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E-commerce News and Insights | Jun 17, 2020

The Rise of Virtual and Augmented Reality in E-Commerce

The Rise of Virtual and Augmented Reality in E-Commerce

Shippo Snippets:

  • Virtual reality can serve as the bridge to online shopping for people who currently prefer brick and mortar stores
  • Shopify has essentially enabled augmented reality for everyone—allowing even the smallest merchants access to this technology
  • VR stores may someday incorporate each of our five senses to facilitate shopping

The Story:

As so many of us have been cooped up at home during the COVID-19 pandemic, the topic of virtual and augmented reality in the e-commerce experience seems to be more relevant than ever. But even beyond our collective experience of recent months, VR and AR will most definitely play a bigger role in our lives in the not-so-distant future. One source estimates that the virtual and augmented reality market is forecasted to hit $571.42 billion by 2025. And, in terms of e-commerce, we’re barely just scratching the surface of possibilities.  

For those less familiar, virtual reality refers to the concept of creating an immersive, digitally simulated world. Augmented reality is where a real-life environment is enhanced with graphics, effects, and other content. From an e-commerce standpoint, augmented reality has already been a very useful tool in helping shoppers visualize how a product may look or fit them, or fit within their home. And virtual reality has also been evolving in its own right.

A Bridge Between Online and In-Store

There’s been endless discussion around whether a majority of consumers prefer online shopping to visiting physical stores and vice versa. And while e-commerce continues to grow and see record numbers—even before COVID-19—there will still be reasons why some shoppers would rather shop in-store.

A 2019 report reveals that 55% of consumers want to experience an item before making a purchase, and also may appreciate the personalized nature of the shopping experience. 

In other words, seeing is believing. So, it makes sense that we’ll see virtual and augmented reality become more and more prevalent within the online shopping experience in the near future. 

But wait, it already is.

Earlier this year, Shopify made it easier for its merchants to add 3D modeling and video elements to their product listings, without the need for additional code or an external app. This is on top of the Shopify AR functionality that was launched in 2018. Shopify has essentially enabled AR for everyone—giving even the smallest merchants access to this technology, through their existing accounts. The outcome? A better customer experience and, in some cases, higher sales.

Speaking of which, Shopify also reports that having the addition of native 3D modeling has helped facilitate increased conversion rates by as much as 250% through merchant product pages.

On the VR front, eBay created the first VR store experience in cooperation with Myer, an Australian retailer. With it, consumers can immerse themselves in the Myer store experience, while viewing more than 12,500 items in VR and ordering using the eBay app.

Other Uses of the Technology in E-commerce

Besides the positive uses around improved customer experience, ease of shopping, and potential increased sales, AR may also be a useful tool in reducing both cart abandonment and returns.

As the functionality can enable customers to “try before they buy,” shoppers would be able to make more informed purchase decisions up-front. Further, the technology can also be utilized in cross-selling complementary items both on product pages and in the cart.

In the VR realm, there’s the concept of offering a holistic store experience without the burden of high rent, utilities, insurance, and other monthly expenses associated with running a physical store.

Examples of AR and VR E-commerce by Industry

Fashion. Shoppers can get an up-close perspective of clothing, can personalize items online to see what they’d look like, and even replicate the dressing room experience.

Designer Rebecca Minkoff utilized 3D and AR technology through Shopify and found that shoppers were 44% more likely to add the item they engaged with in 3D to their carts, and 27% more likely to buy it. 

Even better, when shoppers interacted with an item in AR, the probability of a purchase became 65% greater.

Cosmetics. With stores closed during COVID-19, MAC cosmetics has been utilizing AR “try-on” functionality in its e-commerce efforts, where customers can both experience and purchase items online. 

Home decor. IKEA launched its IKEA Place app with AR functionality in 2017 to help consumers better visualize how its furniture and decor would look in their homes. It will eventually be rolling it into its main app for e-commerce purchases. Wayfair also enables shoppers to upload a photo of something they’re interested in, and then serve up similar items, while also allowing users to view applicable items in 3D within their home setting.

Home Improvement. Shoppers can watch how to handle DIY repairs, and then purchase the necessary items to do it themselves. Lowe’s debuted its Advanced Visualization a few years back. 

