Amazon is Doing It! So is Google, Apple & Facebook. THAT SHOULD BE ENOUGH TO CONVINCE YOU THAT AUGMENTED REALITY IS HERE TO STAY. Issue: January 2018
BASED ON RESEARCH from Goldman Sachs, Heather Bellini, their Technology Business Unit Lead, believes that AR/VR will be an $80 billion dollar USD industry by 2025 – the AR/VR industry is as transformative as the early Motorola brick cellphones (DynaTac) was to the 1980’s as AR/VR will be to 2018 and beyond.
AR/VR $80 Billion Dollar Industry by 2025
Slowly but surely, augmented reality is starting to become the every day norm in retail. Beauty brands were early adopters of AR – they embraced it and intertwined it with digital media, targeting, younger social shoppers. Large apparel brands and furniture retailers have followed suit looking to provide immersive experiences for their customers.
BUYING BIG TICKET ITEMS BECOME LESS INTIMIDATING WITH AR APPS Augmented reality is the perfect sales tool for large ticket items. For furniture retailers, AR provides a better human-experience for the buyer. AR empowers the user a tool that transforms a regular buyer to becoming a superstar designer.
Many buyers find furniture shopping to be stressful and daunting. Outside of purchasing a home and a car. The next largest expenses are furniture, mattresses and large home appliances.
Buying big ticket items like furniture becomes less intimidating when using augmented reality apps. With a few clicks, the buyer can try out different furniture pieces without any financial investment or risk. The customer can overlay, photorealistic, 3D furniture models in their own room settings or in different room designs.
Consumers still prefer to buy expensive items in-store, so they can test the products. When it comes to buying a sofa or a mattress, the power of touch is important. Customers get to feel the fabric and choose their preferred comfort levels – plush versus firm.
Whereas when buying the item online, they’re solely relying on their sense of sight. Regardless of the channel the customer chooses to shop in (online or in-store), there’s still a gap – context!
AR BRIDGES THE GAP AR bridges the gap and provides context to your customers. Since 83% of human information is consumed visually, buyers can see exactly what the furniture would look like in their own space and even to scale.
When shopping in a large retail show room, it’s hard to imagine if the item will fit in their own home. An item that looks small, in a vast showroom, can look oversized in an average family room.
With online shopping, perception is everything! Unfortunately, colours on a screen never truly appear as they are. On screen a pair of mahogany bar stools may end up looking more ebony in person. 22% of returns are made because customers perceive an item looking different – driving up return rates and lowering margins for retailers.
RETURNS ARE AN ISSUE Returns are a major cost! Many consumers will buy a product, unbox, assemble, try it out, to only return it! Having a restocking fee can help off-set the costs incurred for returns, however, retailers still end up loosing in the end – holding on to inventory that can’t be sold at full margin or even junked!
For retailers who offer free returns, it cuts even deeper. Based on research, Amazon return rates are between 5 to 15%. Fortunately in furniture retail, it’s around 5%. But every percentage point you can shave off can improve your bottom line.
* Data point for others came from: Strategy & PWC, 2017 Retail Industry Trends
BENEFITS WITH AR IN FURNITURE RETAIL
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Improve your customers experience and shorten the product discovery phase
It can shorten sales cycles - less time spent envisioning if the style will work with their home & improve conversation rates
It can lower return rates and minimize the cost of reverse logistic
AR is the next logical retail technology investment for brick-and-mortar and pure-play ecommerce businesses. Consumers are already using AR in their social media apps such as with Facebook Messenger, SnapChat, etc. It’s an adoptive technology that is already being used on mass. Based on research from Retail Perceptions, 61% of shoppers prefer to shop at stores that offer augmented reality versus stores that don’t. AR offers an engaging experience and helps customers make more informed decisions.
Augmented reality shopping solutions empowers both the consumers and the retailers. info@theapplabb.com It increases consumer engagement and stickiness,Email: it brings in foot traffic, increases conversions and it can lower costly returns to the retailer. In-store, AR can be used as a virtual assistant to guide a customer through the product catalogue. In tandem, augmented reality can also turn any place into a storefront – giving your customers a chance to shop from anywhere they want. AR is the forefront of retail change. It turns static images into a dynamic, immersive visual experience. Beauty brands know this and they’ve proven that AR has tangible benefits. Brands that implemented AR, to their existing websites saw their online sales jump by 84% in year one and drove in-store traffic sales up by 31%. You’re customers are waiting for you to make that leap. Are you ready?
TheAppLabb is the catalyst for technology innovation. As a product innovation and development firm, we focus on helping our clients build mobile solutions that will disrupt their industry. Over 10 years of experience with 360+ global clients and over 500+ apps built, we offer strategic consulting, UX and UI design, custom software development and out-of-the-box industry solutions for several vertical markets. Let us turn your ideas into reality. URL: http://wwwtheapplabb.com Email: info@theapplabb.com PH: (416) 745 - 3164 PH: (464) 688 - 2786
Version: January 2018 - TheAppLabb ©
References:
Goldman Sachs - The Real Deal with Virtual & Augmented Reality
http://www.goldmansachs.com/our-thinking/pages/virtual-and-augmented-reality.html
83% of Human Information - Your Senses are Your Raw Information Portals by Velvet Sawchain Consulting https://velvetchainsaw.com/2012/05/23/your-senses-your-raw-information-learning-portals/
22% of Returns - Ecommerce Product Return Statistics & Trends by B2C Business 2 Community
https://www.business2community.com/infographics/e-commerce-product-return-statistics-trends-infographic-01505394
Amazon Return Rates 5 - 15% - AMZ Secrets
http://amzsecrets.com/amazon/question/amazon-return-rate-is-generally-about-5-15-but-it-varies-widely-depending-on-the-category -books-and-media-have-lower-returns-rates-as-they-are-generally-well-described-products-that-the-customer-kno
5% Return Rates - Mattress Startups Make a Bet...by Mashable
http://mashable.com/2017/08/31/mattress-returns-gamble/#sIMMk1N9Miqc
61% of Shoppers... - How Augmented Reality is Changing Today’s Shopping Experience by Retail Perceptions hhttp://www.retailperceptions.com/2016/10/the-impact-of-augmented-reality-on-retail/
Online Sales Jump by 84% - ...Transforming the Beauty Industry ... by The Institute The IEEE News Source PH: (416) 745 - 3164 hhttp://www.retailperceptions.com/2016/10/the-impact-of-augmented-reality-on-retail/