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Augmented Reality Emerging As A Future Staple To The Customer Experience

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Matt Wujciak
06/16/2020

AR

The current crippling reality of customer experience

You’d think a company like them, as high end as they are, they would have that customer service piece figured out a little bit more,” one angry Lululemon customer stated.

When customers took their shopping lists online during quarantine, they brought their questions and concerns with them. But retail’s “customer service channels simply can’t keep up,” the WSJ reported last week. 

Make no mistake, online sales and customer volume is booming in ecommerce. Online sales grew nearly 50% at the peak of the pandemic as consumers stayed home but continued to shop. As ecommerce is currently booming (on paper) for obvious reasons, and call volume is increasing, many business media outlets have recognized that retailers such as Lululemon, Macy’s, Best Buy, and many more are sacrificing the long-term customer experience (and along with it, retention). 

As I recently mentioned in a CCW Digital article, it’s largely due to the fact that large corporations are struggling to adapt to accommodate an influx of consumer volume, lagging behind in consumer behavior research combined with archaic customer service technology – I’m talking about utilizing tools like conversational AI for simple customer service inquiries and the phone channel (human assistance) for personalized/complex ones. 

In order to have “that customer service piece figured out,” Lululemon and some of the other brands mentioned above need the right balance of automation vs. humans, digital vs. empathy and personalization, so that they can better respond to changes in customer volume and inquiries, and deliver a better customer experience to ensure optimal consumer retention rates (and CLV). 

When a customer has a simple question about a product, say the available size or colors of a Lululemon t-shirt, Nike shoe, or Macy’s home décor product, they want to turn to a quick automated customer service tool (such as a chatbot or text) to answer their question. 

Conversely, 69% of consumers say that personalized care influences their loyalty to a company, most of which prefer human assistance via a phone channel. 

Read More: Special Report Series: State Of The Voice Channel (Sponsored By Salesforce)

The concept revolves around having “that customer service piece figured out.” But that involves blending the right balance of automation vs. humans, digital vs. brick-and-mortar, so that they can better respond to changes in customer volume and inquiries, and deliver a better customer experience. (For more details on this topic, visit the article here).

While AI, self-service, and digital transformation is surging, I want to highlight a new technology that many customer-centric retailers are turning to in order to deliver product information to customers.

The famous sci-fi writer Arthur C Clarke’s quote, “Any sufficiently advanced technology is indistinguishable from magic” seems to have been coined for new self-service tools, specifically the emergence of augmented reality (AR).

This magic is now being well-utilized by marketers and customer experience analysts. While conversational AI blended with human support is the new foundation of the customer experience, AR capabilities are beginning to complement the customer experience to solve consumer pain points before they happen. 

Simply put, an AR customer experience can change the influx of consumer volume regarding products across industries such as retail, and answer specific questions before a customer even needs to call an agent or message a chatbot. 

Can AR be a viable option for customer inquiries? 

Whether it’s new voice technologies for personalized customer support and routing, better CRM systems to manage consumer volume and data, conversational AI to give customer service agents a more contextual overview of a customer inquiry, SMS to instantaneously answer a customer’s question, or AR to give you an in-store experience from the comfort of your home, digital adaptation is imperative to the future of the customer experience.  

Read More: How To Guide: How To Scale Conversational AI (Sponsored By IBM Watson)

Want to see a product in real-time, live and in color, virtually try on a piece of clothing, or see the value a given product can provide you? This is where AR can come in.

While it can’t calm you down or give you information about a shipping delay, AR can give customers quick information about a product from their favorite retailers, especially when there’s currently no one around to help you understand the product or give a recommendation. 

Best Buy Co. admitted it’s behind on responding to a deluge of customer service requests. Most of its stores have been closed since mid-March.

Macy’s issued an apology for longer-than-usual wait times on its customer service hub. Last week, like many other retailers whose share price was dispirited, Macy's and Nordstrom closed down 15% and 12.2% respectively on the NYSE. 

Unable to keep up with online orders, IKEA too apologized to shoppers and said it was recalling furloughed workers to help improve its customer support. Its website tells customers it is only accepting emails to cancel orders.

