Today's omnichannel shoppers are constantly looking for the next great experience.
For some, that means highly personalized shopping experiences that cater to your individual preferences; for others, it means an immersive experience that engages the senses and puts the products in the context of the space they will inhabit.
Even when it's convenient to click "Buy" from bed in our pajamas, there are still elements of the retail experience that can only be found in person.
Virtual Reality and Augmented Reality (VR/AR) are ways to get the best of both worlds.
Its implementation intends to close the gap between online and in-person shopping by providing product information through the senses.
- What is Virtual Reality/Augmented Reality?
- Why has AR particularly gone mainstream?
- Is there a market for VR/AR in commerce?
- Does your brand need to implement AR/VR?
- The barriers to entry
- The final answer: a practical checklist
- To use or not to use
What is Virtual Reality/Augmented Reality?
These terms are often used together or interchangeably, but they refer to different things while they are related.
Virtual Reality (VR): When you put on a VR headset, you are immersed in an entirely new world that replaces your real-life environment.
Augmented reality (AR): A “lite” version of VR most commonly used in smartphone applications. It adds virtual elements to a recording made with a phone or other device. Think Snapchat filters or Pokémon Go.}
💡 The global AR in Retail market is projected to reach USD 4.6 billion by 2026, from USD 1.5 billion in 2020, at a CAGR of 20.0% from 2021-2026.
Both technologies can provide consumers with a more engaging shopping experience that makes them feel satisfied and confident about their purchase—convenience without compromise.
Why has AR, in particular, gone mainstream?
Being less complex to implement than VR headsets, AR has become a popular tool for providing contextual information about specific products.
These are the 5 main factors driving the popularity of AR in commerce:
- A sense of ownership: watching the product overlay your spaces or body makes you feel it is yours, which accelerates the conversion.
- It makes customers part of a story: AR is a big trend, and many customers like to feel they are part of something big. AR allows your brand to connect with them.
- It looks cool: AR looks really good and creates a sense of wonder in customers, further accelerating the conversion.
- It lets customers “try on” products in advance: It’s hard to gauge how certain products will look on you or in your space. AR gives you a good approximation and helps customers feel secure in their choice.
- The social element: sharing products you “tried on” with an AR app lets customers ask for opinions from friends and family without leaving home.
Is there a market for VR/AR in commerce?
AR commerce is a growing market, and a fast-growing market at that. By 2020, the global market was estimated at $1.5 billion, but by 2026 it could reach $4.6 billion, according to Banuba.
VR is less widespread for digital shopping because it is much more involved and expensive to develop a headset experience than it is to develop an AR app for your phone or desktop.
So AR remains the most prevalent type of virtual reality used in marketing and commerce, but VR still sees use.
How AR/VR increases your revenue?
71% of retail shoppers would shop more often if they used AR apps.
40% of them consider that they are ready to pay more for a product if they were allowed to test it through AR first.
Does your brand need to implement AR/VR?
Many industries benefit from AR/VR to represent complex structures in novel and productive ways, like automotive, manufacturing, healthcare, aerospace, architecture, supply chain management, and more.
Specifically, in commerce, it can be used to improve upon established systems and provide an immersive experience.
AR makes retail customers more confident they are buying the product they need and are willing to shell out a bit more for that sense of security.
Is that definitive proof that all brands that sell something need it? Not necessarily, but the market is trending towards it.
Let’s explore 9 AR/VR use cases to provide some context on how they can boost the online commerce experience:
Trying on makeup, glasses, clothes, and shoes.
Services like Snapchapt’s “Catalog-Powered AR Shopping Lenses” allow customers to try on glasses and makeup through an AR filter that superimposes each product on their face.
It gives customers a good idea of how the product will look on their faces without having to buy it before testing.
Similarly, L’Oréal’s “Signature Faces” allows customers to try makeup products from Maybelline, L’Oréal Paris, Lancôme, Giorgio Armani, Yves Saint Laurent, Urban Decay, and more through several social media apps.
On the other hand, Walmart’s “Choose My Model” function allows users to select from dozens of models of varying sizes and heights to virtually try on clothes.
