Augmented Reality in Retail

Augmented Reality in Retail

Global Augmented Reality in Retail Market to Reach US$64.4 Billion by 2030

The global market for Augmented Reality in Retail estimated at US$13.9 Billion in the year 2023, is expected to reach US$64.4 Billion by 2030, growing at a CAGR of 24.5% over the analysis period 2023-2030. Software & Services Component, one of the segments analyzed in the report, is expected to record a 24.0% CAGR and reach US$36.8 Billion by the end of the analysis period. Growth in the Hardware Component segment is estimated at 25.2% CAGR over the analysis period.

The U.S. Market is Estimated at US$4.0 Billion While China is Forecast to Grow at 22.4% CAGR

The Augmented Reality in Retail market in the U.S. is estimated at US$4.0 Billion in the year 2023. China, the world`s second largest economy, is forecast to reach a projected market size of US$8.9 Billion by the year 2030 trailing a CAGR of 22.4% over the analysis period 2023-2030. Among the other noteworthy geographic markets are Japan and Canada, each forecast to grow at a CAGR of 21.2% and 20.1% respectively over the analysis period. Within Europe, Germany is forecast to grow at approximately 14.3% CAGR.

Global Augmented Reality in Retail Market - Key Trends and Drivers Summarized

What Is Augmented Reality in Retail, and How Does It Work?

Augmented Reality (AR) in retail is a transformative technology that overlays digital content onto the physical shopping experience, enabling customers to visualize products in a more interactive and personalized way. AR integrates digital images, animations, and information with real-world environments, typically accessed via smartphones, tablets, or AR-enabled mirrors. In retail, AR allows customers to engage with products by seeing how they would look or function in real life without needing to handle them physically. For example, in a furniture store, AR apps let customers visualize how a sofa would look in their living room, adjusting size, color, and placement directly through their phone’s camera. In fashion retail, AR mirrors or mobile apps allow users to try on clothes, makeup, or accessories virtually, showing how products will appear on them. AR uses a combination of camera feeds, sensors, and specialized software to detect surfaces and adjust digital elements accurately, creating a seamless, realistic experience. This integration of AR into the shopping experience helps customers make more informed purchasing decisions and reduces the uncertainty associated with online or in-store shopping, creating a more engaging and convenient retail experience.

What Sets Augmented Reality in Retail Apart from Traditional Shopping Experiences?

Augmented Reality enhances traditional shopping experiences by offering customers a highly interactive, immersive, and personalized approach to product exploration. Unlike conventional shopping, where customers often have limited opportunities to test products before purchasing, AR allows users to see, try, and customize products in virtual environments that mimic real-life settings. This is especially useful for online shoppers who can’t physically interact with products—AR brings a tangible aspect to e-commerce, bridging the gap between online and in-store shopping. For instance, in the fashion industry, AR enables virtual try-ons, allowing customers to see how different clothing items, makeup, or accessories would look on them, eliminating the guesswork involved in sizing and styling. In home decor, customers can use AR to visualize how a particular piece of furniture would fit within their space, experiment with different color schemes, and even match styles with existing decor—all from the convenience of their home. This technology also provides retailers with an opportunity to engage customers with branded experiences, offering them exclusive AR content like interactive catalogs, product demos, and more. By making shopping both convenient and experiential, AR not only improves the decision-making process but also enhances brand loyalty, as customers are more likely to engage with retailers who offer innovative and personalized experiences.

How Is Augmented Reality Transforming the Retail Industry?

Augmented Reality is revolutionizing the retail industry by reshaping customer engagement, driving sales, and reducing product returns. By allowing customers to virtually try on items or visualize products in their intended environment, AR helps reduce uncertainty and build confidence in purchasing decisions, leading to higher conversion rates and fewer returns. For fashion and beauty retailers, virtual try-ons have become especially popular, as they allow customers to experiment with different looks, colors, and styles without physically trying on items, which also reduces in-store fitting room congestion. Furniture and home decor retailers use AR to help customers visualize how large items, like sofas or beds, will fit in their rooms and align with their personal style, enhancing convenience and reducing the need for in-store visits. Furthermore, AR is playing a crucial role in customer education by offering interactive tutorials and detailed product demonstrations that explain how products work or look when used. For example, beauty brands provide virtual makeup try-ons with tips on application techniques and style recommendations. In stores, AR can be used to create “smart shelves” or interactive kiosks that provide product information, recommendations, and even special deals, transforming the in-store shopping experience into a dynamic, self-guided journey. As more retailers adopt AR, the technology is set to redefine customer expectations in both physical and digital shopping environments, creating more engaging, informative, and convenient shopping experiences.

What’s Fueling the Expansion of the Augmented Reality in Retail Market?

The growth of augmented reality in retail is driven by technological advancements, changing consumer expectations for personalized shopping, and the need for retailers to differentiate themselves in a competitive market. Advances in mobile technology, faster internet speeds, and the widespread adoption of smartphones have made AR more accessible and functional for consumers. Today’s customers expect a seamless, engaging shopping experience, and AR fulfills this by offering personalized interactions, whether they are shopping online or in-store. The rise in e-commerce has further accelerated the adoption of AR, as retailers seek innovative ways to bring interactivity and customer engagement to online platforms. Additionally, AR’s ability to reduce product returns by helping customers make more informed purchases has made it a valuable tool in cost savings and customer satisfaction. Retailers are increasingly using AR as a branding tool as well, offering unique, interactive experiences that set them apart from competitors, attract a younger audience, and create memorable brand interactions. The COVID-19 pandemic has also fueled the growth of AR, as it prompted retailers to innovate and provide virtual shopping alternatives during periods of restricted in-store access. As AR technology continues to evolve and becomes more cost-effective, the demand for augmented reality in retail is expected to grow, cementing its role as a critical component of modern retail strategy, enhancing customer engagement, and driving sales in an increasingly digital-first market.

SCOPE OF STUDY:

The report analyzes the Augmented Reality in Retail market in terms of US$ Thousand by the following Application; Component; Device Type; End-Use, and Geographic Regions/Countries:

Segments:
Component (Software & Services, Hardware); Device Type (Head-Mounted Display (HMD), Smart AR Mirror, Handheld Device); Application (Try-On Solutions, Advertising & Marketing, Planning & Designing, Information Systems); End-Use (Furniture & Lighting, Jewelry, Beauty & Cosmetics, Grocery Shopping, Other End-Uses)

Geographic Regions/Countries:
World; United States; Canada; Japan; China; Europe (France; Germany; Italy; United Kingdom; and Rest of Europe); Asia-Pacific; Rest of World.

Select Competitors (Total 106 Featured) -

• Amazon
• Apple
• Augment
• Blippar
• Google
• Gravity Jack
• Holition
• IKEA
• Imaginate Technologies
• Inde

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