The Hot Stores Of 2023 May Be Made Of Meta, Not Mortar

0
72

Share on LinkedIn

Imagine thousands of shoppers flocking to your latest store opening, trying on outfits and making big purchases. And there is no actual store.

This is what the retail industry is poised to capture with the help of fully immersive virtual reality, or the metaverse. Thanks to alert marketers, the platform has morphed into a market destination, and more consumers are buying in. The revenue opportunities of the metaverse, just through e-commerce, could reach $2.6 trillion by 2030, McKinsey estimated in a June 2022 report.

And while much of that revenue goes to gaming, a growing share is expected to be collected by retailers and brands.

Retailers, Meet Your “Shopatar”

Virtual reality and augmented reality (technology that superimposes computer-generated images on the real world) can be super successful at encouraging consumerism because the artificial intelligence (AI) that fuels these experiences is continuously building on the data it collects about its users’ behaviors.

Enter virtual influencers and AI store assistants. These avatars can learn a user’s style preferences and offer fashion advice or product recommendations, a report by software maker Acowebs foresees. “The potential of AI technology will allow for the creation of virtual closets where users may store their current clothing and receive fresh, more individualized outfit suggestions,” the report states.

Take, for example, the RecRoom, a game where players can buy outfits for their avatars or household items for their avatar’s virtual living spaces. Some of these products could come from real brands.

And they don’t necessarily have to be virtual products.

Brands Join VR And AR And It’s The “Real” Thing

Pixels are in fact becoming tangible, as retailers and brands use the metaverse to stage actual products before selling the real things to shoppers. Others, meanwhile, are creating entire communities that can capture more detailed data points. Some examples:

  • Coca-Cola developed its Zero Sugar Byte flavor in the metaverse and then transformed the digital beverage into a limited-edition product, making it consumable in both real and virtual lives.
  • Ralph Lauren in November 2022 launched a digitized clothing and accessories line on the gaming platform Fortnight, followed by the drop of a physical “capsule” collection released on its website.
  • Walmart in 2021 purchased the virtual fitting room Zeekit, and in 2022 rolled the technology out to the Walmart app and Walmart.com, as “Be Your Own Model.” With it, users can dress upload images of themselves to see how clothing items might look. The tool is expected to make it easier for customers to hit that “buy” button.
  • Gucci has created a complete virtual destination, Gucci Town, on the gaming app Roblox. In addition to social spaces, the town importantly features a Gucci store where gamers can purchase digital Gucci goods, including outfits for their Roblox avatars, reports Retail Dive.
  • Claire’s, the accessories chain, also is collaborating with Roblox. It launched ShimmerVille on the app in October 2022. The digital destination, designed for shoppers in their teens and 20s, showcases virtual accessories that also are available in its physical brick stores.

Wait, What Does This Mean For Stores?

Regardless of the potential of virtual reality, augmented reality and the whole metaverse, consumers aren’t expected to abandon the store. Most people – 67% ­– still enjoy shopping in physical locations for convenience, to socialize and to compare products, the Morning Consult reports.

That said, the metaverse should play a role with retail bricks and mortar. Key to the successful incorporation of these channels is a seamless integration and an online-offline experience that is unified, McKinsey advises.

If this is accomplished, retailers and brands can expect these advantages:

New forms of data. The insights from immersive, virtual retail could represent new behavioral trends and data points that retailers and brands can use to predict future behavior. This could be especially valuable in 2024 and beyond, when Google phases out its marketing cookies.

Reduced real estate costs. While stores won’t go away, the metaverse can reduce the need for so many physical locations, as well as make smaller formats more functional. A virtual fitting room costs less to maintain than a physical one, for example.

Market building. The metaverse is borderless, so retailers and brands can build not just virtual boutiques, but global communities. Take Nike’s Nikeland on Roblox, which in its first five months attracted 6.7 million people from 224 countries, The Drum reported. In these communities, visitors can swap style tips, share reviews and take part in company missions, such as charities.

Will the metaverse pay off? If the $2.6 trillion spending prediction is anywhere near accurate, it should be worth exploring. Turning virtual experiences into real profit takes expert execution, however, and part of the work force must be trained before jumping in.

Retailers and brands should have their best analytics teams on board, and be sure to keep one foot in reality.

This article originally appeared in Forbes.

Jenn McMillen
Incendio Founder Jenn McMillen has been building and sharing expertise in the retail industry for 20+ years. Her expertise includes customer relationship management, shopper experience, retail marketing, loyalty programs and data analytics. She's a retail contributor for Forbes.

ADD YOUR COMMENT

Please use comments to add value to the discussion. Maximum one link to an educational blog post or article. We will NOT PUBLISH brief comments like "good post," comments that mainly promote links, or comments with links to companies, products, or services.

Please enter your comment!
Please enter your name here