Augmented Reality in eCommerce: The Answer To Boost Sales & Cut Returns (2024)

"Augmented reality is the ‘boy who cried wolf’ of the post-Internet world — it’s long been promised but has rarely been delivered in a satisfying way.” — Om Malik, the founder of GigaOm, a technology writer quoted.

Augmented reality is usually viewed as big promises with few real-world results. But in eCommerce, AR is finally stepping up and delivering on its potential. It’s helping retailers boost sales and cut down return rates by bridging the gap between online browsing and in-store shopping.

In this blog, we’ll explore how AR is transforming the online shopping experience and why it’s quickly becoming essential for retailers aiming to stand out

What is Augmented Reality?

Augmented Reality (AR) is a technology that overlays digital elements onto the real world, blending virtual and physical experiences through smartphones, tablets, and AR glasses. 

In eCommerce, augmented reality allows customers to interact with products digitally, offering a “try-before-you-buy” experience that brings an in-store feel to online shopping. 

Augmented reality lets customers see products as if they’re right there with them, whether it’s a new couch in their living room or shoes on their feet. This realistic experience boosts buyer confidence and cuts down return rates.

Types of Augmented Reality

Augmented Reality in eCommerce comes in a few main forms, each enhancing customer experiences differently:

1. Marker-Based AR: Uses physical markers or QR codes to activate AR features. Scanning a code can bring a product to life in 3D, allowing customers to view details in an interactive format.
2. Markerless AR: Recognizes physical environments without a marker, allowing users to place virtual objects in real spaces (e.g., seeing how furniture fits in a room).
3. Projection-Based AR: Rely on projectors to show virtual images onto surfaces (walls, floor); it’s common in interactive displays but less used in personal eCommerce applications.
4. Superimposition AR: Replaces parts of the real world with digital elements, often used in virtual try-ons for fashion or beauty products.
5. Location-based AR:  Uses your device's GPS to overlay digital content onto the specific real-world location, like Pokémon Go.

What Are AR's Benefits and Drawbacks?

AR offers clear benefits, especially for online retailers aiming to bridge the sensory gap between digital and physical shopping.

eCommerce Niches That Thrive With Augmented Reality (AR)

Some product categories stand out as perfect fits for Augmented Reality in eCommerce, as they benefit most from virtual visualization. Here are 4 best-fit sectors you may consider if your business is one of them:

AR in furniture 

Retailers like IKEA used AR to let customers place furniture in their rooms, visualizing how pieces will fit and look in their spaces. It helps customers see true-to-scale dimensions and assess style matches, which are otherwise challenging online.

AR in fashion (shoes, clothes)

Fashion brands, like Nike and Gucci, offer virtual try-ons for shoes and clothing. Customers can see how items look on them through smartphone cameras, helping them find the right style and fit before purchasing.

AR in beauty (jewelry, makeup)

Beauty brands also join the AR race to let customers try on makeup shades, jewelry, and accessories digitally. 

AR in shopping

Many eCommerce sites now allow customers to visualize a product’s size, color, and design variations, enhancing confidence in shopping for a wide range of products, from electronics to home decor.

AR’s Impact on eCommerce: Real-World Statistics  

Let’s take a look at the numbers that highlight AR’s game-changing role in eCommerce.

• Higher Engagement and Conversion Rates: AR-based eCommerce experiences are shown to be 200% more engaging than non-AR counterparts, as a more interactive shopping environment will encourage customer to better exploration and decision-making.
• Increased Purchase Likelihood: 57% of customers are more likely to purchase from a brand that offers AR experiences, as it enhances the online shopping experience by allowing users to visualize products in a realistic way.
• AR is Driving Retail Growth: According to PwC, AR and VR are forecasted to add up to $1.5 trillion to the global GDP by 2030. Augmented Reality in eCommerce is not only a trend but an expected feature, particularly among younger demographics. This adoption opens up opportunities for retailers to reach more tech-savvy consumers who seek an interactive, engaging shopping experience.
• Reduction in Product Returns: Deloitte's report that AR-guided purchases led to a 25% decrease in returns. By providing a clear view of product size, or appearance, AR reduces the chances of customers returning items, thus benefiting retailers by lowering return-related costs and improving customer satisfaction.
• AR's Impact on Customer Behavior: AR-enabled product interactions can boost conversion rates by 94%, and 50% of Snapchat users report that AR helps them feel more confident about product quality. 
• Customer Willingness to Pay More: A study shows that 40% of consumers are willing to pay more for a product if they can personalize it through AR. This demonstrates AR’s power in enhancing perceived product value by offering customization options that deepen customer connection and satisfaction.

