Virtual Reality: Playing a growing role in Retail
New technologies such as Virtual Reality (VR) and Augmented Reality (AR) are gaining popularity. The technology to enable VR and AR is now inexpensive enough and powerful enough for anyone to experience. Have you considered how it can improve the selling experience for your customers?
Virtual Reality is an Immersive Experience
VR is now mainstream in a variety of applications across different fields such as education, gaming, military and movies. When users experience VR in these mainstream applications, they are no longer intimidated by how it works.
Retailers can benefit from this trend as they start to look for opportunities to leverage VR to help sell products or educate customers. VR can be used to entertain customers with a virtual experience of your offerings. VR can supplement the bright colorful images, detailed product descriptions and reviews that customers are currently using to make a buying decision online.
Virtual Reality is still in its initial phases with companies like HTC, Oculus, and Samsung. VR is still growing in popularity with thousands of headsets being sold. The price for headsets has come down dramatically with the release of products like the Oculus GO retailing for under $200. This is opening up the market for retailers like Alibaba (see video below), Lowe’s and North Face to start using VR to promote their brands.
Including VR in retail could possibly offer efficient data and analytics, which in turn could benefit retailers in coming up with effective strategies. It could also help in reducing both marketing costs as well as product returns. Major challenges include that VR headsets are uncomfortable and require hardware, as well as the fact that they are expensive. Fortunately, many companies such as Apple, Google, HTC and Samsung are developing affordable standalone headsets or applications that operate on mobile phones.
Augmented Reality changes the Rules
Augmented Reality (AR) can be used to add information or graphics to a live image seen through a mobile phone camera. In the market for home furnishings, AR can be used to position a new couch, chair or lamp in a scene on a live view through your mobile phone camera.
How you might implement and use AR depends on what you're selling. If you have an item that can be seen through a mobile camera and enhanced with virtual elements then it might be a good candidate for AR.
How to Incorporate VR in Retail:
While there are many applications of using VR, here are two ways in which it can be effectively applied in the retail industry:
Interactive VR Experience
Retailers like Swarovski include virtual tours and apps that let customers interact with their products. Virtual tours can provide customers with an immersive experience by allowing them to visualize products virtually before trying them out in the store. To deliver an interactive VR experience, retailers need a team of 3D artists, copywriters, graphic designers, software engineers, sound engineers, and quality assurance experts. The overall cost of such a set up could easily cost $100,000.
Video storytelling can be an engaging way to educate customers. A 360° video experience can enable customers to get a feel of a product in space from different angles. The production of a 360° video requires live action shooting, basic video production, special effects, and post-production. Retailers would also need to provide VR headsets with relevant apps to deliver the content. The cost of making such videos could range anywhere from $50,000 to $200,000 depending on how immersive an experience the retailers choose to offer.
Potential Advantages for Business:
Virtual Reality in retail has advantages as it removes the limitations on space and time and reduces the overall marketing costs. Here are a few of the potential business advantages it offers for retailers:
Specific Store Design and Layout
It is much faster and more cost effective to put together a virtual store design. In this example, customers can tour the virtual store and test store layout and design principles before the physical store is built. Virtual Reality technology is evolving and improving, meaning there are options to visualize store, test out different layouts and test customer acceptance. In addition, with a VR project, shelf and assortment layout can be tested and validated.
VR analysis can allow retailers to understand the customer journey better. Retailers identify the best performing tactics and analyze customer shopping patterns. By following customer interactions in a virtual world, a retailer can gather data on the way that a customers shops. This data can be used accordingly to adjust store layout and optimize product placement.
Dominate the Marketplace
VR is still in the early stages of market acceptance with scarce content. Innovative retailers can take advantage of this fact and learn along the way as the underlying technology keeps improving. If your target market includes shoppers who might be enticed by VR or willing to try VR, then you should consider it. V-commerce can be one element of your marketing plan to help differentiate you from a competitor, and draw in consumers who appreciate the experience.