Use Cases of AR/VR/MR
Use Cases of AR/VR/MR
Understanding
Use Cases for
Augmented, Mixed
and Virtual Reality
JUNE 2018
BY OMAR AKHTAR,
Industry Analyst at Altimeter, a Prophet Company
Table of Contents
2 Executive Summary
3 The Immersive Technology Market Is Expected To Grow Exponentially
4 What's The Difference Between AR, VR And MR?
6 The 5 Use Cases For Immersive Technology
6 Use Case #1: Create Brand Awareness
8 Use Case #2: Train Employees
10 Use Case #3: Test And Learn Customer Needs And Preferences
12 Use Case #4: Build Customer Trust And Confidence In The Product
14 Use Case #5: Bring People Together
16 Getting Started: First Steps For Incorporating Immersive Technologies
Into Your Strategy
18 Endnotes
19 Ecosystem Input
20 About Us
21 How to Work With Us
Executive Summary
Immersive technology, in the form of augmented (AR), mixed (MR) and virtual reality (VR),
is transforming the way we experience and learn about the world around us. It enhances
our reality by letting us interact virtually with people, objects and places we may not have
access to otherwise. It has also opened many opportunities for brands, allowing them to
create experiences for customers and employees that are not “physically” limited. From
demonstrating products to simulating environments, there are endless ways for brands to
engage, entertain and most importantly, enhance the customer and employee experience
through the use of immersive technology.
However, as with any new technology, the idea of using AR or VR poses more questions
than it answers for most companies. What are the specific advantages of each type of
immersive technology? How can they be incorporated into our business strategy? And if
we have to prioritize among them, which technology is most worthy of our investment?
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The Immersive Technology Market Is Expected
To Grow Exponentially
The combined market size for AR and VR is expected to grow from nearly $18 billion in
2018 to $215 billion in 2021.1 That’s a staggering amount of growth in only three years. It
underscores just how quickly immersive technology is expected to go mainstream, rather
than remain a novelty.
According to Emily Olman, CEO of VR/AR experiences company Hopscotch Interactive,
every company should have a plan for how they will incorporate immersive technology
into their business strategy. “It’s a question of when, not if,” says Olman. “The sooner your
company is able to understand the language [of AV/VR] and become fluent in what the
possibilities are, the faster they are going to be able to react.”
Multiple factors have brought us to this tipping point for immersive technology growth.
For starters, the largest tech companies in the world are well into developing the second
or third generations of their AR/VR devices and apps. Samsung, HTC, and Facebook are
focusing on VR headsets; Microsoft is betting on HoloLens, its MR headset; and Apple
and Google are facilitating the development of AR apps for their mobile platforms. The
size of these companies allows them to scale production and offer immersive tech
devices at more affordable price points, which has been one of the biggest barriers to
adoption for most consumers.2
In addition, the quality of the content for AR/VR applications has improved to the point
where it is actually compelling enough for the average consumer. For, the last few years,
only the adult entertainment and gaming industries were creating quality VR content.
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Now, as more content creators embrace the technology, we’re seeing some exciting
possibilities in other industries. Hollywood, for example, has announced plans to produce
VR movies shot with a 360 degree camera, and retail giants like Amazon and IKEA have
launched AR apps that solve a very real problem for consumers: how to visualize product
use before purchase.
Lastly, the wide media coverage of the Pokémon Go craze played a big part in raising
awareness for AR. Not only did the coverage showcase a very compelling and engaging
use of the technology, it revealed just how easy it was to access it. By making Pokémon
Go a downloadable game app that works with just a smartphone, its creators demystified
AR for consumers and other companies alike.
These factors indicate that immersive technology is well on its way to becoming
ubiquitous technology. There are exciting opportunities for brands that understand how
to use it to improve customer and employee experiences—especially since in the future,
customers will expect immersive technologies to be a part of their experiences, rather
than think of them simply as cool gimmicks.
Augmented Reality
This is technology that superimposes a visual experience over a real environment.
A good example is the location-based game Pokémon Go, in which players capture
anime characters that appear on the screen of their mobile phones as if they were part
of the location where players are. For example, you point your mobile phone camera
at a park bench and see, through the phone’s screen, an anime character sitting on it.
More advanced AR experiences, like holograms, project “living” 3D images onto real
environments, which can be seen without any additional devices.
The key feature of AR is that it simply adds to our experience of a real environment
without actually interacting with it. If someone came and sat next to or on the anime
character on the park bench, for example, the character wouldn’t acknowledge them, or
move out of the way. It would simply disappear from the player’s mobile screen.
