How Online Retailers Use AR to Enhance Profits

Brands like IKEA and Nike first laid down the foundation of AR in eCommerce, but now the technology has found more applications in other niches.

Technology might evolve at the speed of light, yet, more often than not, it takes surprisingly long to catch on. This is precisely the case with augmented reality (AR). First introduced in the 1960s, the concept matured only now and still raises doubts regarding the time, cost, and mechanism of implementation.

Meanwhile, customers expect the convenience of view-in-room and try-before-you-buy technologies. According to Deloitte Digital and Snap Inc. report, AR is generally seen as a “toy,” but 76% of people expect and desire to use it as a practical “tool” in their everyday lives. The interest skews particularly high among younger audiences and is associated with the mobile usage boom.

For its early adopters, AR holds a promising future, boosting conversion rates and making online shopping more transparent. Integrating AR may be your first step to bridging the gap between the physical and the digital in your online store. Let me explain in more detail how AR works in eCommerce and which niches present the most successful AR use cases to inspire your brand.

See also: Luxury Brands Embrace AR: Businesses Should Take Note

No clunky headsets needed: How AR works in eCommerce

AR integration in an eCommerce store allows users to experience products in context through their phone, computer, app camera, or an AR headset. It brings most advantages to mobile shoppers, but desktop users will also benefit from AR in eCommerce.

Unlike virtual reality (VR), which requires a special headset to immerse the users into a new reality, AR works with the existing environment. It layers digital items and filters onto real-world elements, and your customer won’t need any additional sensors to experience your product. So at the level of technology, AR development works quite easily: all you need is solid 3D models of your SKUs and integration with the browser’s or mobile operating system’s AR kit.

Step #1: Prepare AR-compatible digital content.

These include high-quality 3D models based on a number of reference images and created by a skilled designer. Mind that taking a simple shot of your product is not enough. Besides, if you have a large product catalog, I highly recommend starting with a few SKUs, a single product category, or some bestsellers. This way, you will evenly distribute the budget and track the results of your AR campaign as you scale up.

Step #2: Integrate the AR kit of your choice.

For Android, there is an AICore Google software development kit that allows you to add AR functionalities to your mobile shopping app. AIKit and RealityKit work in the same way for iOS devices. Integration with WebAR will bring AR content to your web-based products, particularly displayed in Google Chrome and Safari browsers.

All the aforementioned kits rely on three essential components: motion tracking, environmental understanding, and light estimation. They all enable an AR system to

  • Understand flat surfaces, like floors and walls
  • Scale in and out 3D objects
  • Move these objects around as the user fits them into a real-life setting
  • Apply realistic brightness and shadows.

Captured by a simple camera, your product images can be placed in real-world interior design, on the user’s body, and even on a moving object. As a retailer, you won’t have to do anything to make the illusion work, except for an in-depth preparation for the AR integration.

AR use cases that will last long into the future

Brands like IKEA and Nike first laid down the foundation of AR in eCommerce, but now the technology has found more applications in other niches.

Fashion

Apparel and fashion brands found AR a perfect fit at the times of pandemics. With consumers unable to visit physical stores, augmented reality offered immersive shopping experiences and try-before-you-buy features to boost buyers’ confidence and drive sales.

Such is the case of AR clothing try-on, whereby a 3D model of a product is mapped to a customer’s body through a quick smartphone camera scan. The technology might be applied at the level of a mobile native app, Google Shopping, or social media. For instance, Gucci, an Italian high-end fashion brand, implemented AR in their iOS app and on Snapchat for a virtual try-on of their Ace sneakers collection. The result? Higher customer conversions, increased engagement, and enhanced customer base used to retarget other retailers’ campaigns.

Even though the world is coming back to normal after the pandemics, the AR trend in fashion retail is not fading away. High-street fashion retailers will keep investing in technology for the sake of user experience because the UX itself sells in this eCommerce niche.

Furniture

The need to use AR for furniture and home decor companies is driven by convenience and confidence in purchasing. Because let’s be honest: you don’t want to order a couch only to discover that it doesn’t fit in your living room.

For an industry that loses $ 428 billion a year in returned merchandise, AR presents a huge opportunity to reduce returns and cut additional expenses on shipping bulky items. In fact, there are many successful cases of Macy’s reducing product return rates to <2 percent or Build.com lowering returns by 22 percent with an in-home product preview.

And the AR trend in the furniture business will thrive notwithstanding the non-market forces. Users can interact with product models – not just plop and spin – and see how it functions in their space. Customers get a better sense of size, color, and dimension, therefore, following a more transparent shopping process.

Beauty and makeup

Virtual makeup try-on is following quickly behind fashion and furniture in AR shopping maturity. Not only does it bring the user experience to a whole new level, but also consumers tackle the issue of dubious hygiene of using the same sample lipstick or shades as other fellow shoppers in the store.

At the level of technology, AR in cosmetics works as a mask. The system is trained with thousands of 3D models and photos of real faces and later applies a beautifying filter with the lip color, shade hue, or contouring cream available in the retailer’s product list. Prominent brands like NYX, Glossier, Maybelline, L’Oréal, etc., have already successfully experimented with the tech.

Some beauty brands go the extra mile to add an entertainment element to the sales experience. It applies both to social media filters and in-app games that are rather easy and to cheap implement but yield higher conversions. Such was the case of hair color company Madison Reed, which saw a 38 percent conversion rate on their AR Virtual Try-On hair color tool, or Aquafresh encouraging children to brush their teeth with a mini-game.

Automotive

Much like in furniture showrooms, the driving force behind AR in automotive is the convenience of shopping. Car dealerships do not necessarily have the space to display a wide range of products, and shoppers might not want to travel to many stores just to see the vehicle.

AR successfully fills these gaps. Experiences vary from the ones in-store, like Audi City allowing a customer to choose and customize their car model from mobile devices to Jeep using an app to view the interiors of the vehicle and place it in a consumer’s garage. AR strategy in automotive facilitates product discovery and accelerates buyers’ journey alongside instilling trust and confidence in a brand.

Consumer Electronics

Tech giants not only stay at the forefront of AR development but also leverage it to sell their products. This is especially true for consumer electronics companies that care about product design as much as they do about the device functionalities.

Thus, Apple has made it easy to see Mac Studio on your desk before it ships. Customers can view a new iMac in AR by visiting Apple’s product page from Safari on their iPhone or iPad. Not only a device’s camera will scan a flat surface and place an AR object, but also you can rotate it and move your gadget around for a better look. This feature is relatively new but promises to become a role model for other consumer electronics brands.

Conclusion: Taking the reigns of AR

Augmented reality is the first important step to the metaverse. Even though many eCommerce brands have successfully implemented it in their strategy, less digitally mature brands can still hop on the trend that promises to become an industry-standard soon. Start with reality-enhancing experiences and bring a plethora of benefits to your eCommerce business now and long into the future.

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