Virtual, Augmented and Mixed Reality technologies will bring opportunities for merchants as consumer adoption grows.
While E-commerce and digital marketing have proven to be effective platforms, Virtual Reality (VR) is the next innovative technology that will improve and impact the retail and marketing sectors, with market-foresight advisory firm ABI Research forecasting that VR in retail and marketing sectors is expected to generate US$1.8 billion in 2022.
Retail and marketing companies have realized that virtual reality technology can be an effective tool to further assist consumers with the purchase process and provide them with the ability to visualize and personalize the products more realistically,” says Khin Sandi Lynn, Industry Analyst at ABI Research.
Automotive companies and travel agencies are already using VR as a marketing tool, with applications such as virtual test drives and 360-degree tours becoming more widespread. E-commerce is another sector with a good potential for VR deployment. Chinese E-commerce company Alibaba has deployed its Buy+ mobile VR platform for better product visualizing. Alibaba integrates its Alipay payment platform to assist consumers making payment while browsing products using Buy+ VR.
“There is high consumer interest in using VR for making purchase decisions while shopping online or in-store. The availability of low-cost VR headsets is another driver of consumer VR use cases for purchasing products,” notes Lynn.
Walmart’s recent acquisition of VR software company Spatialand is another indicator of VR deployment as a retail solution in the future, as is their use of HoloLens for helping better manage their warehouse logistics. Consumers’ awareness together with investment by retailers and brands will drive the VR retail and marketing market.
Furniture and home improvement stores have been early adopters of VR in the retail segment. VR is an effective platform for customers to view furniture, pick different parts, customize products, and/or visualize an item before making a purchase decision, and has been adopted both in-store and online to provide a better shopping experience to consumers.
Swedish furniture company IKEA and North American home improvement company Lowe’s are two examples that have successfully deployed it, as are Augment – a French company that Tech Trends met last year in Orlando, Florida, which builds syndicated catalogs of AR-ready products from the world’s major brands like Microsoft, Panasonic, Electrolux, and make it available to all retailers through an AR SDK, supporting ARKit / ARCore.
“The number one issue we’re hearing from retailers launching AR for eCommerce (Amazon, Build.com, Overstock, Wayfair…) is the management of 3D products,” explains the company’s Co-Founder and COO Mickaël Jordan. “It’s expensive, time consuming, and each retailer is basically building its own catalogue of similar AR-ready models of appliances, electronics and furniture. It’s nonsense,” he says.
Some of the key findings in ABI Research’s VR in Retail and Marketing report include:
- VR software and service revenue in retail and marketing will grow at CAGR 102% to generate $1.8 billion 2022.
- E-commerce and digital marketing has shifted the way brand and retailers market the products. VR is the next innovation in retail and marketing sector. The realistic feel provided by VR provides many benefits to retail and marketing; enhanced shopping experience, efficient marketing tool, more effective store management system etc.
- VR can also be used for market research to better understand consumer behavior.
- Furniture stores such as IKEA have deployed VR for product browsing, selection and customization. Lowe’s has another interesting VR deployment which allows shoppers to learn how to install their products.
- E-commerce and other sectors such as travel agencies are also starting to use VR to visualize products or try tours, hotels or flight experience before purchasing product or services.
- VR assists consumers in making purchase decisions, helping retail and marketing companies to achieve greater footfall and decrease returns rates.
- There is great interest from both retailers and consumers to use VR in purchasing process. However, deployment cost can be a challenge for smaller retailers and VR might not be the right platform for older generation consumers who are not yet familiar with the technology.
If you would like to find out how to leverage VR/AR/MR in your enterprise, Tech Trends offers Virtual Reality Consultancy support
Alice Bonasio is a VR Consultant and Tech Trends’ Editor in Chief. She also regularly writes for Fast Company, Ars Technica, Quartz, Wired and others. Connect with her on LinkedIn and follow @alicebonasio on Twitter.