How is Augmented Reality Different From Virtual Reality?

The key difference between Augmented Reality (AR) and Virtual Reality (VR) lies in how much of the experience is digitally created.

• In Virtual Reality (VR): About 75% or more of the environment is computer-generated, fully immersing you in a digital world that replaces the real one.
• In Augmented Reality (AR): The digital component is limited to around 25% of the experience, adding overlays to the real world rather than replacing it. In other words, AR enhances your view of reality, while VR immerses you in an entirely new digital space.

7 Futuristic Innovations of Augmented Reality in eCommerce

1. Virtual try-on 

You, me, and your customers have all been there—loving an outfit at first sight but finding it not quite right at home.

Virtual try-ons are truly changing the game in eCommerce, allowing customers to go beyond simply seeing how clothes, shoes, or makeup might look. It empowers customers to make smarter choices, reduce environmental impact, and offer an enjoyable, hassle-free shopping experience that builds confidence and connection.

2. 3D Product Visualization

3D product visualization lets customers explore every angle, detail, and texture of a product as if they’re holding it in their hands. This interactive feature allows users to zoom in, rotate, and inspect products, enhancing product transparency and helping customers feel more informed. 

Shopify and Amazon have embraced this cutting-edge technology, offering shoppers a clearer view of products like furniture, electronics, and home decor.

3. In-Home Product Placement

In-home product placement takes AR a step further that customers can place virtual items in their own space to see how they fit before buying. This is particularly popular with furniture and home decor, where fit and style are essential.

4. Interactive Product Manuals

Instead of reading complicated instructions, customers can view 3D step-by-step guides through their smartphones. It is ideal for electronics, furniture, and DIY items, improving customer satisfaction and reducing post-purchase support calls.

5. Personalized Shopping Experiences

By recognizing customer preferences and tailoring product recommendations in real-time, AR helps brands to offer highly personalized experiences. For example, fashion brands can suggest outfits or accessories based on customers’ previous try-ons or purchases.

6. Enhanced In-Store Navigation

By scanning store layouts, AR can guide customers to the exact location of products on their shopping list, display item details, and even showcase promotions. 

This can help improve in-store experiences, particularly in large retail stores, by blending online convenience with the tactile experience of in-person shopping.

7. Gamified Shopping Experiences

Gamification with AR can turn shopping into an interactive, fun experience. Brands leverage AR in marketing campaigns to offer rewards, virtual scavenger hunts, or mini-games where customers earn points or discounts. 

Pokémon GO-inspired AR experiences bring an element of exploration to the retail world, encouraging brand interaction and customer loyalty.

A Basic Guide to Bring Augmented Reality to Your Online Store

1. Clear objectives

What’s the goal of your AR application? And just as importantly, how will it enhance your customers' experience?

Answering both questions is essential because while the first defines your vision, the second determines the impact. Your AR solution can go from good to exceptional if it’s built with a clear purpose that’s centered on customer experience.

2. Choose a AR-enabled software platform

If you’re selecting an AR-powered platform, consider a few key factors. First, check the license type, especially if you’re on a budget—many platforms offer free versions. Remember to make sure the platform supports your intended hardware, whether mobile, laptop, or AR glasses. 

Also, look for compatibility with all operating systems you plan to use, especially if you’re developing for multiple. Finally, assess the platform’s features to ensure they align with your app’s needs.

