Can Augmented Reality Breathe New Life Into Banner Ads?

Early executions show a boost in engagement, CTR

Taking a page from the leader of the free world, companies want to use AR to make digital ads great again.
Home Depot

The very first banner ad on the Internet—for AT&T on Wired in 1994—had a click-through rate (CTR) of 44 percent. Now that the novelty has worn off, that rate is more like 0.05 percent.

Add augmented reality (AR), however, and it may be a different story. Taking a page from the leader of the free world, companies like Blippar and Oath want to use AR to make digital ads great again. But, like Trump’s presidency, can it last?

How brands are using AR in digital advertising

Chris Bell, regional commercial director of APAC at AR company Blippar, said in a recent blog post that the opportunity with these ads is to marry the high reach of display media with the interactivity, personalization and realism of AR.

Blippar rolled out its AR ad unit in May 2017, which it said uses a smartphone or desktop camera to deliver interactive, contextually relevant AR experiences from banner ads. Since then, Bell said brands have seen a 30 percent greater engagement rate, and dwell time has increased by more than 11 times. While the specific engagement rates for these efforts are unclear, Blippar has worked with Jaguar Land Rover and Honda to give users an inside look into a new car and to deliver a “fanciful” holiday experience, respectively.

Blippar is not alone in trying to spruce up digital ads through AR. Oath, formerly known as AOL and Yahoo, is offering its own AR ad format in the U.S., aiming to spice up email banner ads on the Yahoo Mail app.

Oath tested the unit with Pottery Barn and The Home Depot, which allowed consumers to see what furniture and holiday decorations would look like in their homes. As a result, consumers spent an approximate average of two minutes interacting with the ads, and the Home Depot campaign had a 12.5 percent CTR. (Pottery Barn would not share its CTR.)

John DeVine, chief revenue officer of Oath, said his goal is to create ads consumers want to see, much like ads in magazines like Vogue.

Home Depot tested AR ads during the holiday season to show consumers what a Christmas tree and its decorations would look like, hoping to excite customers about its selection.

“Holiday decorations are a personal reflection of your own style, so we wanted a way to showcase the decorating options available and to make sure customers were comfortable and confident,” said Erin Everhart, senior manager of media strategy and mobile at Home Depot.

Everhart said Home Depot has been using AR since 2013 in applications that allow customers to pick patio sets and paint colors. The Home Depot app also allows customers to visualize products like vanities, faucets, lighting and décor. But this was the first time it ran AR ads in an actual ad unit.

“We know that a person’s home is going to be their biggest investment, and the products they choose [are] a direct reflection of who they are,” Everhart said. “We can empower them by using technology to build that confidence to make sure the product they’re buying is the right one before they make that commitment.”

From chairs to lipstick

When consumers tapped on the Pottery Barn ad, they were able to see how furniture could fit in their homes. This, in turn, made the process of choosing these bulky items a little easier, said Felix Carbullido, CMO of Pottery Barn parent Williams-Sonoma. “What’s really cool was because of the camera on your phone and the AR kit we leveraged, everything is actually to scale,” he said.

He explained that if viewers tapped on an ad for a leather chair, the chair would be dropped in the room using AR, and “you could get a realistic idea” about how it would look and fit, which are “the two things that we’re excited about with AR.”

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