The retail industry is becoming increasingly competitive, so businesses are turning to interactive experiences to set themselves apart and build stronger relationships with customers. Fifty-five percent of US brands and retailers across different categories, according to a recent study by Obsess and Coresight Research, plan to increase their investments in immersive experiences over the next three years. The need to boost customer acquisition, loyalty, conversions, and expansion has led to this increase in spending.
Where to Put Your Money First
The study’s emphasis on investment priorities is key to understanding the future of immersive experiences in retail. In the next 12 months, we will focus primarily on:
- Content customization made possible by data analysis and artificial intelligence
- Compatible with virtual and augmented realities digital mannequin
- Online shops
- Online shows and parades of fashion
- Buying in Groups
- Livestreaming
- Shopping as a game
These priorities shed light on where brands and retailers are placing their attention in order to reap the rewards of immersive experiences.
Online and Offline Convergence through Virtual Stores
Brands and retailers are increasingly putting money into online virtual stores to improve the customer’s overall shopping experience. The Beverly Hills Virtual Store by Ralph Lauren and the Virtual Beach House by J.Crew are two such examples. The research shows that 61% of businesses have already established successful online stores. A staggering 91% of these businesses said they saw a rise in online sales after opening their virtual stores.
Shoppers can peruse and buy from virtual stores in an online setting designed to feel like a real one. Brands can engage customers more deeply by letting them virtually try on products, browse different sections, and ask questions of knowledgeable virtual assistants thanks to technological advancements. Connecting the online and offline worlds in this way increases customer involvement and ultimately boosts revenue.
Content Powered by Artificial Intelligence: Mass Customization
Brands and retailers are also heavily investing in AI-powered content for personalization. With the help of AI, businesses can more precisely target specific demographics of customers with targeted messaging and content. According to the data, the majority (71%) of the companies in the survey have already made investments in this area.
64% of these businesses saw an increase in click-through rates, 65% in average time spent on their platforms, and 61% in Net Promoter Scores after implementing these strategies. Brands can increase customer loyalty and retention by providing a more individualized and exciting experience for each customer through the use of personalized content.
The Funnification of Shopping Through Gamification
As more and more companies compete in the e-commerce space, consumers have shown an increased interest in gamified shopping experiences. In this sector, you can put money into things like interactive polls and quizzes, virtual currency, and missions with points and rewards for completing them. 40% of businesses in the survey have already implemented gamified shopping experiences, and the results have been positive so far, according to the study.
Seventy percent of businesses that gamified their shopping experiences saw an increase in user engagement as a result. Brands can increase customer engagement, boost sales, and make the shopping experience more fun by using gamification techniques.
Social Shopping: Bringing the Social Experience Online
Brands and retailers have recognized the importance of social shopping in an era when social media plays such a pivotal role in consumers’ daily lives. Users can invite their friends to join them in a shopping experience, recreating in-store interactions with virtual representations of themselves. Sixty-five percent of businesses in the survey have already made investments in social shopping, and the results have been very positive, especially for non-fashion retailers.
35% of non-clothing retailers and 15% of clothing retailers both reported substantial growth in online sales. In addition, 49% of non-fashion retailers, compared to 48% of fashion retailers, saw moderate growth in online sales. Brands can leverage the persuasiveness of word-of-mouth advertising by encouraging customers to talk about their purchases, recommendations, and overall experiences on social media.
The Role of Fully Immersive Retail Experiences
The importance of immersive experiences for brands and retailers seeking to stand out in today’s crowded retail market cannot be overstated. Brands need to get creative to compete with the likes of Amazon and Walmart, the two biggest names in online retail. Amazon is expected to make up 37.6% of US retail e-commerce sales this year, while Walmart will make up another 6.8%, according to industry forecasts.
Brands and stores will only succeed in this market if they create interactive experiences that are tailored to the preferences of their target demographic. Companies can better connect with their customers by investing in innovative channels like social shopping, gamified retail, and virtual stores powered by artificial intelligence.
See first source: Insider Intelligence
FAQ
Q1: Why are brands and retailers investing in immersive experiences?
A1: The competitive nature of the retail industry is driving businesses to invest in immersive experiences to enhance customer acquisition, loyalty, conversions, and expansion.
Q2: What are the key investment priorities for immersive experiences in retail?
A2: The top priorities include content customization using data analysis and AI, virtual and augmented reality digital mannequins, online shops, online fashion shows and parades, group buying, livestreaming, and gamified shopping.
Q3: How are virtual stores impacting the retail industry?
A3: Virtual stores like the Beverly Hills Virtual Store by Ralph Lauren and the Virtual Beach House by J.Crew enhance the shopping experience. Businesses report a significant rise in online sales (91%) after establishing successful virtual stores.
Q4: What role does artificial intelligence play in immersive retail experiences?
A4: AI-powered content personalization helps businesses target specific customer demographics with tailored messaging. This approach leads to increased click-through rates (64%), longer time spent on platforms (65%), and higher Net Promoter Scores (61%).
Q5: What is gamified shopping, and how is it benefiting businesses?
A5: Gamified shopping involves interactive polls, quizzes, virtual currency, and missions with rewards. Forty percent of businesses have implemented gamified shopping, resulting in a 70% increase in user engagement.
Q6: What is social shopping, and how are brands leveraging it?
A6: Social shopping allows users to shop with friends in virtual settings. Sixty-five percent of businesses have invested in social shopping, leading to substantial growth in online sales, especially for non-fashion retailers.
Q7: Why are fully immersive retail experiences crucial in today’s retail market?
A7: To compete with industry giants like Amazon and Walmart, brands must create tailored interactive experiences. Investments in social shopping, gamified retail, and AI-powered virtual stores help businesses better connect with customers and stand out in the market.
Featured Image Credit: Ameer Basheer; Unsplash – Thank you!
