Williams-Sonoma gets an edge in the augmented reality race

Dive Brief:

Williams-Sonoma is acquiring Outward, the 3-D imaging technology company that its Pottery Barn unit worked with on a recent augmented reality app, according to a recode report.
The $112 million cash deal gives Williams-Sonoma ownership of technology that can be used to render products in 3-D for a variety of e-commerce and mobile commerce applications. In addition to the Pottery barn app, Williams-Sonoma has been working with Outward on other projects over the last three years.
The report stated that Outward will continue to operate independently as a subsidiary of Williams-Sonoma, and will continue to work with other clients in addition to the brands owned by its new parent company.

Dive Insight:

The augmented reality battle has begun in earnest in the last couple months as more retailers have launched AR apps using Apple’s ARkit technology platform. Pottery Barn's AR app launched back in March of this year and was actually one of the earliest ones.

With so many retailers, including Build.com, Houzz, Wayfair, Overstock and others all taking fairly similar approaches, the apps themselves are quickly becoming table stakes, and retailers will be looking for other points on which to differentiate their AR features.

One such area could be the quality of the 3-D images on which such an app relies, as well as the overall size of the retailer's library of available 3-D product images. Wayfair, for example, has been aggressive in establishing a large 3-D image library, and Williams-Sonoma may be intent on doing the same.

It’s exciting to see retailers buying technology companies, and it shows just how much having a technology edge has come to be valued in the sector. However, these kinds of deals also come with risks and a burden to continue investing in a technology to make sure it fully develops. It's still early in the AR app race so the ongoing investment required may not pay off immediately.

With this deal, retailers will be watching Williams-Sonoma's 3-D and AR app efforts closely and, depending on what they see, there might be more acquisitions to come.