Report: Augmented Reality Retail Adoption to Be Driven by Online Shoppers

Augmented Reality will see major adoption in the retail sector, driven more by use by online shoppers and the retail workforce, rather than use by customers in the brick and mortar environment, according to ABI Research.

AR experiences can prove extremely useful for online customers unable to interact with the physical products they intend to purchase, according to ABI’s Augmented Reality in Retail report.

ABI forecasts that, by 2020, 3% of e-commerce revenue will be generated because of augmented reality experiences. That equates to $122 billion in revenue worldwide.

“The relative ease of integrating AR into existing m-commerce platforms and the impact this can have on the user experience will largely drive customer demand,” said Nick Finill, senior analyst at ABI Research, in a statement.

The benefits of using AR will not overcome the barriers which exist in physical retail, however, which is inherently less reliant on the use of a mobile device.

“For consumers in brick and mortar stores, however, AR can disrupt the customer journey and provides little additional value overall,” Finill said in a statement.

For the in-store employee, AR promises to deliver operational efficiencies and raise the quality of the service delivered, according to ABI.

Smart glasses from manufacturers such as Vuzix are already starting to be used by retail employees to assist with front- and back-of-store operations, according to ABI. ABI forecasts that by 2022 more than 120,000 stores will be using AR smart glasses globally, with deployments evenly split across Europe, North America and Asia-Pacific. This will be driven by the need for efficiency savings to compete with rival retailers and the online sector generally.

Home Entertainment Seeks VR Lifeline – at the Mall?

Apparently alternate reality has come to the home entertainment industry.

Stephanie Prange’s insightful report from the recent DEG event about Virtual Reality (VR), Alternate Reality (AR) and Mixed Reality (MR) infusing new hope for home entertainment studios underscores the fact that this alphabet soup of hype is definitely not reality.

Industry experts contend that VR – a technology that has always been (and will always be) a component of video games – will now transform into a mall-based attraction, or new acronym: LBE (location-based-entertainment).

“Our hope is certainly that the LBE market will not only be a business in and of itself but also encourage and support the home market,” said Jessica Schell, EVP and GM, Warner Bros. Home Entertainment.

That’s a stretch. Malls are dying in America. Amazon, ecommerce and the Internet is rapidly making the demise of this consumer option an increasing reality.

Greg Maloney, retail CEO at real-estate firm Jones Lang LaSalle , which manages malls nationwide, told The Wall Street Journal shoppers in the rural Midwest are changing their habits faster than others in the U.S.

At its peak, there were 1,500 major malls in the U.S. There are currently about 1,000 left, with about 300 expected to close over the next five years. And that’s being generous.

“When you get into rural America, you’re looking at 35 to 40 minutes of driving” to get to the mall, Maloney said.

Apart from a weekly trip to Sam’s Club or Costco, shoppers in the Midwest do as much shopping as possible online, according to The Journal.

Howard Davidowitz, with investment banking firm Davidowitz & Associates, told CNN Money that when anchor stores – Sears, Macy’s, etc., close, it causes more than headaches for mall owners and other retailers.

“I’d say this problem is only in its second inning,” Davidowitz said.

F.Y.E, one of the last standing home entertainment retail chains, which is mall-based, attributes morbid home entertainment sales to declining mall foot traffic.

But let’s forget logistics and stick to other realities undermining wider consumer adoption of VR, AR and MR. Most consumers aren’t select teenagers willing to embrace vertigo for their next home entertainment experience.

Remember 3D Blu-ray? It’s dead. And it wasn’t cost or competing 3D eyewear that killed the concept. It was the fact most people couldn’t wear 3D glasses long enough to watch a trailer, let alone the movie.

Try watching World War Z in 3D. I did. Wanted to jump off that building with Brad Pitt. And I wasn’t even bitten by a zombie. Just wearing 3D glasses. Turns out, 3D was the same hyped gimmick that came and fizzled in the 1950s.

Despite endless VR goggle/smartphone marketing over the winter holidays, a recent Nielsen study found that 53% of respondents were “just not interested” in the concept, while 43% said it was “too expensive” and 14% worried about “motion sickness.”

Augmented reality has many applications that can work for consumers and retail. Even better, it doesn’t require special glasses, just an app and smartphone can enable a user to see what a home improvement to a bathroom or kitchen could look like.

Watch any home improvement TV show, it’s riddled with AR transforming neighborhood busts into must-have homes before a shedding a single ounce of sweat equity.

Mike Dunn, DEG chair and president, product strategy and consumer business development, 20th Century Fox, perhaps summed it up best.

“The challenge from my perspective is not the technology, but how you apply that technology,” he said. Dunn used to be president of Fox Home Entertainment.

