By Retail Doctor Group, in association with Ebeltoft Group

The retail industry is on the cusp of a technology-driven revolution. 2024 and beyond will see retailers integrating immersive technologies like augmented reality (AR) and virtual reality (VR) to create next-generation shopping experiences.  

These innovations aim to transform retail from transactional exchanges to multi-sensory, engaging journeys – enabling customers to ‘try before they buy’ in virtual environments that will become the pre-purchase norm. 

Immersive technologies are set to revolutionise retail in 2024. And beyond, of course, but the priority for retailers must be to leap off the cusp of this retail revolution and embrace the technological change completely in their businesses – long before the revolution becomes a trend and consumers have already found a new home. 


  • ​​The Promise and Potential of Immersive Tech in Retail
  • ​Other Specific Use Cases: AR and VR in Retail Now
  • ​Market Growth and Adoption Trends
  • ​Key Adoption Challenges for Retailers to Overcome
  • ​Strategic Recommendations for Retailers
  • ​The Future of AR/VR in Retail: 2024 and Beyond
  • ​Conclusion​

AR and VR have moved rapidly from being just another concept to being a practical reality in future-oriented retail settings. Global spend on AR/VR has skyrocketed, with 2023 forecasts predicting that it would reach $72.8 billion in 2024.  

This is six times higher than the 2020 spend, which capped out at $12 billion. It also represents a compound annual growth rate (CAGR) of 19%. 

The Promise and Potential of Immersive Tech in Retail 

Adoption is accelerating as costs fall and tech capabilities advance. To take advantage of this trend, retailers have a number of key opportunities in AR and VR that can enrich the consumers’ retail experience and drive loyalty and engagement. These include: 

  • virtual try-ons. 
  • in-store immersion. 
  • pre-purchase visualisation. 
  • gamified experiences. 
  • training and simulations. 

We take a deeper look at these key opportunities below. 

Virtual try-ons 

AR allows customers to digitally ‘try on’ clothes and accessories in the comfort and relative privacy of the space they’re in. For example, Snapchat’s AR try-on lenses let users virtually try on sunglasses from brands like Prada.  

This reduces returns and enhances engagement, while also eliminating the need to go in-store just to try on an item. The convenience also makes it easier to buy what you want, when you want it, aligning to the impatient consumers’ need for less time-wasting in an average shopping journey. 

In-store immersion 

AR/VR can enhance brick-and-mortar retail with virtual product demonstrations and immersive branded experiences. For instance, North Face’s AR app lets customers view jacket designs projected onto their own bodies, displayed on their mobile devices. 

Consumers can also join XPLR Pass™, the North Face rewards program, from within the app and use their rewards to enhance the overall shopping experience through personalised recommendations and more. 

Pre-purchase visualisation 

Home improvement stores who offer AR apps to view virtual furniture in its intended space prior to buying create a winning element of convenience for their customers. An example of this is Lowe’s, who have added a new augmented reality feature called “View in Your Space,” to their consumer app. 

The buying process is more streamlined, and the purchase decision is made easier for the consumer once they find their “perfect match”. 

Gamified experiences 

Retailers are creating playful, interactive experiences leveraging AR/VR. For instance, Sephora’s Beauty Insider program rewards loyal customers by unlocking exclusive VR content, like virtual makeup tutorials and behind-the-scenes footage. 

Gamification doesn’t just relate to online environments. Selected Sephora stores also offer AR beauty try-on stations where customers can experiment with hundreds of lip colours using facial tracking software. What’s interesting is that Sephora has been doing this for quite a few years already. 

Gamification increases customer engagement, drives brand loyalty, and provides unique, personalised shopper experiences. 

Training and simulations 

AR/VR enables immersive staff training through simulations that improve employee product knowledge and customer service skills. Retailers like Walmart, for example, use modified headsets to provide thousands of employees with immersive, scalable VR training simulations that boost employee readiness. 

Other Specific Use Cases: AR and VR in Retail Now 

While it’s still relatively early days, many local and international innovative retailers are already using AR and VR in their customer experiences.  

91% of retailers around the world invested in AR/VR in some way over the past few years, according to a recent article by Forbes. And 46% of consumers already use AR/VR features available to them for shopping purposes. 

