Digital trip to the store
According to the Centre for Retail Research, e-Commerce is the fastest growing market in Europe. In 2020, the estimated growth in this area was 31.1%. New technologies are used for customer comfort: virtual, augmented and mixed reality. Let’s look at how virtual shopping helps consumers to interact more effectively with the brand, and business — to increase the lifetime value of the customer.
Every day the world is moving more and more intensively into the digital sphere. According to the British marketing company Coleman Parkes, 21-40% of business contributions are directly related to e-Commerce. In the coming years, this indicator will only grow.
Back in 2017, Forrester Research investigators predicted the growth of e-Commerce transactions in the B2B segment from $889 billion to almost $1.2 trillion by 2021. According to MediaPost, this growth is due to the convenience of searching and shopping on the Internet. According to this source, $1.2 trillion accounts for about 13% of all B2B sales. This means that e-Commerce has become an integral part of the global retail system.
The transition from offline to online leads to the emergence of new technologies. Stores strive to make the process of buying goods as simple as possible for customers. According to Linkedin, about 67% of purchases are made in digital format. Therefore, in order to retain the client, companies are implementing IT solutions based on artificial intelligence.
Augmented reality (AR) is a technology that expands the physical world by adding layers of digital information to it. A person sees reality with computer-generated images superimposed on it.
The sensory information used can be constructive (to improve and complement the surrounding world) or destructive (to completely mask everything the user sees). Anyway, its goal is to organically combine the digital and physical worlds. For example, the popular mobile game Pokemon Go is based on this technology. The participant sees Pokemon only if he/she points the camera at them.
According to the German research company Statista, the AR technology market is growing. It is projected to be valued at more than $18 billion in 2023. It is also assumed that by 2022, consumer spending on autonomous and embedded mobile applications with augmented reality around the world will reach almost $ 15.5 million.
Now that AR is on the rise, it is being used in end-product oriented industries. Including e-Commerce.
Many online store owners are still cautious about the introduction of AR. After all, they still don’t know what this technology is and how it is changing online sales. For most companies, AR-based IT solutions are still abstract, mysterious and perceived as science fiction. But augmented reality shopping is not a concept from the future. Companies like Andersen are already increasingly introducing this technology.
For example, IKEA customers can use a special application to place virtual items from the furniture catalog in their room in real time. This makes it possible for a potential buyer to see in advance how this or that thing will look in the apartment.
Kabaq is a food trading app that uses augmented reality to interact with customers more effectively. Users can view all the dishes on the menu using smart devices and order them online. This gives consumers a great opportunity to see the actual serving size and how the dish will look on the table.
AR creates a sense of “being there” for objects that do not really present. This is much more convincing to potential buyers than ordinary images or videos. Compared to classic shopping, augmented reality in e-commerce offers online stores improved interaction with visitors. Modern technologies arouse the curiosity of buyers and increase their involvement in the purchase process. About 40% of consumers are willing to pay more for a product that they can try using AR solutions.
Virtual Reality (VR) is a technology that allows users to fully immerse themselves in the digital space. If AR complements the surrounding reality, VR completely transforms everything around into a pre-modeled world.
VR shopping is no longer a fantasy movie dream. Today, companies using this technology successfully compete with traditional shopping malls.
About 45% of customers prefer to visit regular stores on special occasions, such as holidays. It is difficult for digital shops to recreate the same atmosphere online, so they cannot do without the help of modern technology. Virtual reality systems provide users with a realistic shopping experience.
Thanks to the mobile application and special equipment, customers can use all the functions of ordinary stores: try on clothes, communicate with consultants or just look at the items. More than 66% of consumers are interested in buying goods using virtual reality. Many people do not want to purchase a product before fitting it. If online stores provide customers with such an opportunity, they will make even more purchases than previously planned.
Large companies realized the power of virtual reality and began to apply this technology in shopping malls around the world. In particular, Amazon has installed 10 VR kiosks that provide customers with a completely new shopping experience.
