Augmented Reality Unlocks Personalized Shopping Experiences

Have you ever bought a piece of furniture online only to return it not long after it arrives? What you had imagined the item to look like in your living room turned out to not meet your expectations — the colors weren’t right, it didn’t mesh well with the rest of the room, or despite you measuring beforehand, it was too small for the space.

Retailers recognize this problem and they empathize with the experience of shoppers whose excitement fades after delivery. Fortunately, augmented reality (AR) is making it easier than ever for consumers to visualize what products truly look like ahead of time. This technology creates interactive experiences where digital elements are displayed in a real-world environment through smartphone apps or AR glasses.

IKEA Place was one of the first to tap into this technology, allowing consumers to see furniture pieces in their own home. Home renovation and design app Houzz also uses a “View in My Room 3D” tool to help shoppers visualize what a newly designed room would look like.

Beyond furniture retailers, makeup brands like NYX Professional Makeup and Sally Hansen are using AR to allow virtual makeup try-ons. Nike is also solving foot-size accuracy by offering Nike Fit, an AR solution that measures the full shape of users’ feet. Following the pandemic, Kohl’s partnered with Snapchat to create Kohl’s AR Virtual Closet, where consumers can step inside an AR dressing room without leaving their homes.

The use cases for AR in retail are endless. Retailers have an opportunity to tap into the value and power of AR to bring a personalized shopping experience for their customers — one that captures engagement and sales.

Boost Conversion Rates With AR

According to Shopify, interactions with products having AR content showed a 94 percent higher conversion rate than products without access to AR previews.

The reason is simple: AR drives purchase confidence and sales, especially for items that consumers haven’t seen or touched in person. These virtual try-on experiences allow consumers to understand the context or relationship between objects and imagine using them in real life. AR emulates the in-store experience and brings products to life. By allowing consumers to digitally interact or “try on” the item, retailers can increase conversions and decrease their return ratio.

Improve the Customer Experience With AR

AR technology provides an immersive experience that adds value to the purchase journey. Not only does it offer an interactive visual-media format, but it’s also an effective promotional tool to boost connections with shoppers.

For example, retailers can promote AR functionality through social media. Snapchat recently rolled out new shopping features that blend AR lenses with the ability to sell products directly to mobile consumers. The company explained that with 93 percent of Snapchat users interested in AR for shopping, users can now “express their style, try on digital versions of real-life products, click through to purchase them, and even share their shopping adventures with friends.” Retailers can also build an app that lets consumers create AR videos that become shareable media.

AR doesn’t stop here. In the future, the technology will become integrated with other devices to strengthen the customer journey. For instance, Apple is rumored to be working on AR/VR products, including headsets and glasses. Car manufacturers have plans to show directions on the windshield to make it clearer when to turn or stop when driving. Retailers must keep an eye on the changing landscape and pay attention to all the opportunities that AR can make possible.

Create a Personalized Experience With AR

At the end of the day, personalization should be the main priority. Personalized experiences drive conversions, and AR takes that experience to the next level. In 2022, it's estimated that 1.1 billion people will use AR on their phones alone. The challenge for brands is to accurately represent the real world in a realistic small-screen format.

However, the rewards are worth it. Retailers that understand the value and power of AR technology and create visual, eye-catching effects will reap the benefits. AR is becoming a must for conveying innovative personalized shopping experiences that create a compelling end-user experience.

Gary Ballabio is the vice president of technology partnerships at Cloudinary, a cloud-based service that provides an end-to-end image and video management solution, including uploads, storage, manipulations, optimizations and delivery.