Effects of AR and VR on the Automobile Industry

Advancements in technology have always resulted in improvements that have made life better. Technology making life better continues in the pharmaceutical industry, the mining industry, the healthcare industry, and even the automotive industry for that matter.

Making life better for everyone is the purpose of implementing technological advancement in the first place.

Two such advancements are that of Augmented Reality (AR) and Virtual Reality (VR), and the effects of its implementation in the automotive industry as we know it.

Virtual reality is a simulated experience that can be similar to or different from the real world.

It may be used to impart entertainment and educational experiences. Other distinct types of VR include mixed reality and augmented reality.

Augmented reality is an interactive experience of a real-world environment.

AR is where the objects that reside there are enhanced by computer-generated perceptual information, sometimes across many sensory modalities including auditory, visual, haptic, olfactory and somatosensory.

The primary difference between AR and VR is that augmented reality adds digital elements to a live view.

AR and VR are often delivered by using the camera on a smartphone, etc. Virtual reality implies a complete physical immersion experience that eliminates the physical world.

How do AR and VR play a part in the automotive industry?

That’s simple. Gone are the days when everything you did was in person and on-site, and where products had to be examined by coming in contact with them.

Advancements in technology have allowed us as both manufacturers and consumers to build an even more intimate relationship with people and objects than anyone could have ever imagined earlier.

The way manufacturers have had to market their products has changed since the advent of the internet. Manufacturers who once relied on mass advertising, now focus on more a targeted approach to the way their goods are offered.

What we aim to achieve is an understanding of the several applications that augmented and virtual reality have in the automotive industry thus far.

Immersive virtual reality.

Some say that you can judge a person by the car they drive. That is usually said as cars like all non-commercial vehicles are expressions of the owner’s personality. Automotive manufacturers are now implementing an immersive virtual reality experience to not only influence the purchasing decisions of their prospective customers but to create and reinforce strong brand loyalty.

There are several ways that automotive manufacturers missout on snagging loyal customers for several reasons, be it, lack of relevance that is unique to a customer, poor transparency, and failure to meet customer expectations.

By implementing immersive technologies like AR and VR, automotive manufacturers can create a realistic comparison of the look and feel of the actual product. A realistic view and understanding by consumers goes a long way to reduce post-purchase dissonance and increases transparency.

With a virtual showroom, automotive companies can make the process of purchasing a new vehicle less stressful.

By using this experience, customers can toggle between a wide range of options to ensure that they end up choosing a final product that best suits their needs and personality.

These options can be anything from the color of the interiors, customized seating arrangements, and seats among other options. The possibilities are endless. Another great advantage of a virtual showroom in comparison to a full-scale showroom is that the costs required to set up a virtual showroom are much lesser.

Having virtual models doesn’t require manufacturers and retailers to maintain variations of a variety of physical models. Always being required to have every model in the showroom can lead to the possibility of unsold cars due to unpopular color code, for example, whose value depreciates with each passing day, and will eventually become a loss for dealers.

With the help of this technology, dealers can manage their inventories and allow them to better anticipate customer preferences.

AR customer experience

AR usage in the automotive industry has bought a huge change in the automotive industry. BMW was the first to use AR in the automotive industry. It has been found that over 40% of consumers are willing to pay for a product that is AR compatible. And, this is no exception for the automotive industry.

An example of how manufacturers have picked up on this insight is that of BMW partnering with Accenture to construct an AR app that allows prospective customers to explore future car models without having to leave the comfort of their homes.

It also allows them to make customizations to these AR models according to their preferences.

Virtual car simulation.

Simulators have been in use for some time now. Think like, simulators for pilot or astronaut training, military applications, and other teaching modalities. It’s understandable that the application of simulators in the automotive industry exists.

Virtual simulators are not only used in driver training facilities but can also allow manufacturers to run trials, test theories and carry out market research. For example, manufacturers can run controlled tests to figure out the best possible ergonomic settings for drivers, which, in turn, improves road safety and this will lead to greater brand loyalty.

VR test driving.

Harnessing the power of VR, manufacturers have begun investing in 360-degree videos to give potential customers an idea of what it will be like to own and drive a particular model. It has proven to be as effective as possessing a virtual showroom. A virtual showroom works especially well for terrain-specific vehicles like a vehicle from Jeep or BMW that is built to conquer off-road terrain.

Virtual simulators allow prospective customers to take a virtual test drive and experience a vehicle of their choosing in a safe environment. At the same time, manufacturers and dealers need not invest in expensive test vehicles which will reduce their overheads quite significantly.

The dealers can help by allowing the customer to make better-informed decisions than they would have by examining a car in a showroom.

AR for self-servicing.

Augmented reality is a very purposeful technology as it can help customers carry out tasks that do not need a mechanic. And, this is something that manufacturers can offer as part of a self-service package. Self-serve AR allows users to interact with the real world using computer-supported graphics.

Augmented reality can be used to complete simple tasks such as how to replace the windshield washer fluid in your car to more complicated tasks like ensuring the wiring under your car’s bonnet is configured.

The use of AR will allow a customer to figure out what is wrong with the vehicle before they have to take it to a mechanic and this will foster a better relationship between a customer and the manufacturer.

VR for nostalgia.

Nostalgia is a great marketing tool. Using the feelings coming from nostalgia is a brilliant way of reminding people of where your brand has been, where it stands and the direction it’s headed in. Through nostalgia, patrons form an emotional connection with a brand and this subsequently increases brand loyalty.

Manufacturers can record and share 360-degree videos of expos, auto shows or even pop-up booth stores globally and this has proven to be a great strategy to implement to increase engagement levels with prospective customers of a brand.

Nostalgia enriches the entire story-telling process of a brand.

Conclusion

Although relatively new, the use of immersive technology such as augmented reality and virtual reality in the automotive industry is gaining traction. The number of its applications are increasing as well.

Automotive companies that are investing in these forms of immersive technology are projected to gain a competitive edge over other market players. These days, the idea of a ‘sharing economy’ has taken center stage, making the art of selling new vehicles an even more challenging process.

Through the effective implementation of these technologies, automotive manufacturers and dealers can look to increase safety norms, reduce costs, and make the entire experience of purchasing a new vehicle all the more enjoyable, which, in turn, is expected to take the automotive industry to new heights.

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