Creating The Phygital Store Of The Future With Mobile Apps and AR

The Evolution of AR

Augmented reality has been around for over a decade, but unlike its virtual reality cousin, the technology has advanced at an increasing speed and matured profusely, backed by the upcoming generation of 5G connectivity and edge computing.

Brands have begun to see augmented reality as a vital part of their strategy and have integrated its development and concept into their digital transformation roadmap. This is especially the case for many in the post-COVID trading landscape, for those seeking to offer experiential elements in a safe space by fusing the digital touch within a physical environment.

The active use of the webcam and front camera for video calling and selfies has, in turn, generated a high adoption for augmented reality, eliminating the once privacy-sensitive barriers. Daily use of filter overlays on Snapchat, Instagram, TikTok, and the likes by four billion daily active users have consumers accustomed to augmented reality as a technology that’s embedded natively within their frequent app usage.

Global tech advisory firm ABI Research indicated the augmented reality market will be worth more US$140 billion (£100.7 billion) in the next four years — prompted by the pandemic as with all other retail technology in experimenting with virtual store experiences.

Given the evolution of Snapchat filters that was primarily used for entertainment, cameras now carry a commerce function as well, as brands piggyback onto social media platforms for their intricate AR experiences. Augmented reality has become a democratised technology that is available to anyone with a smartphone and camera — removing the barrier of access, and at a lower cost in comparison to a hardware device for virtual reality solutions.

The Phygital Experience

Real-time facial recognition has benefited many cosmetics brands but the technology has morphed beyond virtual try-ons or furniture placement as commonly seen.

In recent use cases, several brands such as Nike and Tumi have utilised augmented reality and integrated the technology within their in-store environments to enhance the shopper experience. At Nike’s New York House of Innovation, the retailer re-created Oregon’s Smith Rock State by geo-fencing a microsite to replicate the ‘base camp’ where visitors can use their mobile to access a map and checklist of activities by scanning QR codes and activating the AR visuals. The experience has been further gamified by rewarding users upon completion of activities with physical goods and virtual redemptions.

Luggage brand Tumi opted for a different approach to its omnichannel experience by creating a fully virtual store (exclusively for the APAC and Middle East region) that is accessible through its website and mobile browser. Customers can view and discover Tumi’s products through 360-degree 3D video technology and AR implementation. Users are to scan the QR code off the screen to activate the augmented reality browsing experience within their mobile for an up-close and personal viewing. The virtual store is connected to various shopping channels such as its e-commerce site and even WeChat profile with live customer chat integrated for the seamless shopping experience. Users can also have an “Instagram-able” experience by uploading their selfies onto their virtual magic mirror as a sharable moment. In this case, augmented reality provides the ability to be used outside of the store environment, but within consumer’s homes to mimic physical retail, as well as increasing after-sales opportunity.

Key Takeaways

The promising nature of augmented reality has attracted over 2,000 investors in this space as exhibited on AngelList. New pandemic-driven trading environments has prompted many retailers and investors to seek for augmented reality solutions and seed at early-stage opportunities for the rewarding ROI the technology will bring.

The cost of augmented reality has significantly lowered over the years owing to the maturity of the development. This in effect has removed the barrier of adoption, making the technology more feasible than industrial headsets as generally seen with Microsoft’s HoloLens and the upcoming Apple VR headset.

No longer is AR simply used as part of a marketing campaign, but the technology has been transformed into one that benefits and engages the users in personalising their experiences through interactive platforms. AR can be used to improve existing services but also operational-wise, by providing augmented training or informative usage for staff as assistance.

Without needing an additional app, augmented reality has become much more accessible especially as consumers in the West are increasingly more accustomed to scanning QR codes from current covid-19 practices. AR will be used widely for safety measures in bringing consumers back into the store by providing safer activations and retail experiences. Staff can also run its lenses over a product to see information overlay the visual captured, which can aid staff with merchandising operations in-store.

The use of augmented reality used aside from gamified features should be developed on a problem-solving basis and to think beyond transaction-orientated activities in the case of how augmented reality can benefit the user and the experiences it can deliver, either in replacement or enhancement of the physical retail store.