Augmented Reality for Retail Market

Augmented Reality for Retail Market Overview

The global augmented reality for retail market size is estimated to be worth around US$ 2.36 Billion in 2022 and is projected to grow at an enormous CAGR of around 43% to 46% throughout the forecast period, totaling around US$ 23.0 Billion by the end of 2032. Growth in the market is driven by increasing adoption of cutting-edge technologies like augmented reality by retail businesses such as specialty stores, malls, supermarkets, departmental stores etc. for enhancing customer experience.

With changing shopping trends and customer preferences, demand for modern technologies like augmented reality and virtual reality is witnessing an uptick in the retail industry. Augmented reality for retail brings interactive representation of products to consumers wherever they are, thereby delivering immersive experiences.

Various modern retail industry sectors and e-commerce retailers are incorporating augmented reality for retail to enhance customer experience. Adoption of these modern technologies is believed to help retailers to woo more and more customers, thereby increasing the sales. It assists them to create brand image among customers by means of creating interactive shopping experience.

Although augmented reality for retail is still in its early developmental phases, it is gradually becoming a new trend with its numerous benefits and applications. Usage of augmented reality helps customers to visualize themselves wearing the products and thus assists them in choosing a perfect combination.

Rising adoption of augmented reality by retailers to increase their sales as well as to enhance the customer experience will continue to provide a strong thrust to the growth of augmented reality for retail market during the forecast period.

Which Factors are Spurring the Growth of Augmented Reality for Retail Market?

Rising need for improving the overall customer experience in a highly competitive retail industry, growing penetration of smartphones and connected devices, and increasing spending by people on purchasing products from online shopping platforms are some of the major factors driving the growth of augmented reality for retail market.

Augmented reality for retail has emerged as a game-changing innovation as it empowers customers with the ability to visualize and customize products by interacting virtually in 3D.

Ongoing fierce competition in the retail industry is encouraging retailers to adopt innovative technologies like augmented reality and virtual reality in their space. The adoption of augmented reality for retail enables the creation of immersive product and services catalogs with preview features. It offers several benefits including providing better communication, creating an immersive experience, and offering more engagement. Besides this, it also enables the e-commerce companies to mitigate the disadvantages of not owning a showroom.

Augmented reality for retail allows customers to try out products virtually before purchasing them. Adoption of this technology ignites customers’ interest in products while providing all the required product details.

Various smart retailers of clothing are integrating smart AR mirrors for virtual apparel fitting as a try before you buy option. This rising trend of try on solutions across clothing and jewelry stores is anticipated to boost the growth of augmented reality for retail market during the assessment period.

Thanks to the features of augmented reality, designers and contractors can allow their clients to preview and visualize a vast selection of designs before finalizing their selections. Thus, it plays a key role in minimizing the incidence of product return and significantly enhances customer satisfaction.

Similarly, growing usage of augmented reality for retail for planning and designing a wide range of products like furniture will further boost the market growth in the forthcoming years. Users can simply plan and design their home décor by virtually placing different items to get a sense of the real environment.

What are the Challenges Faced by the Augmented Reality for Retail Industry?

There is no doubt that augmented reality is incontrovertibly the future of retail industry. However, there are certain factors that are posing a challenge to the growth of augmented reality for retail market. Some of these factors are the expensive development expenditure, lack of awareness among small retail business sectors, and poor penetration of augmented reality across various developing and underdeveloped regions.

How is North America Contributing to the Growth of Augmented Reality for Retail Market?

With increasing adoption of modern technologies by retail industry sectors and heavy presence of leading market players, North America will continue to lead the global augmented reality for retail market during the forecast period. Among North American countries, the U.S is projected to remain at the epicenter of market growth, expanding at an astounding CAGR over the forecast period.

The U.S. is home to some of the major retail industries in the world. These leading giants are increasingly incorporating cutting edge technologies such as augmented reality and virtual reality to enrich customer experience and make shopping more interesting.

Similarly, rising adoption of connected devices coupled with increase in online shopping rates is anticipated to further expand the market size across the region.

Nikhil Kaitwade

Principal Consultant

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What is the Demand Outlook for the Asia Pacific Market?

According to Future Market Insights, Asia Pacific Europe is expected to provide lucrative growth opportunities for the providers of augmented reality for retail during the forecast period. Growth in the market will be driven by the rising penetration of modern technologies like augmented reality and virtual reality, presence of favorable regulations, and a gradual increase in the number of domestic and regional market players.

Demand for augmented reality for retail is particularly surging across fast growing economies like China and India due to increasing penetration of online shopping platforms, growing popularity of AR based products like smart AR mirrors, and rising efforts of retailers to enhance customer experience.

Moreover, rapid increase in the number of retail industry sectors is expected to further generate growth prospects within the Asia Pacific augmented reality for retail market in the future.

Market Competition

Some of the key participants present in the global augmented reality for retail market include Augmented Pixels Inc, Cortex, Blippar, Contus, Inde, Apphitect, ValueCoders.com, Xenium Digital, Intellectsoft US, and Virtualware, among others.

These leading players are continuously innovating to provide advanced solutions to the end users. They have adopted growth strategies such as partnerships, collaborations, acquisitions, and mergers to expand their global footprint.

Besides this, they are using various tactics to penetrate emerging markets of Asia Pacific, MEA and other regions.

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Report Scope

Key Segments Profiled in the Augmented Reality for Retail Industry Survey

By Retail Type:

• Furniture
• Apparel
• Groceries
• Footwear
• Cosmetics
• Jewelry
• Others

By Component:

• Hardware
• Software

By Application:

• Malls
• Specialty Stores
• Supermarkets
• Department Stores
• e-Commerce
• Others

By Business Size:

• Large Retailers
• Medium Retailers
• Small Retailers

By Region:

• North America
• Latin America
• Western Europe
• Eastern Europe
• APEJ
• Japan
• Middle East & Africa