July 11, 2024

Revamping Retail: Impact of Augmented Reality on Shopping Decisions

AR offers businesses new opportunities to engage with customers through entertainment, education and product evaluation. This study empirically tests these three applications of AR to demonstrate their influence over purchase decisions.

By using AR technology, retailers can provide consumers with elements of an in-store shopping experience while giving them access to information remotely. Examples include Warby Parker’s mobile app allowing consumers to visualize glasses on their face and IKEA Place’s visualizing furniture within your space feature.

Product Visualization

Augmented reality (AR) is an immersive technology that allows customers to engage with products via the cameras on their smartphones. Unlike virtual reality headsets, which require special glasses for viewing purposes, AR is easily accessible for all consumers – and may well become the future of retailing.

AR is an invaluable asset for retailers as it can enhance customers’ experiences more than traditional marketing can. For example, 3D models of furniture can be placed inside a consumer’s home to give an accurate representation of its size and placement within their space – helping ease doubts about fit while increasing sales with reduced returns and logistic costs.

AR technology can also increase product sales by providing consumers with a virtual try-on experience. For instance, Warby Parker offers mobile apps which enable consumers to select a pair of glasses before using their smartphones to overlay a virtual model onto their faces for try-on and review purposes – giving buyers an accurate representation of what the glasses will look like on them before making more confident purchasing decisions.

AR has an even larger effect on product sales for less mainstream offerings that appeal to a narrower target market, commonly referred to as “long tail” products. This suggests that AR helps even the playing field for niche brands and products while simultaneously increasing overall revenues.

Product Try-On

Virtual try-on is a powerful way to help customers make confident purchase decisions. AR can enable customers to virtually try on shoes, sunglasses or makeup before making their choice, while home decoration products can even be digitally placed in their environments to see how well they fit – helping reduce return rates and shorten customer journeys.

Experiences have been found to significantly affect purchase intentions (Bell, Gallino and Moreno 2018; Chandukala Dotson and Liu 2017), yet providing them can be a daunting challenge online retail, particularly furniture sales. By using AR for furniture sales online consumers can digitally experience how a piece fits into their living room without traveling anywhere!

Consumers can easily control the media richness and interactivity of an AR shopping experience to increase their sense of telepresence, creating more contextualized shopping experiences. Utilizing this technology, brands can create immersive and exciting experiences that encourage exploration and engagement from consumers – capturing consumer interest while creating loyalty among them. Experiences also reveal a lot about consumer preferences, which can help brands leverage targeted marketing. For instance, one brand that collaborated with Marvel on an immersive AR superhero experience was able to reach wide audiences while garnering strong engagement and building strong customer loyalty.

Contextual Context

AR offers retailers various opportunities to enhance the customer experience. For instance, customers shopping in-store can use an AR app to visualize how furniture such as a couch would look in their own home prior to making a purchase – providing confidence that an expensive mistake won’t occur when making decisions based on AR apps.

Online shoppers can also take advantage of an AR app to virtually try on makeup or clothing items in their own environment, thereby decreasing uncertainty regarding product fit, increasing conversion, and ultimately leading to more sales.

Consumers can use AR to gain more information about products and brands they’re interested in, like Nike using social media platforms such as Snapchat to engage younger consumers by showing them how their shoes and other items appear in real life.

AR is also an effective way to level the playing field for lesser-known or niche products that appeal to a narrower audience. AR allows consumers to evaluate products more quickly in their consumption context, thus decreasing brand signals’ influence during evaluation processes and increasing buying potential; this effect is especially noticeable when used with more expensive items that fall into what’s known as “long tail” of product sales distribution.

Product Mix & Match

Augmented reality (AR) can be an invaluable resource for businesses and consumers. AR provides users with an enjoyable and worthwhile experience that has proven its ability to increase conversion rates while decreasing return rates, among many other advantages.

AR differs from virtual reality in that most consumers already own smartphones, making it a more accessible solution for retail use. AR can create experiences for customers such as product visualization and virtual try-on.

Retailers can utilize AR to assist customers in selecting product combinations that will work well together, which is especially useful when selecting makeup or furniture items with multiple variants. IKEA’s Place app enables users to see how furniture pieces fit in their homes before making a purchase, which has proven beneficial in reducing returns and logistics costs for the company.

AR can help shoppers assess the quality of products. According to one study, researchers discovered that AR increases utilitarian value purchases by allowing people to view product details in their natural environments – this makes shopping more engaging for consumers and increases satisfaction levels; moreover, its effects were particularly noticeable for niche products or those falling into long tail sales distribution; therefore it can level the playing field between niche brands and products and mainstream products.

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