E-commerce now accounts for 20% of total retail sales, generating about $6 trillion USD annually. But while the pandemic inspired more customers to adopt online shopping, it also changed customer expectations about convenience and personalization. Retailers who want to grow online sales and boost customer loyalty can exceed those expectations as a way to stand out as retail competition heats up.
The customer experience is the playing field where the winners will be decided. A January 2023 Zendesk customer experience trends report identified a shift in customer preferences toward immersive experiences. It was found that more than 60% of customers are excited about immersive experiences, with a desire for more convenience and greater personalization among the key drivers.
3D technology has a massive role to play in delivering the convenience and personalization customers demand while also helping retailers control costs. Here’s a look at three ways 3D vision technology, like augmented reality (AR), can drive sales, build loyalty, and help retailers operate more efficiently while delivering an immersive experience.
Create Fully Virtual Online Stores With AR
Most images on retail sites are two-dimensional, so the experience of shopping online isn’t much different than leafing through a printed catalog. AR is a gamechanger that lets retailers build a fully virtual online store. It’s a trend that’s catching on as major brands use 3D technologies to create immersive shopping experiences that customers can access through laptops or mobile devices.
Virtual online stores provide an experience that is closer to a traditional store visit without leaving home. This convenience also allows retailers to reach loyal customers who might otherwise be unable to attend a brand’s special event. For example, retailer J. Crew celebrated its 40th anniversary by creating a virtual beach house that customers can visit to view virtual merchandise presented in creative ways.
In addition to convenience, virtual stores powered by 3D technology can also offer personalization by allowing customers to choose an avatar that interacts with the virtual storefront and products.
Use AR to Get Product Return Costs Under Control
With the right marketing strategy, retailers can reach customers anywhere in the world with a digital platform. The downside is that when customers can’t try on items like clothing and shoes, they are more likely to return them. Returns are expensive for retailers and harmful to the environment due to reverse logistics emissions.
According to an Insider Intelligence report, returns accounted for 19.8% of e-commerce spending in 2019, before the pandemic. In 2022, return expenses were projected to spike to 26.5% — almost $280 billion USD. It’s a dilemma for retailers because customers expect free returns, and it’s a problem for consumers since higher return costs will ultimately be passed on to consumers as higher prices.
AR can help retailers control return costs by helping customers find the right fit the first time. Body scanning technology, such as one of our customers, Size Stream, can help customers get their precise measurements, and advanced AR features like personal avatars that are scaled using actual measurements can let customers try on clothes virtually and get a better feel for look and fit. This approach ticks the personalization box for the customer while improving convenience for both retailer and customer by reducing returns.
Put Products in the Room with AR
A customer may admire a sofa, wall hanging, cabinet, or other piece of home décor inside an in-store or online showroom, but that doesn’t necessarily mean they have confidence it will look great in their home. Using 3D vision systems, AR tools can provide that assurance by putting products in the room, complete with accurate dimensions, sizes, and other specifications.
IKEA was an early AR adopter; customers have been able to use the IKEA app to view the placement of items like chairs and tables inside their homes for several years. It’s a popular feature that other retailers are adopting to drive sales and provide the ultimate in personalization: a view of the product as it would appear in the customer’s own home before they make a purchase.
The potential applications are endless. Many online eyewear retailers have deployed AR to allow customers to virtually try on glasses, including Warby Parker and Zenni. Leading beauty brands let digital shoppers test makeup virtually using AR tools, including Maybelline, which offers a virtual beauty studio that lets shoppers try different shades, experiment with eyebrow shapes, and more.
AR for a Better Customer Experience
Customers are telling retailers what they want: immersive experiences that offer convenience and personalization across channels. Brands that deliver can gain a competitive edge, and the current consumer enthusiasm for immersive experiences is an opportunity for brands to set themselves apart.
3D technology, like AR-powered solutions, is a great way for retailers to provide the convenience and personalization customers crave while addressing the returns issue. With AR that lets customers visit a store without leaving home, get the right fit every time, and see products inside their homes before buying, retailers can deliver a memorable immersive experience, boosting sales and customer loyalty.
Frequently Asked Questions About Immersive Technology for the Customer Experience
1. Why does immersive technology matter for the customer experience?
The blog frames the customer experience as the playing field where retail winners will be decided. E-commerce now accounts for 20 percent of total retail sales, generating about 6 trillion dollars annually, and while the pandemic drove more customers to shop online, it also raised their expectations around convenience and personalization. A January 2023 Zendesk customer experience trends report found a shift toward immersive experiences, with more than 60 percent of customers excited about them and a desire for greater convenience and personalization among the key drivers. 3D technology, including augmented reality, has a large role to play in delivering that convenience and personalization while also helping retailers control costs.
2. How can AR create fully virtual online stores?
Most images on retail sites are two-dimensional, so shopping online is not much different from leafing through a printed catalog. AR lets retailers build a fully virtual online store, a trend catching on as major brands use 3D technologies to create immersive shopping experiences that customers can access through laptops or mobile devices. Virtual stores provide an experience closer to a traditional store visit without leaving home, and they let retailers reach loyal customers who might otherwise be unable to attend a brand’s special event. As an example, the blog notes that J. Crew celebrated its 40th anniversary by creating a virtual beach house that customers could visit to view merchandise presented in creative ways. Virtual stores can also add personalization by letting customers choose an avatar that interacts with the storefront and products.
3. How does AR help retailers reduce product returns?
When customers cannot try on items such as clothing and shoes, they are more likely to return them, and returns are expensive for retailers and harmful to the environment due to reverse logistics emissions. The blog cites an Insider Intelligence report noting that returns accounted for 19.8 percent of e-commerce spending in 2019, before the pandemic, and that in 2022 return expenses were projected to spike to 26.5 percent, almost 280 billion dollars. AR can help retailers control these costs by helping customers find the right fit the first time. Body scanning technology, such as that of Orbbec customer Size Stream, can give customers precise measurements, and advanced AR features like personal avatars scaled using actual measurements let customers try on clothes virtually and get a better feel for look and fit, improving personalization for the customer and convenience for both sides while reducing returns.
4. How can AR let customers preview products in their own space?
A customer may admire a sofa, wall hanging, cabinet, or other piece of home decor in a showroom without being confident it will look great at home. Using 3D vision systems, AR tools provide that assurance by placing products in the room complete with accurate dimensions, sizes, and other specifications. The blog points to IKEA as an early AR adopter, with customers able to use the IKEA app to view how items like chairs and tables would look inside their homes, a popular feature other retailers are adopting. It notes the potential applications are wide, with many online eyewear retailers such as Warby Parker and Zenni using AR for virtual try-on, and beauty brands including Maybelline offering a virtual beauty studio where shoppers can try different shades and experiment with eyebrow shapes.
5. What is the overall benefit of AR for retailers?
Customers are signaling that they want immersive experiences offering convenience and personalization across channels, and brands that deliver can gain a competitive edge from the current enthusiasm for these experiences. 3D technology such as AR-powered solutions is presented as a strong way for retailers to provide the convenience and personalization customers crave while addressing the returns problem. By letting customers visit a store without leaving home, get the right fit every time, and see products in their homes before buying, retailers can deliver a memorable immersive experience that boosts sales and customer loyalty.
