Snapchat’s ambitions for augmented reality have been dashed.
While abandoning its original plan to develop AR tools for businesses, the social network is doubling down on its effort to turn augmented reality into a powerful ad business. This change may prove to be both smart and necessary, especially in light of advertisers’ ongoing hesitations to devote significant expenditures to AR.
This is not to claim that Snapchat’s AR advertising is a complete failure. Retail advertisers, for instance, are avid users of the company’s AR advertisements. Snap’s AR advertisements are still not a need for every marketer in every sector, though.
The CEO of the marketing firm Block & Tam, Brittany Eber, voiced her opinion that Snapchat’s AR capabilities are still under development and that they might not yet be necessary for all advertisers. However, she stressed the potential of augmented reality (AR) advertising as a potent tool for marketers to interact and fully immerse their customers. She thus voiced regret after learning that Snap has shut down its AR enterprise branch.
“I’m hopeful that Snapchat will continue to invest in AR and develop advanced features to further enhance effectiveness for brands,” she continued.
Nick Jones, the head of social for EssenceMediacom’s EMEA division, who collaborates with Snapchat to create AR assets for customers, shares this opinion. Even though not every client’s approach would include Snapchat, he emphasized that those that have used AR have achieved amazing incremental gains when combining AR with Snapchat’s video solutions. Jones did not, however, provide specific numbers for these findings or indicate how many of EssenceMediacom’s clients utilize Snapchat’s AR.
Naturally, it’s still a work in progress.
The company collaborates with “the world’s biggest brands to build creative AR experiences that deliver engagement, brand loyalty, and real business results,” according to a Snapchat spokeswoman who talked to Digiday.
The representative stated, “For these partners, AR is a significant component of their marketing strategy. According to our research, customers not only expect these experiences but also desire them. This is why more than 250 million Snapchat users play with lenses more than 6 billion times every day on average.
MGOMD, which ran an eight-week campaign for Specsavers utilizing a multi-product strategy that included AR, is one example of Snapchat’s AR accomplishments. The platform claims that the AR lens used in the campaign created an average playtime of 28.78 seconds and a share rate of 5.42%, which was 2.5 times higher than benchmark.
The lifestyle accessory company Fossil, which received more than 60,900 lens shares, was another notable achievement. In addition to driving 219 purchases at a conversion rate of 1.45% and an average lens playtime of 12.67 seconds throughout the campaign, Snapchat’s AR technology.
According to Bettina Traurig, Head of Paid Social, Performics @ Zenith UK, “Snapchat’s AR can be highly effective as it offers unique opportunities to engage with users through interactive and immersive experiences.”
However, Traurig noted, whether this is a must-have or a nice-to-have depends on how well-established the client is. Even while these are the businesses that can really benefit and feel the impact from the competitive edge that AR delivers, less well-known advertisers can run into budget issues when it comes to things like AR activations, she continued.
Fortunately, AI has already lowered costs and made using AR easier, making it more widely available, according to Traurig. It is our responsibility as partners to work with our client to ensure that their investment in this technology yields worthwhile results. It’s an exciting time, and I can’t wait to see how businesses take advantage of this chance and effectively utilize the format to stand out and get traction.
Challenges remain ahead:
The truth is that augmented reality (AR) has been one of the hottest topics in technology for a while, and when Snap’s AR filters initially appeared, they sparked a blaze of excitement. According to Marcus Collins, a clinical marketing professor at the University of Michigan, Snap was there as an early adopter to profit from the technology. Despite the company’s decision to double down on the metaverse, “They [Snap] even got there before Facebook/Meta,” he claimed.
However, as noted by Jasmine Enberg, lead analyst, social media and Insider Intelligence, some advertisers are still attempting to grasp the use of AR that goes beyond entertainment. “Snapchat’s AR remains a tough sell, given that advertisers still largely regard it as an experimental ad format,” she claimed.
Although Snap can be proud of being a digital pioneer, there is now considerably less emphasis on augmented reality as a cutting-edge creative technology because interest in artificial intelligence has lately increased. However, after Apple releases its augmented reality headset, the VisionPro, there might be a surge in interest in the technology the following year.
The previous pitch
Right now, Snapchat is probably rethinking its strategy and developing a better and newer AR pitch for marketers. An AR one-pager supplied with Digiday, meantime, demonstrates how Snap was promoting the technology to marketers a year ago.
The discussion then shifted to the benefits of augmented reality for marketing.
A large portion of the data was already well-known, such as the number of daily AR users (250 million) and the number of monthly active users (750 million) for Snapchat. The clear message was that Snapchat had long viewed augmented reality as a full-funnel play that could increase conversions in addition to awareness.
The one-pager’s claim that AR could generate a $3 return on ad spend—nearly a fifth more than other digital advertising formats—was the part that truly stood out.
ROAS, however, varies depending on the client.
According to Kevin Goodwin, vice president of performance marketing at New Engen, some of his clients are pushing Snapchat to a $1.50 new customer ROAS because they feel that the economics are appropriate for their company. Due to their lower margins and greater emphasis on quick profitability, other clients have ROAS levels that are far higher than the $3 ROAS reported in the one-pager.
For those kinds of numbers to materialize, a campaign’s many moving elements must all be in sync. However, a $3 ROAS statistic would undoubtedly grab advertisers’ attention, much like Snap’s one-pager did.
Or, to be more precise, Snapchat AR is a huge success when it appeals to marketers. The problem, though, is that it hasn’t quite satisfied a wide range of them. It will be interesting to see if Snapchat can change this.
According to them, the platform does have a firm handle on younger millennials and members of Generation Z, and as a result, it might be a wise location to invest money.
Simply put, Snapchat does work for AR, but mostly in certain verticals, like retail. It brings up that article on advertising education once more.
“AR doesn’t make sense for every campaign,” said Adam Telian, vice president of performance marketing at New Engen. “It must either have entertainment value or be used in a way that encourages customers to learn more about your [a brand’s] product.”
