AR can add enormous value for consumers in their shopping journey and physical retail must evolve in response.
By Shorya Mahajan
The prevailing uncertainty ever since the pandemic made its way into our lives followed by new waves of virus and repeated lockdowns have had a detrimental effect on consumers. Whether it is affecting their spending behaviour as we face an uncertain economic future, simply plan to stay at home to stay safe or live in areas under increased lockdown measures; consumer buying behaviour has evolved significantly – potentially forever.
The retail industry was already in the midst of significant change before the pandemic struck, following the growing influence of e-commerce combined with technological advancements. However, as the majority of retailers struggle because of restrictive measures at places and evolving behaviour of pandemic, they are leveraging technology to encourage shoppers back to shopping spree while helping them feel more at ease when shopping. Safety is, of course, the key driver of new technology implementations in retail.
The Evolving Ecosystem of Retail
As retailers evolve, they need to re-strategise their business model according to changes in the ecosystem so that they can enhance customer engagement and improve the overall shopping experience. Technology is a critical disruptor that is having a profound impact on retailers as well as shoppers. E-commerce continues to grow significantly especially during pandemic. According to recently released statistics by IBEF, despite uncertainty created due to pandemic, e-commerce sector expects strong sales growth in 2021. The market is projected to grow from US$ 38.5 billion as of 2017 to US$ 200 billion by 2026.
Further, the e-retailers are tapping on advanced technologies like Augmented Reality (AR) to enhance the customer journey. Many brands are integrating AR-enabled applications into their businesses. For example, IKEA’s “IKEA Place” app allows users to see the products in a superimposed graphics environment. Tata Motors’ launch of the new Tata Safari 2021 was also aided by Augmented Reality (AR). The company launched the Tata Safari Imaginator suite to provide a virtual experience to customers at their preferred location. Recently, Hero MotoCorp also decided to launch a virtual showroom for its customers to provide them a 360-degree shopping experience. In an orbit shift to engage with customers, Titan also tapped on virtual try on solution.
Augmented shopping enables shoppers to engage with brands through features like personalize the product virtually or virtually try on clothes from the comfort of home. There are various technologies that can be used to scan pictures of a person and map clothes accordingly, allowing one to see what they would look like. These technological advancements make the virtual image look realistic, which has never been possible.
By integrating AR into shopping journey, brands are able to deliver more intuitive and detailed product information than standard web experiences. The augmented reality in the retail market is expected to grow from USD 411.3 million in 2017 to USD 7,951.2 million in 2023, highlights a report by Markets and Markets.
The Benefits of AR in Retail
Augmented retail is full of benefits. It allows personalisation of user content so that the customer looks for relatable items without wasting time. Additionally, it facilitates ease of trials through virtual mirrors where one can simply find out the size of the apparel and see how it is looking and fitting the body. Further, printed content is one of the masterstrokes of augmented reality marketing. It is amazing how one can get all the information about a product just by holding their phone over a particular picture. The augmented retail enables this feature.
Also, augmented retail dissipates barriers of language with Google Translate AR mode. Even if one is using printed catalogues, the AR content in it will guide one to choose one’s convenient language.
The Future of Retail
A Neilsen IQ’s 2019 global survey revealed that consumers seek Augmented and Virtual Reality as the top technologies to assist them in their daily lives. And clearly, that interest has since soared especially amid the pandemic. In fact, Shopify recently released that interactions with products having AR content are likely to show a 94% higher conversion rate than products without AR. It is impressive how retailers are also using AR to redesign the digital shopping experience within virtual stores. The recent collaboration of Kohl with Snapchat to create Kohl’s AR virtual closet is a great example. It allowed the shoppers to step inside an AR dressing room, explore the items, and make a purchase. The next phase of AR in retail will likely be a gamified social experience where companies apply digital entertainment approach to connect with new, younger customers.
In many ways, the pandemic has been a catalyst for the digital transformation of retail. Surely, AR can add enormous value for consumers in their shopping journey and physical retail must evolve in response. It is time that all retail brands re-imagine their business to provide immersive shopping experiences which is the potential future.
The author is co-founder and COO of Adloid