Executive Digest – The benefits of incorporating augmented reality in online retail

Executive Digest

André Mendes

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11 May, 2023

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The incorporation of emerging technologies has been a key factor in the success and expansion of e-commerce. Among the available innovations, Augmented Reality (AR)—which involves overlaying virtual elements (such as 3D images) onto the physical environment through electronic devices—has emerged as a powerful tool with the potential to revolutionize the consumer experience and drive online sales.

Its application in e-commerce has the potential to provide a more immersive, interactive, and personalized shopping experience, impacting several factors, including:

1. Improvement of user experience (UX)

Augmented Reality allows the consumer to visualize and interact with products in a more realistic manner, offering a better understanding of the features, dimensions, and functionalities of items. For example, IKEA launched the IKEA Place app, which uses AR technology to allow customers to visualize furniture and décor items in their home space before making a purchase.

2. Reduction of return rates

With the ability to more accurately try out and visualize products, consumers tend to make more informed choices, thus reducing returns and all associated post-sale costs. In the fashion industry, for instance, companies like Warby Parker and Gucci use augmented reality to allow customers to virtually try on glasses or shoes, ensuring a better fit and satisfaction.

3. Increase in conversion rate

Implementing AR features in e-commerce can lead to an increase in the conversion rate since consumers are more confident in the quality and suitability of products. The Sephora Virtual Artist app, for example, allows customers to virtually test makeup and find the ideal colors and products for their individual skin texture and tone.

4. Competitive differentiation

Adopting augmented reality technologies can provide a competitive edge in the market, attracting more customers and increasing engagement. Companies like LEGO and Converse have developed AR applications that allow consumers to interact with their products.

5. Optimization of logistics and inventory management

Augmented Reality can also be used to improve efficiency and accuracy in inventory and logistics management. AR applications can help employees locate products in warehouses, streamline the packaging process, optimize storage space, and automatically read and count stock entries, among other benefits.

It is extremely important for companies to anticipate and adapt to these emerging trends, as they will undoubtedly be better positioned to attract and retain customers through a superior and differentiated shopping experience.

Tags:

Ecommerce B2B, Media Clipping