Table of Contents

Augmented Reality

[2022] Increase sales this holiday season - a guide for every ecommerce store

Team Avataar
November 22, 2022
minutes read

Chances are, if you've shopped online, you've taken advantage of holiday season sales. And if you're a retailer, this time of year is crucial to your success. Unfortunately, it’s also one of the most difficult to prepare for.

Some of the biggest issues that retailers experience during the holiday season are:

  • High cost of customer acquisition
  • Low product satisfaction
  • High return rates 

Given that categories like electronics jumped more than 100% in online spending last year over the pre-Christmas week, you’re going to need a tool to give your customers the best possible experience. That tool is augmented reality (AR). AR can help shoppers envision what products will look like in their homes, which can lead to higher conversion rates , increased satisfaction, and build long-term customer value. 

Plus, with AR, you can offer interactive experiences that will make your store stand out from the competition.

Before we examine the benefits of using an AR tool for e-commerce this holiday season, let's look at some key statistics about this time of year and why it is so important to get it right.

Holiday online shopping statistics

Even after online shopping had exploded over the last two years, there was still room to grow last holiday season. A study from Mastercard found that U.S. e-commerce sales increased 11 percent from the 2020 to 2021 holiday seasons, a period that runs from November 1 to December 24. 

That number was quite low, compared to the previous years, and in total e-commerce sales have now jumped more than 60 percent since 2019 as shoppers were forced inside their homes.

This isn’t just the big marketplaces either. Driven by an influx of independent merchants flooding onto the platform, sales on Shopify from the start of Black Friday to the end of Cyber Monday were more than $6.3 billion in 2021

Interestingly enough, retail sales also increased year over year, meaning merchants will have to prepare for increased demand in both brick-and-mortar locations and online. Augmented reality, then, offers a perfect solution, as AR in retail is also having a huge effect on customer confidence, conversion rates, and return rates.

Not only that, but with the advent of in-store AR, your supply chain and inventory management issues become a thing of the past. Customers can engage with infinite aisles to see the entire product catalog right in front of their eyes - even if it’s out of stock - and order it to be shipped when available.

How to prepare your e-commerce platform

When preparing your e-commerce platform for the holiday season, there are a few key things to keep in mind. 

Get ready early

It’s never too early to prepare, either, as 42% of shoppers are preparing to buy gifts earlier this season. That significant behavioural change is driven by skyrocketing inflation rates and could drastically affect retailers who aren’t prepared for an early sales rush.

Test the infrastructure

Next, make sure your website can handle an increase in traffic. This means testing the site speed and ensuring that your host can handle the load. You don't want customers getting frustrated and leaving because your site is taking too long to load.

Streamline your store

Take a look at your product pages. Make sure they are clear and concise, with high-quality product photos and videos. This is especially important if you're selling things like furniture or home decor, as customers want to be able to see what they're buying. Giving customers an option to view products in their space with AR helps them make an informed buying decision, which increases sales conversions.

Ditch the tape measure

Finally, consider using a tool like augmented reality to give shoppers a better idea of what your products look like in real life. This can be especially helpful for things like furniture, where customers need to know if it will fit.

They no longer have to jot down numbers and then start measuring. Just pull up the AR platform and see it right in your own space!

Benefits of AR in online shopping

Now that we've looked at some key statistics and tips for preparing your e-commerce store for the holidays, let's examine how augmented reality can help you increase sales, the end goal of every business.

Informed buyer

One of the main benefits of using AR is that it allows shoppers to get a better idea of what they're buying. This is especially important for things like electronics, which can often look different in your home than in 2D product pictures. 

With AR, shoppers can see the television in their house before they buy, getting a better sense of how it will look with the rest of their decor. This can lead to higher conversion rates, as customers are more likely to buy something if they know they'll be happy with it.

Higher confidence

In addition to helping shoppers make informed decisions, AR can also increase buying confidence. This is because AR allows shoppers to interact with products before they buy, which can help reduce anxiety about making a purchase.

It also boosts satisfaction, which can drive lifetime value by making more customers return for an additional purchase down the road, or pass along positive reviews about the experience. 

Higher Conversions

Another huge benefit of using AR in online shopping is that it increases conversions. By allowing potential customers to see what a product looks like in real life before they commit to buying it, you can reduce the number of abandoned carts and increase sales.

