Let augmented reality develop its true role in our culture before “monetizing” it
“We are witnessing the obsolescence of advertising.” — Regis McKenna
Regis McKenna is the famed marketer behind Apple Computer. He taught Steve Jobs a thing or two about public relations and advertising.
The quote above is from McKenna’s widely-read 1991 piece in Harvard Business Review, perfectly titled Marketing Is Everything. He saw 25 years ago what is more true today than ever.
McKenna deserves a bit more airtime before we continue, so here’s a bit more from his book:
Advertising overkill has started to ricochet back on advertising itself. The proliferation of products has yielded a proliferation of messages: U.S. customers are hit with up to 3,000 marketing messages a day. In an effort to bombard the customer with yet one more advertisement, marketers are squeezing as many voices as they can into the space allotted to them. Customers simply are unable to remember which advertisement pitches which product, much less what qualities or attributes might differentiate one product from another. Very simply, it’s a jumble out there.
I’ve said it before and I’ll said it again now. Cameras are the new start menu. They’re the next great consumption experience, the next great transaction experience, and the biggest opportunity for marketers in a decade. Spatial computing is making brand new worlds possible.
But if we don’t get marketing inside the camera right, the whole effort will have been for naught. Extended reality isn’t just another cranny into which one ought to shove more coupons or banner ads.
These virgin spaces are as yet unpolluted by irrelevant messaging from companies stuck in outdated approaches to communicating with the people on whom they depend most — consumers.
The Biggest Opportunity for Marketers in a Decade
We have a few key things working for us us right now.
One, the user behavior of being in the camera — as if in a browser — is skyrocketing. The camera is no more a picture-taking app than the smartphone is a piece of hardware used to make phone calls. This is important because camera marketing works best when it’s germanely part of everyday life; think about how Alexa lives in your living room, awaiting your command.
Secondly, thanks to Snap, those users understand and moreover actively desire dimensional camera experiences. And third, the distribution of the hardware necessary to extend reality has widely proliferated.
The pre-conditions for an ecosystem are in place, meaning that all of the components for an ecosystem are present — but we do not yet actually have an ecosystem.
Money can push the technology forward, but only experience can push user adoption and engagement forward. This is our most precious and important component to building said ecosystem.
I love author Matt Mason on this topic. In The Pirate’s Dilemma he explains how hip-hop, arguably one of the important platforms ever, had the unique and essential luxury of mixtape culture early on, which allowed it to grow at an appropriate pace, bottom-up, developing its own style and idioms along the way.
By the time hip-hop went mainstream, it was incredibly strong and vibrant. Hip hop was in a place where it was able to influence the mainstream as much if not more so than the mainstream influenced hip hop.
Today, a new hit single can go from a shaky living room selfie video to worldwide sensation in a matter of hours. Matt’s worry is similar to mine, that these new paradigms are no longer given time to germinate, and as a result lack cultural sustenance for the long haul. Tech and tech culture are moving so quickly that good ideas and important new paradigms risk flaming out if not incubated correctly.
Advertising: The True AR Killer
More and more I am seeing and hearing about “AR advertising.” I’m pretty worried about this idea, for two reasons.
One, there isn’t an ecosystem to sell against. It’s too early to monetize. It is too early to harvest. Certainly in the future there is the potential for an incredible ad network, powered by data we have never had access to before. But is that what we want already? Do we want to complicate this new medium so prematurely?
The quickest way to kill the potential of augmented reality is promising to sell it as the next advertising platform/medium. Fifteen years ago we heard the same story about social media. That’s come back to bite us.
Brands were promised an “owned” channel and encouraged to build one, brick by brick. We were promised a paradigm shift, and a distributed commons where everyone had a voice.
These days social is a decidedly paid channel. Brands write checks for the privilege of talking out their own back porch (and horning into yours), and my feeds more closely resemble Sunday’s circular of yore than a town square, or global brain. Arguably social is today an advertising channel first, and a conversation second, instead of the other way around. Arguably too, AR can be more “social” than social, if done right.
