According to a study published by analysis firm ReportLinker, immersive technologies are poised to play a significant role in the retail sector. This is largely driven by the acceleration of digitization and e-commerce during the health crisis. The market for augmented reality (AR) and virtual reality (VR) in retail is expected to reach $3.79 billion by the end of the year. While the study takes into account the VR sector, it emphasizes that AR is the most widely adopted solution by brands due to its user-friendliness and accessibility on mobile and computers.
Despite cost-cutting policies resulting from the pandemic, several companies have prioritized their AR operations to overcome the challenges of confinement and social distancing. Luxury brands, in particular, have embraced AR technologies as a means to engage customers during store closures. Gucci, for example, implemented augmented reality fitting tools within their mobile app. Other notable examples include Burberry’s virtual try-on solutions on Google Search and Dior’s virtual try-on on Snapchat. Social media platforms like Snapchat have enhanced the AR experience with gesture and voice recognition features.
Geoffrey Perez, Head of Luxury at Snap Inc., highlighted the increasing popularity of AR, stating that 75% of Snap’s audience interacts with augmented reality daily, reaching over 200 million users worldwide. The closure of physical stores during the crisis has accelerated the need for mobile storytelling strategies, with AR being a powerful tool to inspire, engage, and convert customers.
Leading companies like L’Oréal have also embraced AR technology in their retail strategies. L’Oréal launched virtual try-on capabilities within Instagram Shops, utilizing solutions developed by start-up ModiFace and Facebook’s Spark AR platform. As more brands like Hermès dedicate filters to their products, the use of AR in retail is expected to gain even more traction in the coming years.
The market for augmented reality and virtual reality in retail is projected to surpass $17.86 billion by 2028, with a Compound Annual Growth Rate (CAGR) of +24.8%.
Useful Links:
1. ReportLinker – Augmented Reality Market
2. ModiFace – AR Solutions for Beauty Industry
