Andrew Watts, Founding Partner at KHWS, the Brand Commerce agency
Retail is not shy of technology. Its adoption is often a necessity. However, whether it’s e-commerce platforms, back office inventory or mobile apps and optimisation, getting to grips with how to make technology work best and achieve good ROI in the retail space is no mean feat.
Digital is driving constant change in consumer behaviour, and coupled with a decline in retail footfall and spending, retailers are turning to disruptive technology such as VR and AR to keep pace with the change.
It is no secret that retail footfall is in long term decline. However, according to a report by Visa Europe, spending is prolific when it comes to eating out, days out and holidays, just not retail.
This demonstrates the rise of the ‘experience economy’ – people preferring to spend their money on social activities such as going to festivals, the movies, travelling, etc. Combine this with the fact that consumers are shopping online more, bricks-and-mortar retail stores are facing some serious challenges, most importantly – how do they attract customers back to their stores?
Shopping experience in VR and AR
Enhancing the traditional shopping experience is certainly one way to increase footfall. To that end, retailers have been experimenting with virtual reality (VR) and augmented reality (AR) technology with varying degrees of success. VR and AR, sound similar and both aim to alter people’s reality, but enhance the retail experience in different ways.
AR “augments” reality, using superimposed computer-generated images to alter people’s view of their actual surroundings. Tesco’s use of AR allows customers to visualise key products within the comfort of their homes with its Tesco Discover app. Custom shelf company Tylko takes the technology one step further putting you in control of designing and customising the perfect shelves in real time, wherever you want them in your home with its design app.
On the other hand, virtual reality creates an entirely digitalised reality that feels real as it is experienced through multiple senses. Last year Diesel broke ground in this area, launching its flagship London store with a 5D multi-sensory virtual reality (VR) experience.
Can VR and AR be more than a gimmick?
As with all disruptive technologies, it is a risk at the early stages of adoption. It can also be regarded as gimmicky if implemented without actually improving the shopping experience in any meaningful way. This aside, implementing VR and AR technology is also a costly investment. It requires rolling out the technology across many stores and training staff to ensure that each and every team member is adept at talking about and operating it.
Without proper infrastructure and staff who are not entirely invested in the technology, VR and AR can be an expensive failure for retailers. Considering this, it is crucial that retailers properly plan any VR and AR activity and ensure that it dovetails into overall marketing strategies before taking the plunge, lest it fail to get off the ground.
So how can retailers assess the best way to implement them into the shopping experience without it feeling superfluous?
Despite the proliferation of technology, the heuristics – mental shortcuts that we all use to make decisions – remain the same. There are over 128 in total, and we have worked with Durham University’s Business School to identify and reframe the nine most relevant to making a purchase. We call these Sales Triggers, and they provide a framework that makes behavioural science accessible and useable for retail marketers, helping shape their strategies. We advocate that this approach will help determine the best deployment of VR/AR activity to enhance the shopping experience
For example, one of the nine sales triggers is ‘the value of ownership’. This trigger is a solution to many of the challenges that retail marketers experience in the context of VR and AR, as the new technology enables you to overcome the consumer need for owning part of the brand without investing monetarily. Utilising VR or AR to enable consumers to try products without committing to purchase will make them more likely to buy in the future – it’s sampling for the new era and can be taken far beyond the traditional sampling remit.
IKEA’s virtual reality showroom enables shoppers to visualise their own taste by explore and configure furniture, changing colour schemes, accessories, wallpaper, lighting and even the time of day, to bring to life different configurations of the room. This experience is immersive and enables IKEA shoppers to experience how not only a piece of furniture, but an entire room might look like before committing to a purchase.
Understandably, retailers are desperate to increase footfall to complete with leisure experiences and it is tempting to simply throw VR and AR into the shopping mix and hope for the best.
However, retailers who take the time to understand the behaviour of their shoppers and how they browse their stores, will have a much better chance of successfully implementing VR and AR into the shopping experience in a way that feels natural and exciting.
