AR in car retail

How is AR Transforming Car Retail in India?

January 7, 2022

Nowadays, a growing number of automobile companies are beginning to harness augmented reality for their operations. AR is reshaping car retail bit by bit, right from the manufacturing stage to the sales and services stage. Essentially, the dealer network is slowly transitioning into a successful and contemporary sales channel that blends the benefits offered by emerging technologies with the strengths of the conventional channels. 

The retail industry is quite competitive. Retailers have to gain the attention of potential customers irrespective of the niche. Thus, retail businesses are more motivated to establish new brands and find new ways to engage customers. Many retailers are leveraging emerging technologies like AR/VR to stay ahead of the competition. Similarly, car retailers are experimenting with how AR can help them drive sales and stay ahead of the fierce competition.

Some of the ways in which Augmented Reality is transforming car retail are as follows:

Showroom Experience at Home

Using AR in car retail can help dealers minimize the time spent in showrooms while even eliminating it completely as in some cases. In order to create an enticing shopping experience, AR car showrooms can be accessed through the smartphone which makes online shopping seem as real as offline shopping. Customers can view the cars they want to see and compare models and features, effectively replicating the in-person shopping experience to a great extent. In fact, in some cases, the technology can be so powerful that it can facilitate shopping solutions that are completely online.

Enhanced Shopping Experience and Increased Conversion

As per a survey, the onset of the pandemic has transformed online shopping behavior considerably. UNCTAD Secretary-General Mukhisa Kituyi stated:

“The COVID-19 pandemic has accelerated the shift towards a more digital world. The changes we make now will have lasting effects as the world economy begins to recover.”

In such a situation, it becomes imperative for retailers to deliver an enriching shopping experience to the people. 

Now imagine being able to see a 3D image of the product before buying it. Similarly, those willing to buy cars can see a life-size 3D image of the car they want to buy. With the advanced technology, the potential customers could also open the door of the car and take a sneak peek as if it were real. The technology can also allow the buyers to turn on the lights, open and close the doors, and roll the windows like in a real car. This can be very helpful to the prospective buyers who can see how the car is without being physically present next to the car. 

BMW collaborated with Accenture to create the BMW iVisualizer which uses computer vision, image processing, vision sensors, motion tracking, depth perception to deliver an immersive experience to its users. 

Jaguar Land Rover uses AR to let users indulge in a virtual test drive with a 360-degree view of the interiors of the car. The users can also tap on the screen to obtain additional information about the different features of the car. 

Toyota created Toyota Hybrid AR, in collaboration with Brandwidth, to let consumers see the interior of its C-HR vehicle. It overlays the hybrid drivetrain on actual vehicles so that customers can see how it works. Additionally, the app has hotspots that customers can tap on to get information about features such as battery and fuel capacity.

Educating Customers About The Functionalities

It can be tricky for auto brands to educate consumers on the various technical features of cars. Most paper manuals cannot be easily comprehended by customers which limits their understanding of the functions of their cars. Instead, the customers can view interactive 3D animations demonstrating different functionalities. This could be a great experience for customers, and it could reduce the amount of time that engineers spend dealing with issues that customers could fix themselves.

Earlier, Hyundai has launched an AR sales tool for Australian auto dealerships. The app helps the sales staff to easily demonstrate the different features of Hyundai’s i30 hatchback. In another instance, financial services company USAA’s AR app allows customers to launch a virtual technician to visualize 3D animations on how to change tires, top-up fluids, examine the engine, and much more. Similarly, automobile part manufacturer Delphi developed an AR tool that lets customers scan a vehicle and see all of the products that are installed in it. 

Performing Customizations

As per a new study, consumers are taking much less time doing research and shopping for a car online during the pandemic as they tend to find their best fit much quickly. Apart from offering an immersive shopping experience, AR also allows users to customize their cars. The BMW iVisualizer lets users customize the exterior and interior of their cars from a list of options. For instance, customers may change the color of the exterior by simply selecting a color from a list of available options. 

Innovative Marketing

Auto brands are blending media and gamification to connect with potential customers. As a result, consumers who are delighted with such experiences increase brand loyalty and also tend to act as brand advocates. For instance, BMW has experimented with AR on Snapchat in order to reach out to younger audiences. BMW X2’s  “Be the one who dares” ad campaign renders a real-life AR version of the car while users can walk around it, view it from different angles, and even customize the design. In another example, the Audi Quattro coaster AR app is triggered by certain Audi TV commercials wherein it appears as if the digital cars are bursting out of the TV screens and sitting into people’s living rooms. With this approach, the cars can not only be explored in detail but can also be used as toys, as they can be shrunk to miniature size and raced on a digital track similar to Hot Wheels.

How Has COVID-19 Affected Car Retail?

The pandemic permeated all areas of our lives. The frequent lockdowns and economic uncertainty have had a huge impact on the retail sector as well. Due to this, the car retail sector has had to adapt and innovate to address the unique challenges brought about by the pandemic. Consequently, dealerships have been forced to tighten up their online and digital presences, with Close Brothers Finance research revealing that 43% of dealers spent time building up their online presence during the peak of the pandemic in 2020. 

It appears that although the pandemic has affected car dealerships, it has also spurred long-term consumer trends. As Porsche Director of Digital Sales stated, “What we see today is not the death of car dealerships and offline stores. It’s instead of the evolution of automotive retail.” Although Augmented Reality has only begun impacting the auto industry, it is doing so quite powerfully, and more and more auto manufacturers and dealers are adopting it to stay ahead of the competition. AR technology has enabled companies to drive a significant increase in sales with a higher conversion rate and a drop in product returns. Due to the increasing amount of car purchases made online, AR offers us a unique opportunity to see the kind of car we dream about without ever leaving the screen. Moreover, AR content isn’t hardware-dependent, as it is accessible from a variety of popular devices, including smartphones and tablets. 

From all indications, we cannot predict the fate of brick and mortar stores but it looks like AR will continue to transform the retail space and help create the experiences that are one-of-a-kind. As Muchaneta Kapfunde, founder of FashNerd stated:

“This [Retail] is a sector where AR is revolutionizing the way we shop by bridging the gap between digital and physical worlds. A radical store re-invention will offer retailers new ways to increase convenience and personalization, and consumers the opportunity to experience re-envisioned shops.”

Augmented Reality is doing wonders across different sectors. Right from the medical field to classroom education to entertainment, AR has been explored for a plethora of applications. As the technology matures and additional ideas get developed, we can expect AR to transform many more aspects of our lives.


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