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How 3D and augmented reality benefit bricks-and-mortar retail
3D and AR

How 3D and augmented reality benefit bricks-and-mortar retail

Written by

Rod Reynolds

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February 6, 2024

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Recent years have seen a number of blue-chip brands investing in their bricks-and-mortar operations, defying pandemic-era expectations that online shopping would come to replace physical sales. This article examines the more nuanced and complex picture that has emerged, providing insight into the consumer mindset and technological advances that are reshaping the future of shopping.

Retail sector dynamics

Bricks-and-mortar retail is enjoying a resurgence. According to data cited by Shopify, US retailers opened twice as many physical stores as they closed in 2022, while the Economist Intelligence Unit (EIU) predicts that “2024 will see the strongest pace of growth for offline retail since the post-pandemic rebound of 2021.”

The COVID-19 era prompted significant changes in consumer behavior as lockdowns forced physical stores to close their doors and drove shoppers online. A 2020 report by IBM estimated that the pandemic had accelerated the shift from physical stores to online shopping by five years – encapsulating the view held in many quarters that the change in consumer habits would inevitably lead to e-commerce overtaking physical sales as the dominant segment within retail.

But data from the sector reveals a more complicated picture. By 2022, 94% of US consumers had returned to in-store shopping, while US Department of Commerce figures revealed e-commerce sales accounted for just 15.5% of total retail sales in Q3 2023 – a figure the EIU forecasts will remain the same in 2024. At the same time, growth in e-commerce sales is expected to remain strong, with the EIU predicting an increase of 10.5% in 2024.

A recent article in the Financial Times titled “How online shoppers fell back in love with the high street” highlighted the strong rebound in share prices for British high street institutions such as Marks & Spencer as evidence for the resurgence of in-store shopping. Meanwhile, a host of big-name retail brands, including Primark, Kohl’s, IKEA, and Target have invested in their bricks-and-mortar operations in recent years, opening new locations and updating existing ones, integrating interactive and engaging in-store experiences. Even Amazon, the world’s largest online retailer, stated in 2023 that “physical retail remains an important part of our business.”

Nonetheless, the same FT piece notes that, in the bellwether sector of clothing, despite a drop-off from their pandemic-era peak, online sales remain well above 2019 levels. With both online and offline sales rising and brands seemingly hedging their bets in terms of which channel to prioritize, the direction of travel in retail now seems unclear. It’s here where a closer examination of consumer behavior offers crucial insight.

Shoppers want the best of both worlds

“Stick to new COVID-19-era habits, or go back to the old ways of doing things? For most US consumers, the answer seems to be ‘both’.” That’s one of the conclusions of a study by consulting giant McKinsey, which found that 75% of consumers in the US shop both online and in-store.

Pandemic-era lockdowns drove millions of consumers online, particularly in categories they might traditionally have shopped for in-store. One of the effects was to introduce them to innovations such as augmented reality (AR) product visualizations and virtual try-ons, which provide an immersive shopping experience, allowing buyers to get up close and personal with products in a way only previously possible in a physical setting.

It's no surprise, therefore, that in a post-pandemic world, consumers wowed by the best e-commerce experiences want to retain the convenience, transparency, and personalization on offer, even as they take advantage of the freedom to return to in-person shopping. According to IPSOS, 77% of shoppers want to use AR to interact with products before buying, while 82% feel more confident in purchases as a result of using AR. But this is just the tip of the iceberg.

Customer journeys are no longer linear, taking in different touchpoints and weaving between physical and digital engagements. Catering to this new world of omnichannel shoppers is the challenge firms are trying to adapt to as they determine how to prioritize investments in their physical and e-commerce properties, with McKinsey noting that “providing a seamless experience in both online and offline channels is becoming table stakes for brands and retailers.” In this context, 3D and AR offer a host of compelling solutions.

Personalize and visualize in augmented reality by clicking on "See in your space".