The American online store eBay has launched the world’s first virtual reality department store. To create it, the company collaborated with the Australian retailer Myer. At the moment, users can view more than 12,500 objects there, 100 of which are available in 3D. Prices and product information are updated in real time. In addition, artificial intelligence analyzes the preferences of users and offers them the appropriate choice.
The most unusual thing in a digital store is a completely new shopping experience with the Sight Search function. To confirm their purchase decision, users do not click on the desired product, but simply look at it for a few seconds. Then they add the items to the digital cart by clicking on the “Add to Cart” button.
Every year more and more companies are introducing virtual reality. This technology not only replaces a trip to a regular store for customers, but also makes shopping more exciting and diverse.
Mixed reality (MR) can be described as the merging of the real and virtual worlds to create an alternative environment. Its main difference from AR and VR is the point of contact between the real and the virtual. So far there are not many examples of mixed reality in the world, but large companies already have something to show.
The mixed reality mirror, patented by Amazon, allows shoppers to try on clothes. The display located behind the mirror shines through its surface and creates a mixed reality of reflection and digital projection. The advantage of this option compared to the traditional fitting is its high speed. The buyer can try on completely different outfits in just a few minutes.
Unfortunately, this magic mirror has not yet gained huge popularity. Perhaps the reason is that it does not perform one of the main functions of fitting – it will not help you find out whether the clothes are comfortable and whether their size and shape fit your body.
Another example of using MR technologies is an innovative way of buying furniture offered by Target. This large network has implemented two functions based on mixed reality. The room designer and the “See It In Your Space” technology give customers the opportunity to take a picture of their room and check how the object of interest looks in it. This helps consumers avoid making the wrong choice.
By moving and rotating a chair, rug or lamp, the user can see exactly how they will fit into the interior. Store visitors use this technology to buy both expensive furniture and small seasonal goods, such as a Christmas tree.
Difficulties with using AR, VR and MR in e-Commerce
Visitors are increasingly shopping in stores using the technologies described above. So, in 2019, L’Oreal sales increased by 49%. This was due to the fact that customers had the opportunity to try the product before buying with the help of modern IT solutions.
However, there are a number of difficulties that companies need to overcome in order to ensure the success of new reality technologies. Coleman Parkes experts have identified the key challenges that organizations face when implementing e-commerce solutions. Thus, 62% of companies find it difficult to find the right technology for their business, and 47% of companies do not yet know how to combine e-commerce with the classical sales model.
The main task when trading via the Internet is to find solutions, allowing customers to physically interact with goods. If buyers cannot fully appreciate the size of the product, its appearance or touch the thing, they are less likely to make a deal.
The Country Casual Teak furniture store offered its solution to this problem. The company has made the purchase process as realistic as possible by adding another dimension using augmented reality. To achieve this goal, the store used stereoscopic 360-degree photography and special equipment such as Google Cardboard, Oculus Rift and Samsung VR. These breakthrough solutions give visitors the opportunity to fully experience their purchases.
The mentioned technologies expand the possibilities of virtual purchases and take users beyond the simple viewing of a two-dimensional image on the screen. Customers feel as if they are really in the store. Google Cardboard creates the illusion of viewing in the showroom, giving customers more points of contact with the product.
Another difficulty in implementing alternative reality is due to the high cost of the technologies necessary for its application. And if AR can be activated on almost any modern device, then special equipment is needed for virtual and mixed reality. When it becomes more accessible, the popularity of the described IT solutions will rapidly increase.
Today, people have become more likely to order goods online and use digital stores. However, it is unknown whether an alternative reality can completely replace trips to ordinary shopping malls.
There are several opinions about the future of such technologies. But most marketing specialists and developers consider mixed, augmented and virtual reality in e-Commerce as excellent tools that benefit business.
Casey Millhouse, head of the VR/AR Association in Singapore, says that “VR provides an opportunity to embed point of sale communications within a simulated and immersive real-life retail experience.” This means that customers cannot only test products, but also try shopping at a greater level of interaction.