Technology Can Boost Your Retail Business Success!Amplify Your E-Commerce Sales: How AR

As the world moves beyond the pandemic, direct-to-customer (D2C) businesses are presented with the task of adapting to the shifting retail environment. In the current retail landscape, where e-commerce solutions are becoming increasingly prevalent, businesses are searching for innovative ways to connect with customers and drive sales. One such amazing technology that is gaining popularity is augmented reality (AR).

This is specifically pertinent in the business-to-business (B2B) e-commerce, where AR-enabled virtual stores are gaining traction. These showrooms allow companies to showcase their products and services to customers more immersively, regardless of their physical location. Customers are now able to envisage products in their real-world environment by employing AR, which allow creating a more tailored and winning shopping experience.

With e-commerce as one of the front-runners, AR technology is gaining drive in numerous industries. Industry giants including IKEA, Sephora, Nike, ASOS and several others have leveraged AR to boost their customers’ online shopping experience. The reason why these companies are capitalizing in AR specifies the massive potential of this technology for the retail industry. Some recent studies specify that the global market value of AR in the retail and e-commerce industry is expected to reach $6.74 billion by 2028, with a CAGR of 20% during the forecast period 2022-2028. To cope up with this swiftly budding technological landscape, the retail businesses must embrace AR and enjoy the most of its many benefits.

Our all-inclusive study on AR in e-commerce offers valued insights into how businesses can harness this technology to grow and succeed in the competitive retail market. So, read on to learn how AR can transform your e-commerce business and aid you to be obvious from the crowd.

What Is Augmented Reality?

AR or Augmented Reality is a pictorial technology integrating three critical features: real-time interaction, seamless integration of virtual and real-world elements, and accurate 3D registration of virtual and physical objects. AR technology overlaps digital content and info onto a user’s real-life environment, thus generate an improved virtual experience of the physical world. AR improves a user’s insight of reality through incorporating computer-generated displays, sound, text, visuals and graphics.

Google Maps’ Live View feature is a key example of AR technology that helps users envisions their destinations in the real world. Popular applications like Nintendo’s Pokémon Go and AR filters on social media platforms like Instagram and Snapchat are also widely used examples of AR technology. AR is getting implemented in many industries, including consumer retail and products, to enhance their marketing and operational abilities. It’s not just limited to gaming or navigation applications. Leading e-commerce brands and in-store retailers are investing heavily in AR to create immersive brand experiences and stand out in a competitive market.

AR: Rapid Flight, a force that should be reckoned with

The usage of AR is growing along with mobile usage, with projections suggesting that nearly all smartphone users and 75% of the global population will be regular AR users by 2025.

70% of industry executives believe the AR sector will bring in greater revenues than the VR market. Incorporating AR experiences into products can increase conversion rates by up to 94% in some cases.

According to recent polls, 76% of individuals desire to utilize augmented reality as a useful tool in their daily life. An overwhelming 92% of Generation Z individuals are interested in using AR for shopping, indicating that younger consumers are likely to lead the widespread adoption of this technology. It’s crucial for businesses to take note of this trend and invest in AR to provide innovative experiences for their customers.

What Does the Progression of E-commerce Through Augmented Reality Entail?

The use of augmented reality (AR) in marketing and advertising campaigns dates back to 2008, when BMW first utilized this technology. However, this early foray into AR was not very successful due to the relatively new concept. It wasn’t until 2016 when Pokémon GO game took the commercial potential of AR by storm. This mobile game captivated a vast audience with its advanced features, leading businesses such as cafes, hotels, and restaurants to seek inclusion as “Pokemon gyms and Pokestops” to attract a larger customer base.

During the pandemic, a significant portion of US-based e-commerce retailers transitioned from physical channels to online portals in just three months. This sudden shift led to e-commerce market growth equivalent to a decade in just a quarter. In fact, over half of e-commerce consumers reported that AR-based shopping has been very important to them since the beginning of the pandemic.

