Market View

Market View: The New Look of Marketing is Augmented Reality

Imagine a smartphone view of a grocery aisle with your promotions popping up.

By John Stanton, Contributing Editor

I never considered myself a techie, or anything close to it. However, in-store technology has changed so much that even people like me have to take notice. Some of this technology will make brick and mortar stores more convenient and more fun -- two of the key benefits Millennials are looking for.

There is a lot of technology coming into the market and into the stores, but I want to focus on just Augmented Reality (AR). This is not virtual reality, where you wear goggles and see the world in 3-D. While that is really cool (a word I don’t use often), it has more entertainment value than practical marketing value.

AR superimposes a computer-generated image on a user's view of the real world. For example, you could have a grocery aisle with no promotional materials on the shelves. A nice clean aisle. However, if a person looks through their smartphone down the aisle, they would see promotions for items or recipes for food in that aisle.

For example, you could have an aisle with no promotional materials on the shelves. A nice clean aisle. However, if a person looks through their phone down the aisle, they would see promotions for items or recipes for food in that aisle.

Despite consumer interest, nearly two-thirds of companies don’t use AR at all in the U.S. A few retailers across a number of industries have integrated AR technology into the in-store experience. It’s a smart move, especially since it has been reported that 61% of consumers would prefer stores that offer AR experiences — and 40% of them would pay more for your product if they have the chance to experience it through AR. Equally importantly, the new group of consumers are the Millennials and Gen Z, who are familiar with this type of technology. They will see it in other stores and will expect the food industry to keep pace.

So what? This has a major effect on food processors’ in-store marketing. Since retailers like to set a limit on how much promotional material can be in an aisle, this opens up almost unlimited possible displays. The food processor is no longer in competition to see who can get their display in the store. And you can use as complicated a message as you think can be comprehended.

For example, if you are selling canned tuna, you can offer other products to enhance the food. While everyone may mix tuna with mayonnaise, you can say “try using capers for a new flavor.” You can direct consumers to another aisle -- for example, if they are buying green beans, you might direct them to the soup aisle for cream of mushroom soup to “spice up” those plain beans.

You can give simple cooking instructions or even hints like "to get the most flavor, don’t overcook." You can refer customers to a website where you give longer or more complicated messages and recipes.

Even simple items that food processors had to rely on store employees to put up signs for (and for which there is low compliance) can be used. For example, in the fresh food aisle, where you might see a sign for the farmer who grew something locally, you can show the source of all the local foods without having too many signs in the section. You can give simple nutritional information such as, “Besides being delicious, did you know asparagus contains vitamins A, C, E, K, and B6, as well as folate, iron, copper, calcium, protein and fiber?”

You can also make this entertaining. Clearly one of the biggest impediments to in-store grocery shopping is that it is boring. You can have characters lead you to the other sections of the store, you can have virtual (or famous) people tell you how to cook the food; the opportunities are limitless.

I reluctantly also note you can show prices. It seems we are obsessed with price, but you can offer deal prices, but make lowering price your last choice.

Now the bad news: Retailers are still going to charge you a fee even though they are now doing very little work on the promotion. In fact, if retailers believe this will be more effective than the in-aisle promotional displays, they will charge more.

Keep in mind that I am too old to believe in a panacea but this technology appears to be a way to make shopping a little more entertaining and informative. It will help keep consumers visiting brick and mortar stores. However, to go at this idea “guns a blazing” may be a mistake. Pick initial partners that appear to be interested in staying in business or those that are willing to be innovative. Go slow and develop metrics. Being "really cool” isn’t what I am suggesting.

Keep in mind the words of Darwin who said, “In the struggle for survival, the fittest win out at the expense of their rivals because they succeed in adapting themselves best to their environment.”