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The retail industry isn’t immune to the Big Tech layoffs dominating headlines: Amazon’s expected cuts will target both its retail and devices arms, and Meta’s VR aspirations are on the chopping block. But the apparent retreat from mixed reality doesn’t necessarily mean retail won’t continue to see advancements in those sectors.
The layoffs are likely the result of over-hiring and macroeconomic headwinds, rather than go-to-market flaws with the technology or intrinsic barriers, Eric Abbruzzese, research director at intelligence firm ABI Research, told Retail Brew via email.
“I don’t imagine planned AR/VR device launches or feature rollouts will be delayed, but instead spending becomes more focused,” Abbruzzese said.
Amazon Fashion’s recent partnership with Snapchat—enabling users to virtually try on glasses from brands like Oakley and Ray Ban—could be an example of just that shift.
“It does solidify some timing and resource allocation for the company,” Abbruzzese said. “Rather than building everything in house, Amazon is partnering; Amazon is one of the few companies who could theoretically build out an entire AR retail branch for a business of their size, but partnering likely was mutually beneficial for Amazon and Snap to quicken their AR retail efforts.”
- Snap is all in on AR, reporting 250 million daily users of its AR capabilities in 2022, and launching initiatives like a multi-year partnership with Live Nation.
Trend setters: Shahd ElAshri, a research analyst at International Data Corporation Canada, told Retail Brew the Snapchat integration indicates Amazon is “starting small,” but that the AR experience market isn’t closely linked to the layoff-heavy world of AR/VR hardware.
- Amazon is trying to “have the first mover’s advantage of seeing ‘Okay, is this gonna work?’” ElAshri said.
- The new Shopping Snapchat lenses are currently available for eyeglasses, accessible through Amazon Fashion’s public profile on Snapchat. The companies have plans to expand into additional verticals, Snap said.
Abbruzzese said he’ll be keeping an eye out for indicators of the partnership’s success over the next year. “If we see AR expand more deeply into Amazon’s platform through not only more product support, but Amazon marketing AR more as a feature, then that indicates some success as well,” Abbruzzese said.
“If Amazon is pushing into AR now, expect competitors to do so in the next 12 months,” he added.—MA