Furthermore, more than half of e-commerce consumers reported that AR-based shopping had become increasingly important during the pandemic. Retailers that integrated AR-based solutions experienced remarkable sales growth, with some observing as much as a 200% increase. These developments signify the immense potential of AR in the e-commerce industry and how it has evolved over the years.

Different Types of AR That You Can Utilize In Your E-Commerce Business

Incorporating augmented reality (AR) into e-commerce operations has become increasingly popular due to the various capabilities of AR-based applications. AR technology comes in different types, each type offering exclusive features for the businesses.

• Marker-based AR Apps

  Marker-based AR Apps is one of the most popular types of AR applications. These apps identify an object or marker through the camera of a smart device and show info related to it on the screen. This type of AR is also known as Image Recognition AR or Image Recognition-based. Once the marker is sensed, the app swaps it with a three-dimensional version of the object. Thus it let users to check it in detail from diverse angles.

• Markerless AR Apps

  Unlike the marker-based AR, markerless AR applications do not need a prompt from an object or marker. Instead, users can place virtual objects anywhere they like and interact with them freely.

• Location-based AR

  Location-based augmented reality is a markerless AR that employs geographic placement to display digital content to consumers at specified places. This type of AR is popular in games like Pokémon GO, which displays digital characters in real-world locations.

• Projection-based AR

  This is a type of AR that necessitates an exact process where synthetic light is projected onto physical surfaces, to generate a hologram-like effect. Users can understand object specifications by interacting with the projected image. This technology has been employed in movies like Star Wars.

• Overlay AR

  This comprises of an application that overlap digital content onto the mobile screen so that it gets a seamless part of the real world. This means that the digital content is combined with the physical environment naturally and in an immersive way.

• Contour-based AR

  It emphasizes on the borders, contours, and edges of real-world objects to sense and track them and then overlays digital content onto these objects. The digital content in this type of AR is offered to create a sense of interaction with the physical environment, to showcase that the digital content is truly a part of the real world.

What Rewards Does Augmented Reality Offer To E-Commerce?

As per Google, 60% of people are concerned in envisaging how a product fits into their lives before obtaining. Augmented reality technology offers an excellent opportunity for e-commerce companies to provide a realistic shopping experience to their customers. In the following section, we will discuss some of the most impactful benefits of AR in e-commerce:

• AR Improves Customer Engagement

  Augmented reality improves customer engagement by providing an interactive experience on e-commerce websites and applications. By offering an immersive customer experience, customers are more likely to stay longer on the shopping platform, increasing the likelihood of a purchase. Even if they don’t make an immediate purchase, a positive customer experience can improve engagement and brand loyalty. Augmented reality, particularly for beauty, fashion, and home decor industries, offers a “try before you buy” approach, allowing customers to feel like the product is right there.

• AR Reaches New Customers

  Augmented reality can help reach new customers, particularly in today’s competitive market. Creating attractive AR campaigns can help e-commerce companies grab customers’ attention. The impact of AR in mobile application development and marketing activities is evident, with industries ranging from education to healthcare leveraging its capabilities. IKEA is an example of an e-commerce company that uses AR-based campaigns to target new users and improve their shopping experience. IKEA’s mobile application, “Ikea’s Place App,” joined forces with Apple’s ARKit in 2017, allowing users to place IKEA furniture virtually anywhere in their homes or offices. Apple is another example to includes AR in its latest features and updates to improve the shopping experience, helping brands attract and target new users.

• AR Helps in E-Commerce Higher Sales

  AR has been shown to upsurge sales significantly in the e-commerce industry, thus it is demonstrating to be a game-changer. A study led by Harvard Business Review discovered that consumers who utilized augmented reality were 19.8% more likely to obtaining than those who did not use AR. This defines the power of AR for driving revenue growth of the businesses. In fact, Shopify provides a great example of the positive impact of AR on sales. Since introducing 3D models in AR to its online marketplace in 2018, the Canadian e-commerce company has experienced an impressive increase of up to 250% in conversion rates on its product pages. These results indicate the immense potential of augmented reality technology in transforming the e-commerce industry and driving business growth.

