Insights

Augmented Reality Reduces the $761 Billion Retail Returns Challenge

by Scott Lester - March 2, 2022

The internet has fundamentally changed the way we shop; providing consumers with the ease and convenience of being able to make purchases from anywhere, and at anytime. In fact, a recent story on CNBC and data from the NRF (National Retail Federation) states that online sales account for 23% of the $4.53 Trillion of total US Retail Sales in 2021. However, there is a headache brewing for retailers and suppliers as this channel grows to become a significant share of total volume sales — nearly $761 Billion worth of merchandise is returned annually. In fact, the return of products purchased online increased to approximately 20.8% by the end of 2021. That is a daunting percentage of unsatisfied consumers and a big expense when you think about costs like free shipping that reduces your margins.

In order to thrive in a digital first economy, retailers must deploy new strategies to reduce returns to drive a healthy business for their shareholders. This is where tools like shopping in Augmented Reality play a critical role in driving long term value for both the shopper, the retailer and the products they sell. Augmented Reality reduces the imagination gap by letting people place products in their environment to see the physical dimensions before making a purchase. By allowing customers to virtually “try before they buy,” you’ll provide them with more information that will reduce return rates. In fact, recent findings from Eyekandy Insights has uncovered that 63.33% of shoppers state that they would favor a retailer that offers Augmented Reality services over one that does not. And, Shopify has even reported that returns decrease by as much as 40% when AR/3D visualization is added.

SO, WHAT ARE SOME EASY TACTICS THAT RETAILERS AND SUPPLIERS CAN DEPLOY IMMEDIATELY TO SOLVE THE RETAIL RETURN DILEMMA?

It does not matter if you are selling consumer electronics, furniture or cosmetics, implementing Augmented Reality on the product description pages of all ecommerce channels is the foundation to your AR strategy. Services, like Eyekandy’s Point & Place® platform allows you to easily scale AR features to enhance the on site shopping experience. The added benefit is that AR makes shopping more fun for the consumer.

Once you have a solid foundation in place; there are additional tactics you can deploy to assist the customer along on the path to purchase.

AR SALES AVATARS ‘BOTTLE THE LIGHTNING FOR THE PERFECT PITCH

Utilize AR Sales Avatars to help educate shoppers on product benefits. This technology uses animated avatars or volumetric holograms to place your best salesperson in the shoppers space to deliver the perfect pitch. It fuels shopper confidence to make an informed purchase decision, while bringing the ‘art of storyselling’ to your category and product description pages. A major benefit in executing Avatars is 100% control over the narrative on the exact product attributes and features that you want to highlight in a minute or less.

For instance, when a user visits the Product Description Pages (PDPs) of Intel® Evo™, they can launch an AR Sales Avatar that Eyekandy created to tell the brands story of purposeful technology in a highly innovative way.

BLEND LIVE VIDEO WITH AR TO BOOST SHOPPER CONFIDENCE

Integrating Live Chat technology with Augmented Reality is a great way to bring your actual in-store sales team into the consumers home for higher consideration items. From that new workout equipment to your baby registry, live video allows your sales team to guide the shopper on a journey, while consulting them on how the product fits (or looks). It’s a more personalized approach that brings human elements to shopping in AR.

For example, Ebuyer uses live video technology to sell more laptops. As a digital pure play, many of their products are high end servers that require a face to face conversation for the buyer to fully understand the technicalities. The more they can communicate during the selling process, the less likely the transaction will result in an unhappy customer — a win, win for the retailer and the brand!

In conclusion, returns can have a significant impact on your business that results in excess inventory and costs to your bottom line. However, savvy retailers and brands are accelerating their digital toolkits to quickly offer services like Augmented Reality to their customers. It’s a surefire way to future proof your business!

Are you looking to revolutionize the shopper journey with AR?
BOOK A MEETING with our experts today for a consultation.

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