Extended Reality for a Great Shopping Experience
The rapid advancement of smartphones, AI, IoT, and 5G networks will bring Extended Reality to shoppers much sooner than expected. Extended Reality (XR) will be shaping a world very different from today’s current commerce experience. The primary reason is a device most of us carry in our pockets: our smartphones.
Extended Reality” (XR) describes a full spectrum of enhanced digital and physical experiences: Augmented Reality (AR), Virtual Reality (VR), and Mixed Reality (MR).
By 2021, 3.4 billion phones have even more advanced AR capabilities, meaning billions of shoppers are able to explore physical products with digitally integrated content and make better informed purchases.
Already, nearly a third of consumers (32 percent) use AR apps, most frequently for gaming and social media.3However, analysts such as IDC expect healthy growth in consumer AR/VR spending to deliver a five-year CAGR of just over 52 percent.
To ignore the implications of AR would be akin to ignoring the advent of online shopping and the disruptive transformation it caused. In fact, we believe AR could be as disruptive to retail as the web or mobile was.
The business and brand implications for AR and related XR technologies directly affect the very core of an organization’s digital reinvention strategy. Succeeding with XR will rely on an organization’s infrastructure, data, and cloud capabilities, as well as a clear vision for the design of improved customer and employee experiences.
Now, the availability of 5G is giving a tremendous boost to the development and adoption of XR. As the use of these technologies becomes more sophisticated, digital experiences will increasingly be integrated with physical ones, so that the boundary between them will blur, with users enjoying much more rewarding interactions.
How will this affect consumers’ shopping preferences and behaviors, whether online or in-person? And what implications does this have for how companies interact with their customers, including how they define and express their brands?
Four major changes to expect
- Pre- experiencing product:
Today, when shopping online, consumers can browse photos of a product, text descriptions, and, sometimes, a video. AR more closely replicates the experience of physically exploring a product before buying it, with the added benefit of access to detailed information, as if a knowledgeable sales associate were there to help. AR tools that allow a user to configure, personalize, try on, or in other ways test drive products are expected to quickly become standard.
- Extending the relationship beyond purchase:
With AR, companies can continue to interact with a customer after a purchase in new, meaningful ways. Ongoing product support after the sale can be far more helpful with AR user manuals, instructions, and feature guidance. But that’s just scratching the surface of AR’s potential.
AR on a smart phone or tablet can easily replace the sometimes cumbersome or limited digital screens included in many current products, such as smart refrigerators or ovens. In fact, when customers can engage with a product via an app on their own digital devices, manufacturers can avoid the effort and expense of embedding a customer interface directly into their physical products.
- Enhancing the in-store experience:
Mobile devices have made comparison shopping so simple that many consumers are showrooming: visiting a physical store to see a product, then purchasing it online— sometimes from the same retailer, but often from another source with a more competitive offer. Nielsen.com reports nearly three of four grocery shoppers have used a physical store to showroom before purchasing online.
The combination of AR, data and AI working in tandem to enrich the in-store experience could help keep shoppers in the store. AI-powered AR can assist sales associates to help, or even become a consumer’s personal shopping assistant, offering information such as features, ratings or ingredients, and special incentives to help close the sale.
- Expressing the brand as a XR avatar:
XR will change how companies define and express their brands. AR is already putting new pressure on brands to create tools that help customers feel confident they’re making informed purchasing decisions. Those companies that do this with a consistently delightful, branded experience will position themselves to win.
For many, an XR avatar will become the incarnation of the brand. The challenge for brand and marketing professionals will be two-fold. First, they will need to develop and execute an experience strategy that enables AI-driven personalization via an XR experience. Second, they will need to consider the extent to which customers should be allowed to customize the experience.
Preparing for an XR World
Early movers who master XR could upend existing channels, just as the digital age shattered music distribution. For example, how easily might shopping habits change when consumers interact regularly with their stove through an XR app, and, with a few clicks, can purchase anything associated with cooking—ingredients, cookware, even cooking lessons? The design of compelling XR experiences that offer superior utility has the potential to revolutionize a company’s customer experience strategy, reframe customer relationships, and fend off competitive disruption.
Marketers, developers, and experience designers need to quickly become fluent in the expanding uses for XR, and especially AR. But the need for XR fluency extends further. Associates in product design, customer service, warranty, repair, sales, logistics, supply chain, field service, and operations should start learning how XR can be applied in their areas.
Unlike other technologies that can be integrated into a company’s workflow with relative ease, XR will require technical expertise in new coding languages specific to 3-D and XR experiences, such as iOS ARKit, Unity and SceneKit. For VR and MR, teams will need detailed knowledge of the experiences that can be had using physical devices such as Oculus Quest, Magic Leap One, or Microsoft Hololens.
Developers will need to be adept at using tools such as Unity, Unreal Engine, Apple AR Kit, and Android AR Core. And multidisciplinary creative teams with 3-D modeling skills will be needed to imagine and design XR experiences that are intuitive, useful, and differentiating.
Above all, XR is not a future state. It is happening now. And now is the time to put it to work.
With information of IBM Corporation Expert Insights © Copyright IBM Corporation 2021