Technology
Why retailers should embrace augmented reality in the wake of COVID-19
Vertebrae Founder and CEO Vince Cacace shares insight on why and how retailers, battling through the coronavirus pandemic sales environment, should put AR at the top of the to-do list and offers up best practices for a successful deployment and integration.
May 19, 2020 by Judy Mottl — Editor, RetailCustomerExperience.com & DigitalSignageToday.com
It's a challenging time for retail but technology can prove to be a lifeline and that's the case when it comes to augmented reality.
In the wake of COVID-19, in which retailers worldwide shut down for months, retailers using AR are enjoying a 19% spike in customer engagement, according to data from Vertebrae, and the customer conversion rate increases by 90% for customers engaging with AR versus those that don't.
And that's just two compelling reasons why AR should be at the top of the retailer's to-do list, according to Vertebrae Founder and CEO Vincent Cacace. Vertebrae is a Facebook AR partner and works with brands like Coach, Crate and Barrel, Toyota, 1-800-Flowers, CB2, Adidas and many others.
Retail Customer Experience reached out to Cacace to get greater insight on the power of 3D technology and AR is bringing to the e-commerce experience.
Q. The COVID-19 pandemic is clearly altering and will further alter how retailers approach customer experience and engagement -- and your own client data reveals AR engagement is up nearly 20% and the conversion rate increases by 90% for consumers engaging with AR compared to those that don't. What is driving that behavior – is it the consumer embracing AR or retailers doing a better job with AR?
A. A mixture of both. Consumers are displaying a higher level of consideration as they make purchases online for items that they would typically go to a store to see, touch, and feel. Because of this, they are more open to trying newer experiences like 3D & AR that answer questions and give them the confidence to buy - like “how big is it?”; “how does it look on me or how does it look in my space?” and “what are the details?” Another reason for increased consideration is that they definitely don’t want to make a trip to the post office to process a return.
For retailers that were not early adopters or part of the early wave of retailers enabling 3D and AR on product detail pages, there has been an inertia shift. This inertia that previously held them back from focusing on immersive content is now, out of necessity, forcing them to do so. Retailers are looking at us as the Zoom for commerce. And what better way to increase focus on digital than to give all consumers the ability to seamlessly shop using 3D and AR as if they’re in the physical store.
Even before COVID-19, shoppers were telling us these tools had value -- more than half of participants in a survey said they wanted AR help visualizing how products would look in their environments, and a quarter wanted to virtually try on new makeup or clothing. And demand has only grown since then.
Another reason 3D and AR shopping experiences are especially helpful right now is that they’re designed for mobile, which is where everyone’s shopping now that many are away from their workplace computers. 3D and AR solve some of the top hurdles to mobile conversion, by utilizing all the features of the device like the depth camera, gyroscope, webGL, and more.
Q. For the retailer that hasn't moved forward with AR technology, what are some initial best practices to avoid potential challenges and issues?
A. The process is actually quite simple to think about. You need photorealistic 3D assets for your product catalog, and you need to display those in ways that they can add value and ultimately improve ecommerce performance.
However, there is a lot of complexity throughout the value chain, and there is inevitably someone on every innovation team that claims they can build this themselves and save money. We have never seen this strategy work. Once you get below the tip of the iceberg, the amount of features and functionality required to implement a proper scalable workflow for creating, QA’ing, managing, deploying, syndicating, and reporting on 3D and AR content is incredibly complex - and brings with it many challenges that aren’t noticeable until they cause issues.
Best practices are to start with a reasonable amount of products that you know the performance of and can benchmark against, and have incredibly thorough A/B testing in place with different variants that can iterate and improve upon different user flows, CTA’s, functionalities, instructions, etc.. Then retailers can use the incremental revenue lift to fund additional asset creation across the catalog, while optimizing for engagement.
Best practices for a mass merchant retailer are to produce 3D assets of core, exclusive, and private brand products, and then setup a system to make it easy to pull in assets from national suppliers in formats that are industry standard. This yields having the largest 3D catalog with a mix of proprietary assets, while still not having to invest in creating 3D for all of the products that you sell.
At Vertebrae, we’ve invested many years and millions of dollars in a platform for end-to-end immersive commerce -- from 3D asset creation to deployment to analytics and reporting. And we’ve made a platform that marketers and merchandisers can use to control assets, just like they do 2D images, so brands’ internal resources can be dedicated to selling, not finding and hiring the right IT specialists.
Q. From talking with your clients and working with them have you heard any common misconceptions about deploying AR in retail – whether they view it as too costly or not able to manage it internally?
A. I’ve heard people say that AR is nice looking but not hardworking. That’s something of a dated misconception, stemming from when 3D and AR tools were mostly buried in apps and only reached maybe 5 percent of a brand’s audience. We’re able to use 3D and AR as freely as standard images, which means they can be workhorses, and not just for show.
The utility of 3D and AR is also spreading rapidly. In addition to product detail pages, 3D & AR can be used in paid media in digital and social. They can and are being used in Google Search results, with more and more functionalities coming online across channels every week.
We’ve also worked with Facebook on launching AR advertising and commerce initiatives, both on Facebook and Instagram; social media is another area of growth for immersive commerce. And with syndication capabilities, brand manufacturers can share 3D and AR assets with dealer partners and help drive sales through those channels. So, we view 3D and AR as very hardworking even now, and much more so in the very near future.
Q. What are some tips and advice for the retailer striving to get AR up and running in an efficient, cost-effective approach – any 'don'ts' they should avoid?
A. Thanks to online personalization, we all now acknowledge that shopping isn’t a generic experience. Retailers should apply that same concept to their product catalog, and if cost is an issue, immersive doesn’t need to be uniformly deployed across the entire catalog all at once. You can prioritize 3D and AR development based on your top 25 products, or the single category that is most suited to immersive experiences, or the new or seasonal trend pieces that you want to highlight through social AR. We’ve also seen 3D and AR used effectively to encourage buying higher price point items; for example, CB2 found that product pages featuring 3D and AR experiences drove 21% higher revenue per visit and a 13% lift in average order size.
It’s also important to understand exactly what you’re paying for. Skimping on 3D asset quality is never a good idea; 3D is an effective selling tool in its own right, as well as the foundation for AR, so it’s important to get it right. On the flip side, we’ve seen retailers overpay for asset creation; for example, paying multiple times for a single SKU because it comes in different colors or textures. We offer a configurator tool that allows retailers to start with a single 3D model in grayscale and then apply different textures or colors, eliminating the need to pay individually for every different iteration of the same product.
And finally, don’t underestimate the effort required to get effective, multichannel 3D and AR up and running. There are countless numbers of retailers who have come to us after failed attempts at managing their immersive commerce in-house. This is not only costly because they’ve squandered the internal resources, but it also puts them behind the competition because they have to essentially start over. I sometimes liken it to home cooking versus running a restaurant; making a remarkable meal for your family doesn’t necessarily translate into running a successful eatery. Restaurateurs need to standardize recipes, source wholesale ingredients, and deliver at scale consistently for eat-in and (increasingly) take-out and delivery, all while keeping a close eye on what resonates with diners as well as the bottom line. Similarly, while it's relatively easy to produce a one-off AR experience using a 3D file, it's another to build a library of Web-first, commerce-ready 3D and AR assets that meet formatting requirements across devices and touchpoints, to track performance using metrics that capture engagement and interaction, and manage deployment strategically to meet changing consumer expectations.
About Judy Mottl
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