While uncharacteristically warm weather boosted retail footfall in June, there is no avoiding the fact that the outlook for Britain’s retail industry is not too healthy—hurtling towards a third quarter of decline. That’s not to say consumers aren’t spending. Last year, Visa Europe found that people were spending more on eating out, days out, and holidays than shopping on high streets. The rise of the “experience economy” is a well-known post-recession phenomenon, but it’s one that retailers have yet to fully capitalise on.
It is quite clear that consumers are no longer satisfied with the traditional retail experience. Shoppers want so much more than to be simply served—they want the physical experience to fit seamlessly with the digital and feel that their lives have been enhanced. To compete with the outdoor, leisure, and social activities that consumers are flocking to, retailers must provide them with an engaging in-store experience that goes beyond offering enthusiastic customer service and well-organised shopping aisles.
Bringing immersive, disruptive technologies—virtual reality (VR) and augmented reality (AR)—into stores has been tipped as a way for retailers to tap into the “experience economy” trend. Nearly a third of consumers believe retailers should invest more into adding augmented and virtual reality capabilities to their apps. However, as retailers strive for engagement, before investing heavily in leading-edge technology, they must determine whether the technology is right for them, and establish how to avoid the all-too-common pitfalls that can prevent it from being deployed to its greatest effect.
Experimenting With VR And AR
The ways that VR and AR aim to alter perceptions of reality to create an immersive experience are different and enhance the retail experience in distinct ways.
VR’s use of headsets aims to eliminate other stimuli, with the visor and the use of headphones to control auditory outputs creating a digitalised world that is eerily real. IKEA launched its own virtual store, which enabled customers to visualise a new kitchen in their home. M&S was an early adopter of VR, deploying the technology to create pop-up virtual reality showrooms as part of the launch of its homewares range.
Where VR aims to transport you to another reality, AR enhances real-life surroundings. Tesco used AR technology to allow customers to visualise key products within the comfort of their homes with an augmented version of its Home Book catalogue. Apple’s upcoming ARKit platform, set to be rolled out later this year with the new iPhone, means that the opportunities for retailers are only going to become broader.
Is It Worth The Investment?
While these examples demonstrate the exciting ways that retailers are already using VR and AR to enhance the shopping experience, they do not tell retail marketers what they want to know—is it worth the investment? Deploying VR and AR technology seamlessly into the shopping experience, across potentially hundreds of retail stores, and training staff requires significant input. Proper planning is crucial to the long-term success of AR/VR in retail.
This is where behavioural science comes in as a key tool for marketers. It is important to remember that despite the proliferation of technology and the impact this has had on consumer behaviour, the mental process shoppers use to make decisions remains unchanged.
Heuristics are the hardwired shortcuts all consumers use to make decisions, and the basis for behavioural science. There are 128 in total, and we have identified the nine that are most relevant to making purchase decisions. These “sales triggers” form a framework that makes behavioural science accessible and useable for retail marketers, helping to shape their strategies and inform marketing activity. Using this approach will help marketers determine the best deployment of VR/AR activity to enhance the customer experience.
When thinking about VR and AR, retailers could consider the value of ownership—one of the sales triggers. Ahead of the point of sale, consumers like to feel like they have some level of ownership without having to commit too much money or effort—it’s the classic sampling trick. VR and AR technology can enable consumers to try products before they buy.
Enhance The Bottom Line
VR can benefit a business’s bottom line too. Topshop’s use of VR technology enabled customers to select a garment off the rack and see it on themselves without trying it physically, creating an immersive shopping experience where customers could try a product they might eventually be enticed to buy.
However, it is vital that retailers remember that shoppers still like human contact, and our experience has shown that, without properly trained store staff or in-store promoters leading consumers to use the tech, it simply isn’t effective leaving headsets by the wayside. The investment must be made to ensure staff are as committed to the technology as the retailer is.
When deciding whether VR or AR is worth the investment, it is important that retailers have considered the role of their store in the purchase process and, in particular, the type of products they intend to enhance with AR or VR activity. This insight will allow retailers to develop a measured strategy for implementing VR and AR technology in a way that creates an exciting retail experience, not only increasing footfall but crucially driving more sales.