Augmented reality (AR) and virtual reality (VR) technology have the potential to offer consumers a more immersive online shopping experience, with more immersive experience compared with the flat, 2D grids of product photos that have typified online shopping for the past two decades.

The technology is also making ecommerce more natural, intuitive, and social, offering shoppers new ways to discover, learn about, interact with and purchase products in photorealistic virtual store environments.

By 2024 there will be an estimated 1.7 billion mobile augmented reality (AR) users worldwide, a rise of 1.5 billion from the 200 million seen in 2015, according to recent data by Statista, and a Snap commissioned study from Deloitte Digital found interacting with products that have AR experiences leads to a 94% higher conversion rate.

"When we shop in a physical store, it's a three-dimensional experience that we often enjoy with family or friends," said Neha Singh, founder and CEO of Obsess, an augmented and virtual reality software platform for experiential shopping. "AR and VR now let us re-create that experience online."

Virtual and Augmented Reality Stores to Explore and Interact With

She pointed out the technology also lets consumers explore and browse virtual stores in the same way they explore videogame environments, navigating through different sections of the store and clicking on products and collections to engage with and learn about them.

"Consumers are looking for interactive, immersive experiences that they can enjoy safely from the comfort of their own homes, on whatever device and at whatever time they choose, and AR and VR are enabling that," she said.

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AR Proves Enticing for Younger Shoppers Acclimated to the Tech

For many, AR-enabled ecommerce provides a more engaging and enjoyable online experience for consumers, but as with any new product, technology or experience, consumers have a learning curve when it comes to AR and VR.

"Younger shoppers who grew up living much of their lives on their mobile phones and interacting with each other and with brands through videogames, esports and social media are obviously the most likely group to embrace new technologies, but other generations are coming along, too," said Singh.

She noted the pandemic has been a tailwind for AR/VR adoption, as more people globally took up videogaming, purchased in-home fitness technology and tried VR headsets for the first time.

From her perspective, AR/VR tech offers an entertaining and highly immersive virtual shopping experience that many consumers love once they try it.

"We expect adoption of AR/VR headsets to continue to increase as the technology and user experience improves and as awareness grows, as they provide immersive experiences that are unparalleled," she said.

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Giving Consumers a Better View of the Product Through AR and VR

Ashley Crowder, co-founder and CEO of VNTANA, which helps businesses upload existing 3D designs or 3D scans and create an immersive ecommerce and web-based augmented reality experiences, said their clients have found AR gives consumers a better understanding of the product.

"You can see that product true to size by holding up your phone and seeing it on your desk," she said. "This is great for something like bags, where the number one reason for returns are size issues."

AR and VR give consumers a way to experience and engage with brands and products online that was impossible in the past, which helps drive higher conversion rates and basket size.

Apparel, beauty and home are some of the many retail categories that are obvious fits for virtual shopping environments enabled by AR and VR, because people want to know how those products will look on them, or in their home, in real life.

Crowder noted companies like Snap and Meta are investing heavily to make AR work at scale on their platforms, which will bring new opportunities for businesses to entice consumers.

"Snapchat is continuing to invest in face and shoe try-on technology, and their studies show a big rise in conversion rates," she said. "I think people don't realize how easy it is - the technology is there, it's just a matter of seeing it on more websites and in more places."

Learning Opportunities

Starting Small and Building Up

Crowder said businesses can start small by investing tactically in AR, the first step of which is to create Web-ready 3D models of products.

"Start with getting the 3D products up on your website with items that we know work well — anything with the face seems to be working well right now — and when you have a 3D asset, it opens up all the possibilities for you to push that onto Facebook or Snapchat."

She added that for retailers that already design and manufacture using 3D modeling software, they might even have digital assets that can be leveraged and converted into web-ready images.

"We have a lot of clients who start with their top ten products, or otherwise start with their lower selling products and see if offering an AR experience with them provides a lift," Crowder said. "You don't have to start with everything."

AR Offers Applications Across Retail Channels

Singh pointed out even grocery and CPG shopping experiences are benefiting from the technology, allowing consumers to discover and interact with products and brand content in immersive, engaging environments.

She predicted AR- and VR-enabled virtual ecommerce experiences would become much more commonplace in 2022, not just for categories like apparel, beauty and home, where AR has been used for a number of years to enable shoppers to virtually try on different looks and see how furniture might fit in their living room. "In the new year, many more brands across categories will invest in building immersive virtual flagships that let shoppers discover, browse and engage with products in much the same way they do in brick-and-mortar stores in real life," she said.

Singh noted forward-thinking brands and retailers are already creating immersive ecommerce experiences and starting to envision how their brand and products should appear in the metaverse.

They're creating their own visually unique virtual stores, islands and other environments where consumers can discover their brand, their products and their collections.

"Many fashion and accessories brands are already partnering with gaming platforms to test demand for virtual products and with companies like ours to build immersive virtual stores that are hosted on their own sites today, but that will live across metaverse platforms in the coming years," she said.

Crafting a Plan for Long-Term AR Deployment Success

Crowder noted automation will be a key element to a successful AR strategy, especially for businesses that have a larger number of products that need to be displayed.

"It's one thing to make an AR experience for 10 products, but for bigger product portfolios, you need an automated system to do that," she said. "We explain it's just like uploading a video across multiple platforms, where the codec changes but you don't think about it - that's what we do for 3D."

To succeed over the long term, Singh said brands need to build experiential ecommerce into their budgets and create three- to five-year plans for their AR/VR initiatives and must think organizationally about virtual selling and create line items for these investments.

"Over the longer term, technology advances will allow brands to render virtual environments in real time in order to provide a highly personalized ecommerce experience that most people have difficulty even imagining today."