Effect of Augmented Reality (AR) and Virtual Reality (VR) experiences on customer engagement and purchase behavior in retail stores

Abstract

This review paper explores the impact of Augmented Reality (AR) and Virtual Reality (VR) technologies on customer engagement and purchasing behavior in retail settings. As immersive technologies continue to evolve, AR and VR are increasingly employed to enhance the shopping experience, offering interactive and personalized engagements that traditional retail cannot match. Through a comprehensive analysis of recent literature, the paper highlights how AR applications, such as virtual try-ons and interactive product displays, significantly enhance customer engagement by providing novel and enriched shopping experiences. Similarly, VR facilitates virtual store visits and immersive product interactions, leading to higher levels of customer satisfaction and brand loyalty. The paper discusses key metrics for evaluating engagement and purchase behavior changes, including increased dwell time, higher conversion rates, and enhanced customer satisfaction. Additionally, the review identifies challenges, such as technological integration and user adaptation, which may impede the full potential of AR and VR in retail. The findings underscore the transformative potential of AR and VR in reshaping the retail landscape by bridging the gap between digital and physical shopping environments, thus driving more informed purchasing decisions and fostering deeper customer connections. Future research directions are suggested to address the limitations and further investigate the long-term impacts of these technologies on consumer behavior.