Extended reality, or XR, is an umbrella term given to all computer-generated environments that either merge the physical and virtual worlds or create an entirely immersive experience for the user.
It covers three distinct categories – Virtual Reality (VR), Augmented Reality (AR) and Mixed Reality (MR) – and is anticipated to reach a market share of $215 billion by 2022, an 800% increase from today’s figure.
Fueling this growth are powerful use cases with the potential to shake traditional industries to their core. Tour hotel rooms in Abu Dhabi, meet real estate agents in a virtual world and customise the leather trim in your new car – all from the comfort of your living room.
To better understand consumer mindset, behaviour and decision-making, SYZYGY Extended Realities (XR) commissioned a consumer research survey in the UK. Polling 1,000 consumers, we asked XR-related questions that are most pertinent to brands in 2019 and beyond.
As the line between digital and physical continues to blur, today’s consumers no longer treat the two as separate worlds. Our species is moving towards an existence where both existences merge and interact seamlessly. This is the future of our augmented humanity.
As a retailer, here’s how to ensure your brand is best positioned to thrive.
Mass market adoption is close
Today’s marketplace is ripe for the mass adoption of XR technology, with two defining factors shaping this space.
First, advancements in the underlying technology have brought the cost of consumer XR products down while increasing quality and functionality.
When asked, “What are the biggest barriers stopping you from purchasing a Virtual Reality headset?” ‘Quality’ ranked as the lowest barrier to entry, with just 3% of consumers concerned about the quality of XR products.
Second, consumer behaviour has matured to a point of acceptance and anticipation – in other words, the modern shopper can now envision XR in their daily lives.
According to our research, 72% of consumers believe that XR will become part of their daily routine as the smartphone is now. Younger generations are even more bullish. In fact, 81% of 16- to 34-year-olds believe that XR will play a ubiquitous role in their daily lives.
The truth is unequivocal: technology has finally caught up with culture and consumer behaviour.
Using XR to create purpose-driven experiences
Over the past decade, pioneers like Amazon have rewritten the rules of business, meaning today’s brands must deliver purpose-driven experiences that are fast, reliable and super-efficient.
Consider this: in 2019, 81% of companies expect to compete on the basis of customer experience.[1]
While competition is high, the rewards are great. In fact, customers who have a very good experience with a brand are 3.5x more likely to repurchase and 5x more likely to recommend that company to family and friends.[2]
With a diverse array of functions and use cases, the judicious application of cleverly crafted XR experiences can help businesses win the battle of customer experience.
To better understand which sectors are most appealing to today’s shoppers, we asked the public to choose from a list of XR experiences that would be of interest.
The top-three responses across eight different industries were:
- Retail (25.4%) – Seeing how a piece of clothing would look on you prior to purchase, or how a sofa would look in your living room.
- Entertainment (25%) – Watching movies and playing games in XR.
- Tourism and Hospitality (23%) – Exploring a travel location, from seeing inside potential hotel rooms to experiencing the activities on offer.
XR has real utility in the marketplace that has yet to be fully realised. For brands, this is good news. Now is the time to invest in a clear and coherent XR strategy.
A new era of retail experiences
From virtual stores to AR-integrated physical locations, retailers are beginning to experiment with XR technology as a way to drive sales.
Nike is one brand at the forefront of this innovation, using AR technology that allows shoppers to design their own custom shoes. Set within the confines of a futuristic studio in Soho, New York, Nike’s “Makers’ Experience” combines AI, VR and other emerging technologies with object tracking and projection technology. Together, this enables custom designs to appear on shoppers’ sneakers, whether they are moving or standing still.
Our work with Danwood S.A., a leading property development company in Europe, shows the potential of using VR in a retail sales setting. To convince potential clients to purchase a premium home that had not yet been built, we designed an immersive, full 3D experience that takes the customer into a virtual house. The experience, which only requires VR goggles and a sales representative, means that the properties can be shown to customers in any retail market in Europe.
For the first time, property viewing has become mobile and agile. With VR, the customer and agent experience full immersion in the house. This technology serves as more than just a compelling visualisation; it actually enhances the selling process, since a salesman can enter the property with the customer and advise or even modify aspects of the home as they journey together.
Collectively, these examples show that XR technology is now delivering real results. With heightened quality, these experiences prove XR is no longer a toy. In fact, the implementation of XR is a game-changing moment that will alter the course of marketing for years to come.
Prepare for tomorrow, today
Adoption takes time, but when it occurs, innovation will pave the way for an entirely new ecosystem of creativity and experimentation.
As the world hurtles towards a more immersive digital ecosystem, the convergence of XR and human behaviour will open a new window for discovery, interaction and purchase. Our focus shouldn’t be on technology for technology’s sake. It should remain firmly fixed on the human experience.
When retailers use XR technology to enhance the user’s journey and solve real-world problems, then the industry can take one large step towards a truly “Augmented Humanity”.
[1] Gartner | Customer Experience Survey, 2019
[2] Temkin | Experience Matters Report, 2018