Other relevant examples include: 

  • Amazon Sumerian – Once again at the forefront of modern technology, Amazon’s Sumerian platform for VR/AR content has been around for about 5 years. The platform helps retailers build multi-user, branded VR environments that are accessible via headsets. Customers interact with featured products and immersive virtual brand experiences. 
  • Charlotte Tilbury Magic Mirror – This AR makeup mirror is available at selected Macy’s stores. The Charlotte Tilbury Magic Mirror overlays makeup in a virtual try-on experience onto live video of the customer’s face. In this way, shoppers can see the products applied realistically before deciding whether to buy or not. 

Market Growth and Adoption Trends 

AR and VR are two of many technologies set to reshape the retail landscape in 2024 and beyond. And as AR and VR technology matures, our prediction data indicates there’s a surging interest in adopting AR/VR technologies in a growing number of retailers’ business models. 

Specific adoption trends driving growth 

Thanks to mainstream affordability of AR/VR devices like Oculus headsets and LiDAR-equipped iPhones, retailers are able to perform sophisticated AR tracking that further enhances the personalisation trend. 

Specific adoption trends driving growth include: 

  • The growing post-pandemic installations and adoption of 5G networks and technologies that support bandwidth-heavy AR/VR applications will see a surge in retail use in 2024 and beyond. 
  • Cloud-based platforms like Microsoft’s Azure Spatial Anchors will enable complex and shared AR customer experiences across multiple devices, increasing the trend towards community-based shopping experiences. 
  • Maturing AR/VR content creation tools like Unreal Engine and Unity will empower retailers to readily build personalised shopping experiences that speak to the consumers’ need for gamification. 

As investment ramps up to meet growing demand, and tech hurdles lower to meet consumer needs, AR and VR technologies are poised to transition from novel, nice-to-have innovations to normalised, everyday gadgets in a retail environment within 2-3 years. 

Key Adoption Challenges for Retailers to Overcome 

While AR and VR are promising technologies, there are barriers that remain to seamlessly mainstreaming the integration of immersive tech in stores. 

These are just a few of the challenges that stand between retailers’ adoption of AR/VR tech: 

  • Consumer education – Retailers will need to put more effort into making their loyal shoppers more aware of the AR/VR use cases and benefits available to them, specifically showcasing the tangible value, convenience, and time-saving aspects. 
  • Inconsistent experiences – A lack of standards and fragmented tech stacks hamper a smooth transition and integration of AR/VR retail technologies. The implementation of shared frameworks will help ease this process. 
  • Privacy concerns – Personalising AR/VR shopping experiences needs access to customer data. Retailers need to use open and transparent data practices to address the privacy issues their consumers are concerned about. 
  • Accessibility features – AR/VR technologies and practical requirements should be built into experiences upfront so they do not exclude people with disabilities. For instance, voice controls for the blind, and captions for the deaf. 

Strategic Recommendations for Retailers 

How can retailers develop an effective AR/VR strategy, now? Given the market’s momentum on this innovative technology, retailers need to explore immersive technological opportunities available right now, and upgrade as the technology further develops and refines.  

Some key strategic recommendations include: 

  • Start small and iterate quickly – Run low-risk pilot projects, such as a single AR-enabled store area. Test and refine this area extensively before scaling up or rolling out anything buggy. 
  • Choose high-impact use cases – Prioritise product visualisation and other customer pain points where AR/VR can add significant value, but be sure to avoid gimmicky integrations that degrade trust. 
  • Build in-house capabilities – Invest in internal AR/VR skills development, like Walmart has done. Be sure to partner with reputable technical support providers that help you maintain long-term flexibility. 
  • Integrate with broader tech stacks – To make sure that your AR/VR integrations work seamlessly across multiple apps and platforms, your online and offline data should synchronise without a glitch. 
  • Make experiences social – Give customers the ability to share their AR/VR retail experiences via their social media accounts. User-created content and advocacy is a goldmine of engagement that helps drive viral adoption. Remember to include AR/VR channels as part of your omnichannel strategy. 

 The Future of AR/VR in Retail: 2024 and Beyond 

Looking ahead for 2024 and beyond, immersive technologies will continue to evolve consumer shopping experiences with future developments that may include: 

  • AR smart glasses 
  • Metaverse malls 
  • AI-driven hyper-personalisation 
  • Multi-sensory experiences 
  • AR/VR social shopping 

We take a brief look at each of these developments below. 

