We asked Jeff to share his insights on how AR will affect retail and why he thinks there’s an urgency for retailers to develop AR for their brands; both for consumers and on the back-end.
Who’s developing AR for retail?
A profound movement is being orchestrated by the big retailers to deliver AR. Apple, Google, Microsoft, Alibaba, EBay, Amazon; retail giants are offering new augmented and Virtual reality experiences to customers and announcements come out every week. It’s time for smaller brands to pay attention. The frontrunners are already in full swing and you it’s important to understand you don’t need to be as big as these guys to start somewhere.
Why does retail need AR?
There are a few facets of AR that retailers need to grasp
AR is Immersive and Engaging
AR can instantly provide users with an immersive and engaging experience. AR can fill in the gap that leaves customers hanging for more information, standing in a store searching their phone.
As we enter the age of the experience economy, many retailers are searching for ways to reinvent the physical store, using lights, video screens, and audio. They’re constantly challenged to find ways to deliver on personalized service. AR can compliment that. Augmented reality has the potential to become a trusted sales associate. And since AR is your trusted sales associate, it will have handled the first level questions consumers have on products and “Real” associates can focus on what they do best, upsell, cross-sell and closing the deal.
AR is available in your Customer’s Pocket
Given that approximately 87% of shoppers do comparative shopping on-site with their mobile device, it’s really about leveraging the tools they already have in-hand. With AR, you can keep customers in your ecosystem both in-store and at home. Give them them an engaging experience in store, but don’t let them down once they get home!
AR Dramatically Speeds Product Discovery
For all types of products from technology and electronics, to clothing and consumer goods, customers are looking for more information. They want to know, what’s behind this?
CPG is ripe for taking advantage. Take the example of a grocery store. Do you want to know the nutritional values of various foods? Where does that vegetable come from? What can I cook this ingredient with to surprise my guests? Is there a simple recipe I could try? With AR information on products in-store and in-shelf, customers are more likely to say, okay, let me grab one of those, even if they’ve never eaten it before. Using the phone, customers can point at any product and get this type of augmented information, making them more knowledgeable consumers.
…and, as we now realize, anything can be augmented!
Are customers the only ones using it?
From logistics companies to high end to mid level retailers, it’s not only customers that are impacted with the advantages of AR. Take, for example, DHL, one of the largest shipping companies in the world. They’re implementing AR in their logistics chain.. In a pilot study they demonstrated a minimal 15% increase in productivity as well as an important decrease in mistakes by using AR. The technology guides their work, so that instead of scanning bins in the aisles, they use their AR glasses, and the technology ensures the package goes to the right place. The reduction of human error is amazing.
Anyone that has online ordering can do the same on their back end. This can be a benefit to any and all retailers.
AR can also be used as a training tool on the back end. New associates need to learn about the products in the store can do so using AR and VR, eliminating the knowledge gap for new employees. It could standardize the training, and takes away the element of subjectivity in training as well as having proven better impregnation of information.
Who will benefit the most from AR?
The real winners are the customers. They’re gaining access to a much more engaging experience, by getting answer to fundamental questions about products while perusing the shelves and aisles of their favorite store.
Any brand that offers an augmented experience is going to be preferred by customers. Think about the home decoration market. Ikea is a good example of that. Their AR app, developed with Apple ARKit, already has hundreds of thousands of downloads – yet they only have about 500 out of hundreds of thousands of products available in the app but still, consumer love it. It’s just a beginning, and what’s to say about Amazon jumping in the AR commerce trend…
What’s the takeaway from the Ikea experience? They started small, but they’re going to iterate. This resonates highly for me.
Isn’t it better to wait and follow the big retailers’ lead?
I’ve been an advocate for iteration for a long time. I’m the first to tell you: don’t wait for the killer app! It won’t be tailored to you. Create an experience that’s in sync with your business issues and objectives. Release at 70-80% and iterate following the learnings you gather from user feedback. It doesn’t matter how big or small you are – AR not only provides information to your customer, but it also provides the retailer information about what a customer is looking for—their behavior. There’s no business size that’s too big or small not to gather customer behavior information.
Is AR expensive to develop?
AR experiences have a huge advantage over virtual reality. They are lower cost to develop and lower cost to deploy. You have the advantage of using your customer’s hardware.
You can get started quickly. Do something for a vertical slice, product launch or for your new season. In many cases, your product is probably already digitized. You can reuse web assets you already have and just deploy them in AR. Watch the path they use to peruse, gather information to map your customer journey. This is something you can get through ecommerce sites, but you have no way of tracking in store.
What’s your last word on the topic?
AR is here. There are at least 600 million phones out there that are AR capable. Consumers are eager to have experiences. Give them some!