You could say it started with Pikachu. In the summer of 2016, the mobile game Pokémon Go exploded in popularity, augmented reality (AR) effectively went mainstream, and it wasn’t long before AR filters and lenses caught on with Snapchat and Instagram users. These days, there’s more to AR than just fun and games. For future-facing brands and retailers, augmented reality represents an exciting and lucrative new frontier — a global market expected to reach over $250 billion by 2028, where highly personalized customer experiences can be delivered at the tap of a mobile device.
What is augmented reality?
According to Gartner, augmented reality (AR) is the real-time use of information in the form of text, graphics, audio, and other virtual enhancements integrated with real-world objects. It is this “real world” element that differentiates AR from virtual reality.
Augmented reality vs. virtual reality
While virtual reality (VR) creates an artificial world for the user to explore via a headset, in most cases, an AR experience only requires a smartphone and access to the campaign’s app, making it much easier for brands to embrace this option as part of their omnichannel strategy.
Enhancing the omnichannel experience with AR
By creating an immersive experience based on a customer’s own unique environment, AR achieves the holy grail of omnichannel marketing — customer-centricity. Augmented reality allows organizations to interact with customers at a deeper level, which in turn gives consumers the confidence and reassurance they need to convert. Research from NielsenIQ reveals that 64% of customers consider AR to be the leading technology to assist, amplify, and augment their daily lives, while 51% of respondents said they are willing to use AR technology to assess products before buying.
Try before you buy
Think about it, when you’re investing in items like furniture, you usually try to gather as much information as possible about the product before you commit to the purchase - the style, dimensions, color, but the option to see how the item will look in your living space can prove game-changing. A study by Apple found that consumers are 11 times more likely to buy furniture if they can use AR to see how it fits within their home, while home improvement businesses report 20% fewer returns when consumers can experience products using AR.
When integrated into an omnichannel strategy, AR-powered interactions bridge the gap between a customer’s home and the store and online and offline experiences. Applying AI and machine learning, retailers can enhance the experience further by delivering relevant and personalized product recommendations.
How social commerce is leveraging AR technology
Capitalizing on post-pandemic shifts in consumer behavior, social platforms are seamlessly integrating AR technology into the social commerce experience they offer their users.
Pinterest’s “Try On for Home Décor” feature gives users the ability to virtually place items from 80,000 shoppable pins in their home using the Pinterest Lens camera. According to the platform, pinners are five times more likely to purchase from Try On-enabled pins than standard pins.
In February 2022, Snapchat announced that its catalog-powered shopping lens generated $6 million in sales and 30 million product try-ons over a two-week period for partner Ulta Beauty, while MAC Cosmetics reported 17 times more purchases among women and over 1.3 million AR-powered try-ons. The social platform is now offering brands a suite of AR tools allowing them to create 3D models of products, generate assets for Snapchat AR try-on Lens experiences, and use Snap’s AR Shopping Templates to import their product catalog and create AR shopping catalog Lenses.
The opportunity for phygital retail
When it comes to the brick-and-mortar retail space, AR technology provides brands with the opportunity to blur the lines between physical and digital experiences and satisfy the three I’s of phygital strategy: immersion, immediacy, and interaction. And the sky is the limit for creative concepts — case in point, Nike’s 2021 campaign at its flagship ‘House of Innovation’ store in New York, in which the sports retailer delighted customers with an immersive experience that featured a re-creation of Oregon’s Smith Rock State Park. Using their phones, visitors were invited to scan QR codes to access a map, a checklist of activities, and AR visuals, and were rewarded with physical and virtual incentives.
Spinning the globe to Turkey, iGA Istanbul Airport has recently launched an AR-driven service on its mobile app which offers passengers special deals and discount codes at airport stores. Passengers simply log into the Istanbul Airport app and select the AR tab. A virtual character called CiGA then accompanies them on their route, and as they approach a store, the name of the store appears as a pop-up and provides details of special offers and promotions.
Embracing the new reality
Whether utilized within an app, as part of your social commerce offering, or in a phygital situation, augmented reality has the potential to revolutionize the consumer experience — and across a diverse range of industries, from fashion and retail to automotive, real estate, entertainment, and travel. Brands who seize this opportunity now not only gain a competitive edge, but also signal their intention to build real and lasting customer connections.
Fiona Hilliard is a Content Marketing Manager at Sitecore. Connect with her on LinkedIn.