Bridging the physical and digital realms

By overlaying digital content onto the users’ physical environment, AR provides the perfect vehicle to enable a seamless customer journey. Here are four key ways brands can use immersive shopping experiences to meet the changing expectations of customers:

1. AR elevates the online buying experience

With live configuration functionality, product visualizations, and virtual try-ons, AR lifts the customer journey above the norm, delighting shoppers and enabling brands to offer the kind of immersive and personalized experiences omnichannel shoppers have come to demand. Launched directly from the product page, using just a smartphone or tablet, the process is seamless and immediate, providing a lifelike shopping experience wherever the customer chooses to shop from.

2. …and brings the pleasure back to in-store visits

AR allows customers to browse and research products in a state-of-the-art digital environment, whenever – and wherever – they choose to shop. And for brands, immersive shopping ensures that customers encounter the best and most realistic representation of their product: presented in 3D and augmented reality, customizable, and ready for them to visualize in their own spaces with just the tap of a button. This eliminates the need for shoppers to traipse from store to store, sorting through tens or hundreds of product options, and relying on guesswork to judge if the selected item is the right size, fit, and color for its intended space. Trips to store become a fun part of shopping again, a social experience to excite and enthuse customers.

3. In-store AR unlocks new possibilities for retailers

As well as enhancing online platforms, AR can lift the in-store journey with new innovations and experiences. AR displays and ‘mirrors’ can complement physical displays, inspiring customers and reducing space and inventory requirements for retailers. When beauty brand MAC launched its AR-powered try-on tool, allowing customers to interact with its cosmetics range via an in-store smart mirror, it saw customer engagement increase by 200%.

4. AR is the unifying solution brands are seeking

In an omnichannel shopping landscape, AR is the everywhere, always-on solution that can unify a brand’s physical, online, marketing, and social channels into the seamless journey buyers want. This is a priority for businesses as, according to Google, 60% of all buying journeys begin online, while for big-ticket purchases such as furniture, up to 80% of the customer’s buying process takes place at home as customers browse and research on a digital device.

But many of those journeys still involve visits to store to asses suitability and quality in person. In these instances, lifelike 3D and AR visualizations make it less likely the purchase will be abandoned because the real-life item doesn’t meet expectations. Meanwhile, for customers inspired by a product they see while browsing in-store, 3D and AR extend the shopping experience by allowing them to visualize the item in the own space when they get home, making it more likely they go on to complete the purchase. 

Easily deployed via QR code or a snippet of web-responsive code, AR experiences can be launched from any physical or online platform, and immediately deliver a lifelike and personalized shopping experience to the consumer, meeting them where they are. Even for traditional bricks-and-mortar retailers such as Home Depot, integrating 3D and AR in this way has been an unmitigated success, with conversion rates for customers who use the their immersive tools double or triple those of customers who do not.

Shopping reimagined

The paradigm of in-store versus e-commerce is an outdated one. For retailers, it’s no longer a question of which approach will prevail or which to prioritize; consumers want to mix-and-match the best parts of both worlds and expect companies to make that journey seamless, personalized, and immediate. Immersive technology makes that possible.

“3D and AR make the frustrating parts of shopping fun again, by allowing consumers to enjoy browsing, customizing, and purchasing products from wherever they are, in a way that feels real,” says Rafael Muñoz, Founder of Enhance XR. “All the heavy lifting of searching for products and finding the right items can be done from the comfort of home, allowing physical stores to be reimagined as exciting destinations that add value to the customer journey as social experiences.”

As consumer behavior continues to fuel growth in both bricks-and-mortar and online commerce, with changing expectations of what each can offer, the business opportunity for brands that can leverage those dynamics is a tantalizing one. The key question for retailers today is how to thrive in an omnichannel environment. 3D and AR offer the perfect solution to this challenge, bridging the gap between the physical and digital world that, as far as consumers are concerned, no longer exists.

Contact Enhance today for more information on how to create 3D models for your business.

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