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Too many furniture companies are shutting down retail stores in 2023.
The reason is very simple – the high operational cost to run physical retail stores are not getting much profitable.
While big furniture companies are bleeding from ops cost, relatively small retail store outlets are thriving. They are using AR to their benefits. How?
What happened with Cadena88?
We often talk about how 3D and augmented reality (AR) is being used to bridge the gap between the physical and virtual world. Especially in eCommerce, AR gives a major competitive advantage to all who implement it. So what’s a traditional brick and mortar hardware chain in Spain doing with AR?
A household name in Spain, Cadena88 was the first independent hardware store organization in the country. Today, it is the leading hardware stores chain with the largest network of brick and mortar stores in Spain.
The typical store sells items like tools, screwdrivers, nuts and bolts, pipes for plumbing, pots, and pans, that kind of thing. And so you’d be right to think that those don’t exactly sound like the kind of products that would benefit from interactive AR. But what about garden furniture?
Cadena88 was looking to add outdoor furniture as part of their offering. Physically speaking, the typical store was far too small to showcase and stock bulky products like garden furniture. But virtually, anything is possible!
The challenge: utilising its expansive network of stores to sell garden furniture
Cadena88 wanted to expand into the complementary business of exterior furniture while at the same time taking advantage of their brick and mortar leadership position. But how to do it?
Since their stores were too small to physically showcase this range of products, they decided to sell the goods online. However, online sales were struggling with the usual problems of high returns and low conversions, primarily due to a lack of consumer confidence in the size and look of buying furniture products online.
Moreover, in a traditional market like Spain, brick-and-mortar stores are still a primary sales channel. Especially for items like garden furniture. There had to be another way. And that’s what gave Cadena88 their next big idea.
Solution: Adopting AR to empower the sales
After a successful proof of concept, they have since converted their full garden furniture catalog into 3D. And in order to utilize their expansive network of stores, they rolled out free tablets inside all their shops to begin raising awareness of the new product range and AR functionality.
For large products like furniture, AR enables customers to shop with greater confidence. It allows them to visualize how a piece of furniture will not only look but also fit inside their space, which became crucial during the Covid-19 lockdown when all the shops were closed.
The Outcome
As a result, Cadena88 saw sales double last year with this year’s results expected to be even higher. Cadena88 have also seen their product return rates fall dramatically, with almost no returns for garden furniture purchased online using AR. For large goods especially, the ability to see the product in your space before you buy has a strong impact on purchasing decisions.
Hundreds of local shops can now virtually showcase garden furniture products to customers in-store, in addition to other product lines that are not available due to size or stock, thus increasing their product catalog considerably. In fact, it has been so successful that Cadena88 is now looking to expand even further.
It has also increased the ways and hours in which customers can make a purchase. For example, if they see something they like, they can leave the store to see how it fits in their home using a simple shareable link provided by the store or found online and make a purchase from anyplace, anytime.
Giving customers shareable links also allows them to suggest and recommend products over What’s App, text, or email with family and friends, which also helps generate additional sales.