• AR Strengthens Customer Relationships

  Augmented Reality has several benefits for e-commerce businesses. One of them is enhancing customer relationships through an immersive and seamless shopping experience. When customers are able try any product virtually, it boost their faith and become faithful to the brand, leading to improved conversion rates. Besides, AR is also able to develop consumers’ memory, thus makes it easier for them to recall the brand and reappear for future purchases. This is especially helpful to build a long-lasting impression on their customers.

• AR Enriches Conversion Rates

  Studies have shown that AR in e-commerce can significantly improve conversion rates, with brands that use AR or VR for advertising their products observing a 94% increase in conversion rates. For instance, Facebook’s AR partner, Vertebrae, reported a 90% rise in consumer conversion rates for customers engaging with AR compared to those who don’t. AR’s ability to provide a more interactive and realistic view of products has been proven to be a game-changer for the e-commerce businesses seeking to increase their conversion rates.

  

• AR Improves Supply Chain Management

  Implementing augmented reality (AR) in an e-commerce app can unlock several potential benefits in the field of supply chain management. It enables access to real-time data on inventory levels and locations, which in turn facilitates informed decision-making for replenishing stock and streamlining inventory management processes. Furthermore, it provides warehouse staff with real-time updates on order packaging and shipping, leading to improved accuracy and more efficient order fulfillment. This reduces dependencies on retail and supply chain teams and eliminates time-consuming inventory analysis processes, thereby optimizing retail business operations that depend on the supply chain.

• AR Reduces Return Rates

  One of the major challenges that e-commerce businesses face is the high return rate of products. Customers frequently return the products soon after they receive them. Have you ever wondered why this happens? Studies have discovered the key reason for high return rates is are mainly due to improper sizing, fitting, or design of the products, especially for the clothing or related accessories. AR technology enables customers to virtually try out products and gain a comprehensive understanding of them. By providing 3D views, customers can visualize how a product will look in their space, something that static images or short videos cannot effectively convey. This technology ultimately gives customers more confidence in their purchasing decisions.

AR in E-commerce Success: Real-world Examples of How the Top Brands are Benefiting

When making a purchase, consumers need to feel confident that the product they are considering will meet their needs. Augmented reality (AR) technology can preview products and services, helping consumers make informed decisions. Additionally, AR can facilitate the selection process, empowering consumers to choose the right product from the comfort of their own space and at a convenient time. As we look ahead to 2023, learn here some emerging AR trends that e-commerce businesses should keep an eye on.

Online Apps for Fashion with Virtual Try On

Have you ever seen something worn by a mannequin while shopping and admired how good it looked, only to be disappointed by the fit or color when you tried it on? Such experiences can lead to poorer conversion rates in online shopping. Virtual try-on solutions using AR technology is an effective option to provide customers with the right information. Virtual try-on solutions are particularly popular in the fashion, beauty, and lifestyle industries. It let customers to try on makeup, dresses, shoes, hair colors, and other accessories virtually, which can upturn the overall shopping experience. As per a survey, more than half of respondents believe that AR is the best way available for checking out new products.

Beauty and Personal Care

Sephora Virtual Artist — Sephora Virtual Artist allows customers to try on makeup virtually. The app uses AR to superimpose makeup onto the customer’s face, allowing them to see how it would look on them before making a purchase. And now, Sephora is updating its Virtual Artist feature on its app and website with live 3D facial recognition technology from ModiFace. This update will improve facial tracking and rendering to provide users a more accurate virtual try-on experience. The 3D version of the app is expected to perform even better, with a focus on providing a simple user experience to increase conversions. Other retailers and brands are expected to follow suit.

L’Oreal Paris — L’Oreal Paris has developed the Makeup Genius and Share Genius apps, enabling users to virtually try on their products before purchasing. The brand has also collaborated with Facebook Meta and Instagram to offer social media users the opportunity to try out its cosmetics through AR makeup try-on game filters. In addition, L’Oreal has partnered with Snapchat to allow Snap users to try out its makeup products via an AR filter.

