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As a part of its pitch to advertisers, Meta announced augmented reality with Reels ads and Facebook Stories at Thursday’s NewFronts presentation.
Brands such as Sephora and Tiffany & Co. tested Meta’s update, which included AR filters to market to the company’s younger audience. Previously, Meta offered AR ads in its Facebook and Instagram feed and Stories. The company said these ads drove total ad recall in the 18-24 demographic 87% of the time, outperforming ads that did not use AR.
“Meta has caught the room’s attention,” said Peter Chun, global head of partnerships at VaynerMedia. “They will need to continue executing for another quarter or two to force change, but this is their breaking-the-sound-barrier moment.”
Meta reported revenue growth in the first quarter, after three consecutive quarters of decline. During its recent Q1 earnings call, CEO Mark Zuckerberg attributed part of the boosted earnings to AI for helping to push Reels videos to users.
With the news, Meta’s AR ads could position the company to compete with Snap for marketers’ ad dollars. Snap introduced a slew of new ad solutions earlier this week at NewFronts, including First Story, a format where advertisers can reserve the first Snap Ad. The platform is also testing sponsored links in its AI chatbot, My AI.
“I think we will quickly get to a world where AR and AI intersect and will be a commodity across platforms,” said Chun. “We plan to test Meta AR performance versus Snap’s. However, it’s too early to think about budget shifts.”
Chun did not disclose the agency’s Snap spend but said its overall investment on that platform continues to grow.
Sephora tested Meta’s AR Reels ads to create an immersive experience with a press of one’s thumb to generate an “aura vibe” to help select the most fitting fragrances. After trying the filter in-camera, users could visit Sephora’s best-selling fragrances to make a purchase. Sephora saw incremental reach and engagement, with over half the audience being Gen Z.
Similarly, Tiffany & Co. created an immersive AR experience using AR Reels ads to celebrate the reopening of its newly renovated Fifth Avenue flagship store, The Landmark, in New York. Users could experience The Landmark while enjoying Jean Schlumberger’s jewel-encrusted creations.
