Tesco Pushes Retail Innovation With Augmented Reality

As retailers worldwide grapple with economics that are making sales flat, some like Tesco are turning to technology as an answer, specifically AR (augmented reality) and QR codes.

Consumers can use computer terminals in seven UK Tesco stores to scan a product code or Tesco Direct catalogue. Powered by AR firm Kishino, the test program, as shown in the video below, lets users view 3D images of more than 40 products from the electronics and entertainment sections both in-store or online and choose to buy in-store or have a product delivered to their home.

The technology requires a browser plugin and a “marker” like a Tesco catalog or club card as users position catalogues in front of their webcam to view the 3D product images. A television set can be virtually expanded to real size, front and back views, shoppers can watch film trailers and kids can play with ‘virtual Pirates of the Caribbean Legos’ on sale in the supermarket.

The strategy is designed to help integrate AR into the everyday shopping experience, reducing use of in-store shelf space to stock products as well as the number of returns, as customers have more information at their fingertips before purchase. It’s also a way, of course, to sell more merchandise.

"Some of these products — like a movie — don't mean much until you actually use them. If you haven't actually seen them, you are less likely to buy, so I'm keen on anything that brings them to life," commented Rob Salter, head of entertainment products at Tesco, to the BBC. 

Currently seven stores have AR terminals in entertainment sections and five in the electronics section.

Tesco last month also launched an out-of-home AR media campaign on price reductions in a first of its kind multichannel initiative across eight thousand billboards nationwide via blippar.

In a bid to win more market share in South Korea, Tesco’s HomePlus chain there has been testing if commuters will shop virtually on the way home from work via QR codes in a subway station, where scanned items are then delivered to commuters' homes.

It's all to do with keeping on the forefront of technology and innovation. Phillip Clarke, Tesco CEO, is a big believer in “Breakthroughs” as applied to retailing, as he recently stated in a keynote address:

“Refrigeration, the bar code, the milk carton, the supermarket itself: retailers and suppliers have taken new technology – or developed our own –and transformed not just our industry, but our customers’ lives. These three Ts – Technology, Team, Talent – drive change. Take one away, and you are unlikely to achieve real, lasting breakthroughs. Create new technology, uncork talent, mix in a strong team, and you have a powerful recipe for change.”

The global grocery and merchandise brand headquartered in the U.K is the third-largest retailer in the world by revenues (after Wal-Mart and Carrefour) and the second-largest measured by profits (after Wal-Mart). With these kinds of tech forays, that retail pecking order could change.