RSR Research: Beyond Mobile – Augmented Reality for Retail

Discussion
Nov 23, 2009
Nikki Baird

By Nikki Baird, Managing Partner, Retail Systems Research

Through
a special arrangement, presented here for discussion is a summary of an
article from Retail
Paradox
, Retail Systems
Research’s weekly analysis on emerging issues facing retailers.

I think
the time has come to talk about something that has been increasing in buzz
in the general tech community, because of the potential to apply it to
retail. So here’s my definition of augmented reality: the real-time
overlay of digital information over an image of the physical world. In
a lot of ways, augmented reality provides the same kind of interaction
that quick read codes do, but with a more seamless user interface.
Instead of using a camera to snap a picture of a barcode or QR code, you
simply turn the camera on (most likely by accessing a phone app that utilizes
the camera but also provides the additional data overlay) and aim it at
what you want to know more about.

Yelp’s iPhone app is the most recent to garner attention for augmented reality capabilities, overlaying its reviews on camera views of the real-world environment. Now being tested by Yelp, users find the closest restaurants, complete with ratings, simply by pointing your camera down the street.

It’s not that far of a
stretch to imagine the retail applications. Product reviews is an easy
one, though the image recognition is a bit more complex than simply location-aware
overlays on Google Maps. Locating the nearest retail store with the product
you’re looking for is another example. Lowest price for a product? Online
availability of a product? How about, where is the nearest employee in
the store? (Wouldn’t that be great?) Wayfinding, friend-finding, and
product-finding are all applications that have potential in retail.

What does it mean for retail, besides “throw
out your mobile 3-year plan and start over”? It certainly means mobile
experimentation round two. It means there is a serious opportunity for
someone to tackle the product imaging space to see if they can start connecting
product images to product data that will be valuable to consumers. Certainly
video analytics applications are smart enough to spot an item in a product
image, much like facial recognition software.

More important in my book
is the reminder that the consumer user interface is still evolving
in major ways. One of the AR apps shown in a Technology
Review
blog
utilizes glasses to provide the data overlay, leaving
the user hands-free. If we successfully navigate that jump, how long
before your “mobile” app
needs to be optimized for stereo-vision?

Too “out there” for you? It’s closer than
you think. And, just as online changed consumers’ expectations from retailers,
new user interfaces will easily have the same impact, forcefully thrusting
retailers once again to the forefront of consumer technology adoption —
whether they’re ready or not.

Discussion
Questions: Will the arrival of “augmented reality” technologies transform
the retail shopping experience? What other potential applications at retail
might make use of technologies such as phone cameras? Which applications
will be most useful for consumers and stores?

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18 Comments on "RSR Research: Beyond Mobile – Augmented Reality for Retail"


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Max Goldberg
Guest
11 years 5 months ago

Augmented reality brings the world into a store, whether the retailer is ready or not. With a smart phone, consumers can instantly compare prices, get reviews for items, see what their friends think and make purchase decisions. This puts increased pressure on retailers. In a number of ways, such as pricing (does another retailer have the same product at a lower price?), product availability (is it in this store in my size?) and customer service (the consumer will frequently know more about the product than the store staff).

Retailers can use AR to let consumers know if a product that is not on shelf is in the back room, provide instant recipe ideas, and encourage customers to ask friends for fashion opinions.

We’re just beginning to see the uses of AR. It’s going to be an interesting adventure.

Doug Stephens
Guest
Doug Stephens
11 years 5 months ago

All the research that Retail Prophet is conducting points to the idea that there is no single technology that stands to alter consumer behavior at retail to the extent of augmented reality.

Imagine standing in a Barnes and Noble, viewing a book through your mobile device and accessing Amazon book reviews on it. Imagine being able to view a plasma screen TV and get consumer reports information on it while in the store. Or walking down the street and seeing Zagat ratings on the restaurants your passing.

Programs like “Layar” are making this a reality. It’s here now and will only get more robust and more as more data is crowdsourced and linked.

Right now, the retail world is preoccupied with mobile couponing. I think we’ll look back on mobile coupons and sms promotion as a prehistoric stopping point on the way to augmented reality.

David Biernbaum
Guest
11 years 5 months ago

In the not so distant future, I strongly believe that consumers will aim their own mobile devices at the bar code and have immediate access to the product’s web site and be able to access real-time information at the point of purchase.

