Augmented reality is eating the real-world! The substitution of physical products by holograms

There is a general consensus that augmented reality (AR), once it becomes a mainstream medium, can disrupt marketing and management in many ways. One frequently discussed – but mostly unanswered – question is whether AR will render existing physical products and services obsolete or not. Based on a holistic deliberation of AR Marketing and four studies with more than 2,000 respondents, this article investigates consumer acceptance of holographic AR substitutes for real products. The findings show fairly high acceptance rates for some product categories (e.g., Post-it notes, manuals, navigation technology) and low ones for others (e.g., pets, memorabilia). This study also identifies certain product and consumer characteristics (e.g., utilitarian benefits, not visible to others, digitalized products, familiarity with AR) as drivers of substitution. Finally, this paper presents multiple marketing implications, such as the disruptive potential of AR, the possibility of “copying and pasting” the real world including the threat of virtual counterfeits, the role of offline ad blockers, and four generic response strategies for companies.