When new technology platforms emerge, traditional retail typically gets disrupted — and often in painful ways. Consumers generally benefit from the added convenience and cost reductions from e-commerce in the short-term. However, the dominance of companies like Amazon has resulted in many retailers and small businesses closing up shop and laying off employees.
Fortunately, the next emerging tech platform, augmented reality (AR), could result in a resurgence of in-person retail shopping. I’ve interviewed several AR influencers who discuss how the technology can reverse the implosion of retail and incentivize customers to physically visit shopping locations.
Reducing customer churn
The broader trend in retail, particularly among millennials, is a shift in focus from products toward experiences. For this reason, many customers still choose to visit a physical shop even if it may be more convenient to order the item online. People still, at large, value the interaction and experience that comes with physical location shopping. For retailers, this presents an opportunity to leverage technology to literally augment the value of their products for their customers.
Alice Bonasio is a journalist and consultant who covers the AR and VR industry. She expands on this point, “the ability for customers to ‘try before you buy’ will result in a reduction in churn, one of the major pain points for retailers. When it comes to larger items like furniture or household appliances, one of the biggest drawbacks for consumers is that they misjudge the amount of space they have available or dislike the way the item looks once it’s actually in their home. This buyer’s remorse is a huge drain on resources for retailers.”
Bonasio continues, “However, AR allows customers to see an item in-store and then project it realistically back at home before finalizing the process by placing the order online. Such omnichannel experiences will make in-person shopping a value add to the consumer and help retailers avoid churn.”
Augmenting customer support
The promise of the internet was a world in which borders and locations became irrelevant. Ironically, in the past few decades, “global cities” such as San Francisco, Tokyo, and London have become more economically competitive while less prominent urban centers have fallen behind. Fortunately, AR may be the first platform that can fully deliver on this promise, by enabling people in remote locations to provide on-site customer support.
Cathy Hackl is an AR influencer, global speaker and author of Marketing New Realities. She expands on this theme, “in a future where customers walk around wearing mixed reality glasses, it will be possible to provide on-site holographic customer support. Imagine a handicapped woman in West Virginia working remotely on a VR headset, holographically projected onto an information desk at a mall or airport in San Francisco. This would enable all of the benefits that customers would gain from an in-person interaction, save costs by not having to hire more expensive local staff, while making a positive social impact on rural communities that don’t have access to jobs.
Hackl continues, “holographic AR customer support wouldn’t just replace our current experience, but dramatically improve it, particularly if artificial intelligence (AI) is implemented as part of the experience. A store’s holographic customer support agent would be able to instantly produce an infinite number of 3D digital representations of real products for customers. The customer could then interact and play with a range of digital products while also gaining real-time enhanced data. What’s the products story? What materials were used? What color variations can be tried? What sizes are in stock in the store? All of this information would be available on-demand, thus revolutionizing the customer support experience.”
Fun experiences result in foot traffic
The popularity of Pokemon Go showed that, when properly incentivized, customers will walk to physical locations in their cities to acquire digital assets and experiences. The implications of this new consumer behavior are significant for restaurants, retailers, and other businesses that rely on foot traffic. During the zenith of the Pokemon Go phenomenon, many business owners reported doubling their sales due to players of the location-based mobile game.
Keith Curtin is the founder of See Digital, a consultancy that helps brands with their AR strategy. He expands on this point, “there are numerous ways in which AR will help retailers gain more visitors. First, special deals can be combined with engaging game experiences to entice people to show up. Brands can launch massively multiplayer scavenger hunts that result in players gaining access to limited-time deals. Through the use of AI-enabled AR avatars, it will be possible for celebrities to act as personal shopping assistants to people, thus making the experience more personal and engaging, but at scale.”
Curtin expands on this idea, “AR adds further value for companies by producing completely new valuable data sets about consumers. Brand engagement through augmented reality apps allows you to see how your customers are interacting with your products across 3D space and time – something that has never existed before. These data sets are extremely valuable for retargeting and building brand loyalty.”
Beware of gimmicks
Given the current state of AR, it’s understandable to be skeptical that the technology could impact retail in a significant way. It’s for this reason that brands should focus on designing experiences that address real customer problems with practical solutions. If a company’s AR tool doesn’t improve the user experience of its customers, it doesn’t make sense to invest in AR.
Sanem Avcil is an AR influencer and developer. She expands on this point, “brands that use AR need to focus on customer needs and the specific ways in which AR can improve the customer journey. How can AR make shopping more seamless, whether at the store or online? Research the types of AR solutions that are available and see if they will really help the customer by saving them time and money or helping them make better purchasing decisions. Ultimately, your decision should be based on whether or not you can increase foot traffic to your location and improve customer engagement once people are inside.”
Michael Park is the CEO and founder of PostAR, a platform that lets you build, explore, and share augmented realities.