James Tenser
Guest
11 years 5 months ago

Famed sci fi author William Gibson anticipated the creation of what he termed, “annotated environments” as an avant-garde art form in his 2007 novel, Spook Country. To interact with an installation, the art lover would don a pair of wi-fi enabled spectacles that respond to “tagged” objects in an otherwise unremarkable street scene or building interior. The “art” is revealed by the overlay of imagery upon the mundane; and the artist must manipulate aesthetics and technology for an observer whose point of view is uncertain within a continually changing context.

Augmented reality for retail, in other words, sounds to me like life imitating art. It’s probably inevitable, but not coming very soon to the commercial environment. While I can visualize 3-D metatags floating in space in front of items or displays in a retail environment, it’s going to be quite a while before folks casually don a pair of heads-up display specs just to buy milk and eggs.

Ben Sprecher
Guest
Ben Sprecher
11 years 5 months ago
As Nikki points out, the potential here is enormous. The critical thing about Augmented Reality is that it sits at the ideal intersection between retailers, brands, and shoppers, at the most valuable time (when a shopper is looking to buy) and place (where the shopper is physically standing). To imagine the possible applications, just think of ways to serve one (or more) sets of stakeholder interests. A few examples follow… Shopper:– Nutrition adviser (point the camera at the shelf, highlight the product that meets my low fat/low salt/etc. goals)– Budget minder (highlight products or sets of products that meet my budget goals) Shopper and Retailer:– Product finder (type or say “Tabasco” and see a homing beacon that guides you there in the store)– Shopping list store map (like above, but connect-the-dots as you shop your list in a optimized path through the store)– On-sale product highlighter (point your phone down the aisle and the products you’ve bought before that are currently on sale get highlighted) Shopper, Retailer, and Manufacturer:– Targeted promos and ads (show content… Read more »
Cathy Hotka
Guest
11 years 5 months ago

Now that consumer access to mobile technology is near universal, it makes sense that consumers will dictate what interfaces they prefer and will use. There are numerous potential applications for AR in retail, including tying in-store product barcodes to the online catalog description, providing recipes for food products for shoppers in the store, and instant promotions. There’s a lot of potential here…will customers want it?

M. Jericho Banks PhD
Guest
M. Jericho Banks PhD
11 years 5 months ago

Here’s a link to a YouTube video of Yelp’s hidden Monocle Easter Egg app in use. It’s a hidden Easter Egg because Yelp didn’t think it could get the app approved by Apple at this time (soon, though, they say). A 3Gs iPhone is required. I see a collaboration between augmented reality apps and the powerful potential of RFID tags as a way to make RFID more attractive to manufacturers, retailers, and shoppers.

Pete Reilly
Guest
Pete Reilly
11 years 5 months ago

Nikki, Thanks for the post on augmented reality (AR). I think that augmented reality, spurred by game changing devices like the iPhone, will provide a platform for the ‘killer customer experience’.

Retailers who want to differentiate their in-store experience should be looking to AR now.

See my recent blog post for some great examples of current AR as well as retailers who have taken the early lead.

Ralph Jacobson
Guest
11 years 5 months ago
I saw this AR lecture from MIT (http://bit.ly/Z2W5L) a while ago. IBM is a sponsor of this lab and we see numerable opportunities for real-world applicability in our industry. The elements of Augmented Reality involve every facet of retailing in new ways–it requires instrumentation to work, it leverages integration to present content, and it helps consumers to make intelligent decisions. More than anything I’ve seen in recent years, Augmented Reality provides retailers with a way to bridge the gap between the online experience and the in-store experience. This is the secret sauce that retailers are trying to get their heads around and they can really distinguish themselves by showing people how this technology can take their customers to the next level. Imagine going into a grocery store with a device that would reveal metatags that are attached to products (e.g. contains peanuts) and project them in a way that you can see and even interact with them. This is taking the 3D Internet to the next level. Consumers are becoming more comfortable with technology, as… Read more »
Laura Davis-Taylor
Guest
Laura Davis-Taylor
11 years 5 months ago

Fantastic perspective as always Nikki! We personally feel that there are huge applications for this within retail, particularly in relation to connecting people easily to information to help them decide on a product, solve a current shopper challenge or simply delight the shopper with an experience. These unique AR tools will be fundamental to the realization of the “store of the future” we’ve all been talking about for so long.

