Study: Global AR market will grow 65% a year until 2023
The global mobile augmented reality market is expected to grow with a compound annual growth rate of about 65% from 2016 to 2023, according to a report available from Research and Markets. Popular AR applications for the consumer market include gaming, entertainment, advertising, e-commerce and tourism.
North America accounted for the largest market share in terms of revenue for mobile AR in 2016 and is expected to dominate the market during the report's period. The strength is driven by tech giants like Google and Microsoft and by startups like Blippar and Wikitude, according to the report.
Asia Pacific is expected to be the fastest-growing region for the mobile AR market with the adoption of new technologies and economic growth.
AR has been a hot topic this year following the significant success of Pokemon Go last summer. While growth has been predicted by several researchers, what's interesting about this report is the finding that AR will continue to scale up quickly for another 5 years. Also, the strength of the market in North America is noteworthy, pointing to the need for developers and marketers in the region to consider how to have a presence in AR.
While giants like Google, Microsoft and Apple could be important partners for developers, the report also points to the strengths of smaller players who pioneered this space like Blippar and Wikitude, who may be easier to work with for marketers. Blippar has been bolstering its offerings this year as competition heats up from the major digital platforms, launching AR banner ads earlier this year, with Jaguar Land Rover an early adopter. M&M's recently partnered with Blippar to turn a billboard into a game.
Snapchat is another important player in AR and one that marketers interested in engaging younger consumers should consider. The platform's filters, while not cheap, can still be one way to start to experiment with how a brand might look and feel in AR.
Developer interest in AR is high because the expectation is that the user base will explode this fall when Apple launches its new iPhone, which will have AR built into the device. AR will also be part of the iOS 11 software update, meaning a large number of consumers will have an AR-enabled iPhone once they update to the new iOS.
Google is also ramping up in AR. This week, it released a preview of ARCore, an augmented reality (AR) platform positioned to be more nimble than the company's experimental Tango, a high-end technology that didn't gain significant traction with smartphone makers and developers.
Developers continue to discover new use cases for AR, including virtual product trial for cosmetics using selfies for furniture in a home. Following last summer's Pokemon Go success, which showed how AR could help marketers better connect with on- and offline channels, other big-name brands have experimented with gamified AR marketing strategies, including Disney, which is launching an AR treasure hunt to promote its new line of "Star Wars" products at big box retailers in September.
Additional potential uses for AR include providing more advanced navigation capabilities, virtual ads inside a store or more detailed product information while shopping.