Digital retail strategy – will virtual reality live up to its promise?

15th May 2017

In recent years, Virtual Reality (VR) has become the next big thing for hip tech start-ups in Silicon Valley. Some of this buzz has filtered down to retailers who are keen to include it in their digital retail strategy– but does the technology deserve the hype and is it really suitable for retail applications? So far retailers have been slow to adopt VR. So what can they do to encourage users – and is it worth the effort?

Digital Marketing Strategy

Using VR in-store

When Facebook bought up the VR headset company, Oculus Rift, this gave many retailers the confidence to get on board and try it out. Big brands including Topshop and The North Face could see the potential benefit of VR and it’s numerous opportunities for enhancing customer experience and creative retail journeys. It offered high street retailers a new method for luring shoppers away from the web and back into physical stores, in order to experience something new.

Despite this, we haven’t seen many examples of mainstream adoption yet. But experts still insist that the forecast is good. According to Tom Moran, senior UX designer at TH_NK who work with Shop Direct and New Look; the future of VR is very bright indeed:

“It’s been predicted that within the next 10 years, a billion people will be interacting with virtual reality on a daily basis and that the sector will be worth $38bn by 2026. It’s a huge potential opportunity for brands,”

Some retailers including Ikea and M&S have been experimenting with creative VR implementations but according to Retail Week, consumers are yet to be convinced. Many don’t want to invest in a headset or take the trouble to download the apps needed to use it in store – and this has been the main barrier to mainstream adoption; as Andy Harding – former Chief Customer Officer at House of Fraser – explains:

“Three years ago, people were talking about how virtual reality could be the next frontier of retail, but as far as I’m aware, no-one has come out and said we’ve done it”

“Headsets haven’t penetrated the consumer market yet, and that’s a bit of a problem.”

“Plus, it doesn’t help that most home computers can’t support it.

Moran concurs:

“Currently, less than 1% of PCs used globally are capable of running VR. The high price point and current dearth of content leaves the industry in a ‘gap of disappointment’.

“Developers are nervous to invest in an as yet unproven market, but by hesitating they are also preventing the industry from really taking off.

“Likewise, consumers won’t buy the hardware en masse until the great experiences they expect are there. And businesses of all kinds won’t invest in those experiences until they know how big a deal VR will be.”

Moran suggests that the VR experiences which are delivered via mobile – using low-cost cardboard headsets to turn a smartphone into a VR screen – will probably be most likely to crack the market first as these are most readily accessible for users at little additional cost.

VR for online shopping experiences

So what about the web? Using VR in retail isn’t just about using VR in bricks-and-mortar stores to enhance the customer experience – or lure shoppers to the high street. There is another use for the technology which is potentially more significant for retailers in terms of sales: shoppable VR.

Chief of Client Strategy at digital agency Somo, Emma Crowe suggests that one of the best early examples of shoppable VR is the technology developed by Alibaba for famous US department store chain, Macy’s.

The project, named Buy+ was launched in November 2016 and aimed at people who really value the chance to shop in Macy’s from the comfort of their own home, in China.

Chinese shoppers can use the technology – along with an inexpensive cardboard headset and a smartphone – in order to take a VR trip to America and stroll around Times Square in New York. Here they can enter the iconic Macy’s store and browse departments at their leisure, to purchase shoes, clothes or handbags.

Speaking about the technology, David Lloyd of Alibaba explains how it entices shoppers to buy:

“VR empowers consumers to shop in virtual stores, immersing them in a brand and its culture and ultimately motivating them to make a purchase”

“As the technology becomes more advanced, we could indeed have a future in which VR is used to select and purchase products, not simply to view and experience them.”

So it’s not necessarily about getting shoppers into physical stores – VR has enormous potential for web stores too: providing real life experiences – which are fulfilled with purchases of physical goods – in a virtual environment.

Lloyd suggests that until recently, AR (Augmented Reality) was languishing in a similar fashion to VR – but everything changed after people Pokemon Go was launched and became a global phenomenon. He believes that VR just needs a similar ‘killer app’ to launch it into mainstream use and unlock the possibilities for retail, just as Pokemon has done for AR.

Do you have plans to use VR in your customer experience or have you seen some good examples of VR or AR in use in a retail environment? Let us know in the comments section below!


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