8 min read
Nov 13, 2020
retail

Augmented Reality in Retail: A Simple Guide for Your Small Business

Think augmented reality in retail is too futuristic? Think again. Here's how you can use it now to boost engagement, sales, and revenue when it comes to your online shopping experience.

A.K.
Amanda KennedySenior Content Writer

Augmented reality (AR) in retail may be the game-changing technology your business needs to grow sales and delight customers. 

Now that retail stores are increasingly expected to offer contactless shopping experiences, it’s an ideal time to consider implementing this specific type of artificial intelligence tool.  A recent GetApp survey* about contactless customer experience shows that 65% of U.S. shoppers are comfortable using AR in their shopping experience (you can read about our survey at the bottom of the page).

stat showing that 65% of people surveyed are somewhat or very comfortable with virtual fitting or styling

AR tech can be difficult to understand, but don't worry. We're here to answer common questions—including how AR can increase revenue and how other brands are using it—so you can confidently decide whether it’s right for your business. 

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How does augmented reality work in the retail space?

Augmented reality overlays digital information (text, graphics, etc.) on the physical world. For retailers, this can look like a shopper using their smartphone's camera or an app to see what products look like in their environment. 

More and more retailers are using AR this way to help customers make purchase decisions. Just take a look at these examples from well-known brands: 

  • Ikea brings their printed catalog to life. The brand blends offline and online worlds by allowing shoppers to scan their catalog with a mobile device to see how furniture will look in their own home.

  • Zara lets you “shop the look.” Pre-pandemic, Zara launched a campaign where customers could use an app to scan mannequins in store to shop the look. By integrating AR with visual search, shoppers could make instant purchases when they saw something they liked. Zara also incorporated AR for online purchases during the campaign, where AR images of models appeared on packages when customers used the app.

  • Asos takes the catwalk to customers' homes. Shoppers can hold their phones near any flat surface to see a model wearing the clothes they're interested in purchasing.

How is augmented reality different from virtual reality?

Augmented reality is anchored in the real world; digital images are superimposed over reality. Virtual reality is a computer-generated 3D environment that completely surrounds users, often allowing them to move through the virtual environment using an immersive headset. Virtual reality has limited use cases in a retail store at the moment as it typically requires more expensive hardware (like a headset).

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What are the benefits of augmented reality in retail? 

AR's retail benefits include increased conversion rates, improved customer experience, and better brand awareness

Take lifestyle brand Herschel Supply Co. as an example; the company invited customers to scan a QR code to see products in their homes and compare sizing to objects such as couches or chairs. They reported a 152% revenue per visit lift for customers who engaged with the AR experience over those that didn’t.

Another success story involves retailer CB2, which leveraged AR to help customers see furniture in their homes. CB2 reported a seven to 13% increase in conversions, revenue per visit, and average order value for all customers after the implementation (not just those who engaged with the experience).

Augmented reality in retail helps customers feel more confident about product quality, features, and specs when they make a purchase. This can help reduce returns, and also greatly improve overall customer satisfaction. 

AR can also help build brand awareness by differentiating your store from competitors that don't offer AR capabilities. The earlier you adopt this technology, the more time you’ll have to build a customer base for it and avoid being behind the curve. In a September 2020 GetApp survey**, we found that three in 10 businesses have 2021 budget set aside for virtual or augmented reality tech. 

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Why should you use AR to adapt to touch-free shopping trends?

In the wake of COVID-19 social distancing guidelines, contactless commerce is a hot topic in the retail industry.

Even beyond the pandemic, customers value contactless experiences for ease of use and convenience. However, one pain point customers have with contactless experiences is not being able to judge the quality of goods. And that’s where augmented reality in retail comes in. It can help provide a more satisfying experience when it comes to assessing products before purchasing online.

In our September 2020 survey, we asked customers why contactless retail experiences are so important. Surprisingly, customers cited ease of use more often than health and safety reasons.

While the pandemic has caused online shopping to increase dramatically—46% of consumers Gartner surveyed reported increased shopping compared with pre-pandemic habits on desktops alone—it’s unlikely this trend will go away when we reach a new normal (full content available to clients). 

While most are growing more comfortable making online purchases for frequent or low-cost items, our survey found that customers still find it difficult to judge product quality in a contactless environment (think high-value items, such as wedding dresses or designer sunglasses).

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Is it realistic for small businesses to adopt AR?

If you’re not a software developer, there are turnkey solutions for augmented reality software, meaning your team can make use of this technology without needing an engineer or advanced technical skills.

Before investing an AR technology, answer these questions so you know what you’re hoping to gain from the implementation:

  • Are you hoping to set up a try-before-you-buy opportunity? 

  • Are you looking to create a more immersive experience? 

  • Do you want customers to be able to see your products in their home?

Your answers to these questions will help you find the best software for your business' needs. Make sure your software vendor also supports Android and iOS platforms. While we recommend AR over VR because you don’t technically need a headset, it's a good idea to make sure your platform supports common AR headsets in case you want to incorporate them in the future. 

screenshot of ZapWorks
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What should you do next when it comes to AR for your business? 

While these examples may help provide perspective, if you need more help deciding whether augmented reality shopping will work for your retail business specifically, we have a decision-making tool to help you decide.

an infographic showing a VR/AR decision framework from Gartner

If you make your way down the entire decision tree below, then it’s a good idea to move forward with an investment in AR.

Whether you invest in AR now or later, the revenue numbers and research prove that augmented reality technology can improve consumer confidence when it comes to making online purchases. On top of that, AR is a fun, immersive customer experience that leads to positive brand associations. 

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Ready to find the right AR tool for your business and your customers?

Survey methodology

*GetApp’s Contactless Customer Experience Survey was conducted in September 2020 among 968 adult consumers in the U.S to understand how customers have adapted to contactless services in the wake of COVID-19.To ensure participants fully understood the meaning and topic at hand, we defined the term 'contactless' in the survey questionnaire.

**GetApp conducted this survey from Aug. 24-Sept. 27, 2020 of 1,000 small-business leaders from the USA, Canada, UK, and Australia. The goal of the study is to understand what technology investments SMBs are making and the drivers and challenges that influence their decisions. 

Respondents were screened by:

  • Number of employees: 2-499 employees

  • Annual revenue: $5M-$250M

  • Respondents are required to be involved in purchasing technologies for the organization and hold a manager-level position or above in the company.

Disclaimer: Results of this study do not represent global findings or the market as a whole but reflect sentiment of the respondents and companies surveyed.

Note: The applications selected in this article are examples to show a feature in context and are not intended as endorsements or recommendations. They have been obtained from sources believed to be reliable at the time of publication.

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