Payments Leader

Augmenting the Retail Reality In-store and Online – by Dan Peacock

May 1, 2018

Dan Peacock, Vice President of Product Strategy

Retailers don’t have to sit back and watch as their customers leave their stores to buy online or via digital channels. Digitally augmenting the in-store experience allows merchants to promote product awareness, drive customer engagement, grow loyalty and increase sales.

The Real World, with Overlays

Augmented reality (AR) has been heralded as the magic bullet to revive the flagging fortunes of retail stores. While many people know it from Pokémon Go, a phone game that utilizes a player’s mobile device’s GPS function to locate, capture, battle, and train virtual creatures that appear on the screen as if they were at the same real-world location as the player, AR is not a new phenomenon. In fact, it has been used by a myriad of industries, in multiple ways, for almost a decade.

Unlike virtual reality (VR) where an immersive, computer-generated scenario simulates a lifelike experience, AR layers virtual information over a live camera feed through a smartphone, tablet or headset. Rather than obstruct the view of the surroundings, AR enhances the real world with images, text, video, graphics, etc.

Furniture shops have developed apps that allow 3D models of products to be overlaid onto a live camera feed from a customer’s home. This gives them the opportunity to not only see if furniture fits in a room but better understand how the item impacts a room’s atmosphere.

Clothing manufacturers use AR so customers can try out various styles. By simply pointing a camera at their feet, customers see how different shoes would look, for example. Some in-store changing rooms have even evolved into “smart trial” rooms where a mirror with an LCD screen lets customers pick and mix clothing they wish to try on, and then overlays different colors and styles to ensure the best choice possible.

The aim is to make visualization easier – customers see the actual products in their living room or clothing on their body rather than a simple picture in a catalog. Customers change color and style at will – then hit the “buy” button.

Growing Revenue by Augmenting the Everyday

Augmented reality can provide a bridge between the offline and online retail worlds; evidenced by the growing number of retailers experimenting with the emerging technology. The aim is to breathe fresh life into the in-store experience and enhance shopping on retailers’ websites or mobile apps.

AR can help merge online and offline experiences by encouraging customers to try out new products, hassle-free, before enticing them into a store. But to fully engage customers, retailers need to exploit the fun and novelty aspects of AR to increase time spent in-store, while also offering a memorable experience that visitors enjoy. This, in turn, builds positive association with a store visit and brand.

Closing more deals and increasing sales is the ultimate objective. With an augmented retail experience, customers can be shown more information on the products available – colors, styles, availability and even reviews. This makes the purchasing decision easier and simultaneously blends engagement with increased sales.

A retail environment that involves AR can also help convert a new visitor into a loyal, repeat customer. A highly personalized experience makes customers feel important, which encourages them to spend more time in a store. It also incentivizes them to provide even more data, which can allow for further personalization on subsequent visits. As AR technologies mature, customer loyalty can become more targeted and engaging, thus facilitating new purchases by better mapping customers’ shopping behaviors.

The Augmented Future

Augmented reality has recently experienced a flurry of new apps as the technology needed to deploy AR is becoming increasingly affordable. ARKit and ARCore, two AR platforms created by Apple and Google, can now detect the position, topology, and expression of a user’s face. These development environments allow for easy AR app creation, which means software developers can build AR features into existing apps or create new programs with unique AR features.

The future of augmented reality promises even more options and benefits to retailers and consumers alike. AR is quickly becoming a necessity, increasingly driven by customer expectations. It represents the engaging value-add that can elevate a brand above its competitors, and become a new norm in retailing.

A Consumer-led Evolution

Augmented reality adds interactivity, engagement and fun that can truly transform the in-store experience into something unique. That’s an experience that is unparalleled by online shopping and can help lure people back to retail stores.

The AR market is expected to grow to around $133 billion by 2021, according to Zion Market Research, and consumers are ready for it. In fact, analysts at Retail Perceptions suggest that 61 percent of shoppers prefer to shop at stores that offer AR, and 55 percent of shoppers agree that AR makes shopping more fun and exciting. What’s more, 40 percent of shoppers would be willing to pay more for a product if they were able to test it first through AR.

There will undoubtedly be new technologies, programs, and options invented in the future, so it’s important to get on board now, so as not to get left behind in this ever-changing technology landscape.


Dan Peacock

Vice President of Product Strategy

Dan is a member of FIS’s Payments Product Strategy team and focuses on developing the long-term strategy for U.S. retail payment products. His background spans 19 years in financial services leading co-brand credit card programs in the retail, travel and loyalty sectors, as well as issuer-branded consumer and business card programs.