Why do retailers go to digital agencies?
To deal with typical retailers’ pain points such as low sales, poor brand awareness and loyalty, buyer’s remorse, and tough competition.
Digital agencies know that pain points are their opportunities. That is why they can offer innovative solutions for typical problems of retailers. The best digital agencies can offer extraordinary solutions, such as augmented reality advertising and marketing. That is what LEGO, l’Oreal, GAP, Zara, Axe, Danone, Allo, Ikea use augmented reality apps for marketing.
I’ve analyzed the most typical “pains” of retailers according to Forbes, Kissmetrics, and Nasdaq to make one unexpected conclusion: most retailers’ troubles are in the past already. Technological solutions, such as augmented reality, that used by top world brands can deal with most of them.
Before speaking about retailers’ pain points, I feel I need to tell a few words about augmented reality. Let’s face the truth, most people don’t know what it is.
Augmented reality (AR) is the overlay of digital information onto physical world. It’s what people would call magic centuries ago. If played Pokemon Go, you have a general idea about AR. If you are not into AR gaming, it’s easy if you look at this picture. AR allows you to see 3D models or animations overlaid on physical environment with the help of a smartphone or a tablet.
So how can this technology help with retailers’ pain points? Let’s see. Here are the things that digital marketing agencies hear from businessmen working in retail most often:
“I want to improve brand loyalty”
Brand loyalty or the desire of customers to buy the same product over and over again depends. Brand loyalty depends on the degree of customer engagement. If they don’t feel a connection- they might leave.
But what on earth is this customer engagement? The first thing you must understand is that customer engagement is a value for a brand. It’s the unique capability of a brand or a service to please customers and to obtain their mindshare. I would rephrase it in a simpler way: it’s the attention and time customers spend with the brand before or after purchase.
Second, users’ engagement is particularly important for the B2C sector because when customers engage with the brand, they join a brand community ( consciously or subconsciously). Customers’ engagement is a guarantee that after drinking the milk and throwing the package away, your client will choose the same package of milk in a supermarket again after a week. It can be a pair of jeans or a new shampoo, it doesn’t matter. New Look created one of the most effective augmented reality applications to target Middle East students and had very promising results in terms of brand loyalty:
10.000 interactions a month and 6,58 minutes average engagement.
This app helps users to create “a unique look” combining different pieces of clothes.
“I want to increase sales (of course)!”
Even if the sales are growing, even if the sales reached the sky, there is always more things to sell. Boosting sales is the mission that can never be completed.
Danone, a French company that produces dairy, launched an AR marketing campaign to improve brand awareness and to increase brand loyalty. Sales boost was a pleasant plus. Augmented reality application was created for kids who wanted to learn more about the space. Each yogurt had one small magnet inside, and the picture from this model could be animated with the help of an augmented reality app.
Result: Danone could not reveal the stats regarding their sales, yet the company acknowledged the sales exceeded their expectations.
“I want to improve brand awareness”
Companies don’t like investing money in brand awareness for one simple reason: it is almost impossible to measure ROI. If you create a marketing campaign solely for brand awareness and, for instance, place the banners of your company in a subway, you will never understand how many customers found you with the help of these banners.
That’s why most companies assume that a brand’s image is self-curated and positive by default. But brand awareness is never created on its own and it’s never stable. That’s why the most successful brands in the world, such as Nike or Pepsi, pay a lot to build strong brands recognizable by millions.
Speaking about Pepsi. The company invested in astonishing AR campaign to shock common citizens and then to surprise millions of people all over the planet.
Result for Pepsi: 8 mln views on YouTube and Undestructable Reputation
In Forbes they suppose that brand awareness can be measured by the resilience with which it can meet any negative events. Strong brands with substantial customers’ loyalty can make any scandal fade away in 24 hours. Luckily for Pepsi, their brand awareness was not tested with the scandals yet.
So brand awareness cannot be underestimated in critical situations. That what happened to Tesla, for instance, when thousands of cars were called back because over a brake issue. But Tesla is cool, everyone knows Tesla, everyone knows who Elon Musk is. That is why the scandal was forgotten in 24 hours.
