CES 2013: Augmented Reality for Retail Sales

Curtis Franklin Jr., Executive Editor | 1/10/2013 | 16 comments

Curtis Franklin Jr.
Showrooming is a major challenge for many retailers. Augmented-reality software could help solve the problem... or make it much, much worse.

At CES 2013, I saw an interesting set of applications designed to make it easy for a customer to come into a store and explore different product offerings without ever entering a fitting room.

FaceCake provides the hardware and software that shows the customer his or her image on a television monitor, then dresses that image in whichever clothes and accessories the retailer would like to recommend.

As I watched a company representative go through a demonstration, I was struck by two things: First, it's pretty obvious that the clothing and accessory selection is computer generated and applied to the image. Next, it's pretty good as a first-level decision-making tool -- and it's almost certainly going to improve.

Here's how it works: A customer first goes about "registering" her body's location by moving her hands to cover selected spots on the screen. The customer then uses her hands and arms to control the selection of items through gestures interacting with object menus on the screen. The FaceCake spokeswoman gestured to scroll through menus of different clothing collections, selecting one after another to "try on" via the display.

With many of the clothing selections, the software suggested purses, scarves, and other accessories that could then be added to the outfit and modeled in a 360-degree view of the total ensemble. If the customer approves, the outfit can be saved and printed out for delivery by a sales representative. All-in-all, it was a fast, impressive demonstration.

Now, it's important to note that the clothng wasn't presented in Avatar-level quality. Some of the graphics were a bit blocky, but they allowed a reasonable view of what certain clothing lines and fabric patterns might look like when worn. For the retailer, it would let a customer quickly page through a set of possibilities and decide which outfits are worth spending the time to try on for fit and finished effect. It's a system that might well allow a clothing retailer to provide personalized service quickly to a large number of customers.

So far, so good. I was left with a question, though: Would some customers use the system for even more sophisticated showrooming activities? Would savvy shoppers use the tools to pick their best outfits and then search online for the best possible price?

That question gets to the heart of how retailers can use augmented-reality systems. There's no doubt that a retailer could use the system as part of a concerted effort to give personalized service to the customer. There's also very little doubt that many companies won't do that for fear that it will be used by bargain-hunting customers who ultimately make their purchase elsewhere.

There's a reason I feel such optimism about what a system like this could do for a retailer. That optimism is tied to the ways in which personalized suggestions could be improved through the use of applications such as the SAP personalized shopper app, which I also saw at the show.

The fact is that the tools are now being put into place to allow retailers to know their customers well, to tailor product and service offerings directly to the customers' interests, and to reduce transactional friction.

No doubt, some customers will take the suggestions provided by these sorts of systems and then look for the lowest-cost purchasing option online. Retailers would do well to look past that possibility and embrace technology that will allow them to build customer loyalty and increase the value of each interaction. With a proper dedication to customer service, the rewards for shoppers and retailers alike could be substantial.

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Susan Nunziata   CES 2013: Augmented Reality for Retail Sales   1/17/2013 11:38:07 PM
Re: using it to build brand loyalty
@Curt: I would have to agree. I think service is going to be the key going forward for brick-and-mortar retail in the face of growing price pressure from online retailers. 
SaneIT   CES 2013: Augmented Reality for Retail Sales   1/16/2013 7:55:30 AM
Re: using it to build brand loyalty
For those purposes I can see the value.  For jewelry as shown in the example I can see where seeing how a necklace will hang and how large it really is might be good to know before placing an order online.  I just wonder how many people will actually use it.
CurtisFranklin   CES 2013: Augmented Reality for Retail Sales   1/15/2013 11:37:41 PM
Re: using it to build brand loyalty
@stotheco, I think you're right: done poorly, this could be very off-putting. Retailers have a lot of incentive to get it right, and fortunately for them, vendors have a lot of incentive to help them get it right.
CurtisFranklin   CES 2013: Augmented Reality for Retail Sales   1/15/2013 11:36:19 PM
Re: using it to build brand loyalty
SaneIT, I don't think this is good for check fit. For figuring out whether a particular color, style or cut works for your body, it can let you quickly makes a bunch of first-level decisions.
CurtisFranklin   CES 2013: Augmented Reality for Retail Sales   1/15/2013 11:34:36 PM
Re: It can back fire...
@rdv there are certainly limitations to the current implementation but I think the future of this technology looks incredible. I think many customers will have a lot of incentive to learn to use this technology because it will help them get what they want faster and with less effort.
CurtisFranklin   CES 2013: Augmented Reality for Retail Sales   1/15/2013 11:32:51 PM
Re: using it to build brand loyalty
@Susan, I can imagine a scenario in which this sort of AR helps reduce costs for the retailer but I think it will be used primarily to help differentiate on levels of service rather than price. To be honest, I think it's going to become harder to compete simply on price -- the real competition is going to be around a level of service that can be deliverd for a competitive price.
stotheco   CES 2013: Augmented Reality for Retail Sales   1/15/2013 5:41:07 AM
Re: using it to build brand loyalty
Augmented reality is another medium with which stores can go the "extra mile." It's an interesting concept and I hope they do it right, otherwise they might just end up driving customers away. 
SaneIT   CES 2013: Augmented Reality for Retail Sales   1/11/2013 7:55:52 AM
Re: using it to build brand loyalty
I think for a lot of products, this could be very useful and in many of those cases it's not a matter of price it's a matter of does a product fit into a space or if it clashes with other pieces.  I'm thinking more along the lines of things like furniture or say cabinets during a kitchen remodel.  AR would be great for a store like IKEA if the customer could drag pieces into a clean version of the room that they want to fill.  I'm not sure I'd try a pair of AR jeans on for size since I couldn't feel where they are tight or where they might bother me.
rdv   CES 2013: Augmented Reality for Retail Sales   1/11/2013 2:04:12 AM
It can back fire...
"Here's how it works: A customer first goes about..."

  The retailer has to train the customer on how to use it or otherwise the customer will have to spend time exploring the tool... If the customer gets irritated by the system response he would quit... t

  Also after looking at the videos, I feel that this technology is good if the customer chooses tight fitting dress.  If the customer chooses loose dress (or the one with frills) then using this tool might not help...
Susan Nunziata   CES 2013: Augmented Reality for Retail Sales   1/11/2013 12:22:10 AM
Re: using it to build brand loyalty
@Curt: do you think it would be worth the investment in AR even for a reailer whose primary differentiator is price not service? 
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