Lenskart — Lenskart, a popular eyewear retailer, has harnessed the power of AR to provide customers with a seamless and worry-free online shopping experience. Through its innovative mobile app, customers can try on various eyeglasses and sunglasses without leaving the comfort of their homes. The app uses cutting-edge AR technology to scan the customer’s face with 360-degree angles and capture 463+ facial points. This allows the app to create a precise 3D model of the customer’s face, which can then be used to try on different eyeglasses with the 3D try-on filter. The use of AR by Lenskart has altered the traditional way of getting spectacles and eyeglasses. The online eyewear shopping has become more convenient, and enjoyable than before. Overall, Lenskart has set a new standard for the eyewear industry, providing a more tailored and engaging shopping experience to their customers.

Warby Parker — Warby Parker is a well-known eyewear retailer that has successfully implemented AR into its e-commerce solution. They have developed an app that allows customers to try on glasses virtually using their smartphone or tablet. This has been well-received by customers and has helped to drive sales and reduce returns. It has also been particularly useful during the COVID-19 pandemic, as it allows customers to try on glasses from the safety of their own homes.

Clothing

ASOS – ASOS, an online fashion retailer, has launched a feature known as “See My Fit.” With this feature, customers can view up to 500 products per week on six diverse models, each with a unique body shape, to simulate how the garment would look on different body types. The technology behind “See My Fit” maps each product digitally onto the models, considering the garment’s size, cut, and fit. As a result, customers can gain a realistic and engaging presentation of how the product would look on someone with a similar body shape. By reducing the gap between online and in-store shopping, this feature enhances customers’ understanding of how the product would fit them before buying and reduces product returns.

Zeekit — Zeekit is a pioneering AR-based fashion startup acquired by Walmart and has transformed the industry with its ZEEKIT “Virtual Fitting Room” app. The app enables customers to upload full-length photos and virtually try on various clothes, creating an online shopping experience akin to in-store shopping.

Shoes

NIKE — a leading fashion and apparel brand, recognized that customers often purchase the wrong shoe size when shopping online, with approximately 60% of people experiencing this issue. To combat this problem, NIKE turned to AR technology and partnered with 8th Wall and BDRG studios to create its web-based AR app, NIKE FIT. This innovative app requires only one input from the user to measure their foot size accurately and then uses a virtual AR-based try-on filter to show how the footwear will look on the user’s feet.

Home Furnishing and Decor

IKEA — A noteworthy example of AR technology transforming the customer experience in e-commerce is IKEA. With the launching of the IKEA Place app, the retailer has disrupted the industry by offering customers the ability to preview furniture in their homes before purchasing. This personalized experience allows for a more realistic and immersive shopping experience, providing a distinct advantage over competitors. Furthermore, by utilizing AR technology, IKEA can drive higher sales by making shopping more convenient for customers. Given the retailer’s warehouse locations, which are typically situated outside of city limits, this feature eliminates the need for customers to travel back and forth to pick up products. As a result, the IKEA Place app has significantly enhanced the retailer’s competitiveness in the market.

Wayfair — Like IKEA, Wayfair also has emerged as a front-runner in the field of AR-based furniture shopping apps. Customers constantly seek a seamless AR experience that can be extended to multiple products using AR technology. AR’s infinite capabilities have resulted in a higher degree of realism by adhering to the principles of the real world. According to Steven Conine, co-founder of Wayfair, AR is set to be the future of every American household since try-before-you-buy has gone digital. In essence, Wayfair’s AR app has transformed the retail experience into an elevated one.

Houzz — This is a fantastic AR app for the furniture and home industry, providing innovative ideas to customers. By using AR technology to visualize products, Houzz estimates that customers are 11 times more likely to make a purchase. This makes Houzz AR a powerful tool for driving sales. Additionally, the app’s curated approach has been especially helpful to millennial consumers looking to buy furniture.

