SNAP Research says augmented reality is integral to driving product purchases
Snap inc. Snapchat, owned by SNAP, released a new report about the growing value of augmented reality (AR) as an adjunct to the online shopping process and how modern shoppers are using AR tools — like virtual try-on and other visualization elements — to make more informed product choices.
The report, based on a survey commissioned by Snap and Publicis Media, covers responses from 4,028 shoppers between the ages of 13 and 49 in the US, UK, France and Saudi Arabia. According to the report, two-thirds of consumers are less likely to return a product after using an augmented reality feature.
Almost three-quarters of respondents are likely to buy clothes after using an augmented reality experience in the future, followed by retail (70%), beauty (69%), travel (64%) and food and beverages (60%).
According to the survey, 80% of respondents feel more confident in their purchases when using augmented reality tools.
Snap Inc. price consensus chart | Quote from Snap Inc.
Snap launches into AR purchases to attract users
Snap promoted its AR commerce research on the Snapchat platform. A report from Accenture revealed that the global social commerce market could reach $1.2 trillion by 2025.
In the first quarter of 2022, social network revenue grew 38% year-over-year to $1.06 billion. More than 250 million Snapchat users used its augmented reality features daily, on average, and its daily active users grew 18% year-over-year to 332 million.
In April, the social network published a report indicating that 92% of Gen Z shoppers prefer AR reality tools for e-commerce. This survey of 16,000 consumers in 16 markets found that Gen Z consumers preferred AR shopping tools over millennials and Gen Xers.
In May, the company unveiled several new AR tools, including a flying camera called Pixy, designed to connect brands with shoppers on its platform. Pixy will cost $230 and will be sold in the United States and France.
Additionally, the company debuted new AR lenses at the Electric Daisy Carnival in Las Vegas, as part of Snap’s National Live Entertainment LYV partnership. Snapchat entered into a multi-year partnership with Live Nation to use AR experiences, which were created with artists. The companies plan to collaborate with artists at various music festivals throughout the partnership.
Snap will begin offering a variety of free AR developer services, including data storage, to help developers create more complex AR experiences.
Snap will also be rolling out a new feature called “Dress Up” on Snapchat where users can browse AR shopping filters that allow them to virtually try on clothes and accessories.
Over the years, Snapchat has partnered with brands and companies like Toys R Us Canada, American Eagle, Gucci, and Adidas to engage with products beyond the typical 2D images.
As Snapchat tries to lure brands onto its platform with its augmented reality tools, this Zacks Rank #4 (Sell) company is set to face fierce competition from retailers like Amazon AMZN and pinterest PINS, which have started releasing their virtual product testing features.
Earlier this month, Amazon released an AR tool to let shoppers virtually try on their shoes. Last year, AMZN launched its Room Decorator tool, an augmented reality feature that allows consumers to virtually decorate their homes with furniture.
Similarly, Pinterest launched its tool, Try-On for Home Decor in February, allowing furniture shoppers to view furniture in their homes using AR technology.
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