Last updated: March 3, 2022 Augmented reality in retail: 4 examples of AR boosting sales for retailers

Augmented reality in retail: 4 examples of AR boosting sales for retailers

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As augmented reality matures beyond a source of entertainment, more and more retailers are discovering how this technology can boost sales. Typically, these applications fall into one of two categories:

  1. AR that optimizes the buying experience 
  2. AR add-ons that enhance an existing product or service

For this post, we’re looking at augmented reality in retail – examples of how retailers are boosting sales thanks to AR, plus one often talked-about application you should hold off on for now.

Augmented reality in retail: Examples of AR boosting sales

  1. Show large products in context: One core AR functionality shining in the era of lockdown is the projection of a 3D product image into an image of a shopper’s home. This is particularly useful for larger items like furniture and appliances, which were historically harder to sell online because of their high cost and high shipping costs – and therefore high margin of error. If a customer doesn’t like the sofa they order online, it’s a much bigger hassle to return it than if they don’t like their new mixing bowls. IKEA’s Place app lets borrowers project 3D furniture renderings into their homes to test look and fit before placing an order. The kind of certainty such applications can give shoppers is one reason 3D technology like AR can increase conversions as much as 40 percent and reduce returns by as much as 35 percent.
  2. Increase the value of toys with AR-fueled games: Since the start of the pandemic, 20 percent of parents have spent more on toys and games for their kids. Overall, toy sales were up 19 percent from March to April, driven by purchases of interactive items like games. In fact, sales of “static” toys like Barbies actually fell at the start of the pandemic as parents sought cost-effective ways to keep their kids occupied. That trend will likely continue as summer camps are canceled and schools face an uncertain future this fall. Toy sellers can fuel sales in this time by enhancing the value of all kinds of toys with AR-fueled games. LEGO, for example, offers a game that lets kids view entire AR worlds around their assembled creations. BIC offers an app that lets kids bring their illustrations to life. What’s great about this strategy is that developing an AR game can happen independently of normal toy production and sales, then work as a value-add offering during marketing and advertising. Parents looking for toys with maximum engagement potential will respond positively to clear, ongoing ways to engage children stuck at home.
  3. Deliver post-sale customer support: Lowe’s currently offers an AR app that helps professional contractors show homeowners how to handle basic home repairs. Porsche is using AR to enable experts who can’t travel as they normally would to tackle especially difficult repairs. Other brands can offer post-purchase AR support in the form of assembly instructions (for furniture or toys, for example), troubleshooting office equipment (e.g., fixing a paper jam), or repairing appliances. In an era of high unemployment and reduced consumer spending, demonstrating additional value for existing products can help brands distinguish themselves and win shoppers’ hard-earned and closely guarded dollars. This advantage may prove important even after the pandemic ends: 65 percent of consumers say they plan to be more mindful of their spending post-pandemic.
  4. Guide people through physical stores: In 2017, Lowe’s launched a pilot program that offered an interactive AR map to guide in-store shoppers along the most efficient path to get every item on their shopping list. As the economy reopens, this kind of AR application could help convince reluctant shoppers to return to physical stores by ensuring they spend as little time inside as possible. The tech could also ease some of the stress of shopping in a face mask, which can prevent glasses wearers in particular from enjoying full visibility. This type of AR application would also empower retailers to guide customers in shopping patterns that promote social distancing.

Virtual try-ons: Don’t quite fit…yet 

Some AR tech that’s not quite ready for prime time: augmented reality-powered try-ons.

Even as the economy reopens, 36 percent of Americans say they’re not yet ready to return to in-person shopping, which means continued financial distress for retailers of clothing, shoes, and accessories. And stores may be required to limit the number of people in their shops anyway, meaning online shopping will remain an important part of revenue for months to come.

At first glance, it may seem like AR could provide a solution by powering at-home try-on tech.

In fact, brands like Warby Parker and Wannaby have launched apps that let at-home shoppers virtually try on products (in this case, glasses frames and shoes). 

But for most brands, it doesn’t make sense to attempt this, for three reasons:

  • It’s hard to get right: To create a try-on AR experience, you’ll have to develop a dedicated app, which means hiring a bunch of developers and spending a lot of money. And there’s no guarantee that you’ll be able to get it right.
  • You’ll force users to download a dedicated app: Even if the app you build is amazing, most users aren’t interested in downloading an app for a single, highly specific purpose. So all the money and time you invested might be for naught.
  • Google and Apple are working on it: Here’s the thing: if try-on AR were easy to do, more people would be doing it. Even the biggest names in hardware and software (Google and Apple) haven’t yet cracked the code, and they know their devices inside and out – and probably have the best IT talent available. The good news: reports suggest that both companies are working on this functionality. When they get it right, brands will be able to take the tech and run with it – for a much smaller upfront investment than is possible now.

AR in retail can improve buying experiences + add post-purchase value

Because of COVID-19, people are shopping online more and are more likely to be careful with their money. The augmented reality in retail examples above also apply to improving sales in these circumstances by increasing shopper confidence during an all-online shopping experience and by increasing the value and usability of the products they buy in any format.

With new AR hardware expected this year from Apple, AR will only become a bigger part of the retail and post-purchase landscape. Brands that can meet increasing customer demand for AR applications will be poised to grow sales well into the future.

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Ben Houston

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