Over the last few years, augmented reality has become one of the most valuable marketing tools for numerous companies like BMW and TopShop.
From gaming, augmented reality has moved to retail and ecommerce industry where it is a great tool for attracting new customers. This technology is gaining popularity across the globe.
Over 50% of Australians surveyed suppose that these technologies are likely to become as widespread as smart mobile devices.
Augmented reality technology is especially appealing to consumers in China and Japan.
According to Worldpay’s survey, 95% of people in China have used virtual or augmented reality in the past three months. The research also highlights that 84% of Chinese people believe VR/AR to be the future of shopping.
About 66% of consumers in Japan would like more offline stores to implement augmented and virtual reality. All this tells a lot about the growing popularity of immersive technologies.
By 2022, Statista predicts the retail sector will represent 5% of the augmented and mixed reality software market, and it’s forecasted AR in retail will equal about $80 billion in 2022.
The last few years turned out to be hard for many both online and offline stores.
According to CNBC, nine retailers went bankrupt in the first quarter of 2017. An obvious reason for their failure is the lack of revenue. Augmented reality is a way of how retailers can generate more sales.
Augmented reality is much more than just overlaying camera images with generated three-dimensional objects.
It’s an instrument that can help retailers significantly improve their marketing strategies and ensure a higher revenue.
The immersive technology is only gaining momentum across retail, but it has already started surprising us and turning our fantasies into reality…augmented reality.
Why consumers prefer augmented reality
While ecommerce has its undoubtful advantages such as no need to rent a physical space and a broader audience reach, consumers still prefer physical shopping experience over online buying.
A survey conducted by Retail Dive showed that 62% of consumers would rather physically interact with an item they consider purchasing and prefer offline stores over ecommerce.
49% of respondents like physical stores more than online ones because they adore getting things they pay for right away.
Besides, 20% of respondents answered they prefer traditional shopping since they find this process a sort of a social aspect.
How AR brings value to customer shopping experience
The most important drawback of ecommerce is that it can’t provide shoppers with tactile interactions, a high level of a personal approach, and product delivery compared to bricks-and-mortar stores.
Augmented reality can help online stores provide their customers with a deeper and more realistic shopping experience.
On the other hand, this technology allows traditional stores to offer their consumers bright, unforgettable, and fun emotions that are much richer than those we all have experience in an offline shop.
Fast finding the right item
Most of us have faced an issue of navigating through numerous shelves in order to find what we need. Customers may lose a lot of time in a physical store in search of a particular item.
Furthermore, shoppers may even get lost in large stores without getting what they’ve come for. With augmented reality, the things are going to change.
By implementing the immersive technology, retailers can help their customers navigate through the store aisles to a certain shelf.
One of the largest online grocers in China called Yihaodian created an augmented reality app that helps users navigate through the virtual store aisles. The grocer set up virtual stores in certain public places where users can find and pay for necessary products to get them delivered to their front door.
The same concept can be applied to real facilities where visitors can navigate through the store using a built-in smartphone camera and an augmented reality mobile app.
Simplifying decision making
When choosing clothes, you often need to try them on to make sure they fit. This augmented reality can reduce the time required to make the right choice.
If visitors need to check more variations of a certain item, they can point their smartphone camera at a dress to see how it looks in different colors. In addition, they can choose a suitable color, pay for the dress, and order its delivery to their home without even leaving an AR app.
In addition, AR advertisement is not just about 2D images. The immersive technology enables retailers to create three-dimensional animations that would help businesses better describe the advantages of their products.
One of the main advantages of offline retail over ecommerce is in enabling customers to interact with an item they consider purchasing. However, it makes shoppers interact with each item they consider buying even though this is the same type of an item with another option.
So Uniqlo, an NYC-based clothes retailer, decided to target this problem by implementing augmented reality solutions.
Uniqlo used the immersive technology to allow trying goods in different colors without the need for changing clothes.
Their augmented reality dressing room is based on the Kinect’s color-changing engine and a half-mirror touch panel. In addition, with this solution, shoppers can instantly share an image with their friends in social networks.
Converse took a step further and created its AR solution that allows customers to try shoes without the need for taking them on. Using the app, shoppers can overlay a camera image of their feet with chosen shoes in real-time.
Thus, customers don’t need to go to the store at all. With augmented reality, they can try a particular item, virtually interact with it, make a purchase, and get a delivery right to their front door.
Augmented reality can help retailers use their physical space more effectively by displaying relevant ads or product variations to visitors without having to put similar items in the shopping room.
