Augmented Reality (AR) Shopping Market Size, Share & Trends

Updated on : October 22, 2024

Augmented Reality (AR) Shopping Market Size & Share

The global Augmented Reality (AR) shopping market size is projected to reach USD 11.6 billion by 2028 from USD 3.4 billion in 2023 at a CAGR of 28.0% during the forecast period. Growing adoption of online shopping and e-commerce platforms, rising competition in market driving the need for brand differentiation, growing demand for personalized shopping experience are some of the major factors driving the market growth globally.

Augmented Reality (AR) Shopping Market Statistics Forecast to 2028

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Augmented Reality (AR) Shopping Market Trends :

Driver: Growing demand for personalized shopping experience

Augmented reality (AR) is revolutionizing the shopping experience by offering personalized interactions. Unlike traditional online shopping, AR allows us to use our phones or devices to preview products in our own homes before making a purchase. This reduces the chances of disappointment and returns, enabling better decision-making. Retailers from various industries are utilizing AR to enhance personalization. Furniture stores like IKEA provide AR experiences to visualize furniture in our homes. Makeup brands such as NYX Professional Makeup and Sally Hansen offer virtual makeup try-ons. Nike even utilizes AR to measure our feet accurately for the right shoe size. Moreover, AR significantly impacts purchase behavior. Products with AR content have a higher chance of being bought compared to those without AR. When we can digitally interact and virtually try on products, we gain confidence in our purchases and reduce the likelihood of returns. AR creates a sense of being present in the store, making shopping enjoyable and leading to smarter choices.

Restraint: High cost of AR technology

AR technology requires specialized hardware, such as advanced cameras, sensors, and processors, to deliver immersive and interactive experiences. These hardware components can be expensive, making it challenging for retailers and brands to adopt AR shopping solutions on a large scale. In addition, developing AR applications and content requires specialized skills and expertise, which can also be costly. Businesses need to invest in hiring or training professionals who are proficient in AR development, adding to the overall cost.

The implementation costs associated with integrating AR infrastructure into existing e-commerce platforms or developing dedicated AR shopping apps can be a significant barrier. This encompasses the development of backend systems, ongoing maintenance, and continuous updates to ensure a seamless and high-quality AR shopping experience. Additionally, the high cost of AR hardware, such as headsets and smart glasses, presents a challenge for consumer adoption, as the investment required may deter potential users.

Opportunity: Lower costs of storage and efficient inventory management

The lower cost of storage and efficient inventory management present significant opportunities for the AR shopping industry . Augmented reality technology enables virtual shopping experiences, allowing consumers to explore and interact with virtual products in a realistic way. By integrating AR into the shopping experience, retailers can overcome traditional limitations of physical store space and inventory management.

The lower cost of storage becomes an opportunity as AR shopping eliminates the need for retailers to stock large quantities of physical inventory. Instead, retailers can maintain a virtual inventory of products, reducing the costs associated with warehousing, logistics, and physical store space. AR allows customers to virtually try on or test products, browse through virtual shelves, and make purchase decisions without the need for physical stock on hand. This streamlined approach to inventory management lowers costs and increases efficiency for retailers.

Challenge: Consumer Acceptance

Consumer acceptance poses a significant challenge for the AR shopping industry . While augmented reality (AR) technology holds immense potential for enhancing shopping experiences, it relies on consumer adoption and acceptance to achieve widespread success. There are several factors which contribute to the challenge of gaining consumer acceptance.

Firstly, AR shopping requires users to embrace and adopt new technology. Not all consumers are familiar with AR or comfortable using it in their shopping routines. There may be a learning curve associated with understanding how to interact with AR interfaces and navigate virtual shopping experiences. This lack of familiarity can create a barrier to entry, hindering the adoption of AR shopping platforms.

Augmented Reality (AR) Shopping Market Ecosystem

The major players in the Augmented Reality (AR) shopping market with a significant global presence include PTC (US), Alphabet Inc., (US), Microsoft (US), Apple (US), Meta (US). These companies not only boast a comprehensive product portfolio but also have a strong geographic footprint.

Augmented Reality (AR) Shopping Market Segmentation

Information System to register highest CAGR during the forecast period

The integration of information systems in AR Shopping apps and devices enhances transparency and empowers customers with relevant and accurate information. For instance, a customer using an AR Shopping app on their smartphone can scan a product's barcode and instantly retrieve detailed information about it, including specifications, pricing, and customer reviews. This allows customers to evaluate the product's features and quality, compare prices, and make well-informed decisions. Additionally, the app can provide real-time data on product availability, allowing customers to check if the item is in stock at nearby stores or online retailers is expected to drive the growth of AR shopping market.

