IBM is working on an augmented reality (AR) app to help retailers provide more product information to their customers, as well as to gather more information about them.

The company's research labs have designed a prototype of a mobile application that can be used by store goers to identify products and retrieve more information about potential products. The company is testing it now with a number of shops in the US.

"This is a neat way of providing customers with more information about products, which they would normally [research] on the Web," said Jill Puleri, IBM retail vice president. "It's also a way for a retailer to target and change behavior, and get some cross-selling and up-selling going with consumers."

The idea behind the app, according to IBM, is to help the retailer provide more information to the shopper while they are in the store, rather than letting the consumer return home after a store visit to further investigate products on the Internet, increasing the likelihood that they will buy the product online.

This is how it works: A user entering a store can download the application, register, fill out a user profile and then use the app to find out more data about products in the store that are of interest. The user would aim the phone toward a product of interest and the app will use the phone's built-in video camera to identify the product using image-processing techniques. The identification process might work similar to how QR (quick-response) barcodes are used today, though it would not require the product packaging to contain a barcode, and would allow the retailer, rather than the product vendor, to present the information about the product.

Once the product is identified, the app can then download more information from an IBM server, such as ingredients, product specifications, price, reviews and applicable discounts. It could provide information tailored to the individual user, such as if the product being reviewed triggers allergies. With the user's permission, the app could also send a notice to the user's social networks, alerting friends and associates that this individual is shopping at the retail outlet.

In addition to providing an app for customers to use, IBM will also provide the tools that will allow retailers to analyze the information generated by consumers when they use the app, such as the products and features they found of most interest. It could also be used to provide digital coupons and serve as the basis of customer loyalty programs.

"We have found in our research that consumers have a huge open-mindedness about sharing information about themselves if they get something of value back," Puleri said.

IBM is working with a number of clients to test the mobile application and associated software, though it has not discussed when it would commercially offer the package. It could represent a large market for IBM, though. In-store shopping still accounts for more than 92 percent of all retail volume, according to Forrester Research.

The company also has no plans at present to release the mobile app as a stand-alone technology, which was first developed in a company lab in Israel, or use it as part of a retail-wide standard. This solutions-based approach "gives the customer to the first right to market. It will give them a competitive advantage," Puleri said.