How Virtual Reality Could Spawn Rapid Commerce Growth

How Virtual Reality Could Spawn Rapid Commerce Growth
The ho-hum trips to the shopping mall is an era of my life I want to forget. It’s not that I don’t like shopping. I just don’t understand:
  • Why do I have to wait 2 hours just to see the new pair of sneakers?
  • Why do I have to go through an entire clothing outlet before I can find the jeans section?
  • And why I have to scan every nook and cranny to know if a new store has opened up?

But, there’s one shopping experience I’ll always remember. There was recently an exhibition at the mall and people were taking turns trying on fancy looking headsets. Though I’m not a fan of queues, the excitement on people’s faces made me curious. So I went over to see what was all the fuss.

Bam! After a flash and a whoosh sound, I could see a 360-degree view of the entire mall. In that moment, I was the only one inside, and I could check out all the shops (as well as the products inside) without actually going into a store. Heck, even a shopping cart was hovering above my head asking me if I’d like to buy something.

That was the day I discovered virtual reality (VR).

Virtual reality and commerce

Image source: YouTube

Virtual reality has been discussed since the late 80s early 90s. It’s going to affect many aspects of everyday life, not just in the form of commerce, pastime and entertainment, but also as a way to increase knowledge, meet new people for business, increase knowledge, and greatly improve communications. VR is just getting started, and it’s going to be big.

The Birth of “Virtual” Stores

It’s only a matter of time before VR technology hits a retail store near you. Retailers all over the globe are embracing this technology to transform how consumers live, play and shop.

Tommy Hilfiger is one of the latest examples. Working with WeMakeVR, a Netherlands-based startup, the company introduced VR headsets in its stores to enable shoppers to see its runaway shows and shop items from the latest collection.

In-store virtual reality

Image source: FashionUnited

And beyond promoting a product, VR is being used to tell a story about a brand’s craftsmanship and demonstrate the production process.

TOMS is one of the first brands to do this. It recently introduced Samsung VR headsets in its flagship outlets that take shoppers on a virtual trip to Peru and show them what it’s like to gift shoes to those in need (TOMS has been giving away a pair of shoes for every pair sold since the beginning).

It’s evident that VR offers several benefits to retailers, but what about consumers? Fast Company offers some insight on consumer’s take on VR:

“Cool” is the most frequently used word by consumers who try virtual reality. Generation Z is the most passionate towards VR, followed by millennials, Generation X, and baby boomers.

What’s intriguing is that all age groups are excited to experience VR. Also, of the 2,282 consumers surveyed, 79% of people said they’d like to try VR again, and 81% will tell their friends about it.

What should really interest retailers is the “Future of Retail” survey of 1,400 consumers by The Walker Sands. It found that 66% of consumers are interested in buying items via VR. 63% said that they’re expecting VR to change the way they shop.

Visualize that for a few minutes. What would a vcommerce experience look like if you had other people present, and you could see customer service people or attend virtual events?

As you talk to a VR brand representative about a cardigan, other customers or sales reps could  raise a point that adds to your understanding of the product, and you’d feel like a part of a live discussion. The immersive experience offers direct participation, where you’re making eye contact and having conversations, just like in real life (without needing to drive 20 minutes to the mall) .

All this means that there’s great opportunity for online shopping to become more “social.” With virtual reality, online shopping isn’t an isolated experience, as it has been for the last 20 years.

And another area where VR will truly make an impact is in delivery. It would be interesting to see how retailers utilize the technology to handle “checkout” in the virtual world. One thing they could do is handle it like non-playable characters in Online Role Playing games, where it looks like the customer service rep is talking to only you, but may be actually speaking to 100s of people at the same time with the exact same interaction.

That being the case, the “virtual representative” handling the checkout (who is a bot actually) could remind customers that the real item will be at their door in just a few hours. There’s an opportunity to partner with on-demand delivery networks like UberRUSH to make delivering things more convenient and reliable than packing and dispatching them yourself.

So it’s safe to say that VR technology, which could become an $80 billion industry by 2025, will have a significant impact on commerce.

Implications for Physical and Electronic Commerce

VR could be even more transformative than the internet ever was – reshaping every aspect of retail outlets and making them virtually accessible.

That said, retailers should be scared of VR technology, because it could eventually put them out of business. Companies like Sixense are developing virtual retailing solutions that enable consumers to shop just like they would in a retail outlet. For instance, consumers can use Sixense’s vRetail platform to grab an item of the shelf, see its description, tap a few buttons to see a video of it or change its color, and then add it to their cart.

When developments like these become profound and gain consumer acceptance, brands may skip brick and mortar deals and start giving business to firms that engage in vcommerce.

If this happens, it would be interesting to see how a VR company handles logistics. Retailers like Target perhaps foresee the threat, which could be the reason behind the company’s interest in virtual reality.

The main reason online shoppers are excited about VR is because they experience the product/service first. They can also co-create their shopping lifestyle with brands to enjoy a more personalized experience. This will likely increase consumer satisfaction and have a positive impact on sales.

