Table of Contents Expand Table of Contents What Is Augmented Reality? How It Works Examples AR vs. VR FAQs The Bottom Line Augmented Reality (AR): Definition, Examples, and Uses By Adam Hayes Full Bio Adam Hayes, Ph.D., CFA, is a financial writer with 15+ years Wall Street experience as a derivatives trader. Besides his extensive derivative trading expertise, Adam is an expert in economics and behavioral finance. Adam received his master's in economics from The New School for Social Research and his Ph.D. from the University of Wisconsin-Madison in sociology. He is a CFA charterholder as well as holding FINRA Series 7, 55 & 63 licenses. He currently researches and teaches economic sociology and the social studies of finance at the University of Lucerne in Switzerland.Adam's new book, "Irrational Together: The Social Forces That Invisibly Shape Our Economic Behavior" (University of Chicago Press) is a must-read at the intersection of behavioral economics and sociology that reshapes how we think about the social underpinnings of our financial choices. Learn about our editorial policies Updated March 02, 2025 Reviewed by Caitlin Clarke Fact checked by Yarilet Perez Fact checked by Yarilet Perez Full Bio Yarilet Perez is an experienced multimedia journalist and fact-checker with a Master of Science in Journalism. She has worked in multiple cities covering breaking news, politics, education, and more. Her expertise is in personal finance and investing, and real estate. Learn about our editorial policies Ryan Oakley / Investopedia Close What Is Augmented Reality (AR)? Augmented reality (AR) is a modified version of the real world, achieved through the use of technology. AR uses apps, consoles, screens, and projections to overlay or combine digital information with real-world environments. Key Takeaways Augmented reality (AR) involves overlaying visual, auditory, or other sensory information onto the real world to enhance one’s experience.Retailers and other companies can use augmented reality technology to promote products or services, launch novel marketing campaigns, and collect unique user data.Unlike virtual reality, which creates its own closed environment, augmented reality adds content and information to the existing world. Get personalized, AI-powered answers built on 27+ years of trusted expertise. ASK Understanding Augmented Reality (AR) Whereas smartphones and tablets are limited to the size of a screen, wearable AR devices, like smart eyewear, for example, may provide a more complete link between the real world and the virtual realm. The catch, of course, is getting users to adopt the technology. So far, many wearables aren't mainstream. Amid the increase in data collection and analysis, one of AR’s primary goals is to highlight specific features of the physical world, increase understanding of those features, and derive smart and accessible insights that can be used in real-world applications. This data can help inform companies’ decision-making, gain insight into consumer spending habits, and more. Examples of Augmented Reality Some early adopters of AR in the retail sector have developed technologies designed to enhance the customer shopping experience. Augmented reality has been incorporated into store catalog apps, which allows consumers to visualize what different products would look like in different environments. For example, when buying furniture, shoppers point the camera to the appropriate room, and the product will appear in the foreground. In the healthcare sector, AR apps enable users to see highly detailed, 3D images of different body systems when they hover mobile devices over a target image. This use of AR has become a powerful learning tool for medical professionals. AR is also becoming more popular among companies developing metaverse solutions, particularly in mobile computing and business applications. Important This area is under continuous development, so technologies are very likely to change rapidly. Augmented Reality vs. Virtual Reality Augmented reality puts virtual information on top of a real-world environment to enhance the experience. For example, with Pokémon Go, users search in their real-life neighborhoods for animated characters that pop up on their phone or tablet. In the NFL, broadcasters use AR technology to better analyze plays. In contrast, virtual reality immerses users into an entirely different environment. For example, virtual reality users may be immersed in an animated or digital scene. Virtual reality can also be used to photograph an actual local location and embed it in a VR app. Through a virtual reality headset, someone can walk around Italy as if they were actually there. What Is Augmented Reality Used for? Augmented reality (AR) either makes visual changes to a real environment or enhances that environment by adding new information. It can be used for various purposes, including gaming, product visualization, marketing campaigns, architecture and home design, education, and industrial manufacturing. What Are the Advantages of Augmented Reality? Augmented reality (AR) is an interactive experience where a real-world environment is enhanced with computer-generated visual elements, sounds, and other stimuli. It can provide a user with a heightened, more immersive experience than they would experience otherwise, which adds to the user's enjoyment or understanding. From a commercial perspective, augmented reality can increase brand awareness and boost sales. Is Augmented Reality or Virtual Reality More Realistic? Since augmented reality (AR) uses a real-world environment in conjunction with computer-generated elements, it may be seen as more realistic than virtual reality (VR), which is 100% computer-generated. However, advances in technology mean that even entirely virtual environments can seem realistic. The Bottom Line Augmented reality (AR) is a technology that overlays a real-world environment with a computer-generated one, enhancing the user's experience and shifting their perspective. It can be used in everything from gaming and design to shopping and education. It is a form of mixed reality, combining the real world with digital elements, as opposed to virtual reality (VR), which is entirely digital. Get personalized, AI-powered answers built on 27+ years of trusted expertise. ASK Article Sources Investopedia requires writers to use primary sources to support their work. 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