Lifestyle

Amazon — Amazon, one of the world’s most popular eCommerce platforms, has embraced AR technology by launching a new feature for smartphones called Amazon AR View. This feature enables customers to overlay virtual products onto their actual surroundings using their smartphone cameras. This feature is available to both iPhone and Android users via the Amazon smartphone app. Amazon’s adoption of AR technology in its eCommerce platform is a sign that the technology is becoming increasingly mainstream, suggesting that customers will expect AR to be a standard feature in their overall eCommerce experience.

Break Down of the Expenses Involved in Building an AR-based Retail App

Augmented Reality (AR) technology is increasingly being recognized as a valuable tool for enhancing the retail customer experience. However, the development of an AR-based retail app can be a complex and costly undertaking. Developing an AR-powered e-commerce app incurs varying costs, contingent upon factors such as app complexity, features and functionalities, targeted platform(s), development team location, and other variables. To provide a breakdown of the expenses involved, we will examine the key cost components of building an AR-based retail app.

Development costs

Development cost is the most substantial expenditure for building an AR-based retail app. These costs differ based on the app’s intricacy, the features needed, and the proficiency of the development team. Expertise in AR technology and programming languages such as C++, Java, and Swift is vital for the development team for creating a user-friendly, efficient and engaging app.

Design costs

Design cost is also a vital consideration when it comes to developing an AR-based retail app. The user interface should be visually alluring and intuitive, demanding the expertise of a skilled designer. The design costing depends on the experience of the designer and the complexities of the app design.

Content creation

The AR-based retail app will involve high-quality animations, 3D models, and textures for producing an immersive experience for the user. The complexity and amount of the content required decides the content creation cost. Furthermore, the app might necessitate the integration of product catalogs, adding to the content creation costs.

Hardware costs

They are another vital cost to consider. The app will require high-end devices along with innovative features to run efficiently. The hardware cost will depend on the type and number of devices required to support the app.

Maintenance and Support Cost

Maintenance and support is highly required after the app is developed and launched. The maintenance cost includes bug fixing, software updates and security updates while support costs consider resolving customer queries along with providing customer support.

Finally, it’s the marketing and advertising strategy on which the triumph of the AR-based retail app will depend. The marketing and advertising cost will depend on the target audience and the channels used to grasp them. Traditional advertising methods such as billboards and print media and social media marketing are among the options available.

Incorporate Augmented Reality into Your Retail Business with Us

Customer gladness is critical in today’s enormously competitive economy. It’s not enough to simply offer a great product or service; businesses must provide an immersive and engaging shopping experience to stand out from the crowd. Businesses may elevate their customer experience by deploying consumer-focused solutions like AR.

At Softqube Technologies, we focus in AR development practices and can aid you develop reliable AR-based solutions for your business. Our skilled team of developers will monitor you through the entire process, confirming that you have a strong understanding of what to expect. With us by your side, you can boost your marketing campaigns and bring your products to life with the power of augmented reality.

So, if you want to improve your customers’ shopping experience and boost your business’s bottom line, don’t hesitate to contact us. Let’s work together to create innovative solutions that will take your business to new heights!

FAQs

Q1. How can businesses leverage AR to enhance the shopping experience for their customers?

A1. The integration of augmented reality in e-commerce allows businesses to offer virtual product trials to customers. This immersive experience enables customers to interact with products before purchasing them, providing them with more informed and confident buying decisions.

Q2. What are the most operative uses of augmented reality in the e-commerce business?

A2. Augmented reality has proven to be highly advantageous for e-commerce businesses, largely in terms of augmenting customer engagement and experience. AR also plays a significant role in improving conversion rates and reducing the number of order cancellations and returns.

Q3. What qualities set AR and VR apart?

A3. AR superimposes digital content onto physical objects, while VR immerses users in a virtual world. AR provides additional information and enhances learning experiences, while VR is used for training simulations, immersive gaming, and storytelling. AR is more accessible as it only requires a smartphone, while VR requires special headsets. Both technologies have made significant progress and have untapped potential.