Therefore, online stores and buy/sell marketplaces may suffer the same fate as brick and mortars if VR takes over unless they’re quick to adapt. Amazon is already working on a VR platform for Amazon Video, and it’s likely that the ecommerce giant will expand VR to other segments of its business.

Right now, ecommerce has a slight edge over vcommerce because the new technology lacks high-quality content. For now, industries like gaming are doing well in this area, but it the ability of VR manufacturers to provide content interesting enough for commerce will be critical for its success.

To survive, online and offline merchants will have to invest in offering a true omni-channel experience to consumers, which includes VR.

Take a tip from Rakuten – the Japanese variant of Amazon with investments that stretch from ecommerce to social media apps. They acquired Fits.me, a “virtual-fitting room” startup that created two-way technology to enable online shoppers who can’t try something on physically to visualize how an item could fit them, after they input in details like weight, age, and height.

What About VR for Social Media and Mobile?

If you love getting advice and recommendations about products from your peers on social media, you’ll love it more in a VR environment, surrounded by friends with whom you can have discussions as products are displayed in the background. And it would be icing on the cake if you can all see how the real-version of the product looks by taking a virtual trip to the retailer’s outlet.

Indeed, virtual reality has the potential to revolutionize the way we use social media networks on PC and mobile. And it could happen soon considering that social media companies continue to invest in VR while other firms merge social media and VR technology to create new platforms.

Here are some interesting developments:

1. Facebook and Oculus

Facebook recently acquired a leading VR headsets developer, Oculus, for $2 billion, setting expectations high for VR on social media. Oculus VR is launching Oculus Rift – a virtual reality headset that will work on any gaming laptop or desktop – on 28th March 2016. Facebook wants to extend the tech’s advantage from gaming to other verticals, including media and entertainment, education, communications, and other areas.

Facebook has also created a new social virtual reality team with the aim to speed up the processes that link VR and social. The company already introduced Social Alpha on Oculus’ Cinema application last October, which enables up to 5 people to watch videos and talk in a virtual home theater.

It also launched a dedicated game for the Oculus Rift called Toybox. It enables multiple users to play games like ping pong.

While the current market for the Oculus Rift is primarily gamers, Facebook is highlighting the social components of Oculus to give average consumers a reason to purchase the headset. But given the $599 price tag of Rift along with a decent gaming PC could set them back $2000. That’s why the company is incorporating VR technology into 360 Video, giving users a more immersive experience. Below you can see an awesome clip from Star Wars: The Force Awakens.

2. Starship and vTime

 UK-based Starship recently showcased the first-ever mobile virtual reality social network at CES in Las Vegas. Named vTime, the mobile app enables anyone with a Samsung Gear VR to customize their avatar, host virtual meet-ups, create friends lists, and do more to personalize their experience.

 

 And just a few weeks ago, vTime was launched on Google Cardboard (a Google-owned platform that enables people to create a VR viewer for their smartphone with a low-cost headset). With a tablet or smartphone, people will be able to view live public exchanges within the app in real-time, or request to view private chats.

The company plans to add more features such as video and image sharing, haptic feedback and motion control. We may also see eye-tracking technology that enables you to navigate the virtual environment with a flick of your eyes instead of the use of a handheld controller or the tilt of your head.

It looks like the future smartphones will act less like “smartphones” and more like “wearable devices”.

3. BoostVC and Beloola

France-based Beloola, a startup that participated in BoostVC’s accelerator program, brings VR to web-browsers. Utilizing WebGL technology, it enables users to create their own VR environments where they can share anything from SMS messages to social media updates.

Users can also build an arena or conference room and engage in conversations in real-time. Imagine creating a Game of Thrones-style environment, where you take your role playing to the next level, with avatars of your choice. Whatever you imagine can be created with Beloola and shared with others in real-time.

The company has integrated a lot of features that add to the social aspect of Beloola. Users can also repost, like, and comment on content within the virtual environment. Having discussions and telling your peers what you think could take your experience to an entirely new level. And all that can be done via your Firefox and Chrome browser.

Final Verdict

Exciting times are ahead. No longer will virtual reality be confined to the gaming universe. I expect more companies to invest in virtual technology and create platforms that serve a general purpose, on which people can build personalized environments, and show up like in real-life.

The challenge/opportunity for retailers is that some people will want their experiences to be the same as their experiences in real-life. For instance, they’ll want their avatars to be able to wear the same clothing. This creates an opportunity for VR-companies to partner with retail brands to offer digital purchases.

In the future, there will be a way for everyone to get in, but it will also be resource intensive. Most companies will try to cheap out, but in the war for attention, they’ll be competing with the AAA video game developers who will be providing a superior level of experience and interactivity, setting expectations really high.

While it’s too early to make conclusions, one thing is for sure: If brands from the commerce industry are not proactive about VR, they’ll miss out on a golden opportunity to make tons of money, now in the consumer market, and later in the enterprise market (when VR matures).

 


About The Author

Dan Virgillito is a storytelling specialist, blogger and writer who helps digital startups get more engagement and business through online content.