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Virtual Reality (VR) Augmented Reality Facebook

What Facebook’s AR push means for the future of commerce and the concentration of power


By Jessica Goodfellow, Media Reporter

April 20, 2017 | 7 min read

After months of quietly shifting its suite of apps to focus on the camera, Facebook has laid out its ambitions to take the augmented reality (AR) baton from Snapchat and lay claim to the medium. But what does this push mean for marketers and the future of commerce, and as Facebook plays with the morphing of reality, where will it draw the line?

Facebook moves into AR

What Facebook’s AR push means for the future of commerce and the concentration of power.

When Mark Zuckerberg pitched what he claims will be the first mainstream augmented reality platform at the annual F8 conference, the industry heard a war cry.

In the space of just an hour, when Zuckerberg announced that AR was Facebook’s next big venture and showed audiences it had the engineering platform in place to deliver on this goal, augmented reality was catapulted from niche to mainstream.

One only needs to trace the trajectory of Facebook Live from the moment Zuckerberg announced it as a key focus at the same conference last year to its mass uptake in the months that followed to see the scope the entrepreneur has planned for his own Pokemon Go-inspired AR platform.

Facebook users saw Live as a way to broadcast their own lives, while brands and advertisers jumped at the opportunity to accumulate staggeringly large audiences for comparatively small capital cost. Facebook’s AR push is expected to be met with similar intrigue.

That’s because the platform has built an engineering infrastructure that has allowed it to spin out tools and applications and deploy them at extraordinary speed “in a way we don't think we have seen before”, says Rob Norman, global chief digital officer at GroupM.

“There is absolutely no doubt that AR is of significant opportunity to brands and marketers," adds Matthew Knight, head of strategic innovation at Carat. "The examples at F8 paint a picture of the world being interactive and shoppable - and every brand manager must be falling out of their seat to think about how they can leverage this sort of technology.”

Commerce giants such as Amazon and Alibaba have been tipped as the main victims of this AR disruption. Norman has said before there are few obstacles to Amazon’s growth. But he tipped distributed ecommerce on Facebook and Google, that offer creative shoppable formats such as chatbots, VR experiences and AR changing rooms, coupled with scale, as the likely end to Amazon’s hold on the commerce industry.

“It is easy to look down the track at this and see how both AR and eventually VR will become disruptive in commerce on Facebook. The one big disruption we thought about in terms of the Amazon and Alibaba ecosystems was retargeting disruption in a direct Facebook commerce environment,” says Norman.

The key thing for brands experimenting with new ways to access consumers in these fledgling environments is to create content that “users can actually benefit from”, says Norman, or risk extinguishing the appeal of the technology as quickly as it spread. The same can be said about marketing in-chat applications such as Messenger, voice applications like Alexa and Google Home, and in VR environments. All intimate user experiences that require bespoke marketing.

“Consumers will be open to marketing content [in AR] provided it adds value to them in some way. That might be through better information such as travel data, it might be by enhancing an experience such as a sports event, or it might be a simple sales offer,” says James Watson, global client director at Imagination.

For marketers it doesn’t matter if it is Facebook, Google, Tencent or Alibaba leading the charge; it is all about who can offer the most scale and ease of use to the consumer. Facebook has spent years easing its users into accepting more advertising by dressing it up as content tailored to their needs.

“What Facebook has done is set up in the consumer's mind the relationship between the ad unit and the content unit,” says Norman.

“Facebook constantly optimises the ad load for each user to look at what their tolerance is. I think they have very cleverly managed to separate the commercial space and the consumer space…Over time we may see a very significant creative tipping point coming out of this,” Norman adds.

Facebook has its arch rival Snapchat to thank for this. Advertisers are unwittingly better prepared for this push into AR as they might have been for other innovations because thanks to Snapchat's innovations through sponsored lenses and geofilters.

Recognising it can’t lead the AR charge on its own, Zuckerberg has invited its community of developers to build AR-based apps to work with its Camera Effects platform. However, like it has had to do with previous products, the business will need to answer accusations of it taking more from its contributors than it gives back to them amid growing tension between the platform and its contributors.

Channel 4 told The Drum earlier this year that for the 2 billion video views it amassed on the platform last year, Facebook paid the broadcaster a “tiny, minuscule amount of money” in return. Meanwhile the Guardian’s former editor-in-chief Alan Rusbridger accused Facebook of sucking up nearly $27m of the Guardian's digital advertising revenue in 2015.

Beneath the veil of altruism the real reason for Zuckerberg's AR developments can be traced back to his overall vision for Facebook to be ubiquitous to how people communicate. It’s the reason why Facebook is fighting Google to provide unreachable populations in areas across Africa and Asia with free internet access, and why Zuckerberg suggested the idea to F8 audiences that many physical products like TVs and smartphones can be replaced by virtual ones.

“Ultimately, for these companies the technology is certainly about improving the experience for their users, but it is also about getting consumers more engaged with their services and learning more about them so the companies offering services are better able to monetise the information they have about their users,” says Ben Wood, Chief of research at CCS Insight.

The question is where Facebook draws the line when it comes to marketers stretching and morphing reality in order to push products to users.

“There are valid reasons why you might want to identify individuals or do analysis on a sales display or particular objects to get additional information – but equally some users might find the concept of Facebook analysing the spaces around them and extracting information based on the images, objects and people it detects a little disconcerting,” suggests Wood.

Regulation bodies and governments are always playing catch-up with new tech until something bad enough happens - like hate speech on social media, and brand misplacement on dodgy videos - that rules are implemented. The onus, therefore, lies once more in the hands of the creator to act as an editor to the way AR unfolds.

Virtual Reality (VR) Augmented Reality Facebook

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