Augmented reality (AR) describes an interactive, three-dimensional experience combining the real world with computer-generated elements. Another way to think of augmented reality is that the technology is an enhanced version of the real physical world. This enhancement is driven by computer-generated perceptual information across multiple modalities, including visual, auditory, haptic, and even olfactory.
Augmented reality devices began to emerge in the 1960s and 70s, with the first wearable technology released in 1980. The AR industry is finally exploding by the 2020s, thus transforming into a multi-billion dollar industry.
ScienceSoft is a company with over 16 years of experience in augmented reality and 25 years in 3D visualization and analysis software, particularly in the oil and gas industry.
ScienceSoft AR apps can scan real-life surroundings with a camera lens and translate the data into a depth map for realistic 3D model placement. The app can also be trained to recognize specific two-dimensional images and three-dimensional real-life objects.
The company’s augmented reality products are also used by trainee doctors to simulate various medical procedures. What’s more, retail businesses use the technology to create virtual fitting rooms, catalogs, or entire virtual supermarkets.
Niantic
Niantic is a self-described leader in augmented reality.
Many people know Niantic as the creator of Pokémon Go, a mobile game that brought augmented reality to the masses and remains the most popular such game today. The company, which is a Google spin-off, is also behind the games Harry Potter: Wizards Unite and Ingress Prime.
Niantic’s real-world AR platform Niantic Lightship claims to be able to accommodate hundreds of millions of users and manages shared state, communication, security, mapping, and other AR functionality.
Apple
Apple is the world’s largest augmented reality platform, with hundreds of millions of AR-enabled devices and thousands of apps.
Some of the various ways the company is utilizing AR include:
Complete Anatomy – using a combination of LiDAR and Motion Capture, physiotherapists and their patients will be able to use AR to assist in mobility improvements during injury recovery.
Snapchat – perhaps the most mainstream use of augmented reality can be seen in the social networking app Snapchat. Using the LiDAR scanner on the iPhone, users can transform their space into a magical forest and have vines growing up their interior walls.
iScape – an app that helps visualize landscape design ideas for outdoor living.
JigSpace – for individuals who must know how everything works, JigSpace lets them learn about the inner workings of jet engines, coral reefs, and everything in between.
Lucyd
Lucyd is a company merging augmented reality with blockchain, releasing a portable line of AR smart glasses in 2017.
The glasses rely on the company’s Lucyd Lab AR blockchain, with users having the opportunity to create content and apps in exchange for LCD coins – the company’s proprietary cryptocurrency.
Some of the core features of the glasses include a front camera, eye tracking, a built-in microphone, wireless charging, and Bluetooth connectivity.
Zappar
Zappar is the world’s leading augmented reality and creative studio with a focus on helping clients develop AR and WebAR strategies.
Specifically, the company uses award-winning SDKs, computer vision libraries, AR creative tools, CMS, and data dashboards to develop and deploy AR marketing content. Zappar also provides training on designing and developing augmented reality products.
Key takeaways:
Augmented reality (AR) describes an interactive, three-dimensional experience combining the real world with computer-generated elements. ScienceSoft scans real-life surroundings with a camera lens and translates the data into a realistic 3D model placement. The company also sells technology to trainee medical professionals and retailers, among other things.
Niantic is a pioneer in augmented reality gaming, responsible for titles like Pokémon Go and Harry Potter: Wizards Unite. Tech giant Apple also offers countless AR apps through the App Store.
Lucyd is a company merging augmented reality glasses with blockchain, while Zappar is a creative studio with a focus on using AR to drive brand awareness. The latter also provides training on designing and developing augmented reality experiences.
Aspect
Description
Advantages
Drawbacks
Examples
AR Hardware
Some AR companies focus on developing and selling hardware devices that enable AR experiences, such as AR glasses or headsets. These devices are designed for consumers, professionals, or enterprise use cases.
– Revenue from hardware sales: Selling AR devices can provide a significant source of revenue. – Immersive experiences: High-quality hardware can offer immersive AR experiences. – Professional and enterprise applications: AR hardware can be tailored for use in industries like healthcare, manufacturing, or education.
– High development costs: Developing AR hardware can be capital-intensive. – Competition: The AR hardware market is competitive, with established players like Microsoft and newcomers entering the space. – Adoption challenges: Widespread consumer adoption may take time due to cost, design, or use-case limitations. – Hardware limitations: Keeping devices lightweight, comfortable, and affordable while maintaining performance can be challenging.
Magic Leap, Microsoft HoloLens, Vuzix
AR Software and Platforms
Many AR companies focus on developing software and platforms that enable AR content creation, development, and deployment. These platforms may target developers, businesses, or consumers interested in creating or using AR applications.
– Diverse user base: AR software and platforms can cater to a wide range of users, including developers, businesses, and consumers. – Scalable business model: Licensing or subscription fees can provide scalable revenue. – Customization: Offering tools for AR content creation and development allows users to tailor experiences to their needs.
