Are retailers missing a virtual opportunity?

With today’s consumers switching between shopping channels on a whim, retailers need to position themselves at the intersection of physical and digital realities to deliver elevated levels of interaction and value-add. With customer expectations for state-of the-art ‘blended’ shopping experiences that are relevant, compelling and personally curated on the up, Periscope By McKinsey polled consumers in France, Germany, the UK and the US to understand their future shopping intentions.

The future of shopping is virtual and augmented

New virtual and augmented technologies are enabling customers to interact digitally within the physical store environment to address immediate needs and preferences. They remove friction and allow retailers to reinvent their store experience.

However, Periscope’s research findings revealed that over 60% of consumers in all countries surveyed had yet to encounter VR or AR applications in-store. Despite this, the majority had future plans to utilise a virtual shelf for a number of activities that they say would improve their in-store shopping experience. When asked which AR or VR applications they would definitely/probably utilise, those that made it easy to access additional product information or ‘virtually’ explore product functionality/suitability scored most highly with consumers in all markets.

The ability to conveniently tap into more extensive product information on-demand held a particularly strong appeal for all shoppers. This was especially the case in France where 65% said they would definitely/probably use VR/AR applications that provided more information, followed by the US (62%), the UK (57%) and Germany (54%). Over two-thirds of French respondents also said that they would definitely/probably use VR/AR applications to see a product in context – for example, “test outside store”, where a consumer may visualise how a paint colour would look on a wall. This sentiment was also echoed by shoppers in the US (59%) and the UK and Germany (56%).

In-store AR/VR innovations prove very enticing for ‘online only’ shoppers

An impressive number of consumers who characterised their current shopping behaviours as ‘online only’ had ventured in-store to try out a wide array of AR/VR applications. This strongly indicates that using new tech-enabled experiences to draw this audience of shoppers in-store is the key to capturing purchases and building future brand loyalty.

Indeed, when we explored which AR/VR applications consumers were most likely to utilise in the future, it was clear that technology innovations that enabled consumers to test product functionality, test product suitability outside the store, provide additional information on a product or deliver an enhanced experience, all held a particularly strong appeal for consumers who only/mostly shop online today. For this cohort of consumers, digital in-store experiences that deliver the on-demand speed and convenience currently afforded by the online world have a strong appeal.

Digital shelves score high with consumers

The touch screen or smart ‘virtual shelf’ (or ‘endless aisle’) gives consumers visiting store fast fingertip-access to the entire product portfolio, together with shopping support features they’re already familiar with from online retail. Detailed search and comparison, recommendations and related add-on items, or additional information and content, all help in moving shoppers along the buying process.

Indeed, the overwhelmingly positive attitude of respondents in all geographies highlights the appeal of virtual shelves for consumers. Our research findings would indicate that the future looks promising for retailers aiming to implement endless aisle offerings in-store and basing their brick & mortar retail proposition on cross-channel experiences. Consumers in all age groups appear confident and enthusiastic about interacting with virtual shelves, indicating that even those aged 50+ are intrigued by the technology.

Asked about their future behaviours, the majority of respondents in all territories had plans to utilise a virtual shelf for a number of activities they say would improve their in-store shopping experience. Browsing products was the top use-case for respondents in France (65%), the US (64%) and the UK (59%), followed closely by receiving similar product recommendations (US 59%, France 58%, UK 54%). For German consumers, browsing products (54%) and getting similar product recommendations (54%) scored equally high as the top application choice.

What the findings for our latest research clearly shows is that consumers who say they only/mostly shop online are enthusiastic early adopters of innovative retail technologies. This indicates that while the convenience of online shopping may have isolated them from traditional stores in the past, new technology innovations are proving highly effective at luring them back to the physical storefront. In a trading environment that is as challenging as ever, make sure that you’re not missing this virtual opportunity.

For more information on this research, download the report ‘The Future of Shopping: connected, virtual and augmented’ via this link.