 

 

 

 

DEG Speakers Confront New Reality: AR Shows Promise, VR ‘Going to Take a While’

Virtual reality, augmented reality and mixed reality have been the new buzzwords in the home entertainment business for the past few years, but the hype is starting to meet reality (the real one) when it comes to the money-making prospects for these new formats in the entertainment realm.

That was the consensus at the “Next Up: Alternate Realities in Home Entertainment: VR, MR, AR” conference, presented by DEG: The Digital Entertainment Group.

“The challenge from my perspective is not the technology, but how you apply that technology,” said Mike Dunn, DEG chair and president, product strategy and consumer business development, 20th Century Fox.

Still, these new formats are here to stay, and the industry must begin to adjust, noted DEG president and CEO Amy Jo Smith.

“It’s not temporary,” she said. “It’s going to be permanent.”

“The near term is not going to be as dramatic as the long term,” said keynote speaker and author Charlie Fink. “We get very excited when we discover something new, but for it to become a product, it takes a long time.”

Fink noted, “AR [especially mobile] is hot right now, and VR is not so hot.”

“Virtual and augmented reality have nothing to do with each other,” he said. “They are not the same.”

What makes AR, which superimposes data and other content on real video, so exciting, he said, is that “the world is going to be painted with data.”

“Who’s going to be doing the painting?” he said, noting that it is an opportunity for IP owners.

Virtual reality requires an immersive experience that is “going to take a while,” he said. Disneyland, consumers being inside a movie, is an early attempt at VR, he said.

“Although I loved Ready Player One [the Steven Spielberg blockbuster about VR], I note that it takes place in 2045,” said Fink about VR. “I would say, ‘Don’t hold your breath. It’s going to take a while for VR to become as big as AR. That said, when you can walk around in the movie, it will be mind-blowing and everybody will do it.’”

Still, it’s all in the developmental stage, as many speakers acknowledged.

Location-based VR, meaning spaces at malls, etc., where consumers can experience VR, is the leading edge of the VR business, speakers said.

“It’s also bringing so many more people to experience VR, hopefully getting over the hurdles of understanding what it means and some of the scariness of getting the headset for the first time and working out that human interaction as you are first experiencing it and so our hope is certainly that the LBE market will not only be a business in and of itself but also encourage and support the home market,” said Jessica Schell, EVP and GM, Warner Bros. Home Entertainment.

“These arcades that are popping up, for us it’s a secondary licensing opportunity for the home entertainment product that we are creating,” said Brendan Handler, SVP and GM, virtual reality at FoxNext. Fox has produced VR projects around its ‘Alien’ and ‘Planet of the Apes’ properties.

“Ultimately, it’s going to come down to content,” he said. “It’s going to have to be breakthrough content.”

It’s also the practical aspect of VR, noted Schell.

“Content’s critical but you have to have great devices to be able to experience the content,” she said. “And to really make that accessible you’ve got to have a low price point, you have to have glasses that people can wear for a long time and watch longer form content without getting tired, without getting sick, you have to have it untethered so people can walk around, wireless, long battery life without warming up your face so much.”

The consensus was VR, AR, MR are still a work in progress.

In a First, Sony and Snapchat Employ Augmented Reality With ‘Jumanji’ Release

With the March 20 release of Jumanji: Welcome to the Jungleon 4K UHD Blu-ray Disc, Blu-ray Disc and DVD, Sony Pictures Home Entertainment is bringing the jungle to life for fans with an augmented reality experience through Snapchat.

In the first of its kind for a home entertainment release, when consumers purchase a copy of the film on disc at any retailer and scan the Snapcode on the front, the packaging elements will start to move, making their way across the retail environment and encouraging people to follow it with their camera phone. Once scanned through the app, users can explore a 360 jungle with a hippo jump-scare and a message from Dr. Smolder Bravestone (Dwayne Johnson) telling consumers that the next adventure lies inside the packaging. Upon opening the packaging, consumers can scan the insert inside the box which will trigger a second experience that brings the characters from Jumanji to life.

“Given the incredible box office success with Jumanji: Welcome to the Jungle, we are continuing the consumer excitement into the home entertainment window by partnering with Snapchat in this groundbreaking AR packaging experience to drive in-store retail engagement and physical product purchase, while giving consumers a new way to interact with the Blu-ray and DVD and share their experience.” said Nicole Longo, Sony director of marketing.

“Much like they reimagined Jumanji itself, Sony Pictures Home Entertainment has thoughtfully reframed AR marketing to drive sales for their home entertainment release,” said Jeff Miller, head of creative strategy, Snap. “Their Snapchat lenses set a new bar for contextual augmented realityintegration with physical packaging.”

In addition to having the Snapcodes on the front of the product, the codes will also be on in-store retail signage and displays. Sony also will employ national TV spots, digital marketing, social media, radio and on-platform ads on Snapchat to support the AR effort.

The film earned more than $400 million at the box office.