Augmented reality and virtual reality: integration across industries

Increased integration of augmented and virtual reality across industries 

The technology-Supertrend virtual and augmented reality is gaining more prominence throughout the economy: Enterprises are increasingly integrating augmented and virtual reality technology into their workflows. This not only improves the industry’s efficiency, but also offers interesting investment opportunities.  

Industries profit from virtual and augmented reality technology

The Credit Suisse technology-Supertrend augmented and virtual reality is establishing itself across industries: As the following examples show, they reach almost all areas of life. From the gaming market to retail firms and the healthcare sector, companies profit extensively from the technological advantages.

Therefore, capital expenditure in the virtual and augmented reality market continues to grow as enterprises explore the technology and recognize its value. As per Digi-Capital, venture capital investments in virtual and augmented reality amounted to 7.2 billion US Dollar during the fourth quarter of 2017until the third quarter of 2018. Out of those 4 billion US Dollar were invested in computer vision and augmented reality technology, which is expected to accelerate on a broader base. 

Gaming sector remains central to the virtual and augmented reality market

The Gaming sector, an early adopter, will remain a strong contributor to the augmented and virtual reality software market. It has strongly adopted virtual reality technology driven by the large user base and gamers’ willingness to spend. As per Market Research Future, the global virtual reality gaming market could surpass 14 billion US Dollar in value by 2023.

Apart from gaming, entertainment fields including sports are also exploring the idea of a virtual reality-driven audience. The National Basketball Association recently collaborated with Intel on a solution through which a person wearing a virtual reality headset can enjoy matches from a remote location.

Mobile augmented reality attracts more content providers 

Retail firms are enhancing shopping experience with product visualizations in the customer’s environment. App-based virtual fitting rooms and contextual product information in stores could further enhance marketing efforts. This highlights the likelihood of a largescale mobile augmented reality adoption in the consumer segment, such as e- or m-commerce.  

In the automotive space, augmented reality is already being used to provide visuals of vehicle configurations to a prospective client and also as part of mobile apps that let the customer hover his phone over car components and receive contextual, manual-like information.

Further virtual and augmented reality industry examples

  • Architecture, real estate, and interior designing businesses: Since often limited to scale models and 2D designs, virtual and augmented reality technology can be utilized to provide virtual walkthroughs with 3D models.
  • Healthcare and medicine: Software providers create value by enabling remote assistance for surgeons and remote pre- and post-operative consultations for patients. Furthermore, virtual reality-based phobia treatment and surgery simulation are potential fields for usage.
  • Academic and corporate education: Virtual reality simulations especially come in handy where trainings with real equipment are expensive and risky, for example in the military and the aerospace industry. The segment generated 116.7 million US dollar in revenues in 2017 and is expected to generate 2 billion US dollar by 2022.
  • Prototyping: Industries such as automotive that rely on expensive and time-consuming product prototyping can realize enormous cost savings through virtual reality simulations.
  • Logistics and operations: The logistics company DHL recently introduced Google Glass’ Enterprise Edition in its warehouse operations for contextual visual information such as instructions and navigation. As per DHL, this resulted in an operational efficiency increase of 15 percent on average.
  • Travel: The travel company Thomas Cook collaborated with Visualise to produce virtual reality-compatible 360° videos as a new marketing strategy to let customers immerse in a holiday destination and visualize a trip before booking.

Augmented and virtual reality investment by industry in three years 

Firms invest more in augmented reality than in virtual reality (percentage of firms).

Source: PwC (Global digital IQ survey, 2017), Credit Suisse

Investment conclusions for the augmented and virtual reality market

Experts continue to believe that the virtual and augmented reality market can grow significantly over the next few years. Promising investment opportunities could be possible in hardware and software platform providers on the consumer and enterprise side as well as gaming stocks. Those might structurally grow over the longer term as the move to mobile offers a larger addressable market.