In today's commerce environment, achieving success is more than building a digital infrastructure to support the influx of ecommerce buyers. It's about "wowing" them and, in a post-pandemic economy, businesses need to find engaging, innovative ways to do so in physical, digital, and hybrid spaces.
One area of immediate promise is augmented reality and the emerging market for AR Commerce. AR has been on the rise for years, but it took a pandemic to accelerate e-commerce, digital transformation, and most importantly, creativity and innovation. Now, with 61% of consumers delaying brick-and-mortar retail shopping, according to Ipsos research, AR Commerce represents an immediate opportunity to bring digital and hybrid shopping to life, creating immersive shopping experiences, from anywhere.
Before COVID-19, 51% of Americans stated that they prefer to shop online. But customers want more than digital transactions, especially after COVID-19.
In the "State of the Connected Customer" report, Salesforce research shows that 80% of business customers and consumers say that the experience of buying is as or more important as the product purchased. With digital becoming the first choice for a significant swath of customers, experiences -- in commerce, and throughout the customer journey -- are mission critical. In 2020 - 2021, as a result of the pandemic, we've seen customer expectations become centered on digital-first or digital-like experiences. In the same report, 88% of customers expect companies to accelerate digital initiatives. More so, 69% want businesses to offer new ways to get existing products/services, and 54% want expanded customer engagement methods.
This is an open invitation for AR to step up. Until AR glasses become a thing, augmented reality's current window to engagement is in the very device also driving e-commerce adoption, our iPhones and Androids.
Mediocre and unintuitive experiences are actually pushing customers away.
In fact, 51% of customers said that brands are failing to meet their increasingly high expectations and 76% report that it's easier than ever to take their business elsewhere. Said another way, they're switching from brand to brand to find an experience that matches their expectations.
In a rapidly evolving digital-first world, I don't think any business can afford to lose customers. So, how can brands close this growing experience gap and how can AR offer new opportunities to wow customers?
Physical store visits may not return to normal anytime soon. AR, specifically 3D-powered AR commerce, can make physical goods come to life, from shoes to golf clubs to industrial equipment including forklifts and machinery, virtually, letting customers explore vivid and nuanced details in the comfort of their home, office, or anywhere.
3D and AR solve a challenge facing e-commerce and digital shopping for years. Customers don't really know what the product actually looks like, its true dimensions in a physical space, and how it might appear in a particular setting. Customers often bought by taking a mini leap of faith. As a result, it's estimated that 22% of returns are due to the product appearance being different than what the website displayed. This is one of the important reasons that digital native e-commerce shops, such as Zappos, boasted flexible, easy, customer-centered return/exchange policies.
With 3D/AR, shopping experiences can increase a buyer's confidence that they are getting the right product even though they can't see it in person. This is one of the reasons that AR "virtual fitting rooms" or virtual placement layers are also helpful to all parties. It helps buyers feel confident with their purchase virtually while reducing the cost of servicing avoidable returns (which can be passed on to the customer), while also enhancing customer experiences to keep them engaged, i.e. not shopping elsewhere.
The latest generation of smartphones are more powerful than many PCs. The ability to power fully immersive, game-like 3D experiences in augmented reality is a reality, now.
Consider the visual experiences of the modern consumer beyond the eCommerce store. Many have metabolized a heavy diet of CGI and 3D via gaming and streaming.
Let's take 3D product configuration as an example. With creative AR graphics, UX, and UI design, buyers can zoom in, spin and add features to products in real-time.
For example, AR Commerce pioneer Threekit and TaylorMade recently launched a 3D powered configurator for golfers to design their own highly customized driver. The "My SIM2" builder provides shoppers with more to see than they would in a traditional onsite purchase journey. It also enables customers to see every buildable variation of the club. It would be impossible to do that in a physical showroom
Customers are already asking for this kind of dynamic, immersive environment in other parts of their digital lives. 83 percent of customers pointed to images as the most influential factor in their online purchase decisions. And in a recent Harris Poll, 60% of shoppers say they want to see products online in 3D and AR. Furthermore, they are willing to pay up to 20% more to get it. The ROI is there. Putting a 3D configurator on a brand's website has helped some brands to realize an immediate 30% increase in conversion and a 50% reduction in returns by implementing interactive 3D visuals.
Shoppers are keen to put these 3D products in their own space using augmented reality. Of all the future tech consumers are hearing about, 71.5% say that AR is the one they are most eager to use. The good news is, it's not actually a "future technology" at all. AR is readily available for brands that want to provide best-in-class experiences.
3D and AR have the power to make the entire e-commerce experience seamless for both buyer and seller. It's not just about letting customers configure a product in real time. It's about letting them configure, add on, have pricing update dynamically and check out, all in one visit.
It also connects the online world to brick and mortar. For example, a custom suit shopper can start their experience online and save the configuration, then go into the store and get help from a knowledgeable sales associate, who can verify their measurements, ask about fabrics and styles, and consult on which features tend to work well together. By combining the power of real-time interactive 3D with the kind of service you can only get from human associates, customers get a one-of-a-kind experience they can't get anywhere else.
And finally, 3D and AR experiences are only going to get better. Apple, for instance, is making big investments in consumer-facing LiDAR, a powerful scanner with depth-sensing capabilities. Then, there's the promise of 5G. Like most digital experiences, 3D and AR are at their best when they're super-fast and seamless. 5G claims a 10x decrease in latency. Imagine how many more impactful 3D product experiences customers can have at that speed!
Customers demand that businesses transform and innovate the experiences, digital and hybrid, to engage them, their way. This is an imperative and the costs are great for those that do not move fast enough. Those who move fast to implement 3D and AR will meet those expectations quicker--and smarter--than the rest. Those who reimagine commerce and experiences for this new, immersive, digital-first world, will literally design the future of customer experience.
This article was co-authored with Eron Sunando. Eron is a Vice President of Salesforce Commerce Cloud Go To Market and Transformation based in San Francisco. Eron works closely with some of our largest customers and partners to design their industry transformation strategies towards a more customer-centric and scalable digital commerce business. He has extensive international work experience spanning the United States, Hong Kong, Singapore and Japan in different industries and roles over the last 20 years. He holds a bachelor's degree from Boston College and an MBA from the MIT Sloan School of Management.