In fact, AR looks a lot like the direct-to-consumer holy grail we’ve all been searching for. Imagine a place where advertisements are no longer so much disintermediation, but rather authentic, memorable brand experiences. Imagine never having to pay a toll; imagine all that money going towards something consumers actually like. Imagine building a public playground instead of buying yet another billboard or banner.
The second reason I’m worried about “AR advertising” is that users will run away if the point of these new experiences is to be targeted and served up 10 percent off their next purchase.
Putting aside the fact that millennials literally don’t see billboards, much less respond to ads, there’s zero doubt in my mind that consumers of all ages choose from amongst a constellation of brands based on who they trust most. Extended reality risks being the most egregious digital bait-and-switch yet.
I Know What You Are Thinking…
Here’s a Pratt-trained digi-hippie, allergic to making money, preaching at me about the future of the Internet, and she wants organic growth, and room to breathe, but this stuff ain’t gonna build itself, and it ain’t gonna fund itself either.
Guilty as charged. But I promise you, I’m actually motivated by greed, in a sense. I’m definitely not allergic to making money. In fact, I want us all to make a whole lot of money.
Advertising today is an abomination. Five percent (5%) is considered a fabulous conversion rate. In what other business on earth can you fail to engage 95 percent of your audience and be considered a big success?
My worry is that if we merely transfer outdated advertising formats to these brand new worlds, and moreover if we do so too early on, we’ll end up once again with banner economics, and banner margins, and banner engagements, and banner f*cking everything. Old advertising (including much of social media marketing) drives at impressions only and offers no delight and little utility in return.
My economic worry is our industry’s worry. If we retrofit AR with old advertising models, we won’t make enough money, and we may not make any money at all. But if in contrast we manage to get it right, we can all benefit hugely.
To that point, I don’t just want to complain, fun as this may be. I’m want to tell you how we just might get it all right this time around.
Brand New Worlds
I keep using that term on purpose. Brand new worlds. The first way out of the pollution-monetization-banner problem is to rethink what advertisements are altogether.
In extended reality environments we no longer have to put ads “in” the world. We’re already one level of abstraction beyond that. The world is the experience of its maker. The world is the ad itself.
This is an example of a portal Viacom co-created with us to explore building our brand new worlds. Go ahead, check out the link.
That was fun, right? But think about what it means for a second. Traditional ads are interruptions, quite literally. They are forced breaks. They are filler.
Here’s an example of an ad on one of my favorite publications. It literally stops you mid-page.
Ads live in between and on the periphery, one step above spam. They’re a necessary evil at best.
With ads, we “pay” for goods and services with our time and attention instead of our checkbook, but we still pay.
What’s the best advertisement Walt Disney ever made? Well, he actually never made an ad — trick question!
Instead, he made Disney World. And since December 1971, Walt Disney World has remained the absolute best advertisement on planet earth. It is such a good advertisement in fact, that people from all over the world travel and pay hundreds if not thousands of dollars to see it.
Now a slice of that same kind of thinking is available to every brand on earth. The “advertising message” isn’t a message at all, but rather a way of seeing and being in the world, from the brand’s point of view.
The very best new media brands, like Vice and Glossier, have arguably fashioned entire worlds all their own, without the help of AR. Let’s follow their example, and Walt Disney’s, and go one step further.
Inside of Disney World, or Viceland, traditional ads would be laughably redundant. We might advertise Disney World itself in the pages of USA Today, but once I’m in the park, I’m in the park. The trick if anything becomes to keep me there.
Entering a Cabella’s or IKEA is most certainly entering a brand new world too, isn’t it? A Niketown? What about Reddit? Isn’t that storried community a discrete space all its own, with its own rules and society? What about League of Legends, or DOTA? These analogues all helpfully exist already and are worth studying because they all have insanely good engagement. What do they get right that advertising (and marketing in general) gets wrong?
Showing me a Coco figurine for sale as I leave Magic Mountain or check into my hotel isn’t nearly as abrasive as pushing the same product while I’m watching YouTube, or driving north on I-35 — because I’m already in the world. I no longer need to switch my context in order to make a decision to engage with or purchase something.
