[Image of: RetailWire Logo and Tagline (for print)]

BUSINESS TIPS

ChannelAdvisor:
Online Selling Strategies
RR Donnelley:
In-Store Marketing
LoyaltyOne:
Enriching Customer Relationships
 
[13 comments]

Will virtual reality lead to virtual shopping?

March 31, 2014

Shopping on Facebook hasn't exactly taken off. Will virtual reality (VR) help?

While its surprising $2 billion deal to acquire virtual reality (VR) headset maker Oculus provides Facebook with a gaming platform, many follow-up articles explore how such simulated in-person connections might revolutionize communications with immersive 3D social experiences.

On a conference call, Mark Zuckerberg, Facebook CEO, said VR could be the next big computing platform after mobile.

"After games, we're going to make Oculus a platform for many other experiences," said Mr. Zuckerberg. "Imagine enjoying a court-side seat at a game, studying in a classroom of students and teachers all over the world, consulting with a doctor face to face, or going shopping in a virtual store where you can touch and explore the products you're interested in, just by putting on goggles in your own home. This is really a new social platform."

VR headsets feature motion sensors that track the movement of a person's head. Shifting from one side to the other creates the illusion that the wearer has an active presence in a digital world.

"If you can see somebody else, and your brain believes they're right in front of you, you get goosebumps," Brendan Iribe, CEO of Oculus VR told The New York Times. "You start to realize how big this could be."

[Image: Oculus Rift]

Critics of the deal don't believe VR, which has been hyped for decades, holds any meaningful application beyond gaming. It also causes motion sickness for some, something Oculus is working to solve. Facebook itself describes the technology's applications beyond gaming as "nascent."

But with component prices coming down and as technologies continually advance, some see the deal as a sign that VR may be ready to break out in the years ahead.

At retail, Topshop recently used VR to transport in-store shoppers to London's Fashion Week. But the technology appears to hold more potential for e-commerce.

"Web-based retailer Thread.com could add a virtual clothes rack with full-size, 3D replicas of their suggestions in order to complete their online personal stylist experience," Phillip Dyte, paid social media manager at iProspect, told the Retail Gazette. "Elsewhere, furniture or automotive retailers could use it to show off scale replicas of their products — just like stepping inside the sales brochure."

Not surprisingly, Facebook shared a more transformative view beyond commerce, seeing VR potentially emerging as the next social and communications platform. Wrote Mr. Zuckerberg in a blog post: "One day, we believe this kind of immersive, augmented reality will become a part of daily life for billions of people."

FINANCIALS:     [NASDAQ:FB] [ ]

Discussion Questions:

Do you think virtual reality technology will change communications and e-commerce? How will consumers respond to simulated 3D shopping? What are the implications for retailers?

While we value unfettered opinion, we urge you to show respect and courtesy for people or companies about whom you comment. Keep in mind that this is a public, professional business discussion. RetailWire reserves the right to edit or refuse the publication of remarks that we deem unsuitable. We may also correct for unintended spelling and grammatical errors.

Instant Poll:

How would you rate the potential for virtual reality to transform shopping?

Comments:

Shoppers already find non-immersive VR shopping an appealing idea - we've been asking our shoppers how likely they'd be to use our system for shopping at home if it were available, and we're always getting top 2 box scores in the 80s. That said, there are still massive hurdles to overcome, nausea not being the least of these problems. 3D television has yet to take off, and that's a more benign application. Nascent might be a good description - pre-natal even better.

[Image of: View Braintrust Panelist button]
Dr. Stephen Needel, Managing Partner, Advanced Simulations

Any technology that enhances the online experience and drives the customer to click on the purchase button is probably worth the price. I do think VR will have more impact in non-apparel applications.

In today's edition of Women's Wear Daily there is a very good article about online retailers running to open offline stores. The CEO of apparel retailer Bonobos, Andy Dunn, recently learned it doesn't matter how spectacular your online service is or how generous your return policy, "the key was the try-it-on moment."

Opening a store with a couple of fitting rooms and no inventory (after trying on samples, customers purchased online) proved to him that a great fitting room experience was important because it allowed the customer to touch and feel the clothing. This "aha!" moment proved to him that offline shopping was about more than just instant gratification.

