6 Retailing and e-commerce riding on technology: augmented reality and virtual reality

Abstract

Today’s world and economy are driven by technology and technology-savvy people across all sectors. Moreover, since industrial revolutions have a long-term impact on businesses and society, it is also associated with the progression and recognition of new technologies. Therefore, emerging technologies such as augmented reality (AR) and virtual reality (VR) will have immense potential worldwide in the dynamic retail and e-commerce industry. This chapter gives the reader an idea about the use of AR and VR in the e-commerce and retail sectors. The retail industry has grown considerably over the last two decades with the advent of e-commerce. It is no longer just a “purchasing” activity-based industry. Instead, it has become an “interactive” industry that provides customers with a “shopping experience.” Very soon, AR and VR could be critical factors in establishing customer engagement and product promotion. The Indian retail business is close to $1 trillion in size. It is undergoing various noteworthy changes, including premiumization, a movement toward freshness, a resurgence of vintage habits, increased customer trust on the internet, and a need for 10 min delivery. Some were secular developments, while the Covid-19 tailwind helped others. As a result, the old-world order of organized retail, the value of location and scale, and the power of shelf space are all up for grabs. Some upcoming advances (supported by tech innovations) are virtual reality, augmented reality, robots, facial recognition, 3D printing, etc. They are making their presence felt. These show that they are gradually being accepted. They provide retailers with new ways to engage with their customers and retain them. They are also managing their stores more efficiently while reducing costs, where possible. As a result, retail has become more transformative. Some of the changes are: - Use of AR/VR - Social commerce - Giving importance to deploying machine learning (ML) and artificial intelligence (AI) - Video commerce - Digitization of distribution - Hyperlocal commerce - Omni-channel retailing Other enabling technologies include dynamic demand forecasting and computer vision to understand buyer behavior in store. Objective This chapter gives the reader an idea about the use of AR and VR in the e-commerce and retail sectors. The following topics are covered in this chapter: - AR/VR: understanding the terms - AR/VR: advantages and disadvantages - The changing nature of the e-commerce and retail industry (across the globe and in India) - AR/VR: benefits to e-commerce and retail industry - Factors responsible for the limited use - A few practical examples (in the e-commerce and retail industry).