Flowers. In partnership with fashion designer Jason Wu, 1-800-Flowers recently launched an augmented reality experience to showcase his bouquet collection online. Mobile users can view bouquets in 3D and see how they’d fit within their own environments. Customers using Apple Pay can even make easy online purchases within the experience itself.

Cars. Consumers can look at models of choice online, customize them to see what they think of optional features, and even walk around the vehicle and climb into the driver’s seat. 

Virtual Reality and The Senses

While sight has obviously been key to e-commerce success for eons, VR can—and will eventually—be able to help with the incorporation of the other four main senses into the e-commerce experience.

Touch

While the technology has been around for some time, it has involved wearing awkward gloves or vests with motors that vibrate, along with clunky battery packs. Although this might’ve been acceptable for some early adopters, it’s hardly appropriate for today’s virtual reality shopping experience.

Fortunately, that may not be as futuristic as it sounds. Haptic devices have recently been developed that can forward tactile signals if the receiver is wearing a “lightweight, flexible patch” specifically designed for this reason.

Scientific American reported on this technology in November 2019, with one scientist stating: ”the sense of touch could qualitatively add to your experience, beyond anything that’s possible with audio and video.” And that observation meshes with what many shoppers have noted in surveys.

It’s reasonable to compare earlier haptic devices with the clunky computers from the 1990s that came with space-demanding towers, heavy monitors and more, and wires crisscrossing every which way you turn. The haptic devices recently invented—which contain a disk that’s only a couple of millimeters in thickness and can be powered wirelessly—are more like today’s tablets and smartphones. Super powerful and lightweight.

As many shoppers also enjoy the experience of going outside to travel to a physical store, there is also technology that mimics the following tactile sensations:

  • Water mist: this can allow shoppers to experience gentle rain
  • Heat: micro-heaters can allow VR users to feel warmth
  • Wind: yes, breezes, too

To take advantage of the water, wind, and warmth, you’d currently need to have the FEELREAL VR Mask. But this technological breakthrough will almost surely lead to more tactile experiences made available for e-commerce shopping in the future.

 So, for the customers who prefer brick and mortar stores because they want to see and touch before they buy, virtual reality could ultimately be able to fulfill some of those desires online.

Sound

As one educational facility points out, we don’t realize how important sound is to us until we watch a movie or play a video game with the soundtrack turned off. Sound has been such an important component of enjoying entertainment that, even in the early days of silent movies, live music was performed to supplement the film being watched. In fact, some experts say that sound “makes up 50 percent of the VR experience.”

Thanks to movies and games that incorporate virtual reality, sound is already a key part of many VR experiences, and will play a deeper role in the e-commerce experience. Automakers have already been harnessing sound to enhance the online browsing and shopping experience, for instance, allowing users to hear the sound as users crank the car engine.

Smell

The wind/water/warmth technology by FEELREAL has been built to also incorporate scent generators via replaceable cartridges. There are more than 250 scents available—and, again, although that doesn’t yet mean that consumers can instantly breathe in the distinct aromas of the food or perfume being sold online, this is yet another step forward.

Taste

This is probably one of the more challenging aspects in terms of e-commerce at this juncture. While there are AR and VR experiences available that allow consumers to dine in style with headsets in tow, and sample fantastical culinary creations, the practical uses in e-commerce are still evolving. In the meantime, tech company Blippar, in conjunction with Indian beer chain The Beer Cafe, has an AR app that can tell you a beer’s place of origin, what it tastes like, and it’s country of origin, all by scanning a bottle. 

As mentioned, the VR/AR landscape is an ever-evolving area that has especially become even more useful during recent stay-at-home mandates. It will, no doubt continue to take shape within the holistic e-commerce experience, offering benefits to both businesses and consumers, and become even more accessible and affordable at the same time.

 

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Jim Kazliner is Shippo's Content Lead and Editor-in-Chief. His background spans business, retail, financial, and automotive sectors, as well as music and film journalism. When not spinning yarns on his long-suffering laptop, you’ll find him collecting vintage vinyl and obscure BMX bike parts.

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