The marketing and advertising industry is under ongoing transformation, with shifting consumption habits and increasing ad avoidance by consumers. Not too long ago, the rise of social media shifted control of communication channels from the advertisers to the consumers and redefined the metrics for success (engagement over impressions). Today's frontier technologies will similarly usher marketers into a new era of advertising. Augmented and Virtual Reality, the Internet of Things and Artificial Intelligence are technologies that will fundamentally transform how brands engage with consumers.

Augmented and Virtual Reality

Augmented Reality (AR) and Virtual Reality (VR) have been around in some form or fashion for years. However, recent uptick in investments and significant advancements in technology are reviving global interest. While AR and VR provide different experiences, they both eliminate the restrictions that 2D screens place on content and communication and create a new kind of "user interface." With AR, digital content can now live in our physical world, and we can interact with each other in unprecedented ways. With VR, we can be immersed within digital worlds of information or entertainment, and share the experience with someone physically far away.

What does this mean for brand marketers?

AR and VR open opportunities for brands to create experiences that are fresh and that are more engaging. Many brands saw this early on and started experimenting with the technology, effectively driving the industry forward by bringing VR experiences to the masses. Dream cars in VR, and this has had a major impact on driving purchases, according to jaguar's head of communications. Supporting the creation of these experiences are the platforms and publishers that brands are already on, such as Snapchat, Facebook and Twitter, which deliver or plan to deliver AR experiences. With new types of experiences come new data sources. Eye-tracking technology can help marketers measure whether and how long someone looks at a product placed in a VR experience, or if, how long, and where someone engages with a physical ad or product in an AR experience. While VR can create more intimate experiences for users, brands have a higher risk of becoming more intrusive. As with other technological innovations, privacy is a significant area of concern that must be addressed.

Internet of Things

The Internet of Things (IoT) refers to sensors, devices and machines that are connected to the Internet and communicate with each other. Connected devices or machines are also referred to as "smart," with the most commonly used smart device being smart phones. As more devices go online—wearables, homes, cars and even city systems—massive volumes of data are generated. This enables the exchange of valuable information that can be used to personalize services and to reduce inefficiencies across an almost infinite number of applications.

What does this mean for brand marketers?

For smart devices that can communicate or share information with humans, the user interface typically involves screen displays. The proliferation of screens—whether on connected watches, connected cars or connected refrigerators—can create distribution opportunities for media, and the data analytics can help marketers learn about the users and ensure highly personalized campaigns. Mobile and Web channels currently provide advertisers with data such as location and previous browsing history, while social media platforms provide additional data sets, such as demographics and preferences. With IoT, information around the usage of a device—a device that can be very specific to a marketer's product—can now be within reach. For example, data from smart refrigerators can enable suggestions for items that need to be restocked. Each connected user device becomes a signal or data source that can help brands create higher-quality experiences.

It is important to note that these frontier technologies are not only transforming industries on their own, but are also converging to accelerate that transformation. If AR is layered on top of connected things, then human-device interaction is no longer limited to screens. Simply looking at your refrigerator (while wearing your AR glass) could give you the information you need. With AR and IoT, the billboards of the future can be a connected bus stop bench or any physical structure that displays information specific to the wearer of the AR glass.

Artificial Intelligence

AI refers to technologies that can complete tasks or solve problems usually performed by humans, including visual and speech recognition and winning a chess game. AI makes "smart" objects intelligent, enabling them to make decisions autonomously (e.g., self-driving cars). It also refers to the ability of machines to learn how to deal with variations of a situation ("machine learning"). Personal assistants such as Siri and other AI technologies are powered by the increasing volume of data generated by IoT, social media and our online consumption behaviors.

What does this mean for brand marketers?

Google, Amazon's Alexa, and Apple's Siri are powerful examples of how AI transforms how users are searching for and consuming information. When users can get answers to their questions through Siri, the ads placed on websites providing those same answers reach fewer people. Using its AI technology, IBM recently launched Watson Ads, a new kind of ad unit that will answer voice or text-based questions from users. This is not unlike the chatbots that Facebook has employed and that many brands have been experimenting with. Image recognition technology is also a data boon for marketers. For example, it can enable a Brand X to display an offer on my social feed if I post an image of me wearing Brand X. AI has myriad applications in the space, including optimized media buying, intelligent targeting of media, improved recommendation of content or products, predictive customer service, and content generation.

Across these technologies, perhaps the biggest driver of change in brand-consumer interactions will be the availability of new data sources and the use of more powerful analytics. While the regulatory and cultural hurdles cannot be ignored, these technologies create opportunities for both brands and consumers in the delivery of more personalized, relevant and engaging content and experiences. However, because the technological applications involve deeper integration into every facet of our lives, brand experiences must be crafted carefully, such that consumers welcome them instead of seeking out the next version of ad blockers.