineering at the University of York, he moved on to become an IT consultant at IBM UK. Gaining knowledge and experience of big data and its business applications, he specialized in the analysis and processing of sensitive data. Specific interests include big data analytics and strategy, natural language processing and machine learning. 

Related Keywords:AR, Augmented Reality, Business applications in Augmented Reality


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