Augmented Reality in Bricks & Mortar Retail

LONDON, May 21, 2018

Augmented Reality (AR) will see major adoption in the retail sector, but not in the way many have predicted. AR will struggle to take root among customers in the brick and mortar environment. Instead, AR uptake in the sector will be driven by the retail workforce and online shoppers. This is according to ABI Research, a market-foresight advisory firm providing strategic guidance on the most compelling transformative technologies.

AR experiences can prove extremely useful for online customers unable to interact with the physical products they intend to purchase. “For consumers in brick and mortar stores, however, AR can disrupt the customer journey and provides little additional value overall,” said Nick Finill, Senior Analyst at ABI Research.

Whereas for the in-store employee, AR promises to deliver operational efficiencies and raise the quality of the service delivered.

As has been occurring across other industrial sectors, retail will see a steady rise in the adoption of AR-devices. Smart glasses from manufacturers such as Vuzix are already starting to be used by retail employees to assist with front and back-of-store operations. ABI Research forecasts that by 2022 over 120,000 stores will be using AR smart glasses globally, with deployments evenly split across Europe, North America and Asia-Pacific. This will be driven by the need for efficiency savings to compete with rival retailers and the online sector generally.

Additionally, ABI Research forecasts that, by 2020, 3% of e-commerce revenue will be generated because of augmented reality experiences. That equates to US$122 billion in revenue worldwide. “The relative ease of integrating AR into existing m-commerce platforms and the impact this can have on the user experience will largely drive customer demand,” Finill said.

The benefits of using AR will be unable to overcome the barriers which exist in physical retail, however, which is inherently less reliant on the use of a mobile device.

For retailers and AR solution providers, the challenge is now changing the perception of augmented reality from a novelty gimmick into a technology which can truly engage customers online and improve the bottom line in-store.

These findings are from ABI Research’s Augmented Reality in Retail report. This report is part of the company’s Smart Retail research service, which includes research, data, and Executive Foresights.

About ABI Research

ABI Research provides strategic guidance for visionaries needing market foresight on the most compelling transformative technologies, which reshape workforces, identify holes in a market, create new business models and drive new revenue streams. ABI’s own research visionaries take stances early on those technologies, publishing groundbreaking studies often years ahead of other technology advisory firms. ABI analysts deliver their conclusions and recommendations in easily and quickly absorbed formats to ensure proper context. Our analysts strategically guide visionaries to take action now and inspire their business to realize a bigger picture.