How Snap and New Balance used AR for a holiday campaign

Snap and New Balance are standing under the mistletoe.

For a holiday campaign that’s running through December, New Balance and Snap have teamed up on a “Holiday Gifting Concierge,” which is basically a questionnaire that combines, for the first time, machine learning speech recognition and Snap’s AR lenses.

These are the kinds of campaigns Snap is looking to in hopes they will bolster its advertising revenue. Snap CEO Evan Spiegel said in an internal memo that he’s aiming to increase AR-based advertising to 10% of Snap’s total advertising revenue next year. A majority of Snap’s revenue to date has come from video ads, Snap spokesperson Ahrim Nam said over email, though she declined to share what percent of those ads are currently AR-based.

FWIW, Snap made $1.13 billion in revenue last quarter—a 6% increase year over year—marking the first time the company’s growth slipped into single digits since it went public five years ago.

How it works: Marketing Brew tried out the branded lens, which starts with a few questions. It asks the user if they’re shopping for themselves, a friend, or a family member, as well as if the gift is for someone who prefers to “spend time in nature” or “enjoy a cozy night in,” among other choices. It also asks what kind of product the user is looking for, like footwear or clothing.

Then, it prompts the user to flip the camera in order to display three floating, wrapped presents, which, when tapped, reveal gift ideas. One item we were matched with was the NB Essentials Wide Legged Sweatpant. Cool?

Users aren’t able to make a purchase on the app and they aren’t directed to the New Balance online store to purchase the recommended gifts. The campaign is more of a brand-awareness play, Sharon Silverstein, Snap’s head of US verticals, who oversees Snap’s work with retail e-commerce partners, explained.

“Depending on what the KPI is for the client, we recommend certain templates. And [the New Balance lens] was more brand awareness,” she told Marketing Brew.

Even so, shoppable inventory is hot, hot, hot right now, and companies ranging from Roku to TikTok (and Snap) are investing in it.

So what’s Snap’s advantage? “We open to the camera, we have scale,” Silverstein said. In January, the company debuted what it calls “Catalog-Powered AR Shopping Lenses,” which enable users to scroll through different products as they’re trying them on in selfie mode. Nam, Snap’s spokesperson, declined to share how much of its revenue comes from shoppable inventory, but said 250 million Snap users have used AR shopping lenses over 5 billion times since last January.

Marketing Brew saw Sunglass Hut using this feature, enabling users to try on sunglasses from brands like Prada and Versace virtually with the option of then making a purchase within the app.

“The hardest part,” Silverstein said, is working to change the perception that AR-based ads are “a heavy load” for advertisers, but added that she has found it easier for clients to understand than the metaverse. “We look at AR as enhancing the things in your real world versus living in a different world. So it is much more digestible for our clients to understand.”