The COVID-19 pandemic has permanently altered shopping habits. Consumers now discover items online that they used to purchase only in storefronts. Although many customers still prefer in-person purchasing, we will continue to see annual increases in online purchases as more people connect with the digital landscape. EnterpriseAppToday reports 63% of the “shopping journey” begins online, regardless of whether consumers purchase in person or online.
However, online purchasing has had its challenges, particularly regarding product returns. This problem is where augmented and virtual reality can play a transformative role. E-commerce sites are creating immersive purchasing experiences that rival brick-and-mortar stores to entice consumers to purchase online.
Virtual “try-before-you-buy” platforms are an online innovation that enables shoppers to use augmented and virtual reality to experience a product more completely before purchasing it. It offers enhanced product visualization and increased purchase confidence, which can lead to reduced returns rates and higher conversion rates.
Online shopping obstacles
One advantage brick-and-mortar retailers traditionally have had over online purchasing is the consumers’ ability to experience the products. While online purchasing can’t replicate the physical buying experience, AR and VR can simulate key sensory aspects to assist decision-making.
Many consumers feel dubious when making a purchase online. The ability to visualize products in the comfort of their home or on their body can persuade them to draw the trigger. The inconvenience of returns, which
Statista reports occurs at a rate as high as 23% for clothing, prevents many consumers from frequenting e-commerce sites. Online return rates are three times higher than the rate for in-store purchases, costing retailers approximately $15 for every $100 spent online.
Some clients, however, obtain items with the intention of returning them. “Bracketing” occurs when customers purchase multiple products online to choose the ideal one. AR and VR tech can minimize this practice because it helps customers restrict their options without purchasing anything. Statista cites a 2022 survey showing that 31% of American consumers bracketed apparel purchases if they could not remember their precise size.
Thus, virtual try-on technology helps mitigate high return rates while providing a more delightful purchasing experience.
Not only do high return rates cause financial losses for businesses, but they also contribute to environmental waste. CleanHub, an environmental services company working to prevent plastic pollution, claims that up to 24 million metric tons of CO2 emissions are from e-commerce returns, and in 2022, companies delivered 9.5 billion pounds of returned products to landfills.
Retail tech solutions
To surmount these challenges and enhance the shopping experience, retailers are adopting advanced AR/VR platforms that leverage computer vision, natural language processing, and artificial intelligence technologies like machine learning.
Computer Vision
AR/VR platforms, increasingly popular for virtual clothes purchasing, use computer vision, a critical AI/ML technology, to create immersive shopping experiences. By recognizing and tracking objects, such as the user’s body, these systems create a realistic visualization similar to what you would see at a store. This advanced technology includes eye monitoring and room mapping, helping to give consumers a gratifying experience from the comfort of their residences.
AR/VR allows precise object positioning, giving the illusion that they exist in the physical world. With home furniture purchases, users can navigate through virtual environments and manipulate objects as the system monitors their movements. Companies can overlay data and graphics to provide consumers with real-world information.
Natural Language Processing
Beyond the immersive visual experience, NLP brings personalization to the next level by facilitating voice commands in their virtual spaces, and AI algorithms help interpret and respond to the spoken language. NLP can enhance the virtual experience by providing personal purchasing assistants, product descriptions, and recommendations, making it also more accessible to people with disabilities. Text-to-speech and speech-to-text features assist visually impaired individuals.
Machine Learning
Retailers use ML to personalize content to each shopper’s preferences. ML algorithms analyze user interactions and preferences and adapt to the virtual environment to suit users’ interests. This technology offers enhanced customer engagement as it tailors content for specific consumers. ML is vital for virtual “try before you buy” systems because it enables object recognition, body measurement estimates, and other features that let consumers see how the products will appear in real life.
AR/VR real world examples
Advances in interactive retail technology have made AR and VR technology more accessible and affordable. Mobile applications with AR and VR incorporation make it accessible to anyone with a smartphone. Walmart and Amazon have already made strides in virtual “try-before-you-buy” capabilities on their applications.
Walmart expanded its AR-powered “Beauty Virtual Try-On” technology to include hair color options amongst its almost 500 products in the category, plus cosmetics and apparel. Venture Beat reported consumers can choose from 150 models when trying on clothing. The online behemoth also introduced a try-on platform for eye wear at the beginning of 2024.
Amazon this year “touted its virtual-trying capabilities,” which enable consumers to choose products from major brands like Adidas, Ray-Ban, and L’Oreal.” Its technology helps “you envisage a new pair of sneakers or eyeglasses yourself, as well as lip hues and eye shadow in real time.”
These examples illustrate AR and VR are poised to reshape the online purchasing experience. However, there will be challenges to surmount, such as data privacy, quality 3D modeling, and user technical requirements.
Still, people value convenience and want to avoid returns, which ultimately cost businesses profits, leading some retailers to charge restocking fees. With AR and VR integration, consumers can have more confidence when purchasing online, and retailers can increase shopping opportunities and minimize expenses.