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Mixed Reality
Mixed reality technology is similar to augmented reality in that it superimposes visuals
onto the real world. However, the key difference is that the virtual image in mixed reality
actually interacts with the real environment onto which it is projected. Microsoft’s
HoloLens is an example of a mixed reality device. It projects images onto the real
environment you are viewing through a headset, but those images are interactive, and
can be manipulated by your real hand. To continue the example above, in MR, the anime
character on the park bench might interact with a real person sitting next to them,
perhaps moving out of the way, or sitting on top of them.
Virtual Reality
VR transports users into a simulated, interactive, three-dimensional environment that is
completely separate from the real world. In its simplest form, a 360-degree video can
qualify as a limited VR experience—limited because it allows you to view, but not interact
with, the virtual environment it projects. In its more complex form, VR transports users
into an environment that’s constructed completely outside their current environment,
with completely virtual visuals and audio. For example, by using headsets such as the
HTC Vive or Oculus Rift, users can play VR games in which they are “dropped” in the
middle of a warzone or on the side of the world’s tallest mountain.
However, before deciding to invest in one type of immersive technology over another,
companies should have a clear idea of what they want to achieve with it. From our
research, we have identified five primary use cases for immersive technology that either
solve a problem or improve an experience for the company’s customer or its employees
(or, in some cases, both). The unique characteristics of each type of technology can make
it more suitable to one or two use cases over the others.
To engage fans during the 2015 US Open, Mercedes-Benz capitalized on its endorsement
deal with tennis legend Roger Federer by creating an interactive hologram of him.
Developed by augmented reality platform VNTANA, the hologram was a full, 3D
projection of Federer that virtually “hit” tennis balls served by fans. The VNTANA platform
automatically recorded the experience and sent a branded email with a GIF or video to
share on social media.
According to VNTANA, almost 8,000 fans went through the activation, a 20 percent
increase in consumer engagement over past year’s events. VNTANA CEO Ashley Crowder
believes using AR in this case is a far more effective way to leverage an endorsement deal
than traditional advertising. “You pay millions of dollars to air one commercial, but that’s
usually it,” says Crowder. “With the hologram, the celebrity can interact with thousands of
fans, in a way that just wasn’t possible before.”
Figure 1: Roger Federer gets ready to serve the ball to his hologram at the 2015 US Open
IMAGE: VNTANA
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Use Case #2: Train Employees
Immersive technology has proven to be an effective way to train employees on using
new products, interacting with customers and responding to situations. It gives
employees as close to a real-life experience as possible, without having to bear the costs
of mistakes. And it’s also a faster and more compelling way to teach than handing out
manuals or offering the information in a presentation, since people can learn by doing,
rather than reading.
In some cases, it’s cheaper to simulate and control the entire training environment
using VR, rather than project it onto a real environment like we do in MR. For example, a
leading airline decided to train its technical operations team using virtual reality headsets
because it was cheaper than getting access to a real aircraft.
Figure 2: Medical students can view and interacts with a 3D image of the human body through
Microsoft's Hololens
IMAGE: Microsoft
Walmart partnered with VR training company STRIVR to create a virtual reality training
program at all 200 of its training academies across the country.4 Using Oculus Rift
headsets, the virtual program trains new employees on three types of situations: special
events such as Black Friday, customer service protocols, and logistical best practices
such as re-stocking shelves and storage.
In each training session, trainees’ headsets are hooked up to a large screen so the rest
of the classroom can see what they are seeing, while a teacher critiques their actions.
In addition, the headset records the eye-movements of the trainees, giving valuable
feedback to the program creators about how the users are engaging with the content. As
a result, 70 percent of trainees who used VR did better on their learning evaluation exams
versus those who didn’t. The VR trainees also reported a 30 percent increase in overall
training satisfaction, compared to the non-VR trainees.
Figure 3: A Walmart employee undergoing situational training using a VR headset
IMAGE: Walmart
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Use Case #3: Test And Learn Customer Needs And Preferences
Companies that make large or complex products often run into problems when they
want to test their prototypes with real consumers. It can be too expensive or logistically
difficult to transport prototypes to a place where there are enough testers to provide
credible results. By letting testers interact with a virtual prototype of a product instead of
the real thing, companies can get early insight into consumer preferences, design issues
and usage.
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Organic baby food manufacturer Happy Family used VR to figure out the best way to
stock their products in retail stores.5 Partnering with VR experiences company InContext
Solutions, Happy Family created a realistic shopping experience where customers could
browse virtual shelves stocked with baby food, pick up products and read their labels, and
finally place them in a virtual shopping cart. Customers navigated the virtual food aisle
projected on a large screen by controlling their actions with a mouse and special controller.