– Market competition: AR software and platform providers face competition from established tech giants and startups. – Rapid technology evolution: Keeping up with advancements in AR technology is essential. – Adoption challenges: Encouraging users to embrace AR development or consumption can be challenging. – Developer ecosystem: Building a thriving developer ecosystem is critical for platform success.
Unity Technologies, PTC (Vuforia), ZapWorks
AR Content Creation
Some AR companies focus on creating AR content, such as apps, games, or experiences, that users can enjoy on AR-enabled devices. These companies may develop content for entertainment, education, marketing, or other purposes.
– Creative opportunities: AR content creators have the freedom to develop unique and innovative experiences. – Revenue from content sales: Selling AR apps or experiences can generate revenue. – Brand engagement: AR can be used for marketing campaigns, increasing brand engagement. – Entertainment and education: AR content can entertain and educate users in various ways.
– Content discovery: Getting users to discover and download AR content can be challenging. – Market competition: The app stores are crowded, making it challenging to stand out. – Content quality: Maintaining high-quality AR experiences is essential for user satisfaction. – Development costs: Creating compelling AR content can be resource-intensive.
Pokemon GO, Snapchat, IKEA Place
AR Advertising and Marketing
AR companies in this category focus on offering AR solutions for advertising and marketing purposes. They create AR campaigns, tools, or platforms that allow brands and businesses to engage with consumers through augmented reality experiences.
– Engaging marketing campaigns: AR can create interactive and memorable marketing experiences. – Brand exposure: AR advertising can attract attention and increase brand exposure. – Data and analytics: AR marketing can provide valuable user engagement data and insights. – Innovation: AR allows brands to demonstrate innovation and creativity in their campaigns.
– Adoption challenges: Encouraging brands to adopt AR advertising may require education and demonstration of ROI. – Privacy concerns: Collecting user data for AR advertising should be done transparently and with user consent. – Technical complexity: Developing AR marketing campaigns can be technically challenging and requires specialized skills. – Competition: Brands have many advertising options, and AR is just one of them.
Snapchat AR Ads, Zappar, Blippar
AR Navigation and Visualization
AR companies may focus on developing AR solutions for navigation, wayfinding, or data visualization purposes. These solutions are often used in industries like automotive, aviation, real estate, and urban planning to provide users with augmented information and guidance.
– Enhanced situational awareness: AR navigation and visualization tools can improve users’ understanding of their surroundings. – Safety benefits: AR can enhance safety in industries like aviation, where pilots can receive critical data in real-time. – Professional applications: AR solutions are used in professional and industrial contexts, creating business opportunities. – Data-driven decisions: AR can help users make informed decisions based on real-time data.
– Specialized markets: Targeting industries with specific AR needs may limit the addressable market. – Development complexity: Building accurate AR navigation and visualization solutions can be complex. – Integration challenges: Integrating AR solutions into existing systems or workflows may require effort and resources. – Regulation and standards: Some industries have strict regulations for AR use, requiring compliance.
An effective business model has to focus on two dimensions: the people dimension and the financial dimension. The people dimension will allow you to build a product or service that is 10X better than existing ones and a solid brand. The financial dimension will help you develop proper distribution channels by identifying the people that are willing to pay for your product or service and make it financially sustainable in the long run.
Business modelinnovation is about increasing the success of an organization with existing products and technologies by crafting a compelling value proposition able to propel a new business model to scale up customers and create a lasting competitive advantage. And it all starts by mastering the key customers.
Digital and tech business models can be classified according to four levels of transformation into digitally-enabled, digitally-enhanced, tech or platform business models, and business platforms/ecosystems.
A digital business model might be defined as a model that leverages digital technologies to improve several aspects of an organization. From how the company acquires customers, to what product/service it provides. A digital business model is such when digital technology helps enhance its value proposition.
A tech business model is made of four main components: value model (value propositions, mission, vision), technological model (R&D management), distribution model (sales and marketingorganizational structure), and financial model (revenue modeling, cost structure, profitability and cash generation/management). Those elements coming together can serve as the basis to build a solid tech business model.
A platform business model generates value by enabling interactions between people, groups, and users by leveraging network effects. Platform business models usually comprise two sides: supply and demand. Kicking off the interactions between those two sides is one of the crucial elements for a platform business model success.
A Blockchain Business Model is made of four main components: Value Model (Core Philosophy, Core Value and Value Propositions for the key stakeholders), Blockchain Model (Protocol Rules, Network Shape and Applications Layer/Ecosystem), Distribution Model (the key channels amplifying the protocol and its communities), and the Economic Model (the dynamics through which protocol players make money). Those elements coming together can serve as the basis to build and analyze a solid Blockchain Business Model.
In an asymmetric businessmodel, the organization doesn’t monetize the user directly, but it leverages the data users provide coupled with technology, thus have a key customer pay to sustain the core asset. For example, Google makes money by leveraging users’ data, combined with its algorithms sold to advertisers for visibility.
In an asymmetric businessmodel, the organization doesn’t monetize the user directly, but it leverages the data users provide coupled with technology, thus having a key customer pay to sustain the core asset. For example, Google makes money by leveraging users’ data, combined with its algorithms sold to advertisers for visibility. This is how attention merchants make monetize their business models.
