Ireland were favourites for the game after recent form, but again failed to win a Nations League game.
This comes several months after the Luxembourg humiliation in the early days of Stephen Kenny's reign.
Collins who started the game said that the game could ignite the fire the Ireland squad need.
Republic of Ireland losing to Armenia could prove a good thing, says Nathan Collins https://t.co/Y0vTqZ3Lnm
— The Independent (@Independent) June 6, 2022
"I don't know if it will affect confidence because we know what we can do, he told reporters at Abbotstown.
"It could nearly be good for us as it will add fuel to the fire. We need a reaction and we have said it in there. Whether we show it on Wednesday, we know we need one.
"In a way, it's probably good for us as we've been on a high lately. And now we know we need a reaction, so if we get that it should be good for us."
Ireland have failed to win a single game in the Nations League since it's inception in 2018. Saturday's loss means it no wins and just two goals scored in 11 games.
However Ireland have gone toe-toe with the likes of Belgium and Portugal and Collins believes that they have the ability to face the better sides. He said: "You have seen us play the likes of Portugal and Belgium and they are a high standard. We know that and everyone knows that if we play our game, we can go and beat anyone."
Ireland play Ukraine on Wednesday at 19.45