In these brand new worlds I am already immersively present in a world just like I am in Disneyland, so impressions cease to matter. Instead the goal becomes to encourage me to choose to focus in a particular area, and then decide to participate (in one of myriad possible ways).
Essentially, to brands I say: don’t invade someone else’s world. Now you can make your own frame. And this time the frame (of view, of reference, of reality) can be your own, forever, because it can’t be anyone else’s. AR might be powered by a certain platform or engine but if you create a brand new world, it is your IP.
(Side note: This post by legal concerns and ownership rights in AR by Matt Ranen is a must-read).
So, this is what I mean when I say camera marketing, which is the discipline of marketing experientially (i.e. making and marketing camera experiences) to consumers through and inside the worlds our cameras finally enable.
Gates and Doors and Portals, Oh My!
So, if brands architect these new worlds, how does the ecosystem benefit? The brand makes money surely, as do their designers and builders, but how does everyone else benefit?
On the Internet we have these beautiful things called hyperlinks. In spatial computing we have a conceptual equivalent — hyperspace (a term taken, naturally, from A Hitchhiker’s Guide).
Whether you term them “gates” or “doors” or “portals,” it is already possible to do both of two separate things.
One, it becomes possible transport from one world to another, via spatially encoded links. Some of these will be powered by affiliate relationships, while others will be based on strategic relationships or even just mutual admiration between brands, independent architects, and individual consumers.
Two, it becomes possible to layer one world on top of another, for a multi-frame view of things.
Both of these are how we’ll all make money in AR. The distributed but ultimately linked nature of the Web is the one underlying idiom we’ll actually do well to bring over into AR. Upon hyperlinks the Internet was built, and so too of hyperspace.
We’ll make money on travel, essentially, and everything that flows naturally from that metaphor. There will be special VIP worlds for high-frequency users; there will be time-sensitive gates that present unique opportunities to explore, and there will be combined-frame experiences that create a sort of 1+1=3 effect. Think for example, of Pepsi and the Super Bowl, or Jimmy Fallon and the Oscars.
Imagine going to a digital Frame Store one day — a sort of App Store for different frames by which we can choose to experience the world given our context and goals.
Conclusion
Now matter how far-out all this sounds, what is most important for marketers to take away right now is the size of the opportunity that new world-building represents.
Snap is just one world. You can and should go market there. Snap is awesome. But it is ultimately someone else’s world. You can engage in lens marketing on Snap; lens marketing is putting a branded view on an existing world. But Snap’s world is ultimately theirs and theirs alone. They’ll always sell you access, but you’ll always work through a middleman to speak with your people.
Camera marketing is includive of lens marketing but not synonymous with it. The allure of a truly owned audience persists for all of us; again, the most strategic and effective advertisement on earth is not an advertisement at all. You should both market within Snap, and create a world all your own.
Now what if I’m wrong? What if all this extended reality stuff is a sham? Well, with the absolutely incredible participation rates that folks like the NBA (see here and here) and Coachella (see here) are seeing, I’m pretty sure I’m right.
But even if I’m not, the costs involved here are less and the ability to experiment far greater than any other new or old medium around. As always with these sorts of things, there is a first mover advantage. Can you really afford not to at least get started, and begin iterating from there?
And what if we create so many worlds that — like thousands upon thousands of apps available on the smartphone — consumers grow weary?
Well, I don’t think these extended reality experiences are like apps. They’re more like web pages.
Consumers haven’t grown tired of surfing the Internet. We haven’t grown tired of clicking on links, and in so doing stepping further into a world. We go down rabbit holes because that’s what humans do. We explore, and we tell stories about what we’ve seen, in the world and in our minds.
Arguably this is why we like movies and TV and mobile video so much too — the moving image beckons us to step through an irresistible threshold, transporting us.
What were are talking about here is the one thing that is more compelling than moving images. What’s better than watching Harry Potter? Living it.
Imagine not another war for the home screen, and instead a new kind of Internet, where your first-hand biological experience is the browser, any given frame is the URL, and from there, absolutely anything at all is possible.
Allison is co-founder and CEO of Camera IQ, the first camera experience manager. Camera IQ helps marketers create new worlds that customers love to explore.