When it comes to selling large items that have multiple variations, showrooming all these goods can be a nightmare for retailers that have limited areas in their stores.
If you sell cars and offer different interior colors of the same model, placing these cars requires large areas, which can dramatically increase operational costs.
Therefore, car dealers often show their clients printed color palettes or images of how their desired car can look like. However, it hardly can be called rich shopping experience.
BMW revolutionized typical showrooming using augmented reality. They created a mobile app to provide their customers with wide customization options. The solution enables shoppers to choose different features like wheel size, interior material, and car color.
Furthermore, BMW’s app allows users to see how a new car would fit their garage. This approach enables shoppers to visualize their dream as well as helps a manufacturer save available area in their showrooms.
Gamification and engagement
Gamification is widely used in retail as a way to increase sales. By virtually rewarding users, apps can encourage customers to make a purchase.
With augmented reality, shopping has been turned from just spending money into an engaging game that makes customers associate their shopping experience with bright emotions provided by a certain retailer.
To encourage customers to use your AR app, you can hide promo codes in a 3D animation that can be activated by pointing a smartphone camera at a certain item. Gamification is a concept that will primarily interest kids and allow their parents to make purchases without being distracted by their children.
Augmented reality can help retailers drive more engagement. In addition, by enabling customers to visualize a product inside a package through a printed marker, offline stores can generate more sales.
For this purpose, Lego uses Digital Box, a monitor connected to a computer with a webcam to capture video. This device allows consumers to interact virtually with a product they are interested in by generating a detailed 3D model of completed builds.
In striving to reach a higher customer engagement, Tesco, a British giant retailer, and Disney partnered to create an extraordinary and easily shareable AR mobile app called Tesco Discover.
Using this app, shoppers can make a selfie and add a three-dimensional model of any character from the Frozen cartoon. It’s hard to find a kid who would not want a selfie with Elza!
In addition, Tesco Discover can add different accessories like hats or antlers to user portraits. Branded selfies were available during Tesco’s AR marketing campaign that also involved selling special sticker folders. These stickers could activate frozen Frozen characters through Tesco Discover.
Improved decision-making processes
Traditional retail advantage, which enables customers to interact with an item in reality before purchasing, also comes with its main drawbacks.
The thing is while choosing goods in a bricks-and-mortar store, visitors cannot understand whether or not a certain item is suitable for their home when it comes to such goods as wallpapers, furniture, and textile.
With offline stores, customers simply can’t be situated in different places at the same time. Augmented reality can significantly help retailers increase their customers’ shopping experience by enabling shoppers to virtually place items in their apartments or houses without the need for actually ordering a delivery.
IKEA created an augmented reality mobile app that enables users to check how certain furniture will fit their homes or match their interior color palette. IKEA Place uses a built-in smartphone camera to visualize available furnishings on a mobile device screen.
Why AR helps increase sales
Why does AR have the power to influence people’s buying decisions? Here are a few reasons.
A deeper ownership feeling
People are more likely to buy products they’re used to. It means that if customers had enough time to interact with an item, get assured that it’s entirely suitable for their environment, and visualize possessing this product, there are more chances they will make a purchase.
It’s like playing with a little puppy. After happy time spent with a lovely animal, you can do nothing but taking this puppy home.
When customers feel connected to a certain item, they’re sensitive to purchasing this product. Due to visualization and interaction capabilities, augmented reality can encourage shoppers to buy a product.
Shopping decisions are tightly connected to emotions besides logic. The brighter emotions people feel when they interact with a product, the more they want to feel these emotions in the future.
It encourages shoppers to buy those products, which they associate with positive feelings. Augmented reality can provide customers with an unforgettable shopping experience they want to get repeatedly.
When choosing between numerous offers, customers rely on their logic and emotions. Before buying something, they often weigh pros and cons to make the right decision.
If marketing efforts couldn’t get customers assured that a certain product would fully satisfy their needs, they may switch to another retailer.
Because of its visualization capabilities, augmented reality can help shoppers eliminate their doubts about product characteristics and options. With a better understanding of product advantages, shoppers are more likely to make a purchase.
Augmented reality is an effective marketing tool that works for both shoppers and retailers. When correctly implemented, it can provide customers with an outstanding shopping experience that they want to share with their friends.
This immersive technology has a wide range of benefits for both bricks-and-mortar shops and online stores.
With all its capabilities like visualization, entertainment, gamification, driving deep engagement, and improving a decision-making process, augmented reality proves to be an effective investment that is able to generate more sales for retail businesses.