The Power of Augmented Reality in Retail

Technology is at the forefront of one’s shopping experiences. Anyone can connect their debit or credit cards seamlessly and pay by tapping their mobile phones to payment terminals without having to carry around cash or physical credit cards. These conveniences are further enhanced with experiential shopping experiences offered by augmented reality which can create extensive engagement and long-term benefits for brands, retailers, and shoppers alike.  

Augmented reality (AR) is a form of photographic technology that overlays information onto real-world objects. Perhaps most popularized by break-out mobile games like Pokemon Go!, augmented reality has realistic benefits for brands and retailers. A 2021 study published in the Journal of Marketing found that retail companies could see a boost in sales when incorporating AR thanks to the tech’s ability to create engaging and entertaining experiences for shoppers; streamline customer’s knowledge of products available for sale; tangibly visualize what products will look like “in place” after purchase; and enhance post-purchase experiences.

Entertain customers (and keep them coming back for more) 

Pinning down the wants and needs of retail shoppers can be tricky. Most shoppers are interested in buying online, yet e-commerce still accounts for less than 20% of all retail sales. That share is growing steadily each year, but it shows consumers will continue to visit physical stores for retail purchases. 

As competition for customers remains fierce, businesses can stand out by incorporating AR shopping experiences that entertain and enhance visits to retail spaces. This falls under the emerging concept of “retailtainment”. A 2020 study presented at the International Conference on Business, Management, and Economics concluded that experiential marketing provided brands with “more powerful marketing, more engaged customers, and better return on marketing investments”. By design, augmented reality provides the framework for establishing experiences customers want as AR provides a layer of self-driven interaction.

Educate customers about available products

Shoppers want to know more about the products they buy before they purchase. This has led to an explosion in SEO-driven product review content with titles such as “Top 10 Lawn Chairs” or “Best Skin Care Products”. These are popular for no other reason than consumers want to know what to buy and don’t enjoy the experience of having to return products. And as any retailer will note, chargebacks are a major problem and exceptionally expensive, especially for e-commerce

AR can allow you to add real-time informational pop-ups to your retail products. Incorporating the technology allows consumers with mobile devices to get instant feedback in an exciting way. It’s similar to high-end vehicles with a Heads-Up Display (HUD) beamed onto the windshield. Tons of product data becomes available without consumers having to go looking for it.

Allow customers to see products “in place” 

An important benefit offered by AR is its positive impact on product returns. When shoppers go to buy retail products such as clothes or furniture, they often have to imagine what that product will look like in their own space. This is a bit easier for brick-and-mortar retailers, as buyers can try on clothes in the store. And physical furniture stores do still have some advantages as buyers can at least see displays. 

Nevertheless, many buyers still prefer to shop online. As many have come to experience, online shopping makes the “try before you buy” process a bit more difficult. Buyers are far more likely to return a product if they didn’t have a chance to test it out first. This helps account for the fact that online products have a 20% return rate according to Shopify, compared to an 8-10 percent return rate for products purchased in-store. 

AR is an excellent solution to this. Some businesses have already begun adding AR concepts into the buying process. Zeekit, for example, allows shoppers to try on clothes virtually before making a purchase. Meanwhile, the popular Swedish furniture brand, IKEA, rolled out an AR app in 2017 that lets customers “see” what the furniture looks like in each room.

Build on-going, post-purchase experiences

Brands have long sought to engage customers after purchases are made. There are multiple ways to do this, but AR interactivity post-sale can help expand the lifecycle of existing product lines. 

Lego is an example of this with its AR-driven Hidden Side ghost game. The game offers a multiplayer gaming experience that allows several users to play a “hide and seek” style game using a Legos mobile app. An experience of this nature brings customers back to the product and gives Lego the opportunity to build its brand and attract users to new products within the same or other lines. 

Brands hoping to add post-purchase AR interactivity will need to be particularly inventive to create experiences buyers enjoy. Thankfully, the possibilities of what AR can do for product life cycles is limited mostly by the imagination of marketing teams

Shopkick is an established shopping rewards app with a proven track record of helping retailers and brands drive awareness, incremental sales, and customer loyalty throughout the full-funnel shopping journey. To learn more about our interactive mobile technology capabilities and how we help our partners improve the customer experience, contact our team.

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