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Could Innovative New Tech Stem the Retail Return Tsunami?

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In 2015 Americans returned $260.5 billion worth of retail merchandise. That’s an astonishing 8% of total sales. Much of that returned inventory can’t simply be placed back on the shelf. If unsealed or broken, it can take too long to get items back on the shelf, and ultimately they become a loss for the retailer. But there is new technology on the rise that could stem at least some of the tsunami of returns plaguing retailers. The technology is called “augmented reality,” and it allows customers to see versions of possible purchases in their home, even before buying them.

Randy Rieland writes for Smithsonian.com that Google’s Tango technology found in the new Lenovo Phab 2 Pro phones, will bring augmented reality to the masses. But businesses could be some of the greatest beneficiaries of the new tech. Rieland notes that furniture and home stores like Wayfair and Lowe’s have been early adopters of augmented reality technology, with an eye toward helping customers avoid mistakes in ordering, thereby preventing costly, and unnecessary returns.

Not surprisingly, one of the first companies to embrace the technology is Lowe’s, the home improvement chain. It will have its own Tango app, called Lowe’s Vision, available this fall. Shoppers will  able to point their Phab 2 smart phone at a space in their kitchen and see how different models of refrigerators, for example, would look there. Lowe’s will also take the unusual step of selling this particular Lenovo model phone in its stores. The retail price will be $499.

Another early adopter of Tango is Wayfair, the Boston-based online furniture store. It’s coming out with its own app, called  WayfairView, which is similar to what Lowe’s has developed. The app will let users select 3D images of the company’s furniture and use their phone’s touch screen to position objects on a virtual version of their homes’ floors, walls or ceilings—functionality that will take most of the guesswork out of shopping for furniture online, and mean fewer returns for Wayfair. The phone will also be able to take very precise measurements of indoor spaces.

Tango’s possibilities seem endless. Google has hyped its potential for use in education (as you can see in the video below). But retail is likely Tango’s most profitable market. Today, Tango may only have a foothold in furniture, but wait for a wave of clothing and jewelry retailers to join in. When fashionistas are turning their cameras toward themselves for augmented reality selfies, retailers will rejoice.

 

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Tim Jones

Senior Editor at Young Research & Publishing
Tim Jones has spent a decade in the financial newsletter industry at Young Research & Publishing. He lives in Middletown, RI where, along with his wife and two children, he enjoys the great outdoors, Newport restaurants, and a relentless mission for self improvement.