In fact, AR is expected to increase conversions by a whopping 94%, meaning that if you're not using it, you're missing out on a huge opportunity to increase sales.

Reduced return rate

Because of that increased confidence, shoppers are also less likely to return items they've purchased. This is a win-win for both customers and retailers, as it saves everyone time and money. 

Holiday returns have been a huge problem for years. The National Retail Federation estimated that 13.3 percent of all merchandise sold during the 2020 holiday season would be returned. That amounts to a whopping $101 billion worth of goods. 

If augmented reality can decrease the return rate just slightly, it would mean a huge boost in net revenue for small and large online retailers.

One study found that size alone accounts for 52% of all returns for online purchases, something that can easily be minimised with AR solutions. 

Increased return on investment

It's not just confidence in a single purchase, though. These solutions, like the one offered by Avataar, can add value to a shopper's experience, increasing brand loyalty and customer lifetime value. 

With interactive content, you can educate shoppers on your products in a way that is fun and engaging, rather than overwhelming. 

This is valuable not only to first-time customers but also to those who are familiar with your brand and want to learn more about what you have to offer. Interactive content can help turn one-time buyers into lifelong fans.

Clear the clutter

Meanwhile, with an out-of-the-box 3D and interactive AR solution for a commerce store on Shopify and BigCommerce, Avataar helps you elevate your customer's buying experience. Single-click integration means that you can quickly convert your 2D catalog to 3D models, and publish an interactive AR experience on your product page. 

With an AR shopping solution in place, you can take your e-commerce store to the next level this holiday season and give customers an experience that will keep them coming back.

Benefits of AR in physical retail

But it isn't just for online shopping or AR marketing anymore. These solutions can be used in-store as well, giving some added benefits and leveraging your e-commerce supply chain management to provide higher conversion rates at retail locations.

Infinite aisles

The rush of holiday shoppers combined with this year's supply chain troubles, can often leave your shelves empty and the stockroom barren. Not anymore, with infinite aisles that can be displayed through AR right in the store. This allows customers to view and purchase any product in your catalog, even if it's not physically in the store. 

This is a great way to increase sales, as customers are no longer limited by what they have in front of them. They can find the perfect gift for anyone on their list, without having to worry about whether you have it in stock. Plus, it reduces the chance of them going to a competitor's store to find what they're looking for.

Experience zones

For some people, going to a mall and seeing the surrounding products is part of the fun. 

With AR experience zones, which allow a customer to build an entire room around them, see how their renovated kitchen could look, or see how a new piece of furniture would look in their home, you can give them the feeling of a showroom and bring your products to life.

This is a great way to give customers a more immersive experience and get them excited about your products. It also helps to build brand loyalty, as customers will remember the positive experience they had at your store and be more likely to come back in the future. The speed of technology may soon bridge the online-offline divide, allowing customers to bring their homes with them to physical stores and use AR to place products in their living space while evaluating different products in the stores.

Final thoughts

As you can see, there are many benefits to using AR for your e-commerce store this holiday season. Augmented reality not only provides an interactive and unique shopping experience that will set your store apart from the competition, but it also increases conversion rates.

So if you're looking to give your customers the best possible experience—and boost your bottom line—consider using AR this holiday season and don't be left out in the cold!

We asked our partner, Verbal+Visual, a Shopify Plus agency that works with leading brands such as Jonathan Adler, Kuiu, The Sak, and others, to share some tips for retailers as they prepare for BFCM:

“As you finalise your BFCM strategy, don’t forget: the holiday shopping season is not just about a month of increased sales—it’s about building brand equity for a whole year’s worth of growth. If you connect with your customers and reward them for engaging with your brand, you’ll find yourself ringing in the New Year with a whole new group of enthusiastic brand ambassadors."

Read more about holiday planning from Verbal+Visual here.

Frequently asked questions

What are the advantages of 3D Augmented Reality for ecommerce businesses?

AR can remove the guesswork from shopping by allowing customers to view life-size products in their own environment. According to research, 81% of shoppers feel more confident in their purchase after using augmented reality. Augmented reality has been shown to increase sales conversion by 94% while decreasing returns by 40%.

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