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How augmented reality can increase eCommerce sales

Virtual and augmented reality have taken off in the last decade, going from “virtually” unobtainable to tangibly accessible. Whether it’s walk-in virtual changing rooms or simple apps to insert your products into photos, reality augmentation can be powerful for sales. It’s especially useful for markets like home décor, fashion, and accessories, where people want and need to see what a product looks like in their environment.

This has become a more pressing need for many eCommerce retailers as shopping expands its online presence. The COVID-19 pandemic pushed an already growing trend even further, with a 16%–19% increase in online retail in 2020 (versus an average 4% increase in the years prior). Introducing more ways for customers to see and get an idea of your products before they hit buy boosts conversion, improves customer satisfaction, and can even decrease returns.

Why use augmented reality in eCommerce?

Augmented reality enhances real experiences with digital imagery. A common example is AR apps. The concept is simple: The user takes a photo, usually in the app. The app then superimposes anything, from makeup to paint or even furniture, onto the photo.

Brands like ASOS, L’Oréal, Saks Fifth Avenue, Sherwin Williams, and others utilize AR apps.

For example, the Sherwin-Williams app allows you to take a photo of a room and then update it with different paint swatches.

The L’Oréal app takes a similar approach, but with human skin, allowing visitors to “try on” makeup.

Although it has a basic premise, implementing AR into your marketing strategy can help move customers along the buyer journey and reduce returns based on products not being as expected.

Clearer product information

Explaining what a product is and how it looks to customers is one of the most difficult aspects of eCommerce.

In fact, a 2019 UPS report showed that 27% of all product returns are because the product was “not as described.”

AR capabilities increase the likelihood of consumers taking the time to view the photos and see how the product looks on their photo or in their home.

Sharing more explicit product information improves the customer relationship, potentially extending your CLV.

Increased engagement

AR company Vertebrae (a Facebook partner) conducted studies which showed that implementing augmented reality into apps boosts customer engagement by up to 19%.

Vertebrae uses a modelling platform where you implement 3D images of products in the program, and customers can create 2D models with their own photos.

The result is much like Ikea’s Place app, which allows consumers to insert virtual furniture into their photos to determine if it fits stylistically.

Improved conversion

While research on long-term data like improved customer satisfaction and reduced return rate are still ongoing, one finding is solid: implementing AR significantly improves conversion rate – but only for the people who actually use it.

Take increases with a grain of salt, because the people most likely to use an AR app are also the ones most likely to make a purchase to begin with. Still, Vertebrae reports a 90% increase in conversion for customers who engage with AR versus those who don’t.

Shopify, which has rolled out AR and VR over the last year, has a similar claim, with a 94%–250% increase in conversion.

How brands are using AR to increase sales

Augmented and virtual reality have taken many forms as retailers incorporate them into physical and digital stores. Big brands like Toms Shoes are using VR in person for things like changing rooms and other customer experiences. However, we’ll focus on digital implementations, where brands use augmented reality to boost eCommerce sales.

L’Oréal

L’Oréal purchased fashion AR app Modiface in 2018, making it one of the first of the major beauty brands to implement AR. The app is simple and easy to use. Users apply filters based on the makeup tones and applications of L’Oréal products and see the possible effects in real time.

L’Oréal found that people spent more than seven minutes trying on 20 to 30 shades of makeup before they purchase, and conversion rates from these virtual try-ons tripled during the pandemic.

CB2

CB2 is a mid-range furniture store that delivers global products. Its furniture, which starts at about $250 for a simple chair and $2,000 for a sofa, are not the typical eCommerce experience, and most of its retail sales are now online.

Following the installation of an AR program, in which customers can place furniture in their own homes via AR (on selected products), or take a 3D tour of the furniture in a digital showroom, CB2 saw a marked increase in sales.

In fact, they quote a 21% increase in revenue per visit, which matched to a 13% increase in average order size on pages implementing VR.

Ikea

Ikea Place was one of the first furniture apps to hit the market, and it’s remarkably successful. The app, which launched in parts of Europe, saw average conversion increases of over 200%, with online sales increasing by a total of 10%.

Ikea Place also utilizes virtual reality: users can snap a photo of their space or use live filters to input furniture into an area, as well as tell the app the measurements. That allows them to see how the furniture fits into the actual space, which Ikea claims is 98% accurate.

Wrapping up — Use AR in eCommerce to elevate your experience

Google shows that 66% of consumers show an interest in using AR while they shop. In the study, 6 in 10 people stated they would use AR tools to visualize how a product fits in their homes.

For some industries, like high-end makeup, it’s almost strange not to have AR. Brands from Ulta Beauty to L’Oréal dominate this strategy, and it’s increasingly becoming the norm.

Adopting AR is no longer about building your own solution, but rather, choosing a software as a solution platform. Even big marketplaces like Amazon increasingly offer VR experiences for customers.

Now that it’s relatively accessible even to small brands, you have every reason to introduce this cutting-edge technology into your conversion strategy.

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