Retail’s Try-Before-You-Buy Engine: VR

By Pragati Verma, Contributor

When shoppers like a piece of furniture or decor on Wayfair’s mobile phone app, they can tap the ‘View in Room’ button to visualize it in the comfort of their own home.

Immediately, a 3D-representation of their chosen piece pops up in front of them, as if it were really there. To see how different pieces will look in their home, and if they will fit together in the space, shoppers can move products around, as well as rotate them to view every possible angle.

This augmented reality (AR) technique of being able to visualize physical products in a home space is changing the way retailers from Pottery Barn to L’Oreal think about online retail. According to Steve Conine, co-founder and chairman at Wayfair, the American e-commerce home furnisher, this emerging technology, “brings an unprecedented level of convenience to customers while providing them with the confidence that they’re making the right selection for their home.”

Where Imagination Meets Reality

As Khin Sandi Lynn, an industry analyst for ABI Research, a market advisory firm, sees it — furniture and home improvement is not an easy sector to transition into online. “Immersive shopping experience is crucial for online furniture companies like Wayfair,” she said. “Imagine a non-designer, looking at an online picture of a couch or a center table and trying to get a sense of how it will fit into their room or go with their curtains, carpet and other furniture.”

The problem may be a discrepancy between imagination and reality. The lack of confidence between believing something will look good and seeing that it actually can work, has prohibited buyers until now. Yet virtual reality (VR) and AR technologies, Lynn said, address a major pain point of online furniture buyers — not knowing for sure if something will fit — by providing an “effective platform for customers to view furniture, pick different parts, customize products, and visualize an item without actually visiting a brick and mortar store.”

“This immersive experience will bring online retail closer to the experiential environment of a physical store more than ever before.”

-Khin Sandi Lynn, industry analyst at ABI Research

For Lynn, this improved shopping experience is the reason why furniture and home improvement stores were among the first in the retail segment to rush to VR technology. She has a point. Early adopters of VR and AR features include furniture and home improvement vendors, such as Ikea, Williams Sonoma, Target, and Lowe’s.

While improving the customer shopping experience is key, retailers are also discovering another benefit of embracing immersive environments. The “try before you buy” experience that VR and AR technologies enable helps curtail returned merchandise.

“Free return policies are the norm in online retail, but they crush profit margins and disrupt smooth operations [for furniture retailers],” Lynn explained.

During her interaction with several retailers for her research on VR in retail, she found that furniture stores that deployed virtual reality technology experienced significant improvement in their return rates. “In some cases, retailers saw zero returns from customers who used a VR platform before making a purchase decision,” she added.

Experiential Environments of the Future

Furniture stores might be among the pioneers, but they are far from the only retailers to embrace virtual reality. “We’ve seen a widespread adoption across retail and marketing,” said Lynn. ABI Research forecasts VR software and service revenue in retail and marketing segments to generate $1.8 billion by 2022.

Among those who were quick to jump on VR and AR were fashion brands, such as Sephora and Michael Kors. Adoption is high among automakers and travel agencies too, Lynn pointed out.

“Immersive environments can be a very effective marketing tool [as] customers can get an extremely realistic experience of their digitally configured car, down to the last detail, before making a decision to buy,” she said. “Similarly, travel agents can offer a 360-degree view of travel destination and virtual tours before they sell their tickets and packages.”

If ABI’s predictions are any indication, more and more retailers will embrace these immersive experiences in the coming years, letting shoppers virtually try before they buy. “This immersive experience,” Lynn pointed out, “will bring online retail closer to the experiential environment of a physical store more than ever before.”