“I want to increase my target audience”
Retailers often have a limited target audience: if you sell cosmetics – you target women, and if you sell toys, your customers are kids. Right? What if I tell you that your brand can increase the target audience by engaging new customers using the things they love the most: their smartphones. You don’t need to sell something to the customer to get him/her hooked.
For instance, LEGO decided to reach older target audience by offering parents to download AR app before assembling castles.
Result for LEGO: Number 29 on iStore in #Family Category this year
Another pain point of retailers, according to Hubspot, is the inability to reach an international audience. Companies don’t know the culture of the countries where they want to sell, sometimes, language becomes a real barrier. Outbound, inbound marketing efforts seem futile. Augmented reality applications “speak the same language” – the language of technology.
“I want to improve the communication of customers with the brand”
To be successful, brands need to outreach customers with the help of communication, experience, and advertising. Before brands can actually sell something, they need to explain to customers that they are experts in their sphere, that they have the mission, that they actually care about their customers. Selling just comes as a pleasant bonus.
Communication with the brand is the guarantee that users will be connected to the company on the emotional level. And the emotional connection, no need to remind you that, it’s the magic potion of effective marketing: few drops of positive emotions and customers are hooked. That’s why brands communicate their customers via Hollywood stars, social networks, bright merchandise. Today brands also communicate with their customers via AR apps.
For instance, kids who bought Danone yogurts can play with the company’s merchandise – magnets with 3D animations long after they ate their yogurts.
Result for Danone: company’s merchandise became a toy
“I want to reduce costs and/or optimize physical space”
One of the acutest pain points of retailers today is inevitable e-commerce development. Brick and mortar businesses feel threatened by Amazon and eBay. And they should be those stores that don’t go online and don’t apply digital tools simply vanish.
It seems impossible to compete with huge marketplaces because of the cost of rent, sales managers’ salaries, and other expenses involved in physical stores maintenance. Yet there is an innovative technological solution to this problem- it’s a virtual reality store allowing billions to step in it, and check among literally unlimited number of goods.
Allo, a huge Ukrainian retailer that decided to sell fridges and vacuum cleaners ( that would take all the spare space in physical stores)with the help of AR. It’s the first world retailer to profit from augmented reality shopping. And it’s more than just AR in marketing campaign, it’s advanced level of sales and a new level of customers’ experience.
Result: zero amount of money was spent on rent and salary for sales
“I want to deal with buyer’s remorse”
Do you know about buyer’s remorse? Of course, you know, if you were shopping online at least once or tried buying something in a bad mood. Buyer’s remorse is a common feeling for those who buy online but it’s possible to avoid it with the help of augmented reality applications.
Ikea was the first brand to realize that if you give people a chance to “try before buying” you will earn their trust. Ikea created AR app that allowed “placing” 3D models of their furniture in the full size in their apartments. Of course, users couldn’t just download it and stop. They made this app go viral.
Result: more than 50.000 downloads from AppStore
“I want to create WOW effect for my product!”
Can you guess the main emotion that makes people buy? I know the right answer, it’s awe. And it’s not my personal opinion, it’s the study created by Business Insider. Those brands that evoke awe or surprise in customers ( or make them laugh) are the ultimate winners. People remember them, people become their evangelists sharing content online, people transform into loyal customers.
Axe knows that that is why AXE created an awesome augmented reality marketing campaign. People could see themselves near angels – they could take photos with them and feel happier.
Result: this funny video
“I want to enhance in-store experience”
Brick and mortar stores feel threatened by online stores( and they should be). E-shopping is much more pleasant, engaging, and comfortable for all of us. The only chance to make customers buy something in physical stores is providing them with an exceptional in-store experience. That what a brand can do with the help of AR.
For instance, Timberland added immersive screens to let customers try on clothes without even getting inside the store.
Result: interactions with the brand without getting into the store
So augmented reality is not a gimmick and not an entertainment.
It’s an effective marketing tool that helps to deal with the basic and the most urgent pain points. AR is an innovative solution for digital agencies. And if you want to work with top world companies, you should offer them more than they expect. More than content strategy, SEO, social media marketing breathtaking web design or PPC.
Something as awesome as augmented reality marketing.
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