3. Consistent improve user experience

A successful AR experience isn’t a one-time setup; it requires regular updates and improvements. Collect customer feedback and monitor data to identify areas for improvement. Consider testing new features, refining visuals, and simplifying navigation to make the experience as user-friendly as possible.

How Pioneering Brands Are Leading the Shift to AR in eCommerce

IKEA 

The Challenges: With nearly 40% of customers uncertain about purchases without a trial view at home, IKEA recognized a significant challenge in furniture shopping: the “imagination gap,” where customers struggle to envision how large furniture items will fit and look in their own spaces

How IKEA applies AR: IKEA introduced the IKEA Place app for customers to use AR on their smartphones to view true-to-scale 3D models of furniture in their own rooms. 

Customers simply point their cameras, and the app overlays virtual furniture in the selected space, showing how it looks and fits alongside existing decor. The app also incorporates sound effects and haptic feedback to make the virtual furniture placement feel even more realistic. 

Successfully, it initially launched with around 2,000 products, with plans to expand to over 10,000 items, making AR a scalable solution for IKEA’s vast catalog.

Nike

The Challenges: Nike reports that around 60% of people worldwide wear incorrectly sized shoes, with nearly half a million customers in the U.S. and Canada voicing this issue in online orders. Misjudging sizes leads to higher return rates and dissatisfaction, affecting customer loyalty. 

How Nike applies AR: Nike introduced the Nike Fit feature in its app, allowing customers to measure their feet using AR. By scanning a smartphone camera, Nike can measure each foot individually with accuracy within 2mm so consumers can find the right shoe size.  

Future Trends and Opportunities of Augmented Reality in eCommerce

The future of augmented reality (AR) in eCommerce is bright, with significant innovations transforming the online shopping experience. Here are some key trends and opportunities on the horizon:

• AI-powered integration: The fusion of AR with AI will create smarter, context-aware experiences. By using AI, AR applications can analyze data, recognize patterns, and provide personalized insights.
• Industry-specific applications: AR's applications are broadening beyond retail, with significant impact anticipated in sectors like healthcare, manufacturing, and education. Industry-specific AR solutions - such as AR-enabled medical simulations, smart factory applications, immersive training modules, and educational programs.
• Virtual showroom: Virtual showrooms are quickly becoming a standard for brands that want to offer a near-physical shopping experience online. Customers can explore fully virtual environments where they can interact with products as if they’re in a real store.
• Wearable AR device: Advancements in wearable AR tech, such as smart glasses and headsets, are on the horizon. These devices are expected to become sleeker and more functional, offering seamless integration into business processes like remote support, training, and on-site maintenance.

Closing Thoughts

As we move into 2024, augmented reality is no longer just an emerging technology—it's a game-changer for eCommerce. 

Augmented reality in eCommerce allows retailers to bridge the gap between physical and digital shopping, offering customers immersive, interactive experiences that boost confidence, increase engagement, and ultimately drive sales. AR not only reduces return rates but also enhances satisfaction, leading to stronger brand loyalty.

If you're ready to build your eCommerce store, Golden Owl Solutions can help you harness the power of futuristic solutions such as AI & ML to elevate your customer experience. With 150+ experienced developers, Golden Owl specializes in creating innovative, customized eCommerce platforms that integrate seamlessly with AR and AI technologies. Contact us for a meeting now!

FAQs

Q1. What types of eCommerce products benefit most from AR?

AR is especially beneficial for products that rely heavily on visual appeal and fit, such as furniture, home decor, fashion, beauty products, and accessories. However, any product that customers may want to visualize before purchasing can benefit from AR.

Q2. How does AR reduce return rates in eCommerce?

By providing accurate previews of products, AR minimizes surprises related to size, fit, and style. Customers can see exactly how a product will look, reducing the likelihood of dissatisfaction and the need to return items after purchase.

Q3. Is AR technology difficult to integrate into existing eCommerce platforms?

AR can be integrated into many eCommerce platforms, but the complexity depends on the specific tools and features desired. Some platforms offer plugins or APIs that simplify the process, while others may require custom development.