What is AR and VR Shopping? How Retailers Can Jump on This Trend

With the shift to omnichannel, many businesses are creating digital experiences that feel closer to stepping into a store, as well as upleveling their in-store experiences with digital elements. Some businesses are doing this by using augmented reality (AR) and virtual reality (VR) technology, allowing customers to virtually interact with products. But what is AR and VR, and how can brands start using this technology?

What is augmented reality (AR) and virtual reality (VR)?

While the terms AR and VR are sometimes used interchangeably, they are different types of technology your customers can interact with.

Augmented reality (AR) enhances the real physical world with superimposed digital elements, while virtual reality (VR) is an artificial, simulated environment that provides an immersive experience.

According to Zion Market Research, the global AR market is expected to rise up to $128 billion by 2028. With AR, the customer can see themselves interacting with items in a real-world environment, such as trying on an item of jewelry or clothing. Ikea was one of the first companies to use this concept with its Ikea Place app, which lets customers see how furniture looks in their room before buying. Another example of how you can incorporate AR: In store, when customers point their phone at a shirt or dress, for example, they can see an overlay showing that item paired with a jacket and accessories.

You could make it a full blown experience, adding images, sound, and text to engage the customer. For example, you could play music for a customer while they use AR to shop for shoes from home as they point their phone to their feet to see what various shoes look like on. While complex AR experiences may require customers to have additional equipment, simple AR experiences only require customers to have a smartphone or tablet.

VR can be a more fully immersive experience. For example, a VR experience can immerse a customer in the New York Fashion Week show. As they walk down the runway, their view of the crowd and other models changes. They might even hear cheers from the crowd as though they were there in person. By feeling like part of the action, customers might be more inclined to purchase the clothes that they “modeled” during the experience because the simulation allowed them to see a 360-degree angle of how the clothes looked on their body as well as a sense of how they “felt” wearing the outfits.

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Many brands have successfully used AR and VR on-premise, including educating customers on how to use the products they just purchased. Uniqlo uses AR-enabled mirrors in its dressing rooms but a dealership might use the technology to create a driving simulation for situations when test drives aren’t possible.

Customers may expect immersive experiences within the next year. According to the U.S. Department of Commerce, online shopping increased more than 30% from 2019 to 2020. Square’s Future of Retail report found that consumers are buying an average of 43% of monthly purchases online. As a result, brands are looking to create more immersive online experiences.

While AR and VR are not new concepts, the increase in digital shopping has given customers and businesses a greater appetite for the technology. In fact, 33% of businesses surveyed for Square’s Future of Retail report said that they were interested in providing AR and VR experiences, and 39% of Millennial and Gen Z shoppers are interested in AR and VR shopping. According to Foresight Factory’s Future of Shopping report, 3 in 10 customers want virtual dressing rooms instead of going to a store for clothes.

AR and VR technology is becoming more prevalent. Facebook recently announced the prototype of its new virtual reality, Horizon Workrooms, which creates a simulated meeting that even mimics the speakers’ hand gestures. Google showcases AR search results, allowing users to see the items they searched overlayed in their current surroundings. Snap recently purchased a company with technology that allows brands to create 3D images of their products. With this advancement and others, AR and VR will likely become an expected part of the customer experience in the near future.

While many smaller businesses haven’t made the leap to a fully immersive technology like virtual reality, they are dipping their toes into more virtual or online experiences. Hot Sam’s, a men’s suit shop in Detroit, Michigan, offers a virtual tour of their store on their website. Samantha Shih, the owner of Boston-based custom clothing boutique 9Tailors, says the business is doubling down on their online store and investing in new, virtual experiences.

“Currently you can shop on our site, buy things that you might need for your workwear. But we’re actually also investing in technology that will allow returning customers and new customers to see what types of design options we have to offer, in a more dynamic way,” she says. “We have a 3D rendering of an actual suit that will change dynamically,” explains Shih, who adds that the company is also investing in AR technology so customers can virtually try on suits.

Should your business offer AR or VR shopping?

Before jumping into AR or VR, make sure it’s the right fit for both your customers and your business. Here are things to consider.

Can your products be showcased by AR or VR experiences? Some products lend themselves to AR or VR technology more than others.

  • Home goods businesses can relatively easily take a page from Ikea’s playbook and create a virtual living room for staging.
  • Clothing is often a prime candidate for immersive experiences, since seeing how they look on the customer is often the tipping point to convincing a customer to make the purchase.
  • Beauty businesses can create an AR experience similar to Sephora which allows customers to see makeup or new hairstyles applied on a digital overlay of their face.
  • Distilleries and breweries can create an experience similar to Patron where customers have their own friendly bartender and get a behind-the-scenes tour of the distillery.
  • Experiencing a VR downhill ski run to showcase skis that go faster and turn more quickly could help customers decide to spend more on the product.
  • On the other hand, a retailer selling candles may not see as many benefits from AR/VR experiences if its customers predominantly make their purchases by smelling for the product they’d like to buy.

Do you have the time and resources to create an experience that exceeds expectations? If you decide to create an AR or VR experience, you want to make sure you can do it in a way that won’t frustrate customers or hurt your business’s reputation. While there are technology products that allow you to create experiences with limited technical expertise, you will need to devote considerable time to designing the right experience — and you’ll also need the tech skills, either in-house or third-party, to integrate the experience into your website. The time involved depends on your current setup and the specifics of your experience.

Getting started with AR or VR shopping

Once you decide to move forward with AR or VR experiences, the following steps will guide you through the process:

  • Determine your budget. Costs can range depending on the experience you want customers to have and may include virtual reality designers, a new app, developers, etc. If you want to start with something low-lift as a tester, try creating a snapchat filter or an AR-light experience with a customized Instagram sticker and “try on” items for Stories .
  • Decide whether you want to create an AR or VR experience. Because AR does not require the customer to use a headset, which can cost upwards of $200 each, many retailers opt for AR experiences. But if the customer base you want to reach is more tech-savvy and would likely own a headset, a VR experience might be worth it and set you apart from competitors.
  • Choose an experience to design. Start with a self-contained, high-impact experience. For example, instead of rolling out the experience for all products, consider starting with clothing and then adding other items, such as furniture and artwork. You can also start with a basic clothing try-on and then expand later.
  • Research technology. Look for prepackaged solutions that allow you to use templates to create the type of experience you want to provide. Look for vendors that will easily integrate with your existing websites and apps.
  • Implement the experience. Work with your product and vendor to create your AR or VR experience and roll it out to your digital eCommerce platform. Expect the process to take longer than you think it will, and build in time for testing.
  • Collect feedback. Use surveys to follow up with customers who use the AR or VR tools and find out what they thought of the experience. You can then continue to improve and expand your AR or VR offerings based on that feedback.

By beginning your AR or VR journey, your interactive and immersive experiences can help you stand apart from your competitors now — and set you up for the future.