How Augmented Reality Is Reshaping Retail

How Augmented Reality Is Reshaping Retail

By Heidi Reidel

Augmented reality (AR) is the latest technological innovation for the retail industry. AR made its explosive entrance to the market last year, when Pokemon Go took the world by storm. Retailers have been looking for ways to capitalize on the emerging technology and now, these efforts are coming to fruition.

Benefits of Augmented Reality in Retail

Augmented reality stands to benefit both the customer and retailer. Through AR, a brand is able to give consumers a more personalized experience. Customers can see how a product would look in their own home rather than the home in a catalog. They can also try out products before purchasing them. While anyone can enjoy the comfort and ease of shopping at home, this technology could be life-changing for people who can’t leave the house.

AR benefits the retailer, not only by boosting sales but by providing customer service and displaying products without spending money. For example, Yihaodian AR, China’s largest online grocery store, opened up virtual stores at various locations around the country without spending any money on real estate. The customer simply goes to a location (parking lot, playground, etc.) and uses the app to navigate through “aisles” and add products to their cart. This also saves retailers the money used to employ sales associates.

The Virtual Shopping Experience

Businesses must make a few decisions about the type of virtual shopping experience they want to provide to their customer. For example, they must decide which technology to use: Virtual Reality or Augmented Reality. Virtual reality immerses the consumer in a simulated world. It requires stand-alone technologies such as headsets and, typically, a controller. Augmented reality overlays virtual elements onto the real world as seen through a smartphone or tablet. This is where AR is becoming so popular; AR is less expensive and more mobile than VR, allowing it to reach more customers.

Retailers must also decide if they want to give their customers an in-store or out-of-store experience. The store can have devices available at the facility for customers to try out products or the business can offer an app that customers can use anywhere or at specific virtual locations.

Examples of Augmented Reality in Retail

Many recognizable brands are already taking advantage of augmented reality. IKEA is using AR to overlay 3D models of their products on the real-time feed of the customer’s camera, pointed where they want their furniture to be placed. Converse allows customers to point the camera at their feet and the company’s app will overlay a projection of the shoe on their feet. Lego introduced augmented reality in in-store kiosks back in 2010, where the customer held up the box in front of the screen of the kiosk, and the finished Lego appeared on top of the box on the screen. In 2015, Lego released an app called Lego X, which uses networked Lego bricks to create a 3D model on your device. The bricks are sensor and gyroscope-enabled which allows the software to track them and render a real-time model as you proceed to design.

There are also a few emerging names in the field of augmented reality. Uniqlo, a Japanese-based retail store, has been deploying augmented fitting rooms. These rooms consist of a mirror with an LCD screen that lets you choose the apparel you wish to try on and then overlays different colors of the clothing to help you make the best choice possible. Companies such as The Gap and Adidas are launching their own virtual fitting rooms. Google now has their own AR platform called Tango. Tango also does virtual overlays for shopping but takes it a step further. Lenovo unveiled a Tango-enabled smartphone called the Phab2 Pro.

Investment in the sector is hot, with AR and VR startups raising $658 million in equity financing in 2015. Some projections put AR and VR investment in retail at close to $30 billion by 2020. Augmented reality is poised to completely alter the customer experience.

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