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AR and AI: a match made in heaven for manufacturers and retailers?
3D and AR

AR and AI: a match made in heaven for manufacturers and retailers?

Written by

Vickie Scullard

|

June 20, 2023

Table of contents

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All eyes are on the Apple Vision Pro headset, which was introduced by CEO Tim Cook earlier this week. Its ground-breaking technology allows a user to interact with and manipulate both physical and virtual items and environments while navigating by using eyes, hands, and voice.

It is a glimpse into the new realm of what has been branded as spatial computing – an array of mesmerizing virtual (VR) and augmented reality (AR) experiences.  

The combination of AR with AI technologies is powerful for D2C manufacturers and retailers, offering them the opportunity to deliver engaging, personalized, and data-driven shopping journeys.

Looking ahead, AI and e-commerce investor TS2 predicted that the two technologies will continue to play an “increasingly important role in providing customers with a more engaging and enjoyable shopping experience.”  

Try out your own augmented reality (AR) experience now

AR, VR, AI, and why they are important

AR and VR work very differently. AR places digital information to the shopper's physical environment in real-time, such as 3D objects, filters, photos, and video. VR allows shoppers to view and interact with 3D objects in a computer-generated environment, such as a virtual showroom.

AI is the field of computer science that focuses on developing intelligent machines capable of performing tasks that typically require human intelligence, such as learning, speaking, providing recommendations, prescribing, and solving problems. It involves creating algorithms and models that enable machines to analyze data, make decisions, and adapt to new situations.  

With AR, AI is taken into the spatial realm. Research from Klarna found that AR, AI and robot shopping assistants will dominate the in-store and online landscape for the next generation of consumers. In particular, 81% of those surveyed expect AR to be a part of their in-store shopping experience.  

Both technologies are poised to become the preferred interfaces for users and buyers.  

Why retailers should care

It may sound like something that only the gaming or entertainment industries should be concerned about, but the simple fact is companies that do not integrate these technologies in their customer journey and internal operations will quickly lose their competitive advantage in the market.  

Before the Apple headset is launched officially in 2024, retailers must be up to date with what their customers want – and expect – when they engage with the brand. By adding AR and AI interfaces to the shopping experiences, beyond 2D images, it will give superpowers to manufacturers, retailers, and users.

It is not the first time that a tech giant changed commerce as we know it – Apple’s App Store and Amazon Marketplace prove the point.  We've seen customers alter their buying habits when new distribution channels appeared, with more efficient and experiential ways providing the control, convenience and confidence that is necessary to make purchases.  

READ MORE: Stagwell CEO Mark Penn predicts AR and AI will revolutionize digital advertising industry

Examples of AI in retail

According to research at Presidency University in India, AI is “bridging the advantage gap between brick and motor stores and online stores.”

On an average mobile phone or tablet, there are likely to be several applications that use AI, so you may have used the technology without even realizing it.

Voice user interface (VUI)

VUIs enable users to interact with AI systems through spoken commands or queries. Voice assistants like Amazon's Alexa, Apple's Siri, or Google Assistant are examples of VUIs. They use speech recognition and natural language processing to understand and respond to users' voice inputs.

Natural language processing (NLP)  

NLP interfaces enable users to interact with AI systems using natural language queries, commands, or conversations. These interfaces leverage techniques like text-to-speech and speech-to-text to understand and generate human language, making communication more seamless and intuitive.

Examples of NLP interfaces in commerce include chatbots, which are proven to speed up the information search process by “asking the right questions while providing personalized interaction and communication”. Other examples are voice assistants and language-based search systems that facilitate efficient and effective communication between businesses and customers.

AR in retail  

Presidency University’s research continues to say that augmented reality is a “market disruptive technology” which is “taking the online business by a storm”.

The technology allows buyers to visualize products with a high degree of quality in their unique physical environments, using just their phones or headsets. Brands and manufacturers can ‘deliver’ their products and memorable experiences to their customers on demand, so they can inform their purchase decisions when the time is right for them.  

