In the rapidly evolving world of retail, the integration of immersive experiences has emerged as a pivotal strategy to captivate and engage consumers. In Q4 2023, Obsess partnered with Coresight Research to conduct a study of 150 retail decision-makers, which sought to understand how retailers are thinking about immersive experiences—including how they are prioritizing investments, and which types of results they are seeing.
The full report is available to download for free here.
The report’s findings forecast the AR market to soar to $31.3 billion by 2027. Meanwhile, the VR market, though smaller, is set for significant growth, projected to escalate from $12.9 billion in 2023 to $20.7 billion by 2027. The growth rate of VR is notably 1.5 times greater than that of AR, highlighting a compelling trend in technological advancement and consumer adoption.
However, what makes this growth even more compelling is the insight derived from the survey conducted among industry respondents. More than half of all surveyed brands and retailers indicated that they would increase their investment in immersive experiences during the next three years. Likewise, an overwhelming 86% of respondents indicated a definite intent to increase their investment in immersive experiences over the next 10 years.
This high planned adoption rate within the next few years highlights an urgency around investing in immersive experiences. Despite economic challenges, surveyed brands and retailers have signaled that they will continue to invest in immersive experiences, emphasizing the value that companies believe they stand to gain from investing in this area.
Immersive experiences encompass a wide spectrum—from virtual stores and VR/AR-enabled try-on to AI-driven content for personalization and social shopping.
The impact of virtual stores is tangible, with an impressive 88% uplift in sales after investing in virtual stores. Likewise, brands partnering with Obsess witness up to 10X longer session times in virtual stores compared to traditional e-commerce platforms.
The survey identified seven types of immersive experiences, with four emerging as front-runners in revolutionizing consumer engagement within retail.
Interestingly, virtual try-on, virtual fashion shows/events, and livestreaming are already well-established immersive experiences in the market. The remaining four—virtual stores, gamified shopping experiences, social shopping, and data/AI-enabled content for personalization—are gaining traction among brands and retailers as innovative avenues to boost sales and enrich consumer interactions.
The survey delved into the considerations that companies planning to invest in each type of immersive experience deemed most critical within the upcoming 12 months. Notably:
- Virtual Stores and Gamified Shopping Experiences: Retailers prioritize a seamless user experience, with a “user-friendly interface” ranking high. Additionally, the importance of “mobile responsiveness” underscores the shift towards catering to mobile-savvy consumers.
- Data/AI-enabled Content for Personalization: Companies emphasize tailored engagement, leveraging data insights for personalization. Notably, “data analytics and insights” top the list for virtual stores, signaling a shift towards leveraging consumer behavior data, similar to the approach used in physical stores.
- Social Shopping: Cost emerges as a critical factor, potentially attributed to expenses related to creator-generated content, celebrity endorsements, and user-community activities.
These insights underscore a strategic shift in how retailers perceive and approach immersive experiences. Beyond the technological novelty, companies prioritize aspects that directly impact consumer engagement and satisfaction, aiming to minimize friction and enhance the overall experience.
The report illuminates the evolving landscape of immersive experiences in retail, offering a roadmap for businesses aiming to navigate and harness the potential of new technologies. The integration of immersive experiences into retail is not merely a trend but a strategic imperative, aligning with the evolving preferences of modern consumers. As businesses invest in these technologies, they aim to not only boost sales but also glean invaluable insights into consumer behavior, enabling more informed marketing strategies and innovative approaches to store layout and inventory management.
Download the full report here.