AR Smart Mirror to account for the largest share of Augmented Reality (AR) shopping market during the forecast period

AR smart mirrors also benefit retailers by streamlining the fitting room process, reducing wait times, and enabling personalized recommendations. Beyond retail, AR smart mirrors have found applications in other industries, such as sports stadiums, where they provide fans with interactive experiences and opportunities to capture memorable moments. The increasing integration of AR technology in smart mirrors demonstrates its potential to revolutionize the way we shop and engage with our surroundings. Renowned brands like Ralph Lauren and H&M have successfully implemented smart mirrors in their stores, providing customers with convenient and customized try-on experiences. These are the major factor driving the growth of AR smart mirrors.

Augmented Reality (AR) Shopping Market Share

Software to account for the largest share of Augmented Reality (AR) shopping market during the forecast period

The software segment of augmented reality (AR) encompasses key components essential for AR development, visualization, and management. It includes Software Development Kits (SDKs) that provide developers with tools, libraries, and APIs to access AR functionalities like object tracking and spatial mapping. AR Visualization Software utilizes computer vision techniques and graphics rendering to seamlessly overlay virtual content onto the real-world environment, ensuring immersive experiences. AR Content Management Systems enable the organization, storage, and delivery of AR assets, allowing content creators to manage 3D models, animations, and videos. This comprehensive software ecosystem empowers developers and content creators to build and deploy engaging AR applications across different platforms and devices is expected to drive the growth of AR shopping market.

Augmented Reality (AR) Shopping Market Regional Analysis

Asia Pacific to register the highest growth during the forecast period

Asia Pacific is expected to register the highest CAGR in the Augmented Reality (AR) shopping market share from 2023 to 2028. The AR shopping market in Asia Pacific has witnessed numerous new developments and innovations. Companies like YouCam Makeup have pioneered such AR solutions in the region. Prominent retailers across the Asia Pacific region have embraced AR technology to enhance customer engagement and drive sales. For instance, Alibaba's e-commerce platform Taobao utilizes AR to enable virtual try-ons for cosmetic products, while JD.com has implemented AR features to visualize furniture and home decor items in customers' homes. These retailers provide immersive and interactive experiences, enhancing the shopping journey. The growth of the AR market in Asia Pacific can also be attributed to  factors such as increasing usage of internet-based platforms, the continued rollout of high-speed 5G networks, and and advancements in technology.

Augmented Reality (AR) Shopping Market Statistics by Region

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Top Augmented Reality (AR) Shopping Companies - Key Market Players:

The major players in the Augmented Reality (AR) shopping companies with a significant global presence include PTC (US), Alphabet Inc., (US), Microsoft (US), Apple (US), Meta (US). These players have adopted various organic and inorganic growth strategies such as product launches and developments, partnerships, collaborations, acquisitions, and joint ventures to strengthen their position in the Augmented Reality (AR) shopping market.

Augmented Reality (AR) Shopping Market Report Scope :

Augmented Reality (AR) Shopping Market Highlights

The study segments the Augmented Reality (AR) shopping market based on end use, AR technology, offering, device type, application, and market type at the regional and global level.

Recent Developments in Augmented Reality (AR) Shopping Industry

• In November 2022, Google released new AR shopping features for finding the perfect foundation match and trying on sneakers in AR, providing a realistic and immersive online shopping experience.
• In March 2021, PTC has launched Vuforia Engine Area Targets, the first offering in the market that supports the creation of immersive AR experiences for spaces up to 300,000 square feet. With the use of Area Targets, industrial organizations can create AR interfaces within their facilities.
• In March 2021, Seiko Epson announced the enhancement of the AR glasses – Moverio BT-40 and BT – 40S by using Si-OLED technology to expand the field of view with full HD 1080p display resolution, improved connectivity, and comfort.
• In September 2020, Microsoft partnershiped with Avatar Dimension, and selected it as the exclusive licensee for its volumetric capture technology in the Washington, D.C. area. Microsoft Mixed Reality Capture Studios certified the new studio after a rigorous testing process. The studio captures volumetric digital humans for business and governments, essential for powerful new virtual experiences across all categories.
• In October 2020, Meta launched Oculus Quest 2, which can run as both a standalone headset with the internal android-based operating system and with Oculus compatible VR software running on desktop computers.
• In March 2020, Apple released ARKi 3.5, which is an updated version of ARKi. The upgraded version has a new Scene Geometry application program interface (API) that uses the LiDAR scanner to create a 3D map of the space, differentiating between floors, walls, ceilings, windows, doors, and seats.

Frequently Asked Questions (FAQ):

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