While the term has been coined by Andrew Lampitt, open-core is an evolution of open-source. Where a core part of the software/platform is offered for free, while on top of it are built premium features or add-ons, which get monetized by the corporation who developed the software/platform. An example of the GitLab open core model, where the hosted service is free and open, while the software is closed.
Cloud business models are all built on top of cloud computing, a concept that took over around 2006 when former Google’s CEO Eric Schmit mentioned it. Most cloud-based business models can be classified as IaaS (Infrastructure as a Service), PaaS (Platform as a Service), or SaaS (Software as a Service). While those models are primarily monetized via subscriptions, they are monetized via pay-as-you-go revenue models and hybrid models (subscriptions + pay-as-you-go).
Open source is licensed and usually developed and maintained by a community of independent developers. While the freemium is developed in-house. Thus the freemium give the company that developed it, full control over its distribution. In an open-source model, the for-profit company has to distribute its premium version per its open-source licensing model.
The freemium – unless the whole organization is aligned around it – is a growth strategy rather than a business model. A free service is provided to a majority of users, while a small percentage of those users convert into paying customers through the sales funnel. Free users will help spread the brand through word of mouth.
A freeterprise is a combination of free and enterprise where free professional accounts are driven into the funnel through the free product. As the opportunity is identified the company assigns the free account to a salesperson within the organization (inside sales or fields sales) to convert that into a B2B/enterprise account.
A marketplace is a platform where buyers and sellers interact and transact. The platform acts as a marketplace that will generate revenues in fees from one or all the parties involved in the transaction. Usually, marketplaces can be classified in several ways, like those selling services vs. products or those connecting buyers and sellers at B2B, B2C, or C2C level. And those marketplaces connecting two core players, or more.
B2B, which stands for business-to-business, is a process for selling products or services to other businesses. On the other hand, a B2C sells directly to its consumers.
A B2B2C is a particular kind of business model where a company, rather than accessing the consumer market directly, it does that via another business. Yet the final consumers will recognize the brand or the service provided by the B2B2C. The company offering the service might gain direct access to consumers over time.
Direct-to-consumer (D2C) is a business model where companies sell their products directly to the consumer without the assistance of a third-party wholesaler or retailer. In this way, the company can cut through intermediaries and increase its margins. However, to be successful the direct-to-consumers company needs to build its own distribution, which in the short term can be more expensive. Yet in the long-term creates a competitive advantage.
The C2C business model describes a market environment where one customer purchases from another on a third-party platform that may also handle the transaction. Under the C2C model, both the seller and the buyer are considered consumers. Customer to customer (C2C) is, therefore, a business model where consumers buy and sell directly between themselves. Consumer-to-consumer has become a prevalent business model especially as the web helped disintermediate various industries.
A retail business model follows a direct-to-consumer approach, also called B2C, where the company sells directly to final customers a processed/finished product. This implies a business model that is mostly local-based, it carries higher margins, but also higher costs and distribution risks.
The wholesale model is a selling model where wholesalers sell their products in bulk to a retailer at a discounted price. The retailer then on-sells the products to consumers at a higher price. In the wholesale model, a wholesaler sells products in bulk to retail outlets for onward sale. Occasionally, the wholesaler sells direct to the consumer, with supermarket giant Costco the most obvious example.
The term “crowdsourcing” was first coined by Wired Magazine editor Jeff Howe in a 2006 article titled Rise of Crowdsourcing. Though the practice has existed in some form or another for centuries, it rose to prominence when eCommerce, social media, and smartphone culture began to emerge. Crowdsourcing is the act of obtaining knowledge, goods, services, or opinions from a group of people. These people submit information via social media, smartphone apps, or dedicated crowdsourcing platforms.
In a franchained business model (a short-term chain, long-term franchise) model, the company deliberately launched its operations by keeping tight ownership on the main assets, while those are established, thus choosing a chain model. Once operations are running and established, the company divests its ownership and opts instead for a franchising model.
Businesses employing the brokerage business model make money via brokerage services. This means they are involved with the facilitation, negotiation, or arbitration of a transaction between a buyer and a seller. The brokerage business model involves a business connecting buyers with sellers to collect a commission on the resultant transaction. Therefore, acting as a middleman within a transaction.
Dropshipping is a retail business model where the dropshipper externalizes the manufacturing and logistics and focuses only on distribution and customer acquisition. Therefore, the dropshipper collects final customers’ sales orders, sending them over to third-party suppliers, who ship directly to those customers. In this way, through dropshipping, it is possible to run a business without operational costs and logistics management.
Gennaro is the creator of FourWeekMBA, which reached about four million business people, comprising C-level executives, investors, analysts, product managers, and aspiring digital entrepreneurs in 2022 alone | He is also Director of Sales for a high-tech scaleup in the AI Industry | In 2012, Gennaro earned an International MBA with emphasis on Corporate Finance and Business Strategy.
