AR in Retail Will Be the Norm Sooner Than You Think

Many retailers traditionally utilize a portion of their funds and resources to test new in-store experiences each year, especially pop-up shops. However, 2023 is beginning to change all of that, with more big-name retailers opting to experiment with virtual stores and AR.

Similar to a video game experience, shoppers will be able to explore an immersive world, big or small, and examine products like they would in a physical store. The added benefit is the e-commerce checkout and delivery system.

And even though there are critics who dislike the perceived complexities of virtual shopping, according to PYMNTS, retailers are still searching for innovative and efficient ways to improve the shopping experience. Augmented reality (AR) is turning out to be just that.

According to Research and Markets, "Augmented reality is a technology, which uses the existing user's environment and overlays the digital or virtual content or information over it to offer an immersive digital experience in a real-time environment." AR can also consist of computer-generated 3D environments so that end users enter an artificial world while no longer seeing the real world.

As discussed by Adweek, this technology is more than just a mobile app video game, as "brands that have embraced AR have seen a significant impact to their bottom line. In fact, studies show that consumers are willing to pay as much as 40% more for a product that can be experienced through AR. Using AR gives customers the confidence to buy, increases their post-purchase satisfaction, and reduces return rates."

Furthermore, Research and Markets reported that "augmented reality in retail market size was valued at $2 billion in 2021, and is estimated to reach $61.3 billion by 2031, growing at a CAGR of 41.4% from 2022 to 2031."

Bloomingdale's is one big-name brand that took advantage of 8th Wall web-based AR for its 150th anniversary. Shoppers were sent AR-activated catalogs and could scan AR-enabled pieces to see real-life models walk around in selected clothing that appeared true to life. The gamble paid off since "this initiative led to a 22% higher conversion rate to shop and a 38% higher engagement rate," according to Adweek.

Another successful example is how the online art gallery Saatchi Art created an AR experience called "View in My Room" that allows over 1 million pieces of art to be overlaid into a user's home. Using their smartphone or tablet, the end user can select a work of art from Saatchi Art and see it hung on any wall in their home without the need for an app.

Saatchi Art decided to pursue this avenue after their survey revealed that 87% of art buyers are hesitant to make purchases without being able to see the artwork in advance in their homes. According to the company, their AR strategy "has successfully helped art buyers with their buying decisions online with an average 17% increase in spending."

In the world of retail, AR is also allowing for customizable products, personalized shopping experiences, optimized warehouse spaces, "try before you buy" interactivity, and more detailed information about products being sold. And since AR in retail is still in the developing and transitional phases, brands can capitalize on the wow factor of this technology while pioneering the new frontier.