This shopping simulation allowed Happy Family to virtually test several different product
layouts on a large number of consumers in a cost effective way. Over 200 baby food
purchasers generated 800 responses, giving Happy Family valuable insights into
consumer behavior and optimal shelf configuration. For example, they found that reducing
the number of brands on the shelf got more positive responses from consumers, and
taking up more space on a shelf improved consumer confidence in that brand.
Remarkably, setting up the entire test took only three and a half months from the time
the initial idea was conceived to the day the first virtual test was conducted, further
highlighting the speed and effectiveness of using virtual tech to gain real-world insights.
Figure 4: A virtual shopping aisle created to test shoppers of Happy Family baby foods
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Use Case #4: Build Customer Trust And Confidence
In The Product
Immersive technologies offer companies a great way to demonstrate the value of their
product to customers who might be skeptical. They are especially useful for companies
whose products are likely to elicit buyer’s remorse, for example, luxury cars, large
appliances or furniture. Since these products are not easily purchased-- and cannot be
easily returned either--buying cycles are very long and consumers often have a great deal
of anxiety about purchasing them.
Enter immersive tech. By demonstrating exactly how a product works or what it actually
looks like, these technologies help companies overcome consumer doubt. For example,
IKEA’s AR app allows customers to “place” a 3D image of a piece of furniture within their
room to see what it looks like before they buy it.
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Hardware and home improvement retailer Lowe’s partnered with Microsoft HoloLens
to create a mixed reality experience that helped customers visualize what a home
renovation project would look like. Customers wearing the HoloLens headset could stand
in a Lowe’s kitchen showroom and use simple hand gestures to superimpose different
options on the real objects they were considering. For example, customers were able
to “try” various colors, sizes or textures for cabinetry, hardware, counter tops, and
appliances. They could also instantly view the price for any option they chose to try.
For Lowe’s customers, the HoloLens mixed reality experience helped take the guesswork
out of a renovation project and gave them the ability to visualize the options they had to
choose from. By providing this experience, Lowe’s removed one of the biggest obstacles
to buying their products: the fear that it could all turn out wrong.
Figure 5: A Lowe's customer viewing a virtual kitchen with features being customized in real-time
by an employee
IMAGE: Lowe's
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Use Case #5: Bring People Together
Companies that want to extend the reach of their events, bring communities of
customers together to discuss products or tips, or foster greater communication
between their employees can benefit greatly from immersive technologies. For example,
a large, global organization might be able to bring together several teams from different
countries in a simulation that feels as close to an in-person meeting as possible. Or a
company might be able to allow customers to virtually experience a live event they aren’t
able to physically attend (think of sold out musical concerts).
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To prove the positive emotional and social impact of VR-based interactions, Facebook
commissioned a study that observed 60 participants aged 18 to 51 who took part
in one-on-one virtual conversations while wearing an Oculus Rift VR headset. Each
“VR conversation” took place in an environment that resembled a train cabin, where
participants interacted with virtual avatars of each other. The participants had EEG
sensors record their brain signals and monitor their levels of comfort and engagement
The study found that most participants had overwhelmingly positive emotions during
these virtual interactions, which, they found got easier and more positive over time.
These results were especially true for people who identified themselves as introverts.
Participants also noted that they felt comfortable revealing personal details about
themselves and believed that VR reduced appearance-based judgments.
“It was a lot deeper, and enjoyable, and closer to life than I expected,” said one 43-year-
old male participant. “We moved from two strangers having the same (superficial)
conversation to two humans revealing themselves and their experience of life.”7
Figure 6: Strangers meeting and talking to each other in a virtual room using Facebook’s Oculus Rift
VR headsets
IMAGE: Facebook
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Getting Started: First Steps For Incorporating
Immersive Technologies Into Your Strategy
As you begin to consider incorporating immersive tech into your business strategy,
we’ve compiled a list of initial steps that will help you fully capitalize on it and adapt to its
continued evolution.
Decide what you will use it for: The best way to choose a use case for
immersive tech is to have a deep understanding of your customer and
employee needs. Create a data-proven ranking of your customers; or
employees' biggest pain points and see where immersive technology could
make the biggest impact.
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Visualize outcomes to secure executive support: The best way to sell a new
technology to skeptics and naysayers within a company is to paint a picture
of its potential success. That is quite literally, what Lowe’s Innovation Labs did,
when it first had the idea to deploy a mixed reality experience for visualizing
home renovation.