Shopping may be digital, but apparel buying decisions are still analog!

[Image of: View Braintrust Panelist button]
Marge Laney, President, Alert Technologies, Inc.

For those who just hate the idea of living in the real world, I'm sure this is Viagra. For the futurists saying this is where we're headed, it's a whole new PPT. For most retailers, I think they'll find customers continue to crave genuine interaction.

Outside of the initial buzz about virtual sex on Second Life which soon fell out of reporters' favor, I feel the potential for this extremely low.

[Image of: View Braintrust Panelist button]
Bob Phibbs, President/CEO, The Retail Doctor

To the naysayers:

"Airplanes are interesting toys but of no military value." -- Marechal Ferdinand Foch, Professor of Strategy, Ecole Superieure de Guerre.

"This 'telephone' has too many shortcomings to be seriously considered as a means of communication. The device is inherently of no value to us." -- Western Union internal memo, 1876.

"The wireless music box has no imaginable commercial value. Who would pay for a message sent to nobody in particular?" -- David Sarnoff's associates in response to his urgings for investment in the radio in the 1920s.

"While theoretically and technically television may be feasible, commercially and financially it is an impossibility." -- Lee DeForest, inventor.

"There is not the slightest indication that nuclear energy will ever be obtainable. It would mean that the atom would have to be shattered at will." -- Albert Einstein, 1932.

"The bomb will never go off. I speak as an expert in explosives." -- Admiral William Leahy, U.S. Atomic Bomb Project.

"I think there is a world market for maybe five computers." -- Thomas Watson, chairman of IBM, 1943.

"I have traveled the length and breadth of this country and talked with the best people, and I can assure you that data processing is a fad that won't last out the year." -- The editor in charge of business books for Prentice Hall, 1957.

"There is no reason anyone would want a computer in their home." -- Ken Olson, president, chairman and founder of Digital Equipment Corp., 1977.

"The concept is interesting and well-formed, but in order to earn better than a 'C', the idea must be feasible." -- A Yale University management professor in response to Fred Smith's paper proposing reliable overnight delivery service. (Smith went on to found Federal Express Corp.)

"If I had thought about it, I wouldn't have done the experiment. The literature was full of examples that said you can't do this." -- Spencer Silver on the work that led to the unique adhesives for 3-M "Post-It" Notepads.

"So we went to Atari and said, 'Hey, we've got this amazing thing, even built with some of your parts, and what do you think about funding us? Or we'll give it to you. We just want to do it. Pay our salary, we'll come work for you.' And they said, 'No.' So then we went to Hewlett-Packard, and they said, 'Hey, we don't need you. You haven't got through college yet.'" -- Apple Computer Inc. founder Steve Jobs on attempts to get Atari and HP interested in his and Steve Wozniak's personal computer.

"Why would anyone want a camera in their cell phone?" Gene Detroyer 1995

[Image of: View Braintrust Panelist button]
Gene Detroyer, Professor, Independent

Yes, virtual reality technology will redefine communications and e-commerce in the long-term as Millennials and the younger demographics that are growing up with gaming will be looking for an immersive, 3D shopping experience as they mature.

Retailers do need to develop an omnichannel strategy that includes the right mix of social media, interactive TV (VR, AR, etc.), gaming platforms and disruptive retail, as channels.

The reason that I take a long-term view on this issue is two-fold. Retailers need to find creative ways to engage their customers (as Topshop did for London Fashion Week) to drive greater demand, and, consumers need to become more VR savvy so they are not intimidated by the experience.

This move by Facebook is monumental in raising awareness and interest.

[Image of: View Braintrust Panelist button]
Karen S. Herman, Founder & Design Director, Gustie Creative LLC

VR is sexy. But it is still a bit fantasy. I place my bets with Augmented Reality. The difference is that Virtual Reality is a completely immersive digital experience. Augmented Reality overlays digital images, information and sound onto the real scene in front of the viewer. It "augments" the reality in the here and now. Visual field technologies, like a Google Glass, offer AR experiences in the world.

