Businesses all around the world are using immersive technology like VR, AR, MR, and XR to raise awareness, differentiate from competitors and drive sales. Augmented reality (AR) in particular is being adopted by retailers (online and offline) at a rapid rate. This spike in interest for augmented reality in retail is being fuelled by a plethora of reasons, some of which include ease of accessibility, advancements in immersive technology and the overwhelmingly positive response from shoppers.
With online sales expected to rise to $6 trillion by 2022, AR will play a significant role in retail, e-commerce, and merchandising in the near future. That is the reason we crafted this beginners guide to augmented reality for retailers who are looking to add immersive technology into their business.
What is AR or Augmented Reality?
AR or augmented reality is a semi-immersive experience, where computer-generated, perceptual information is being projected onto the real world. This perceptual information can range from visual, auditory, haptic, somatosensory, to olfactory.
Unlike virtual reality, shoppers don’t need to use headsets to experience augmented reality. AR experiences can be accessed using smartphones or tablets. Whether they are on the train commuting to work, or enjoying a cup of coffee at a cafe, with augmented reality, shoppers can access AR content instantly, anywhere.
The benefit of augmented reality in retail includes cost savings from fewer returns, improved shopping experiences, increased basket size and much more. For the sake of this post, let’s explore these three benefits.
AR helps retailers save money
With more and more sales being generated online, retailers often use their return policy as a form of confidence guarantee for consumers. This can be disadvantageous if they are covering shipping for returns as well. With AR, retailers can still have a return policy as they do, but once customers will be able to visualize a product, they are less likely to return it.
AR improves the shopping experience
According to a study published by Retail Perceptions, 71% of consumers will shop at a store more often if they offer AR. A third of shoppers already use AR, and of those, 47% would prefer to use AR both in store and online. The most stunning statistic is that 40% of customers would pay more to brands that offer AR to enhance their purchasing decisions.
AR increases average basket size
Allowing shoppers to visualize products, change specs and customize products in real-time increases the likelihood that buyers will include add-ons and ancillary offerings. It will also equip front-line staff to push higher-margin offers which require demonstrations and use cases to justify the added costs.
How Retailers are Using Augmented Reality?
AR in retail is revolutionizing the way shoppers discover, interact and customize products they are interested in purchasing. For the first time ever, buyers have the power to access full-scale, 3D models of their desired products without the need to physically travel to the brick and mortar shop.
With the help of augmented reality, retailers can now provide an immersive experience both inside and outside of a store. Below are a few ways retailers are already using AR to help their business differentiate from competitors and win more sales.
AR in Furniture
Buying new furniture can be challenging. AR can help shoppers visualize what different appliances, couches, tables, cabinets, and dressers will look in different parts of their homes prior to purchase. Shoppers can view furniture in different colors, textures, sizes, and shapes to match with their surroundings to empower their confidence in their purchasing decisions.
AR in Interior Design
AR can be revolutionary for both event planners and interior designers. Event planning itself is a stressful job and often choosing the right arrangement can make a big difference. With the help of AR, interior designers can easily visualize and present their ideas in real time. Their ideas for design and layout will not be limited to 2D drawings but can be viewed in a 3D space. They will be able to see what works and what doesn’t before spending any money on making it a reality.
AR in Fashion
Instead of visiting the store or making returns after purchase, consumers will be able to experiment with different fittings for the clothes, jewelry, and shoes that they buy. They will be able to experiment with different colors.
Bespoke fashion, in particular, can take advantage of this technology. Unlike fast fashion, bespoke needs to be custom-made, and if the client is interested in trying a different color or style they won’t have the freedom to make those choices once the piece is being created, and, course, they can’t simply return them. With the help of AR, customers can see what the final product will look like and have complete confidence in the design before it leaves the tailor’s studio.
AR can also be very helpful when it comes to purchasing consumer wearable electronics. Imagine you are trying to buy a watch online, but don’t have the luxury to try on different colors or models beforehand. But you really like that particular style, and you are keen to try it on before purchasing. With the help of AR, consumers will be able to see how the products fit them. They can play with different models and colors, without ever having to leave the comfort of their homes.
AR in Makeup
An AR makeup app can help people to see what different products will look like on their own skin tones before purchasing. Instead of visiting the store to swatch unsanitary tester products in an overwhelming and busy environment, shoppers can see which shades, styles and finishes work better for them than the others. This saves a trip to the mall and gives buyers a more accurate representation of the product before deciding whether it would suit them.
For the beauty and skin care business, product returns represent a significant loss annually. Since returned beauty products cannot simply be re-sold, they represent a profit loss. Any additional confidence that consumers can have prior to making a purchase represents a higher chance of a sale being final.
Top Examples of AR in Retail
Source: IKEA YouTube Channel
IKEA has launched its own AR app called IKEA Place. The app lets users browse through their catalogue to choose the furniture they want to buy, and virtually add it to their room to meet their needs. The app allows users to first scan the surrounding environment to get an idea on the dimensions before they can start placing furniture through the app. The unique app lets you choose between different furniture products and colors to see which suits you better.
Another great home decorating app is by Dulux called Visual. It lets you choose the paint color for your room, office or shop digitally. Simply take a quick video of your surroundings, then you can add different colors to see which one works best. You can also share videos with others, so if you ever need a second opinion, you can do so.
Dressing Room By GAP
Source: GAP Inc.
GAP is another big retailer to adopt AR. The app first allows users to submit their body measurements, then they can use the existing catalog to try on different clothing with sizes to see how they fit. It is a crucial step that GAP has taken to encourage people to shop online.
Magnolia is very similar to the IKEA app, however, it deals with home decor instead. Buying new decor or a piece of art can be difficult and can often be hard to visualize prior to purchasing. With Magnolia’s app, you will be able to try out the different decor they are selling in the various spaces in your home.
Sephora Mobile App
This is another example of where AR can play a huge role. Sephora has launched a mobile app that allows users to try out different makeup products simply by taking a picture of their face. Whether patrons are shopping online or in-store, they can try out various products to see which one will suit them the best.
Tissot Virtual App
Source: Holition YouTube Page
This is more of a promotional campaign, but an important one. Tissot, the Swiss watchmaker, had people try out their app in one of their stores. Consumers would put a plastic strap on their hands and hold it up to a camera. This would generate an image on a screen to show what different models would look like. This was a powerful technique for helping the customer visualize Tissot products, while also piquing their curiosity about other styles that they may not otherwise have had the confidence to try on.
AR is set to revolutionize retail and change the way shoppers discover, interact and customize products they are interested in purchasing. Retailers who have adopted augmented reality are experiencing a boost in awareness, customer satisfaction, and profitability. What differentiates AR from other immersive technologies is the ease of use, customer buy-in, and low barrier to entry. So, if you are a retailer, we hope this guide on AR in retail was helpful in getting you better informed about this new technology.
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