AR experiences

Retailers leverage AR to gamify the shopping experience and engage customers. They create AR-based games or experiences that encourage customers to interact with products or discover hidden offers and discounts. This adds an element of fun and excitement to the shopping process, attracting customers and enhancing brand loyalty.

See in your space

By displaying virtual items in their own home, buyers can visualize the goods they want to buy without the need of a tape measure. For instance, if a consumer is shopping for a dining table, they can find the one they want, scan their space with their mobile device, and then the item will appear there in its real-time dimensions.  

Combining AI and AR: The benefits for businesses

According to a recent study, customers who used AR while shopping spent approximately 20% more time exploring the offerings and viewed 1.28 times more products in comparison to those who did not use AR. Importantly, the probability of AR-engaged customers making a purchase increased by nearly 20%.

In commerce, the intersection of AI and AR is reshaping traditional retail models and giving businesses unprecedented tools to innovate because brands can give clients a more individualized and engaging buying experience.

It is the fusion of visual and personal that is key. By making personalized recommendations, expanding search capabilities, and optimizing the entire purchasing experience, AI enhances the client’s experience. Additionally, it can aid merchants in improving their pricing, inventory control, and supply chain management, resulting in higher profits and lower expenses.

AR is equally advantageous because it overlays digital data in the real world, meaning that it can give customers a more engaging experience. Customers may, for instance, use AR to visualize a product in their house before making a purchase.

Headsets, such as the Vision Pro, are the perfect hardware to experience these technologies together.  As well as improving the buying journey for the user, brands can take advantage of 3D and AR advertising.

This is already available on mobile devices and the next step will be hands-free, enhancing the immersive experiences we currently have.  

READ MORE: Is the future of retail VR or AR? What's the difference?  

Use cases of AI and AR in commerce

There are already a number of examples of the technologies working together in commerce. These are all available now for you to integrate into your online shop without any code or image manipulation.

Recommendation engine

According to Big Commerce, 35% of purchases made on Amazon result from recommendations. AI algorithms can process customer profiles and analyze product attributes, customer reviews, and other relevant data to generate personalized recommendations, in an AR environment. The recommendation engine utilizes machine learning techniques to continuously improve and refine the recommendations based on customer interactions and feedback.  

Virtual assistants  

AI can power intelligent virtual assistants within AR environments, such as XHolo AR. These assistants can guide customers through the shopping process, answer queries, offer product suggestions, and facilitate seamless transactions. They can mimic human-like interactions, providing a personalized and efficient shopping experience.

Virtual showrooms

AI-driven product recommendation systems can work in conjunction with AR to create personalized virtual showrooms, for example BMW. AI algorithms analyze customer preferences and past interactions to curate a selection of products, which are then visualized in AR-based virtual showrooms. Customers can navigate these virtual environments, interact with the products, and receive personalized recommendations and information, creating immersive and personalized shopping experiences.

Customer support

AI-powered chatbots and virtual assistants can be integrated into AR interfaces to provide enhanced customer support. IKEA Place offers a dynamic, immersive shopping experience for furniture, with a chatbot assisting customers in navigating the technology. When customers interact with AR experiences, AI algorithms can understand their queries and provide real-time assistance.  

Data analytics and insights

AI and AR can provide valuable data analytics and insights to retailers. By analyzing customer interactions, preferences, and engagement patterns within the AR environment, retailers can gain a deeper understanding of their target audience. This data can be used to refine marketing strategies, optimize product offerings, and personalize the shopping experience further.

The future is now

The time is now for businesses to develop an AR and AI strategy that informs their operations, service offerings and delightful customer experiences.  

The good news is that companies do not need coding skills to implement AR into their commerce operations and online stores. The right technology partner can get you up and running in just a few days with state-of-the-art AR solutions.  

Enhance offers a no-code, web-based 3D and Augmented Reality SaaS for commerce and advertising. To find out more, try a product demo to begin your company’s AR journey.

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