Over the last few years, augmented reality (AR) has attracted the interest of investors, companies and the general public, especially after Mark Zuckerberg bought Oculus. Currently, many online businesses such as Sony, Samsung and Google are investing massively in AR. Augmented reality is expected to disrupt several sectors, including retail, logistics, healthcare, tourism and manufacturing, etc.
In this article, we will define augmented reality and present some of its benefits for online shopping.
What does Augmented Reality (AR) mean ?
Augmented Reality (AR) is a technology that superimposes a computer-generated image of the user’s real world view to provide them with an improved version of reality. This involves integrating digital information (sounds, images and text) into the user’s real-time environment.
The concept is to combine the virtual and the real and to give the illusion of a perfect integration for the user. These virtual assets can be 2D or 3D images, sound, videos…
It is often delivered using devices like a smartphone or tablet app. The device generates the static or interactive virtual assets and overlays them with what is captured by the mobile device’s camera.
In the following sections we will look in detail at how these two reality technologies work, with a particular focus on the business case for AR.
What is the difference between Virtual Reality and Augmented Reality ?
Augmented reality and virtual reality are two confusing terms, because they have a lot of similarities, but also a few differences. In virtual reality (or VR), the user almost always wears a headset covering the eyes and earphones to completely replace the real world by the virtual world. VR is about eliminating the real world as much as possible and isolating the user from it. Once inside, the VR universe can be coded to offer just about anything from a lightsaber fight with Darth Vader to a realistic (but completely invented) reconstitution of Earth. Although there are certain commercial applications for VR in product design, training, architecture and retail, the majority of VR applications today are focused on entertainment, especially gaming.
On the other hand, augmented reality integrates the simulated world with the actual world. In most applications, users rely on the screen of a smartphone or tablet to achieve this, pointing the phone’s camera at a point of interest and generating a live video of that scene on the screen.
The display is then covered with useful information, which includes implementations such as service instructions, navigation information, or diagnostic data. However, AR can also be used in entertainment applications. A classic example is the mobile game Pokemon Go, in which players attempt to capture virtual creatures while moving around in the real world.
Benefits of Augmented Reality in E-commerce :
Purchasing using augmented reality (AR) is certainly the future of online shopping. This innovative technology has many advantages to offer e-tailers. Here are some fantastic benefits of AR in e-commerce in 2022 :
- Personalizes Online Shopping :
Augmented reality in e-commerce can personalize the shopping experience for customers. Customers will find tools that allow them to see what the clothes look like on them, show what sizes would fit them or show the actual size of a product in their space, and other features that would solve the problems of online shopping. Rather than an online shop showing mannequins wearing the clothes, customers could even see themselves in all the outfits to see which ones would look best on them. Therefore the level of customization is likely to increase the conversion rates of the online shop while increasing sales. - Improves conversion rates :
One of the most distinctive benefits of augmented reality in e-commerce is improved conversion rates. Users are more likely to convert if they have a better picture of the product they are about to buy. With the implementation of augmented reality in e-commerce, e-shops owners can offer a more immersive and engaging product experience, resulting in improved conversion rates.
- Reduces return rates :
Research found that a high number of customers had returned the items they bought due to faulty or damaged products. Another group of shoppers returned the goods because they were not as described on the website. Therefore, using augmented reality in e-commerce can significantly decrease return rates by enabling customers to choose the right product for their needs.
How does AR work in E-commerce ?
E-commerce is a growing field and with the advent of digital technology, e-commerce is making shopping and selling more satisfying and convenient for the average person, and with the introduction of AR, it is becoming more compelling.
Most of the major e-commerce players are acquiring and implementing augmented reality as part of their services, like Alibaba, Amazon, Shopify, Flipakart, etc. In 2018, Alibaba started working on providing virtual and augmented reality services as part of its e-commerce customer experience.
Major retailers and customers now prefer an e-commerce experience with augmented reality to an e-commerce experience without augmented reality. Younger generations are seeking more interactive shopping experiences. Data from research reported that 30% of millennial and Gen Z consumers want more online shopping experiences to incorporate AR and VR technology, compared to 14% of older generations.
So, the use of augmented reality in online shopping offers consumers an immersive experience, allowing them to interact in real time with products while remaining in their own environment. Moreover, AR enables businesses to inform and connect with customers as well as continue to engage consumers after they’ve made a purchase.
This gap is further widened by the Covid-19 pandemic, which restricts the opening of retail shops, leaving consumers unable to enter stores and physically handle products.
Three major brands that are boosting their e-commerce strategy with augmented reality
IKEA
IKEA was one of the pioneers in using AR for online retail. In 2017, it launched its IKEA Place app, which allows shoppers to place thousands of items in their homes with 98% accuracy. The user simply needs to point the camera at their surroundings, specifically where they want to place an item. The user can select any item from the IKEA catalog and the item will appear. They can rotate the item and adjust it to where they want to place it in the room. They can move around to look at the item from different angles.
This technology takes the expression « try before you buy » to a whole new level, giving users the opportunity to test the size, shape, appearance and functionality of a new purchase without ever leaving their living room.
Thanks to AR, IKEA Place offers users this immersive experience that keeps them engaged and convinces them to complete a purchase more quickly.
Sephora
Sephora Virtual Artist is actually the best example of augmented reality as a way to learn. You can try on different makeup looks, take a photo of an outfit you plan to wear to match the shade, check out full face looks and learn how to do your makeup with virtual tutorials. Whether the user is a beginner or an experienced make-up artist, there are augmented reality e-commerce features that allow them to try on and buy the make-up that suits them best.
This technique provides an enjoyable shopping experience for women who like to play with different looks, while making it as simple as clicking a button.
Sephora’s customers can feel confident with their purchases as they have had the opportunity to try on a wide selection of products, which is likely to help increase conversions while reducing refunds.
Nike
In 2019, Nike launched Nike Fit, an application that uses AR technology that measures customers’ feet and gives them the correct size in a variety of Nike shoes.
The app offers different footwear suggestions based on the full measurements it takes of customers’ feet, which makes it personal and engaging for customers to use. The tool has reduced the number of returns and improved the performance of Nike shoes.
Conclusion
Augmented reality creates a more enjoyable and memorable experience for customers. Businesses don’t have to neglect this technology because of the several benefits it represents. But the higher engagement rates will certainly boost overall company sales, which will motivate many companies to offer these services.
Like many technologies, AR would take some time for customers to accept and help it to expand through the globe. But, in the near future we might see it taking off in a big way especially with the covid pandemic.
E-commerce is already growing at a great pace and will continue to do so in the coming years.
