This article was originally published on 18/02/2022

This article will evaluate what is augmented reality (AR) and virtual reality (VR) technology in detail and how small businesses can use them. We will also talk about the benefits of using AR and VR tools for small to midsize enterprises (SMEs).

Prompted by a global pandemic, some businesses found solutions in AR and VR technology when restrictions on physical stores and in-person meetings disrupted businesses. Now, post-pandemic, what are the impacts of these technologies on the market? This article evaluates what SMEs need to know before adopting the technology and uncovers the benefits of AR and VR in business. 

What is AR and VR technology?

In this section, we will explore what AR and VR technology means in the business context.

What is augmented reality software? 

According to Gartner, augmented reality is the real-time use of data as sounds, words, illustrations, and other virtual components combined with real-world things. AR technology holds reality in place and only enhances the virtual or visual experience. Meaning that instead of completely transporting you to the virtual world, it uses digital elements to enhance your vision, making you see a completely different yet more precise version of objects or places. 

An example of this would be buying a piece of furniture and checking how well it would fit in your house by using AR technology on your smartphone. In fact —according to a report by Search Engine Land— Pinterest has recently launched an AR feature that would let users check what sort of furniture would suit their needs and how it would fit in their house. The report further mentions that this feature is already being used by many other brands, such as Walmart, Crate & Barrel, and West Elm. 

VR technology

Google defines virtual reality as technology that lets you go anywhere and helps you experience different objects and places worldwide by actually living in the moment as if you were physically there. VR technology generally requires the use of a headset or other device that takes the user to a ‘new world’ where they witness virtual objects, with a feeling that it is real while they are actually in a computer-generated 3D environment. An example of VR would be a person who is interested in buying a car checking the features, interiors, parts, and colour of the vehicle using a VR-powered headset.

How can small businesses use AR and VR tools?

According to a report by Statista, the global market size of AR and VR platforms can rise to approximately US$300 billion by 2024. The report suggests the rising growth trend of these technologies and that many businesses might be incorporating them. Below, we will discuss AR and VR in business.

Augmented reality benefits for business

As per a report by Mumbrella, 44% of Australians say that shopping online using AR tools has prompted them to buy something. The report also says that “in the past year, Australian shoppers spent $99.5 million on clothing purchases online that had to be returned because they didn’t fit. The report states that at least 31% of these purchases could have been avoided with the use of augmented reality (AR) technology”.

The application of augmented reality can be seen in many sectors such as travel, eCommerce, education, manufacturing, healthcare, and entertainment. SMEs can use AR-powered tools to communicate with users worldwide, simultaneously helping to cut down the product return rate and likely enhancing customer experience. AR software can also be used for employee training to help them understand their role better and to train them for future goals. 

How is VR used in businesses?

According to a study by Grand View Research, the global market size of VR technology was US$15.81 billion in 2020 and is now projected to increase as per a compound annual growth rate (CAGR) of 18% by 2028. VR technology has potentially gained prominence in many sectors such as gaming, healthcare, entertainment, tourism, and training. Similar to AR, VR could also allow small businesses to connect with customers worldwide. 

VR-powered tools could also potentially work distinctively to reduce travel time. Using VR technology in real estate, for example, could allow real estate companies to virtually promote their projected finalised projects in the market before actually proceeding with the construction. VR software could enable these businesses to show the properties to interested buyers virtually, helping them look at the interiors and exteriors before they invest in the property. 

What are the benefits of AR and VR tools for SMEs?

While AR and VR might sometimes work in tandem with each other, they also offer different benefits to varied industries. We have given some of the common advantages of the two as follows:

Create coordinated and entertaining environments

Both AR and VR-led tools could give viewers the sense and feel of an interactive yet entertaining experience using modern technological devices. While VR could allow organisations to use advanced tech features to gain user attention, AR —on the other hand— could provide users with the sense of a personal touch with the help of carefully personalised applications providing important information. 

Help promote brand awareness

Both AR and VR tools could help brands enhance their presence on social media platforms and engage with customers more personally. SMEs can incorporate such technology into their preferred social media platforms to create a more targeted marketing strategy. For instance, brands like Sephora have adopted AR technology to enhance the customer’s shopping experience. Using this feature, users can try on multiple products without even going to the store. 

With AR and VR software, customers may be able to test products or services without paying for them. Not only could this help increase customers’ trust, but it could also boost sales and likely lead to lower return and exchange rates. 

Give detailed analyses of customers’ purchase patterns

As a customer interacts with a product/service, businesses —with the help of AR and VR tools— might get to know the user’s exact requirements. For instance, while shopping for a piece of clothing using AR or VR tools, businesses can record what the users are focusing on and what features they might be using the most —such as which colour or pattern they prefer in this specific case. 

This way, businesses could improve the existing features and add additional ones that users could be looking for. In cases like this, brands could also record the customer’s buying patterns and then customise their marketing strategy and refine their target audience goals. 

What’s the final takeaway? 

Understanding what is AR and VR technology and their advancements can give businesses many opportunities to explore and implement them. The best practices and techniques for implementing such platforms could differ from one industry to another. It might still be arguable whether AR and VR solutions could ever replace reality, but —to some extent— they might provide users with a sense of the future of modern technology.