Why do I see AR as a bigger opportunity than VR? Because most people will want to stay somewhat engaged in the real world around them, most of the time. Imagine shopping with AR: you are walking down the cosmetics aisle in Target, and Heidi Klum is demonstrating how to wear a new eye shadow. You still haven't abandoned your shopping mission, yet you have an experience (possibly a unique and personal experience) overlaid onto reality.

[Image of: View Braintrust Panelist button]
Liz Crawford, VP, Strategy & Insights, Match Drive

Hey, welcome to partial naysayers club. Those who know me are aware that I believe in new ways of doing things and rarely am negative about creative tech. I myself was called "nuts" when I worked on the programming of the first self-service airport check-in system in the '80s.

My only issue with VR and shopping is the overall experience of "going shopping." That is an element of retail that cannot be replaced - no matter the technology. Yes, it may take time. driving to the store, etc - but that is what makes it the reality that it is and always will be.

So go VR/4D whatever. You cannot replace reality - for reality is what it is.

[Image of: View Braintrust Panelist button]
Tom Redd, Vice President, Strategic Communications, SAP Global Retail Business Unit

This has everything to do with quality of the shopping experience. If the experience isn't all that much more immersive or compelling than what is currently available in the mainstream, then I think this will not catch the marketplace on fire. However, I have seen some pretty cool stuff in this realm and it would be great to get this available in the most popular platforms today, like iPad, Android, etc.

First-mover retailers and CPG brands will of course get the most attention. I think there is good potential to capture some market share and enduring brand loyalty with the right delivery execution.

[Image of: View Braintrust Panelist button]
Ralph Jacobson, Global Consumer Products Industry Marketing Executive, IBM

Why is the acquisition "surprising"? Isn't it becoming apparent FB will buy (almost) anything it can get its hands on? The only real issue is whether or not this lottery approach is inspired or desperate.

'notcom'

A real time interactive, three dimensional virtual reality e-commerce shopping experience is easily attainable for the 21 century shopper. The technical issues will largely be addressed with hardware power and footprint improvements as well as the development of new user input/output devices. The software is being developed and tested now and early versions should be seen by the public soon.

The real issue with this platform is in the user acceptability and ownership support. If the software is viewed as difficult to use or clumsy and/or requires a vast amount of system resources users will shy away quickly and be slow to return to a named site. At the same time ownership will be slow to support product that expands a buying experience that severely limits the shopper's attraction to impulse items that increase profit margins. So I guess you might say that ready or not here it comes, whatever "it" is.

'gjarnoldjr'

Like everything else that's new, consumers (and consultants) will give it a try. But the exceptional merchants that cater to the customer will still draw the big crowds.

[Image of: View Braintrust Panelist button]
Jerry Gelsomino, Principal, FutureBest

Only for special events - Tesco shows us the example for its promoting campaign for Pel products - see article and video here.

Christelle ALEXANDRE, chargée de communication, HighCo DATA

Some form of virtual reality technology has been around for ages, and the question is when it will start to make a significant impact. With e-commerce growth continuing to outpace retail growth as a whole, I find it hard to imagine that shoppers would not increase their use of e-commerce when presented with a more immersive experience. That said, some major issues remain. In addition to the nausea effect, there is a big question around the affordability of the units unless they are subsidized (imagine advertising on your VR unit - ugh!). Like all technology, there will be an adoption curve, and it will likely take some time before the units make their way beyond early adopters to the mass market, let alone become ubiquitous. Furthermore, even when a significant portion of the population possesses one, there will continue to be - as Marge said - an aha! moment when the consumer will actually want to try the purchased product for him/herself to see how it really feels/performs.

Bottom line is that while promising in terms of future trends, I do not expect the impact on retail sales to be explosive. That said, I do think there will be a novelty effect, and there will certainly be no shortage of early adopters - consumers and innovative retailers - willing to give it a try.

[Image of: View Braintrust Panelist button]
Alexander Rink, CEO, 360pi

Search RetailWire
Follow Us...
[Image of:  Twitter Icon] [Image of:  Facebook Icon] [Image of:  LinkedIn Icon] [Image of:  RSS Icon]

RetailWire's
Getting Started video!

View this quick tutorial and learn all the essentials...

RetailWire Newsletters