Application of AR, VR & AI in Retail

The technologies like Augmented Reality (AR), Virtual Reality (VR) and Artificial Intelligence (AI) have slowly crafted their ways in each and every sector. E-Commerce and Retail are the two which have erupted to become the major two sectors implementing these new technological advancements.


Retail Industry, a highly competitive sector, is expected to grow at a CAGR of 5.3% and reach USD $31880 Bn. by 2020. Increased consumer spending along with the rise of online shopping has led to the growth of this industry. With India’s policy of allowing 100% FDI for single-brand retail and upto 51% FDI for multi-brand retail, this sector is expected to grow with leaps and bounds in the near future.


Recent Trends as recorded for AI, VR & AR:

  • In Retail Marketing AI, VR, and AR is forecasted to grow by 300% by the end of 2021. Currently, the spends on AI & VR worldwide in Retail stands at 2.90%
  • 77% of customers want product customization features;
  • 65% want more extensive product information;
  • 55% people stated AR made their shopping experience a fun thing.


Retail Industry is a highly cluttered as well as highly competitive industry. In order to carve their space in the minds of consumers and enhance customer experience, the brands are experimenting with different technologies to stand out from the rest.

Benefits of using technologies like AR, VR and AI in retail industry will have the following interests:

  • Enhanced customer experience
  • Reduced operational costs for retailers
  • Improvement in customer engagement
  • Providing personalised experience
  • Useful for employee training

There are different ways in which the retailers are using the technological advancements for their stores:

  • Furniture Retail

Furniture stores can leverage these technologies through things like finding the right furniture according to the apartment size of the customers. This would enable the customers to know what furniture would go well with the shade of the wall and what can be done with the available carpet space. The retailers like Amazon and IKEA have already taken the first mover advantage for this in furniture retail. Other brands like Wayfair, Living Spaces, Ashley, Lamps Plus, etc. have been using the technology of artificial intelligence to measure the size of the room and help in the correct and optimum placement of the furniture.

  • Beauty Retail

The ‘try-before-you-use’ technology is being used by the beauty retailers massively. MAC has taken the first mover advantage in this area. Sephora has been using its ‘try-on’ mirrors both in the online and offline formats. Nykaa has been banking on this technology from a long time by allowing customers to try-on lipstick shades, nail paint shades, etc. virtually according to their skin color.This is helpful for both retailers, as they do not have to set up a brick and mortar store and induce customers through discounts and cashbacks, and for the customers who can try multiple products accessible just at their fingertips.

  • Footwear & Fashion

Nike used AR, VR and AI technology when it put across an option in its store where people could see all the features of the selected shoe on the screen in front of them. Converse, the famous footwear brand, has also been using augmented reality for its ‘try-on’ shoes. With time more brands like Benjamin Moore, Wayfair, Lowe and many others have hopped on the brandwagon and have started using augmented reality to let consumers know how a pair of shoes will look on their feet and what size would fit him.Nike Fit, a machine learning and artificial intelligence induced software, helps in scanning the feet of the people to know exactly which size of the shoes would fit them. This was the first initiative by a brand to fix the dilemma of the customers which they mostly face while purchasing footwear online.

Amazon, Flipkart & Myntra have been using the ‘try-on’ option of clothes on their platforms to give people a fair idea as to how it would look on them. GAP has been using its Dressing Room app to let customers know which size of the clothing will fit them. New York Fashion Week 2018 and H&M collaborated to let the audience scan the dresses and let them purchase it online.


Everyone is online all the time, why shouldn’t your business be?

Online retail marketing has already made the experience more convenient and user-friendly.It requires to be quick and responsive whether it is a normal engagement or a query from the customer. Online retail marketing, with the help of AI and VR technology, has improved the efficiency, increased user engagement; with visuals they make the shopping experience a cake walk for the users.

Customers have been evolving ever since we know, whether it is comparing products to make an informed purchasing decision or purchasing a product a celebrity promoted, there buying behavior is developing. To keep up with the trends the retailers are constantly updating their technologies and tactics.

Let’s look at how different brands have tried their hands on the AI and VR technology to expand in this cluttered and competitive business world.

  • Voice Search:

“Best furniture store near me”, “Best online jewellery shop”, this was pretty much was what voice search was used for. But with the changing purpose of voice search the brands have been leveraging on this technology to increase the product presence and create a seamless user experience. Burger King launched a 15 sec television spot that included the phrase, “OK, Google, what is the Whooper Burger?” Unable to differentiate between the consumer voice and television audio, Google started telling listeners about Burger Kings’s Whooper Burger. Burger King has completely capitalized on the new voice search technology to create the brand awareness about the brand.

  • Chat Bots:

Brands have been incorporating call and message service of 24*7, but how about minimizing the number of steps a user needs to take to reach support? Yes, Chatbots are the new technology which the brands are eyeing on. Speed and availability of service are two of the most valued factors in the eyes of a consumer. Let the user ask his query in a single tap, without leaving your platform, thereby reducing a potential drop-off. Customers often look forward to “personal assistant” who can give out solutions to their problems. Let your chatbots do just that. Along with 24 hour service, chat bots can also recommend products to your brand. Greenply brand had used chatbots to capitalize itself in the Plywood market as the masters of plywood. Their chatbot was “Ask Greenply”, which helped in gaining insights to the users on which plywood would be the best for their use. This helped Greenply in also creating a brand awareness about its own brand and also capturing a space in the minds of the consumer.

  • Personalization:

Isn’t it personalisation which helps in catering to every user’s needs and improve their experience? We just cannot stress enough on personalization. Every user feels special when a brand can customize products according to their needs. With the help of AI/VR Technology brands have been moving ahead and giving the users the option of personalization. Brands like Nike, give users an opportunity to design and customize their own shoes. A user can now mix and match the features and styles of different shoes to create their dream pair of shoes. With the invent of this new technology Nike tried capturing the market share of its competitors.


With time the technology in the digital space has been evolving and giving brands whole new reasons to make a mark in the digital and physical spaces. From fashion to footwear to home decor, AR & VR has the power to transform and completely reimagining a user experience. With the help of these technologies which brands can leverage on and capture the user’s attention. These innovations will also the brand in connecting with the users and creating a user engagement for the brand. The technology will also help the buyers and the shoppers because now they can make a more informed and accurate purchase.

About author: Ishita Agarwal from Batch 2018-2020, SIMC, Pune

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