Augmented reality shopping on the rise

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Gartner believes that by next year, 100 million global consumers will shop in augmented reality (AR) online and in-store.

The firm believes both AR and virtual reality (VR) have the potential to shake-up the customer experience by individualising retailers' offers and enabling customers to visualise products in different settings.

The research and advisory company notes AR and VR will rely on 5G to change the customer experience inside and outside retail stores.

"Retailers are under increasing pressure to explain the purpose of physical stores, and take control of the fulfilment and return process for cross-channel execution," says Hanna Karki, principal research analyst at Gartner.

"At the same time, consumers are progressively defining the value provided by the experiences they receive from retailers. As a result of these pressures, retailers are turning to AR and VR to offer customers a unified retail experience inside and outside retail stores."

The 2018 Gartner Unified Retail Survey* indicated that, by 2020, 46% of retailers planned to deploy either AR or VR solutions to meet customer service experience requirements. Additionally, the technologies behind these solutions have moved 15% to 30% further along the Gartner Hype Cycle over the past 12 months.

"The impact of AR or VR in retail can be transformative. Retailers can use AR as an extension of the brand experience to engage customers in immersive environments and drive revenue," adds Karki.

"For example, IKEA's Place app enables customers to virtually 'place' IKEA products in their space. Additionally, AR can be used outside the store after a sale to increase customer satisfaction and improve loyalty."

With VR's immersive interfaces, retailers can create task efficiencies, or reduce the costs associated with designing new products, Gartner says. They can also enhance the understanding of information through advanced graphical visualisation and simulation technologies. Pilots and implementation examples include Alibaba's full VR shopping experience, virtual reality tours by Tesco, Adidas' VR video to promote its outdoor clothing collection, and eBay Australia's partnerships with Myer to create personalised stores.

5G potential

Gartner believes 5G mobile network technology represents an opportunity to accelerate the adoption of AR and VR in stores.

Gartner's recent 5G enterprise survey indicated AR/VR applications of 5G attract the highest expectations for becoming drivers of new revenue, across all use cases and respondents. 5G capabilities can support multiple uses cases, such as real-time rendering for immersive video, shorter download and set-up times, and extension of brands and shopping experiences beyond stores.

"Gartner expects that the implementation of 5G and AR or VR in stores will transform not only customer engagement but also the entire product management cycle of brands," said Sylvain Fabre, senior research director at Gartner. "5G can optimise warehouse resources, enhance store traffic analytics and enable beacons that communicate with shoppers' smartphones."

* Gartner's Unified Retail Survey was conducted online and via computer-assisted telephone interviewing from July 2018 through August 2018, with 97 respondents in Europe (including the UK), the US, Canada and China.

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