Instagram is Now Augmented Reality’s Biggest Retail Platform

Alexis Macklin, Research Manager Advertising, Apps & Games, Augmented Reality, Augmented Reality Intelligence Service, Imaging & Video, Insight Articles, Media & Entertainment, Software

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As part of its annual developer conference, Facebook announced a major update to its Spark AR platform at F8: Developers will now be able to create AR content for Messenger and Instagram.

The little-discussed expansion would, for the first time, create an outlet to Instagram for third-party developers. With over a billion monthly active users (MAUs), Instagram does not have the largest overall active audience, but it is the biggest social media platform for augmented reality content.

In terms of innovation, Instagram has lagged behind Snapchat. While Snap's social platform may have struggled recently with growing its MAUs, it has been committed with innovating new AR features from product advertisement to games to a brick-and-mortar store with no physical products for sale. Snapchat's platform may provide more meaningful engagement with AR content, but Facebook will be selling something entirely different: brand exposure.

When Instagram first opened Spark AR in closed beta on its platform, select brands were invited to create effects and filters with the platform. Users could then use the content made by the brands by saving them to their account from posts published by the brand. The effects and filters were not available to users natively in app.

Opening Spark AR to third-party developers allows anyone to create an effect easily for free and publish to their account. There will no doubt be a rush from brands to publish marketing content. But they will need influencers (users with a large following that promote a product or a lifestyle) to engage and promote their content to reach their intended audience. While major brands like Nike, NBA, and National Geographic all have large followings on Instagram, some major brands like McDonald's do not even have an official Instagram account. They will need the exposure influencers can provide to promote their content.

(Photo by Instagram)

Facebook's newest updates to Instagram help monetize influencers like never before. In addition to Spark AR's expansion to Instagram, online retail features will be added to the social media platform. In a new shopping feature, brands and influencers can tag products in posts that link to in-app purchases. Naturally, Instagram will receive a cut of the profits.

The future of consumer AR is retail, and Facebook is making moves to become the go-to platform. It is only a matter of time before the shopping feature expands to AR filters and effects.

This will be transformative for the fashion and beauty industry. Instagram is already the biggest platform for promotion of trends for young consumers. Facebook is essentially establishing itself as an online retailer and brands will flock to the platform to pay-and-play to reach millions of young consumers every day.