Determining Feasibility and Calculating ROI for Using Immersive Technology in Customer Experience

Implementing immersive technologies like augmented reality (AR), virtual reality (VR), and mixed reality (MR) for improving Customer Experience requires a careful assessment of feasibility and a clear understanding of the return on investment (ROI).

In a previous post, Boston Engineering asked you to Explore Immersive Technologies in Customer Experience.

Central to the article was highlighting the customer experience challenges your organization is facing. Immersive technologies have emerged as powerful tools to fill these gaps in your customer engagement strategies, and create hands-on, engaging, and scalable experiences. 

How can you asses if Immersive Technologies are feasible in your applications? How will you know if they can provide the returns your organization needs?

Below is a comprehensive guide on how to evaluate the feasibility of immersive technologies and calculate their ROI for your customer experience platforms. 

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What is Immersive Technology? Immersive Technology is the interaction of advanced software, devices, and data allowing users to experience information in new and empowering ways. Augmented Reality, Virtual Reality, and Mixed Reality from Boston Engineering are tools available today to elevate your organization’s capabilities, competitiveness, and agility.

Immersive Technology addresses today’s operational, service, and sales challenges with a nod to the future of business: better information and faster delivery that strengthens companies against uncertainty, while building competitive advantage.

Learn more about Immersive Technologies at Boston Engineering

Assessing Immersive Technology Feasibility

Before diving into immersive technology, it’s crucial to determine whether your organization is ready for it. Feasibility revolves around understanding your goals, evaluating infrastructure, and assessing the potential impact on the customer experience

Here’s a step-by-step guide to help you assess feasibility:  

Define Customer Experience Goals and Use Cases 

The first step in determining feasibility is to clearly define the customer experience goals that immersive technology can address. Ask yourself: 

• What customer experience challenges do you currently face? Are your customers struggling to visualize complex products, navigate information, or engage with your brand in a meaningful way? 

• Are you aiming to enhance product exploration, provide immersive tutorials, or offer virtual customer support? For example, VR could allow customers to explore a new car model before buying, while AR could provide product tutorials in real-time. 

Identifying specific use cases will help you narrow down how immersive technology can serve your Customer Experience goals. 

Evaluate Your Customer Base and Readiness 

Understanding your customers’ digital maturity is essential for gauging the feasibility of immersive technology. Consider the following: 

• Are your customers tech-savvy and likely to embrace immersive experiences? Some customers may be more comfortable with AR/VR than others, especially younger or more digitally inclined demographics. 

• Do your customers already engage with digital channels like mobile apps or social media? Immersive technologies typically integrate with existing digital ecosystems, so understanding customer engagement habits will help you determine if AR/VR/MR is a natural extension. 

Assess Infrastructure and Technology Needs 

Next, evaluate your company’s infrastructure to determine if it can support immersive technology: 

• Do you have the required hardware and software in place? This could include VR headsets, AR-enabled apps, or MR devices. You’ll need to ensure these tools can be easily accessed by your customers. 

• Can your IT and development teams support immersive content creation and management? Immersive experiences often require custom-built solutions, interactive content, and ongoing technical support. 

If your current infrastructure isn’t ready, determine the investment required to upgrade or implement the necessary tools and platforms. 

Analyze Scalability and Long-Term Value 

Immersive technologies can be powerful but require careful consideration of scalability: 

• Can immersive experiences be replicated across multiple customer touchpoints or locations? For example, can AR experiences be easily updated for product changes or expanded to different regions? 

• Will the technology remain relevant over time? As digital trends evolve, ensure your chosen immersive technology can adapt and grow with your business.  

Calculating ROI of an Immersive Technology Investment

Once you’ve established that immersive technology is feasible for your customer experience strategy, it’s time to calculate the return on investment (ROI). Calculating ROI involves balancing the upfront costs with the long-term benefits to both your business and your customers.

Here are the steps to follow: 

Identify Costs 

Start by calculating the total cost of implementing immersive technology, including both direct and indirect expenses. Some key cost areas include: 

1. Hardware Costs: If your immersive experience requires customers to use VR headsets, smart glasses, or other devices, factor in the costs of providing or enabling access to this equipment. 
   
   
2. Software and Platform Development: Developing custom AR/VR experiences requires investment in design, content creation, and potentially third-party development platforms. This can include costs for creating 3D models, virtual environments, or interactive features. 
   
   
3. Maintenance and Updates: Ongoing costs include updating content (e.g., for new products), maintaining software, and ensuring hardware compatibility with future upgrades. 
   
   
4. Marketing and Rollout Costs: Consider the expense of promoting your new immersive experiences to customers and integrating the technology with existing customer-facing channels (e.g., websites, apps, or retail spaces). 

