The future of e-commerce may or may not lie in the “metaverse”. But for The Drum’s deep dive into e-commerce, augmented reality (AR) expert Caspar Thykier tells us one thing is for sure: immersive technology is currently pushing the boundaries of physical and digital stores.
The foundations have been laid for the mass adoption of immersive technologies. Advances in hardware, software, tools, and distribution channels have made augmented reality (AR) a viable, robust, and affordable solution for the mass market. Increased adoption of immersive technologies has followed, along with an increase in the desire to use them in everyday life.
Major e-commerce brands are evolving to capitalize on these advancements, reaping the benefits of higher engagement, dwell times, memory recall, and sales success that these technologies offer.
The evolution of e-commerce
AR developments, spurred by the pandemic, have been instrumental in the surge in e-commerce. Department stores closed, customers stayed home and retailers had to be online. Customers have not looked back.
While the pandemic has been a catalyst, online shopping is nothing new. Online convenience has been around since the 90s, but what we’re seeing now is a consumer desire for more than convenience, influenced by life lived on smartphone screens (and increased exposure to tech immersive).
Consumers demand experiences that put them at the center of the buying process – immersive, contextual experiences that bridge the gap between in-store and online.
Consumers want to be able to create something unique that fits their needs; 47% would pay extra for a product if they could personalize it or personalize it using immersive technologies.
Information is king. 42% want to use immersive technology to assess product features and experience products before purchase (from advanced features and benefits to in-place product appearance). And trust is vital, with 61% of consumers saying they want more transparency. Consumers want to know where their products come from, how they are made and what impact they have on the environment.
To meet these demands and stay ahead of the increasingly competitive world of e-commerce, retailers have turned to immersive technologies and the solutions they provide.
The immersive solution
With traditional commerce, the most engaging retail experiences happened in-store. Now, with augmented reality, retailers can deliver these experiences at home, while providing more information than ever before.
The most pioneering and well-known of these is “try before you buy”: a long-term strategy for brands looking to attract younger audiences, improve conversion and reduce returns. Recent reports have shown how powerful virtual product viewing can be, increasing sales and the propensity to buy. Conversion rates can increase by 94% for products supported by AR try-on technology, with a 5% reduction in return rate.
3D technology in e-commerce spaces is also on the rise, providing value that 2D product images cannot: show product detail, material and quality from every angle, increasing conversion by up to 250%.
Immersive technologies can also convey this heightened experience to customer retention. The Covid-19 pandemic has contributed to the growing value placed on how we appear online, both socially and professionally, especially to younger generations. The value of virtual goods has exploded: Gucci’s virtual 25 sneaker has opened up exciting new opportunities that can be exploited with extended reality (XR) technology.
With the explosion of metaverse and web3 platforms, retailers are faced with the question of where to start, what to build, and most importantly, what will be truly transformative (rather than just a marketing gimmick)?
Retailers need to think about what will lead to tangible results and return on investment. Although the future of e-commerce may be in the metaverse, there is still so much untapped potential here and now with AR.
With the rise of space computing, telepresence, and holographs, as we head headlong into multiple virtual worlds, things are definitely not done changing in the world of immersive technology.
Perhaps we will see purchases in the metaverse, or a greater focus on our digital twins and the use of avatars to build customer loyalty. What we do know today is that cameras and spatial computing enable richer, more immersive experiences for brands and end users. It’s a trend that will only accelerate as we move from mobile devices to headsets and eyewear of the future over the next decade, and one that will continue to shape forward-thinking industries such as e-commerce.
To learn more about immersive selling experiences, visit our e-commerce hub.