Also, Millennial’s will expect these kinds of tools and will likely give their allegiance readily to those that provide them. As measurable as they will be, they may be slow to take off…but they will rocket in adoption once they do.

JoAnn Hines
Guest
JoAnn Hines
11 years 5 months ago

The packaging industry is just starting to incorporate augmented reality. LEGO tested a new idea called the Digital Box to create a virtual model toy from inside the box that sits on top of the box when held in front of a special interactive kiosk. Other AR products are appearing in the music and entertainment industry and are geared towards a tech savvy, mobile and younger audience.

It seems logical that the packaging industry will consider any new technology that will increase market share. The question is, what demographics will embrace it? The shopping experience is, for most consumers, a fairly automatic process. We buy what we know and are comfortable with.

People that shop are generally in a hurry too and since 80% of that audience is time crunched, stressed out, over the edge women, I’m not sure how quick they will be to adopt any AR methodology that will lengthen the shopping experience, no matter how intuitive and clever.

David Dorf
Guest
11 years 5 months ago

Augmented Reality (AR) plus mobile can be a powerful tool and will definitely impact retail. Imagine window-shopping with prices and product information everywhere. And if you think you run into a lot of “text-ers” while walking down the sidewalk, wait until AR takes hold. AR and near-field communications (NFC) might work together as a stepping stone toward wearable computers, which sounds far-off but really isn’t. Additional thoughts here.

michael bigley
Guest
michael bigley
11 years 5 months ago

Apple has already applied for several patents regarding commerce and advertising through their OS; if the rumors of the next iPhone containing RFID capability are true, we are less than 2 years away from having millions of customers holding an RFID-driven augmented reality device in their hands. This could not only be marketing, but transactional in nature.

I believe that retailers who do not have a working strategy to leverage this technology will have their fate inflicted upon them. Those who lead on this will be winners as Amazon is from their early strategy of ecommerce.

Paul R. Schottmiller
Guest
Paul R. Schottmiller
11 years 5 months ago

Lots of potential here and moving fast. I think that the first killer app (or at least cost justifiable app) will likely happen in one of the segments with a little more margin and a high “entertainment” and/or “cool” factor associated with the shopping experience. Exciting times!

Dave Wendland
Guest
11 years 5 months ago

I believe we have seen the future…and the future is now! This exciting, invigorating and endless potential utilization of technology will move retail beyond its physical limitations and provide a much needed catalyst to revitalization. It is clear that traditional retailers can no longer limit retail to the confines of their brick and mortar–imagine the possibilities! Talk about empowered consumers!

Norrelle Goldring
Guest
Norrelle Goldring
11 years 5 months ago

Feels like the opportunity and challenge here is to get (brand) marketers to understand the technology’s capabilities–this is REALLY marketing at retail. They’re the ones with the budgets; the quicker they get on deck (and beyond things like instant wins and mobile couponing) the faster the technology will advance.

Joel Rubinson
Guest
11 years 5 months ago

We will see the convergence of 3 hot marketing areas–digital, mobile, and shopper. AR is only one form of mobile marketing (unless you define it incredibly broadly). QR codes, UPC readers that take you to brand stories, and shopper-customized offers like Scan It! are all coming. This area will be big because it will show ROI and give manufacturers a way of extending the brand in an environment they do not control–retail.

Herb Sorensen
Guest
11 years 4 months ago
I too, strongly endorse this advance, and expect a lot from it–but probably not next year. I think we had a discussion here not long ago about the use of cameras in-store. There is really nothing “private” about any environment with an open door to the public, and augmenting your eyes and brain with a camera (third eye) attached to a computer seems inevitable. (We already deploy the hardware but not the software discussed here, for research purposes, on a routine basis.) This is also closely related to a concept I refer to as “reality based virtual reality.” Once the REAL world is accurately captured, digitized and analyzed continuously, mathematical models will at first show the wide divergence between reality and virtual reality. However, virtual reality will then be able to be properly “distorted” to bring it into harmony with reality. This advanced, more realistic virtual reality is what I refer to as reality based virtual reality. We’re working on it, and expect to intersect with the technology discussed here.
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