Why Snapchat Is Getting Into Augmented Reality

The news that messaging app of the moment Snapchat is investing in building out an augmented reality device similar to the Google Glass product marks a pivotal moment in the five year old company’s history. Snapchat is taking a leaf out of competitor Facebook’s playbook and looking to disrupt both itself and build a disruption-proof content monetization ecosystem.

Augmented Reality Is The Business End of Virtual Reality

2016 is the year of hype around VR (Virtual Reality), yet VR remains restricted by its need to separate the user entirely from the outside world so that they can undergo complete content immersion. The result is a transformative experience, but it limits the applicability of the technology to either entertainment or a specialized niche application such as professional training. AR (Augmented Reality) on the other hand has the key advantage of augmenting the offline world experience. By donning a pair of AR glasses, a user gets enhanced data visualization without the need to seclude themselves from the real world.

This means that AR, despite the Pokemon Go hype, is actually primarily a business tool application that facilitates increased productivity among work groups. As such, it has a much stronger use case for being able to be adopted by everyday businesses for use by their employees. It is the difference between the Xbox and Microsoft Office: VR is primarily a visualization tool while AR is will be primarily a productivity tool.

Snapchat Wants To Grow With Its Audience

Snapchat has experienced rapid user growth over a short period of time, but faces the ever present threat of disruption by another competitor which catches the latest consumer zeitgeist. There are only two ways to minimize this risk, either by buying up potential disruptors (ie Facebook and the Whatsapp acquisition) or by buying up new channels of content distribution which have the potential to migrate audiences away from established digital models (ie Facebook and the Oculus Rift acquisition.) By taking the disruptive distribution acquisition model, Snapchat is betting on buying into a new emerging content distribution model and the ancillary monetization opportunities afforded by that, additionally allowing the company to retain its relationship with its users.   Snapchat also has the strategic objective of retaining relevance to its users, as its ability to deliver a hyper engaged youth-centric audience is key to its relationship with advertisers.

Pokemon Go finally put AR on the map, making it a tangible everyday experience for Snapchat’s key demographic (45% of 16-24 year olds in the UK have played Pokemon Go in the previous month according to MIDiA Research’s latest consumer data.) The user case for AR in entertainment has now been confirmed, but it will be the business case of AR as a productivity tool that really sees the technology become part of working life. When that happens, Snapchat could well own the user relationship between AR acquiring businesses and their workforce.