Augmented reality adoption in marketing communications: agency practitioner and client perspectives

<p>Emerging technologies, technologies whose development and applications are still progressive, are recognised as disruptive forces that profoundly impact businesses across nearly every industry. This is especially true in the advertising and marketing fields, where such technologies have altered how product and service offerings are communicated to consumers. Changing consumer needs for more personalised and engaging experiences through technology compels businesses to adopt such technologies in order to maintain relevance. Among the most novel of those technologies is augmented reality (AR), a technology that overlays digital content in the real environment, which has gained recognition and adoption among businesses as a marketing communications tool. The importance of AR and how it affects consumers is well understood. However, it is the responses of industry professionals - individuals who hold practical experiences in the field that is less known, making their views valuable perspectives into distilling best practices for AR use in marketing communications.</p> <p>This research explores how agency practitioners and marketers (clients) perceive the use of AR in marketing communications in the Malaysian and Australian contexts. It investigates how the agency practitioners and clients understand AR, and the factors that influence their AR development and adoption decisions. Additionally, this research examines their prevailing perceptions of AR’s purpose in marketing communications based on their experiences, along with their projections of AR’s future. Further, to better understand the AR project environment involving the agencies and the clients, this research set out to discover how agency-client relationships function in such projects. The main research questions of this research are, 1) How do agency practitioners and clients define augmented reality?, 2) What are the factors involved in AR adoption for marketing communications?, 3) How do agency practitioners and clients perceive to be the purpose and future of AR in marketing communications?, and 4) What are the major aspects associated with agency-client relationships in AR projects? Given the lack of knowledge in these areas, this research used qualitative methods to unearth the research participants’ experiences and perceptions.</p> <p>This research was conducted in two phases using a semi-structured in-depth interview method. Phase 1 involved interviews with 25 advertising, creative, and digital agency practitioners, and Phase 2 involved interviews with 18 clients, totalling 43 interviews. Purposive and participant-led sampling methods were used, and iterative data collection was conducted until data saturation was achieved. Inductive coding and thematic data analysis method were utilised to analyse the data using NVivo software. Findings from Phase 1 and 2 were discussed by comparing the data from both phases and with that in the existing literature and theories relevant to technology adoption at the organisational level.</p> <p>The three overarching themes identified from the findings are: 1) Knowledge and understanding of AR; 2) AR adoption decisions; and, 3) Agency-client relationships. Overall, the findings indicated that the agency practitioners and clients have a similar understanding of what AR is and their definitions of AR were categorised into these dimensions of: Its realities, capabilities, forms, and types. However, the findings showed that gaps in knowledge exist, as agency practitioners presented a greater comprehension of the technology than clients.</p> <p>The agency practitioner AR development decisions and client AR adoption decisions depend on factors that fall under four distinct contexts: organisational, environmental, technological, and ethical. Organisational culture was also found to influence AR adoption decisions to some degree, specifically those from the Market and Adhocracy culture. As a result, the Framework of AR Implementation for Marketing Communications (FARIMC) outlining guidelines for industry professionals to achieve effective AR outcomes were built following the discussion to respond to the research questions. In addition, a descriptive model - the Model of Augmented Reality Development and Adoption (MARDA) was proposed to explain the factors influencing AR development and adoption decisions at the organisational level. Participant perceptions and projections of the technology also affect their confidence in AR and future adoption decisions. These findings indicated the different perceptions among the agency practitioners and clients regarding AR’s purpose. While both groups viewed AR as an effective customer engagement tool, the agency practitioners believed it is mostly used as a ‘gimmick’ to attract consumer attention. On the other hand, many clients saw AR as a useful tool for brand building. Participants from both groups were mostly confident in AR’s future, mainly due to rapid advancements in AR features and capabilities. However, many participants also indicated there are still barriers to AR adoption and a lack of awareness of the technology. Some thought AR would have better potential in other industries.</p> <p>The findings further suggest the existence of conflict in participant agency-client relationships in AR projects, especially evident among Malaysian practitioners and clients. Mostly, these conflicts were attributed to unmet expectations between parties throughout the relationship lifecycle. Organisational culture may have also played a role, such that those from high power distance cultures displayed power dynamics in their relationships. Participants from high power distance cultures also reported more conflict, probably due to unrealistic and implicit communication of expectations between parties.</p> <p>This research contributes to the technology and marketing literature by investigating the industry professionals’ perceptions of AR in marketing communications. In doing so, this research highlights critical considerations in building effective AR applications for future marketing communication activities by agencies and clients alike. It concludes with theoretical and practical contributions for academia and industry, the research limitations, and suggestions for future research to extend the knowledge of AR and its adoption in the marketing context.</p>