• Casey Reagan

The State of Augmented Reality in Retail - Spring 2020

Retail has been undergoing a transformation for decades; 2020 has accelerated this process. A significant amount of investment was made in developing e-commerce infrastructure over the past decade, an important part of the retail ecosystem as some 70% of shoppers start their shopping journey online. However, with e-commerce solidified, retailers need to make investments in their physical stores to meet the expectations of shoppers with 80%+ of revenue coming from brick and mortar.

Augmented Reality (AR) is one of the developing areas that has a potential for enhancing the offline (and online) shopping experience. There are many applications in place today that are successful. In this report, we will talk about some of the current successes and challenges of augmented reality as well as areas of future development in order to provide insight into where retailers should prioritize their budgets.


Virtual makeup is an application that has been very successful for AR. This will only expand as a result of the pandemic. The ability to virtually try on cosmetics makes it really easy for shoppers to evaluate dozens of looks in a very short span of time. With makeup, feel is important, but the critical aspects of color matching and combination can be more efficiently cycled using AR. Once a couple of options emerge then a deeper evaluation can occur.

There are several brands that are currently providing these tools online and in-store to their shoppers with great success.

A second area of great success is with home furnishing, an item that is difficult to return once you have it in your home and see that it doesn’t work. This may even be the first area of retail where this technology was really applied. Expanding out of home remodeling tools showing how a remodeled home might appear with a 3D model, paint companies started developing the technology. Take a picture of your room and then use software to show different colors on the walls. It was only logical for this to move to flooring and then to furniture and other fixtures as the technology developed.

More Than a Pretty Face

Beyond just showing splashes of color or inserting objects on top of an image there are many other novel applications for AR technology.

Examples include, but are not limited to getting directions. Imagine searching for a product in a store and being able to have virtual AR arrows appearing in view to point you which way to go and then highlights showing you the exact item on the shelf or rack.

AR displays of products in action are another example. LEGO Stores feature displays which can scan a box and then show the interactive features directly on top of the box.

AR can also be used to display product features attached to any given product. Scan a box at the grocery store to see a list of ingredients or scan a tool at the hardware store to see exactly how to use it along with a list of features and functions.


While it may be exciting to imagine the benefits of virtual try-on for fashion, accurate fit and complex features, like the drape of varied fabrics, can be particularly difficult to render. Unlike lip color or paint on a wall, clothing are real complex objects that need to be placed on a variety of body types. Furthermore, color for clothing is important, but perhaps more important in this case is the feel and fit. If the dress doesn’t fit or the feel of the fabric is not appealing then it doesn’t matter if it is the perfect shade of blue.

The Future

There are many advancements being made in the areas of AR, and in the case of clothing in the analysis of body types and virtual fabric shaping. At this point, these are a ways off. We see the future of AR technology and its applications in the retail space, but it does not currently solve all problems for every type of retail. That said, the possibilities are endless.