Dive Brief:

• Baidu, the search engine typically referred to "China’s Google," has been active in experimenting with augmented reality for two years and, according to Forbes, recently launched an AR lab to develop AR services in education, healthcare, marketing and tourism.
• Last summer’s viral mobile game hit Pokemon Go was the first major exposure most U.S. audiences had to AR, but, as the scope of Baidu’s AR lab illustrates, applications of the technology are much further along overseas. For example, some of China's tech companies hide AR "coupons" around real-world locations for consumers to find, per Forbes. 
• Baidu is also working with a number of big-name brands including L'Oreal, KFC and Lancôme for AR ads that allow Chinese consumers to interact with virtual products on their mobile devices.

Dive Insight:

The retail capabilities of AR hold huge potential for brands stateside, as Baidu's partnerships with L'Oreal, KFC and Lancôme demonstrate. A number of U.S. tech players, including Google and Snapchat, have shown strong signs of interest in this area. Late last year, Snapchat acquired the startup Cimagine, which uses patent-pending AR technology that essentially scans retail products to help consumers visualize them in specific locations, like a room or a store.

Pokemon Go laid out a general blueprint for how U.S. marketers can use AR to bridge online and offline experiences via mobile devices but, by and large, there's yet to be another viral craze or significant build-out of the tech. Baidu's richer, more varied applications of AR, such as the virtual coupons and app integrations, show much farther ahead China is in tapping the technology at an industry level. 

Interestingly, Baidu is focused on mobile AR development as opposed to hardware, according to Forbes, in a move to better connect with China's massive smartphone audience. The International Data Corporation recently forecast that AR headset shipments might reach 15 million by 2020, but early use cases might be limited to apps. 

For mobile marketers, the next step might be applying lessons learned from something like Pokemon Go to messaging and engagement. U.S. publishers and brands have shown interest in AR technology, as The New York Times' acquisition of AR/VR agency Fake Love shows. Industry experts tend to agree that AR/VR tech is cutting edge enough that marketers should make sure the more media rich and immersive formats match their messaging, and for those who do take the plunge, AR/VR could open up entirely new brand storytelling possibilities.