In today's digital age, e-commerce start-ups are navigating a complex landscape, competing not just for market share but also for the attention and loyalty of an increasingly discerning customer base. Over the years, e-commerce has evolved from simple online catalogues to interactive platforms offering personalised shopping experiences. As technology continues to advance, augmented reality (AR) has emerged as the next frontier in e-commerce. It promises to revolutionise the way consumers shop online, blurring the lines between the digital and physical worlds.
What is augmented reality for e-commerce?
The concept of augmented reality dates back to the early 1960s, but its application in e-commerce is a relatively recent phenomenon. At its core, AR is about overlaying digital content (like images, videos, or 3D models) onto the real world. This is achieved through devices like smartphones, tablets, or specialised AR glasses. In the context of e-commerce, AR transforms the way consumers interact with products online. Instead of just viewing static images or videos, shoppers can now visualise products in their real-world environment. For instance, someone looking to buy a new lamp can see how it looks on their bedside table through their phone's camera, all thanks to AR.
How does augmented reality in e-commerce work?
AR in e-commerce is a blend of technology, design, and user experience. On the technical side, it involves real-time image processing where the device's camera captures the real-world environment, and the AR software overlays the digital content on it. This requires sophisticated algorithms that can recognise spatial dimensions, lighting conditions, and other environmental factors. On the design front, creating realistic 3D models of products that can be scaled, rotated, and viewed from different angles is crucial. The user experience is the final piece of the puzzle. An intuitive interface, smooth performance, and realistic visualisations are essential for making sure that shoppers find value in using AR features.
The tangible benefits of AR in e-commerce
One of the most significant pain points for e-commerce businesses is product returns. They not only affect the bottom line but also have logistical and environmental implications. Aside from this, there are a number of advantages for both consumers and e-commerce brands:
Enhanced shopping experience
The traditional online shopping experience often feels detached, with consumers relying on static images or videos. AR transforms this by offering a dynamic and interactive experience. Imagine shopping for a vase and being able to place it on your dining table virtually, gauging its size, design, and how it complements your space. This immersive experience makes online shopping more tangible and engaging.
One of the challenges of online shopping is the uncertainty about a product's fit, look, or size. AR addresses this by allowing consumers to visualise products in their real-world environment. For instance, someone shopping for shoes can virtually try them on, assessing the fit and style. This clarity reduces the guesswork, leading to more informed and confident purchasing decisions.
Beyond the practicalities, AR introduces an element of fun and excitement to online shopping. Features like virtual try-ons or 3D product visualisations make browsing products more interactive, turning shopping into an engaging activity rather than a mundane task.
High return rates have always plagued e-commerce businesses, especially in sectors like fashion. AR directly addresses this by offering consumers a clearer understanding of products. When customers can virtually try on a dress or visualise a piece of furniture in their living room, the chances of post-purchase dissatisfaction diminish, leading to fewer returns.
Returns are not just about refunding the customer; they involve reverse logistics costs – shipping, restocking, and potential wastage. By leveraging AR to reduce returns, brands can achieve significant savings, improving their bottom line.
Improved unit economics
Enhanced by the reduction in return rates and associated costs, AR can lead to better unit economics. With the cost to serve each customer decreasing, brands have the flexibility to offer competitive prices or invest in other value-added services, enhancing customer loyalty.
Enhanced brand image
In a competitive e-commerce landscape, differentiation is key. Brands that offer innovative AR experiences position themselves as forward-thinking and customer-centric, enhancing their brand image and appeal.
Sustainability is becoming a pivotal consideration for modern consumers. By reducing returns through AR, brands not only save costs but also reduce their carbon footprint. Fewer shipments mean less fuel consumption and reduced emissions, aligning brands with eco-friendly practices and appealing to environmentally-conscious consumers.
Who does augmented reality well in e-commerce?
Several big players in the e-commerce world have been quick to adopt and excel in the use of augmented reality, setting benchmarks for others to follow. ASOS, for instance, introduced the "Virtual Catwalk" feature on their app, allowing users to view models showcasing selected outfits in augmented reality. Apple, while not a traditional e-commerce player, offers potential buyers an AR experience to visualise how the Apple Watch looks on their wrist. IKEA's AR app, IKEA Place, lets users virtually place furniture in their space, making sure it fits and matches their interiors. These brands have effectively leveraged AR to enhance the customer shopping experience, leading to increased engagement and reduced return rates.
Embracing augmented reality for small brands
For small e-commerce brands, especially those on platforms like Shopify, integrating AR might seem daunting due to perceived high costs and technical complexities. However, the reality is more accessible than one might think. Several AR applications integrate seamlessly with Shopify, allowing even small businesses to offer AR experiences:
Shopify AR is directly from Shopify. This tool allows merchants to upload 3D models of their products, enabling customers to view them in AR.
ROAR is an AR platform that allows businesses to create and manage AR experiences. It integrates with Shopify and offers features like virtual try-ons and 3D product previews.
Aryel is a platform that offers immersive AR campaigns that can be embedded directly into a Shopify store, enhancing product visualisation.
By leveraging these tools, small brands can offer the same immersive shopping experiences as their larger counterparts, levelling the playing field and enhancing their competitive edge.
Why is 3D modelling essential for AR in e-commerce?
To truly harness the potential of AR in e-commerce, 3D models often prove superior to traditional 2D images. These models offer a more immersive and interactive experience, allowing customers to visualise products with greater accuracy. However, creating these 3D representations requires investment in terms of time, expertise, and resources. While not every product may warrant a 3D model, for those with complex dimensions or high return rates, the investment can enhance customer satisfaction and reduce post-purchase discrepancies. Businesses should weigh the benefits against the required resources, considering their product range and target audience's expectations.
The power of AR in e-commerce
As Russ Maschmeyer, Shopify’s Product Lead for AR, aptly puts it, “It just solves some really obvious pain points that have existed in e-commerce forever...instead of seeing that couch in a showroom, you can actually see it in your living room, where it's going to end up.” This sentiment encapsulates the transformative potential of AR in e-commerce. By bridging the gap between the digital and physical worlds, AR offers a more immersive and realistic shopping experience, addressing long-standing challenges in the online retail space.
The e-commerce landscape is ever-evolving, with businesses constantly seeking innovative ways to engage and delight their customers. Augmented reality stands out as a beacon of innovation, offering a blend of the digital and physical like never before. For e-commerce founders, especially those navigating the competitive streets of London, embracing AR isn't just about keeping up with trends; it's about pioneering a new era of online shopping. As technology continues to advance, the line between the digital and physical will blur even further, and AR will be at the forefront of this revolution, guiding e-commerce towards a brighter, more interactive future.