Measure Benefits 

The benefits of immersive technology for customer experience can be both quantitative and qualitative. These benefits help justify the investment and calculate ROI. Key measurable benefits include: 

1. Increased Customer Engagement

Immersive experiences are designed to captivate and engage customers in ways that traditional media cannot: 

• Higher engagement rates: Measure the increase in time customers spend interacting with your brand via AR/VR. For example, do customers spend more time exploring a product in VR than on a website? 

• Improved brand loyalty: Immersive experiences can leave a lasting impression, leading to higher customer retention and repeat business. 

2. Improved Conversion Rates

For many businesses, immersive technology can significantly boost sales and conversions: 

• Faster purchasing decisions: Customers who use immersive technology to explore products or services are often able to make faster, more confident decisions, leading to increased sales. 

• Higher conversion rates: AR/VR experiences that allow customers to try products before buying (e.g., virtually trying on clothes or testing furniture in their homes) often lead to higher conversion rates. 

3. Cost Savings

Immersive technology can also help reduce costs in various areas: 

• Lower return rates: By allowing customers to experience products in detail before purchase (e.g., using AR to see how furniture fits in a room), you can reduce the likelihood of returns. 

• Reduced customer support: Immersive self-service tutorials or virtual support systems can reduce the need for live customer service, cutting down on support costs. 

4. Enhanced Customer Satisfaction

Immersive experiences often lead to higher customer satisfaction by providing innovative, personalized, and seamless interactions: 

• Personalized experiences: AR and VR can be used to offer tailored product recommendations, customized experiences, or interactive content based on customer preferences. 

• Improved CX feedback: Positive feedback from customers who enjoyed the immersive experience can lead to higher Net Promoter Scores (NPS) and better overall customer satisfaction. 

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Calculate the ROI Formula 

Once you’ve assessed both the costs and benefits, calculate ROI using the following formula: 

ROI (%) = [(Total Benefits – Total Costs) / Total Costs] x 100 

For example, let’s say the total cost of implementing immersive technology for customer experience is $200,000, and the measurable benefits (increased conversions, higher engagement, cost savings) amount to $350,000. Your ROI calculation would be: 

ROI = [(350,000 – 200,000) / 200,000] x 100 = 75% 

This means that for every dollar spent on immersive technology, your company gains 75 cents in value. 

Next Steps: Pilot, Measure, and Iterate

After calculating the potential ROI, it’s a good idea to start small with a pilot project. This allows you to test the technology on a limited scale, gather data, and refine the experience before rolling it out to a larger audience. 

• Select a pilot use case: Choose a specific customer touchpoint or product line to test the immersive experience (e.g., an AR tool for product visualization or a VR showroom). 

• Track key performance indicators (KPIs): During the pilot, measure engagement, conversion rates, customer feedback, and cost savings to ensure that the immersive experience is delivering value. 

• Iterate and scale: Based on the pilot results, refine the experience as needed, then scale it across other customer touchpoints or products. 

Conclusion 

Immersive technologies offer significant potential to enhance the customer experience, from increased engagement and personalized interactions to improved conversion rates and cost savings. However, successful implementation requires careful planning, a solid feasibility assessment, and a clear understanding of ROI. By following this guide to determine feasibility and calculate ROI, your company can ensure that immersive technology investments deliver meaningful value both for your business and your customers. 

In the end, a strategic approach to immersive technology can provide a competitive edge, driving stronger customer loyalty and long-term business success. 

Ready to Start the Immersive Technology Journey? 

With the capability of saving time and money in operations, improving field service, and creating efficiencies in your sales process-- Immersive Technologies are currently available to provide an advantage against competition, and a buffer against uncertainty.

Augmented Reality seamlessly blends the physical and virtual, enhancing user experiences by providing additional information and digital elements without completely detaching them from their surroundings. This intuitive integration makes AR an accessible and cost-effective solution across various industries, from education to healthcare to gaming. By overlaying digital content onto the real world, AR empowers users to access valuable insights and engage with information in a more natural and contextual manner.

Virtual Reality offers a completely immersive experience, transporting users into captivating digital realms. VR's high level of engagement and interactivity makes it an ideal medium for applications that require intense focus, such as gaming, training, and therapeutic interventions. By fully engaging the user's senses, VR has the power to inspire, educate, and transform the way we approach challenges and opportunities.

Mixed Reality seamlessly blends the physical and virtual, enabling users to interact with digital elements as if they were physical objects. This enhanced level of interaction and collaboration opens up new possibilities for product design, maintenance, and training. MR is revolutionizing the way we tackle complex tasks and collaborate across different locations.

Whether you’re seeking to meet rising manufacturing demands, offer more efficient training and service delivery, or revamp marketing & sales efforts, Boston Engineering has the tools to tackle these issues head on and incorporate your specific needs. Let us help you create the roadmap to success: Get the full ROI through Immersive Technologies by working with Boston Engineering.

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