The Lab created a comic book that told the story of a young couple who
couldn’t agree on how to redecorate their kitchen. The couple then walks into
a Lowe’s showroom, where they both wear VR goggles to visualize and discuss
their new kitchen, and walk out in harmonious agreement.
Lowe’s eventually brought this comic book vision to life several years later when
they partnered with HoloLens. The compelling imagery of the idea—and what it
would look like if it worked—was instrumental in securing executive support and
aligning stakeholders to a common goal.
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Get your 3D assets together: On a more practical level, it’s a good idea to
locate, gather and centralize all your company’s 3D creative assets (AutoCAD
files for example) in an easily accessible repository. This makes it a lot easier for
vendors who are tasked with creating immersive experiences for your company.
“Every company has 3D models of their product somewhere, but finding them
can be really hard sometimes,” says Ashley Crowder, CEO of VNTANA. “It can
keep costs lower if you can organize your 3D assets, or at least know who to ask
and where to find them.”
Not only does the integrated data flow help recognize customer preferences
across all channels, it helps align all the different stakeholders within the
company on the goals and expectations of the immersive technology.
Endnotes
1
Statista 2018 “Forecast augmented (AR) and virtual reality (VR) market size worldwide from
2016 to 2021 (in billion U.S. dollars)” https://www.statista.com/statistics/591181/global-
augmented-virtual-reality-market-size/
2
“Virtual Reality Industry Survey” VR Intelligence, March 2017 http://vr-intelligence.com/vrx/
docs/VRX-2017-Survey.pdf
3
Clifton Leaf, “How Virtual Anatomy Will Change Med School” Fortune, April 21, 2017
http://fortune.com/2017/04/21/ar-cleveland-clinic-med-school/
4
Richard Feloni, “Walmart is using virtual reality to train its employees,” Business Insider, June 1
2017 http://www.businessinsider.com/walmart-using-virtual-reality-employee-training-2017-6
5
Adam Blair, “Virtual Reality Product Testing Improves Merchandising For Baby Food Brand”
Retail Touchpoints, April 6, 2016 https://www.retailtouchpoints.com/features/retail-success-
stories/virtual-reality-product-testing-improves-merchandising-for-baby-food-brand
6
“Groundbreaking Virtual Reality Research Showcases Strong Emotional Engagement for
Brands, According to YuMe and Nielsen” November 9, 2016 https://www.businesswire.com/
news/home/20161109005274/en/Groundbreaking-Virtual-Reality-Research-Showcases-Strong-
Emotional
7
“How Virtual Reality Facilitates Social Connection” Facebook IQ, January 9, 2017 https://www.
facebook.com/iq/articles/how-virtual-reality-facilitates-social-connection
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ECOSYSTEM INPUT
This report could not have been produced without the generous input from the following
people (input into this document does not represent a complete endorsement of the
report by them):
Josh Shabtai, Director, Labs Productions & Operations, Lowe's Innovation Labs
Les Seifer, Senior Director and head of creative, Tremor Video DSP
OPEN RESEARCH
This independent research report was 100% funded by Altimeter, a Prophet Company.
This report is published under the principle of Open Research and is intended to advance
the industry at no cost. This report is intended for you to read, utilize, and share with
others; if you do so, please provide attribution to Altimeter, a Prophet Company.
PERMISSIONS
The Creative Commons License is Attribution-Noncommercial ShareAlike 3.0 United
States, which can be found at https://creativecommons.org/licenses/by-nc-sa/3.0/us/.
Disclaimer
ALTHOUGH THE INFORMATION AND DATA USED IN THIS REPORT HAVE BEEN PRODUCED AND PROCESSED ALTHOUGH
THE INFORMATION AND DATA USED IN THIS REPORT HAVE BEEN PRODUCED AND PROCESSED FROM SOURCES
BELIEVED TO BE RELIABLE, NO WARRANTY EXPRESSED OR IMPLIED IS MADE REGARDING THE COMPLETENESS,
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THE OPINIONS EXPRESSED HEREIN ARE SUBJECT TO CHANGE WITHOUT NOTICE .
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ABOUT US
Omar Akhtar, Industry Analyst
As an analyst for Altimeter, Omar publishes research that helps companies thrive on
digital disruption. His areas of focus include content strategy, digital marketing and
marketing technology. These research reports include industry benchmarks, maturity
models, guides for developing strategies, and frameworks for evaluating people,
processes and tools.
Omar holds a masters degree in journalism from Columbia University and was formerly
the editor-in-chief of the digital marketing blog The Hub Comms. He was also a writer for
Direct Marketing News, PRWeek, Fortune and The Brooklyn Ink.
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