The Impact of Augmented Reality (AR) Technology on Retail Sales: A Study on Customer Behavior
Augmented Reality Boosts Sales for Less-Popular Brands and Expensive Products, Study Finds
Over the past decade, augmented reality (AR) technology has been revolutionizing the retail industry by allowing customers to visualize how products would fit into their world. From furniture to makeup, retailers have been using AR apps to attract customers and increase sales.
However, little research has been done on the actual impact of AR on sales. In a recent study, Srinivas K. Reddy and his collaborators set out to change that by analyzing data from an international cosmetics retailer that incorporated AR into its mobile app.
The study found that customers who used AR spent more time browsing and purchased nearly 20 percent more products compared to those who did not use AR. The effect was even greater for customers who were new to the app or the product category, showing that AR has the potential to promote online shopping adoption and category expansion.
One surprising finding was that customers who used AR were more likely to purchase products from less-popular brands, as well as more expensive and unusual products. This suggests that AR reduces uncertainty and allows customers to take chances on products they might not have considered otherwise.
Reddy emphasizes that AR is leveling the playing field for brands and products, as customers are more willing to try new things and spend more when using AR. This technology is most effective when customers feel a lot of risk or uncertainty around the purchase process, making it ideal for less-established brands and new customers.
While AR may not be suitable for every retail category, the study highlights its potential to enhance the shopping experience and increase sales. Reddy and his team are continuing to explore how AR usage affects customers’ purchasing behavior over time, with the goal of understanding the long-term value of AR in retail.
Overall, the study demonstrates the promise of AR in retail and its ability to engage customers, increase purchasing rates, and provide valuable insights for retailers looking to enhance the shopping experience.