Lululemon, as another example, says customer service calls are currently 2x–3x greater than usual, and the company has extended its return-processing time to 15 to 20 days, up from 10 to 15 days, the company said. 

With the influx of customer inquiries, consumers often research, click on, or even scan products but exit a site or store without buying anything, because they had one or multiple questions that went unanswered with the original product description in the plain text, again whether in-store or online. 

With in-store AR display boards and APIs, customers can scan a product image, swipe, evaluate, and purchase a product – no research or human assistance necessary in many cases. The customer has all the information in front of them, patterned the way they’d understand the product best. And some digital retail pioneers have been observing this (augmented) reality closely. 

The new AR pioneer - Nike

Of course, much of Nike’s retail model is underpinned by consumer research, which stems partly from the company’s voice of customer program, Larry Rodgers Nike’s Senior Director of Retail Concepts, told us at CCW Austin.

(source: engadget

If you have a digital ecosystem and you have physical stores, how do those two things go together? But the real question is: how do consumers want to use those two channels in different ways?

The sportswear giant is now introducing Nike Fit, a feature that uses a combination of computer vision, scientific data, AI and personalized recommendation algorithms to scan your feet and find the right shoe fit for you. Partially thanks to this voice of the customer program, Nike says that, according to industry research, over 60 percent of people wear the wrong size shoes. With Nike Fit, the company is hoping to solve that problem.

For example, as seen in engadget:

You can get a "You are a 10.5" in this Air Max sneaker, giving you more information about why, like "80 percent of people with similar feet to you purchased this size" or "This shoe runs slightly small." Nike Fit will measure your feet virtually down to the millimeter size, and it can tell you if your right foot is larger than your left one, or vice versa. The company says that, based on early testing, it is quite confident in the technology, so much so that it plans to make it a core feature of its Nike app. 

Read More: Online Customer Service Delays Crippling Our Favorite Retailers: How They Should Respond

Of course, once you've used the AR to measure your feet, like many customer centric ML tools, that information will be saved in your personal Nike profile, which means you don't have to go through a laborious process every time you're trying to buy a shoe or contact a customer service agent (or “athlete” as Nike calls their reps). And if you go to a newly opened retail store, athletes will know which sizes are best for you based off various personalized models by simply scanning a QR code from the Nike app. 

In essence, the technology is a product-specific CRM system in itself, as all your individualized data and history is recorded by Nike, creating a frictionless experience for their customers. 

In fact, according to CCW Digital research, lower friction represents one of the biggest demands for today’s customers. Frictionless customer experience is a differentiator and experience-driven companies that prioritize this component report an annual growth rate of 15% compared to other businesses.

AR in the social media customer experience 

Social media giants have also taken notice of the advantages of frictionless, AR driven customer experiences. Snapchat’s users have become conditioned to sharing lens-altered selfies. Soon its 229 million users will be able to snap and shop lenses on both head and foot, similarly to Nike advocates. 

Lens-enhanced “shoefies” will allow users to digitally “try on” shoes and shop them, much the same way they try on makeup and sunglasses. Using augmented reality, the new tool takes the social media site one step closer to enabling users to digitally try on a full wardrobe, and in turn, attract the fashion industry’s advertising spend – whether it be a Nike or L’Oréal. 

While Snapchat has introduced updates that make it easier for people to discover, advertise and buy products on the platform, Instagram has dominated the social shopping conversation with multiple shopping-centric features including product tagging. TikTok is also offering a “Shop Now” button, tested by Levi’s to try to tap into Instagram’s idea of viral products tags.

Snapchat is in a unique position: it has a largely Gen Z and millennial audience and sophisticated augmented reality lenses are endemic to the platform, which is a natural complement to fashion, who has struggled to solve the problem of online try-on.

However, as more consumer demographics get accustomed to the new digital era that the pandemic has highlighted, more businesses will tap into the customer-centric technologies (whether it be a chatbot or AR tool) that increasingly large target markets are inadvertently asking for as a result of the COVID-19 pandemic. 

No one’s safe from the behavioral economic consequences brought upon by the coronavirus. But adapting to the right CX trends will give you the best chance at being on the favorable side of financial Darwinism. 

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For media coverage, lead gen, and digital marketing inquiries, contact me at matt.wujciak@customermanagementpractice.com.

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