Mainstream Adoption of AR Smart Glasses 

Facebook’s Project Aria glasses are set to go mainstream by 2025. This will make AR an omnipresent in-store feature.  

For the sake of comfort and adoption (especially by finicky germaphobes), retailers should allow shoppers to use either shared or personal AR wearables in-store, much like ten pin bowlers can use either their own or store shoes on the bowling court.  

VR Malls in the Metaverse 

Retail brands may collaborate with each other or with bespoke digital designers to build expansive, rotating VR shopping malls in virtual environments like Meta’s Horizon Worlds 

Although rooted in gamification, Meta has expanded its gaming platform so creators can sell their digital assets in the Metaverse. The system allows for endless virtual stores, but the fees involved may make some retailers hesitant to move across until the platform’s intentions become more mainstream. 

AI-Driven Hyper-Personalization 

Retail AR/VR could harness AI for customised product recommendations and offers based on consumers’ real-time contextual data and expressed preferences. 

AI-driven hyper-personalization is a marketing approach that uses AI to analyse consumer data and create personalised content, show product recommendations, and deliver on-point services. The data collected and analysed includes customer behaviours, preferences, demographics, and real-time contextual information (such as buying habits, preference history, and location data). 

Multi-Sensory Experiences 

VR elements go beyond just visuals and audio, extending to include tactile elements and haptics, such as scent diffusers and temperature changes. Think home-baked cookies fresh out of the oven, but viewed in a virtual environment 

Customers could smell the cookies, virtually pick them up and touch them, even almost taste them on a sensory level. Not only would this drive brand immersion, but it would also increase the perceived emotional connection your customers would feel towards your brand. 

AR/VR Social Shopping 

AR/VR social shopping combines AR, VR, and social commerce to create an enhanced online shopping experience. Gamification is a fantastic tool that brings friends and communities together. 

Shared AR/VR experiences in retail spaces would allow remote friends to shop together. Trying on items or makeup using a custom avatar adds a social, gamified layer to virtual experiences, increasing the odds of engagement and word-of-mouth-based sharing.  

Other benefits include: 

  • Visual merchandising – Shows product features and explains what they do. 
  • Virtual try-ons – Allows customers to virtually interact with a product as if they were physically present. 
  • Enhanced navigation – In a virtual shopping environment, browsing products, reading reviews, and even interaction with fellow shoppers is made easier and more convenient. 
  • Improved conversion and sales rates – The buying decision has been streamlined. 
  • Reduced product return/churn rates – Most customers will have found their “perfect” fit in the virtual environment whilst shopping. 
  • Eliminates the need for a physical store – Retailers can invest in a fulfilment centre instead. 

The idea of AR/VR social shopping is so new, so innovative, and so in demand that it would automatically make your brand stand out from the competition. 


The retail industry stands poised on the brink of an AR/VR-driven transformation – one that will revolutionise the entire shopping experience in 2024 and beyond.  

Retailers should already be preparing for the surge in interest as the technology matures and adoption accelerates. Retailers must action key strategies now or risk being left behind as early adopters reap the rewards of embracing these emerging immersive technologies.  

If you’re not sure where to begin, get in touch today, and we’ll help your establishment become “Business Fit” enough to manage the AR/VR challenges that lie ahead. 

Contact the Retail Doctor Group, a retail advisory and consulting practice that builds retail channels and increases the performance of retail and FMCG businesses through our customised & transformative ‘Business Fitness™’ methodologies.

Since 2005 we have partnered with our clients to build powerful, award-winning, sustainable, and “fit” implemented retail. Ensuring our clients consistently achieve above benchmarks, build sales and margin results. We stay with our clients to ensure success.

As the Australian elected member of International Retail Experts, Ebeltoft Group, we have more than 20 years of experience as retailers and consultants in all retail channels, segments and regions. Today, members of the Ebeltoft network advise 80 of the 100 largest retail companies in the world.

Want to know more about the Future of Retail and prepare your retail strategies? Schedule an appointment with our Insights division by e-mailing us at or calling 02 9460 2882.