AR is the forefront of retail change. AR empowers the user – a tool that transforms a regular buyer to becoming a superstar designer. Based on research from Goldman Sachs, Heather Bellini, their Technology Business Unit Lead, believes that AR/VR will be an $80 billion dollar USD industry by 2025 – the AR/VR industry is as transformative as the early Motorola brick cellphones (DynaTac) was to the 1980’s as AR/VR will be to 2018 and beyond.

1. Amazon is Doing It!
So is Google, Apple
& Facebook.
THAT SHOULD BE ENOUGH TO CONVINCE YOU THAT
AUGMENTED REALITY IS HERE TO STAY.
Issue: January 2018

2. BASED ON RESEARCH
from Goldman Sachs, Heather Bellini, their Technology Business Unit Lead,
believes that AR/VR will be an $80 billion dollar USD industry by 2025
– the AR/VR industry is as transformative as the early Motorola brick
cellphones (DynaTac) was to the 1980’s as AR/VR will be to 2018 and beyond.
Slowly but surely, augmented reality is starting to become the every day norm
in retail. Beauty brands were early adopters of AR – they embraced it and intertwined
it with digital media, targeting, younger social shoppers. Large apparel brands and
furniture retailers have followed suit looking to provide immersive experiences for
their customers.
AR/VR$80 Billion Dollar Industry
by 2025

3. Many buyers find furniture
shopping to be stressful and
daunting. Outside of purchasing
a home and a car. The next largest
expenses are furniture, mattresses
and large home appliances.
Augmented reality is the perfect sales tool for large
ticket items. For furniture retailers, AR provides a better
human-experience for the buyer. AR empowers the user
a tool that transforms a regular buyer to becoming
a superstar designer.
BUYING BIG TICKET ITEMS
BECOME LESS INTIMIDATING
WITH AR APPS
Buying big ticket items like furniture becomes less intimidating when using augmented reality apps.
With a few clicks, the buyer can try out different furniture pieces without any financial investment or risk.
The customer can overlay, photorealistic, 3D furniture models in their own room settings or
in different room designs.

4. Whereas when buying the item online, they’re solely relying
on their sense of sight. Regardless of the channel the
customer chooses to shop in (online or in-store),
there’s still a gap – context!
Consumers still prefer to buy expensive items in-store,
so they can test the products. When it comes to buying
a sofa or a mattress, the power of touch is important.
Customers get to feel the fabric and choose their
preferred comfort levels – plush versus firm.

5. AR BRIDGES THE GAP
AR bridges the gap and provides context to your customers.
Since 83% of human information is consumed visually,
buyers can see exactly what the furniture would look like
in their own space and even to scale.

6. When shopping in a large retail show room,
it’s hard to imagine if the item will fit in their
own home. An item that looks small, in a vast
showroom, can look oversized in an average
family room.
With online shopping, perception is everything!
Unfortunately, colours on a screen never truly
appear as they are.
On screen a pair of mahogany bar stools may
end up looking more ebony in person. 22% of
returns are made because customers perceive
an item looking different – driving up return rates
and lowering margins for retailers.

7. Returns are a major cost! Many consumers will buy a product, unbox, assemble, try it out,
to only return it! Having a restocking fee can help off-set the costs incurred for returns,
however, retailers still end up loosing in the end – holding on to inventory that can’t be
sold at full margin or even junked!
RETURNS ARE AN ISSUE
For retailers who offer free returns, it cuts even deeper. Based on research, Amazon return
rates are between 5 to 15%. Fortunately in furniture retail, it’s around 5%. But every percentage
point you can shave off can improve your bottom line.
* Data point for others came from: Strategy & PWC, 2017 Retail Industry Trends

8. BENEFITS WITH AR IN FURNITURE RETAIL
It can lower return rates and minimize
the cost of reverse logistic3
2
Improve your customers experience
and shorten the product discovery phase
It can shorten sales cycles - less time spent
envisioning if the style will work with
their home & improve conversation rates
1
AR is the next logical retail technology
investment for brick-and-mortar and
pure-play ecommerce businesses.
Consumers are already using AR in their
social media apps such as with Facebook
Messenger, SnapChat, etc. It’s an adoptive
technology that is already being used on mass.
Based on research from Retail Perceptions,
61% of shoppers prefer to shop at stores that
offer augmented reality versus stores that don’t.
AR offers an engaging experience and helps
customers make more informed decisions.

9. In-store, AR can be used as a virtual assistant to guide a customer through the product catalogue.
In tandem, augmented reality can also turn any place into a storefront – giving your customers a
chance to shop from anywhere they want.
Augmented reality shopping solutions empowers both the consumers and the retailers.
It increases consumer engagement and stickiness, it brings in foot traffic, increases conversions
and it can lower costly returns to the retailer.
AR is the forefront of retail change. It turns static images into a dynamic, immersive visual experience.
Beauty brands know this and they’ve proven that AR has tangible benefits. Brands that implemented AR,
to their existing websites saw their online sales jump by 84% in year one and drove in-store traffic sales up
by 31%.
You’re customers are waiting for you to make that leap. Are you ready?
TheAppLabb is the catalyst for technology innovation. As a product innovation and development firm,
we focus on helping our clients build mobile solutions that will disrupt their industry.
Over 10 years of experience with 360+ global clients and over 500+ apps built, we offer strategic consulting,
UX and UI design, custom software development and out-of-the-box industry solutions for several vertical markets.
Let us turn your ideas into reality.
URL: http://www.theapplabb.com
Email: info@theapplabb.com
PH: (416) 745 - 3164
PH: (464) 688 - 2786
Version: January 2018 - TheAppLabb ©

10. References:
Goldman Sachs - The Real Deal with Virtual & Augmented Reality
http://www.goldmansachs.com/our-thinking/pages/virtual-and-augmented-reality.html
22% of Returns - Ecommerce Product Return Statistics & Trends by B2C Business 2 Community
https://www.business2community.com/infographics/e-commerce-product-return-statistics-trends-infographic-01505394
83% of Human Information - Your Senses are Your Raw Information Portals by Velvet Sawchain Consulting
https://velvetchainsaw.com/2012/05/23/your-senses-your-raw-information-learning-portals/
Amazon Return Rates 5 - 15% - AMZ Secrets
http://amzsecrets.com/amazon/question/amazon-return-rate-is-generally-about-5-15-but-it-varies-widely-depending-on-the-category
-books-and-media-have-lower-returns-rates-as-they-are-generally-well-described-products-that-the-customer-kno
5% Return Rates - Mattress Startups Make a Bet...by Mashable
http://mashable.com/2017/08/31/mattress-returns-gamble/#sIMMk1N9Miqc
61% of Shoppers... - How Augmented Reality is Changing Today’s Shopping Experience by Retail Perceptions
hhttp://www.retailperceptions.com/2016/10/the-impact-of-augmented-reality-on-retail/
Online Sales Jump by 84% - ...Transforming the Beauty Industry ... by The Institute The IEEE News Source
hhttp://www.retailperceptions.com/2016/10/the-impact-of-augmented-reality-on-retail/