The idea is to provide a wide range of body types, allowing users to find one that represents them the best and determine how each piece will look on them.
Attending car showrooms from the comfort of your home
BMW provides AR features to let users effectively experience showrooms from their homes, customizing cars with different colors or styles using their tablets or phones. It also provides more immersive VR experiences with goggles, simulating being inside the model.
Relay Cars, on the other hand, allows car shoppers to explore thousands of models from dozens of brands in AR and 3D using smartphones, tablets, or desktop computers.
Positioning furniture before buying
Like clothes, it can be frustrating to shop for furniture online because you often don’t have a good idea of the size of the piece you are looking at. Wayfair and IKEA are two brands trying to close the gap between online and in-person furniture shopping.
Wayfair’s “View in Room” app contains millions of home items experienced through an AR interface, with the ability to add multiple products simultaneously and use real-time lighting for the closest approximation possible.
IKEA’s IKEA Place app is similar, allowing shoppers to use AR with their smartphone camera to place furniture items into their homes, scaled to their real-life size.
Testing wall paint
SWF’s AR Colour Visualiser is an AR app that allows customers to test out over 1000 wall paint colors by the German brand from the comfort of their home, letting them play around with the decoration before committing to a specific color.
The barriers to entry
Both AR and VR have barriers that brands must overcome to implement successfully.
These are some of the most important ones:
One of the most limiting factors. The development of VR implementations is expensive and requires coordination with multiple experts in different fields. Purchasing multiple VR headsets for customer use also adds to the costs.
Lack of knowledge
A lack of awareness about VR technology can cause rejection in employees, who may fear its introduction will disrupt established workflows.
The VR user experience
Some people are susceptible to motion sickness and fatigue when using headsets. Shortening VR sessions and deploying more sophisticated motion tracking can mitigate the problem.
Similar to VR, AR projects accumulate costs through development, hardware, services, and software licenses.
At the higher managerial levels, there could be a lack of confidence in the technology. Or, on the other hand, excessive confidence without proper understanding of application and business benefits.
Applicability and deployment
Finding the most feasible and impactful implementation.
AR apps deliver a brand's intellectual property (IP) to devices outside the brand’s secure network. Measures must be taken to protect the IP.
AR-enabled devices can capture video, sounds, user location, and other data. Brands must make users aware of what is being captured and how the information is used.
Enterprise systems integration
The data used in AR apps is extracted from various enterprise systems. Integration with these systems can be costly and difficult.
AR projects should find solutions to reuse existing 3D assets. Otherwise, 3D designers will spend hours reworking content they have already created before.
A practical checklist
The more you learn about these AR/VR use cases, the more you notice they essentially provide visual and spatial context your clients used to only be able to get in a physical store or by buying items and getting rough estimations of how they’ll fit based on the measurements.
So the main questions to determine whether AR/VR would be helpful to your brand would be:
- Would our customers’ experience be improved beyond the novelty and entertainment factors?
- How will customer sampling behavior change with a “virtual try-on”? Will they sample more products? Will this motivate them to purchase more?
- For new customers, will it reduce the anxiety to buy something they haven’t tried before?
- Will the interface accurately represent how the product looks in context?
- Are the products we sell sensitive to the size and/or shapes of the body?
- Do we have/can we take very high-resolution product images from multiple angles?
- Do we have the resources to create the functionality from scratch or integrate it into other apps? Would our offering stay relevant after development time is done?
- If we were to commit to implementing it, which barrier to entry would limit us the most? What could we do to overcome it?
To use or not to use
VR and AR implementations in commerce are big investments that must be studied carefully before committing. Many factors must be considered in the brand’s context to come up with a solution that improves the experience and maximizes revenue the most.
But one thing is clear; they are both associated with a greater feeling of context and a reduction of purchase anxiety that leads to more confidence: customers feel more secure about a decision that was made after a VR/AR session and are more likely to convert based on it.
This was a (relatively) brief introduction to its pros and challenges, aimed at giving you context and helping you make informed decisions in the future.