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Does the Metaverse Still Have a Chance To Revolutionize Retail?
Meta’s ambitious strategy to promote the metaverse through retail outlets has not gone as planned. The company’s first physical Meta Store opened in California a year ago to showcase the Quest headset, but it has not been followed by others. Martin Gilliard, the leader of the store initiative, has left the company, and another planned store was abandoned due to economic slowdowns and changes in Apple’s privacy norms.
Recently, a focus on cost-cutting has prevailed at Meta, with over 20,000 employees let go in recent months and certain projects winding down for efficiency reasons. Despite this, the original Meta Store continues to operate.
A few years ago, the metaverse was a marketing buzzword, with brands flocking to virtual platforms like Fortnite and Roblox. But the initial excitement has faded with the rise of AI and other tech trends, causing the metaverse to lose some of its allure. However, some industry leaders, like Jen Jones, CMO of Commercetools, still see potential in the metaverse. Jones believes the narrative around virtual experiences is evolving and advises brands not to lose faith in the metaverse’s potential to reshape marketing and retail.
Now, Meta has begun evolving its strategies and shifting its focus to improving the workforce using the metaverse. In the past year, the landscape of the retail labor market has experienced unprecedented transformations due to AI, machine learning, augmented reality, facial recognition, robotics, and beyond. Prior workforce development practices and procedures were swiftly replaced as progressively digital-centric workplaces evolved in response to demands for increased flexibility from the workforce.
The arrival of these technological advancements has unlocked infinite potential for retailers and is a key focus of the NRF Innovation Lab 2024, which explores how business operations can be streamlined for retailers. The metaverse, in particular, is now expected to revolutionize several facets of retail, including workforce development. New research indicates that virtual reality might hold the key to enhancing learning outcomes.
With an established presence in the metaverse, Meta is leveraging insights gathered on the efficacy of VR for learning to grapple with a crucial retail challenge: ensuring employee engagement, training, and retention.
“The metaverse promises to make learning more active. With virtual and augmented reality technologies, people can learn by doing, not just passively absorbing information. This has the potential to transform the way we provide new skills and new lifelong learning tools for people in the future.”
Nick Clegg, Meta’s president, global affairs, via NRF
In a press release last summer, Meta explained five key benefits of the metaverse for employees:
- Reducing risk in dangerous work: Through VR training platforms like Interplay, electrical apprentices can practice on virtual live wires safely. Such technologies make training programs cost-effective, flexible, and safe.
- Increasing caregiver empathy and retention: Platforms like Embodied Labs use VR to simulate cognitive, auditory, or vision loss, enhancing caregiver empathy and knowledge about daily challenges, thus aiding retention.
- Adding longevity to careers: Workers in physically demanding trades can prolong their careers by transitioning to less physically demanding roles through VR training platforms such as Interplay.
- Opening new pathways for jobs: According to Jobs for the Future, careers in extended reality (XR) are more accessible for non-degree holders, potentially allowing a broader population to enter and advance in the technology sector.
- Providing alternatives to physical prototypes: Using AR and VR, businesses can create and manipulate digital twins of large-scale projects in real time, reducing the need for costly physical prototypes.
These notions have already been tested in the real world. For example, Walmart provides a case study on the applications of VR technology in retail. As an early adopter, the retail giant is harnessing the potential of immersive simulations to bolster workforce development and training. Employees partake in virtual recreations of real-world store situations, enhancing the engagement and efficacy of the learning process.
The implementation of VR-based training has unveiled insights into employee abilities and led to improved employee test scores. According to Andy Trainor, Walmart’s former VP of learning, the adoption of VR training modules led to an uptick in test scores between 5% and 10% and reduced the time taken to train employees — an achievement with the potential to make significant positive ripples across the retail industry. VR-based training has been shown to be four times quicker than traditional classroom learning, and it has been linked to a 275% uptick in job confidence after training.
While the impact of VR technology extends to in-store retail training, its potential applications in customer service retail jobs training have the potential to revolutionize workforce development.
Discussion Questions
Reflecting on the evolution of the metaverse and its impact on the retail industry, how can we reconcile the initial failures and setbacks with the potential transformative power of virtual experiences? Given the explosive growth of AI and other tech trends, is there a risk of the metaverse becoming an overshadowed novelty, or can it still reshape retail by delivering unique marketing and customer experiences? As we see the increased application of immersive technologies like VR in workforce training and development, how do we narrow down the “infinite potential” and identify tailored solutions that will ensure optimal employee engagement, training, and retention?
Poll
Loading …BrainTrust
Nicola Kinsella
SVP Global Marketing, Fluent Commerce
Brian Numainville
Principal, The Feedback Group
Perhaps the metaverse – and aren’t we serving as unpaid promoters by using that term (as opposed to something neutral like Virtual Reality)? – should be allowed to develop at its own pace, without the self-serving claim that it’s Revolutionary.
The metaverse isn’t dead, but the idea it will revolutionize retail is fanciful – it was always fanciful. At best it will play a niche role in retail from the consumer perspective, and will play a small role behind the scenes. All that hype a couple of years back now seems absurd!
I don’t know that a Metaverse is still on a path for a “revolution” at retail, nor do I believe that retail is still “on the brink” for Metaverse, at least not on a widescale, not yet. However, I still I fully expect trends to continue and evolve. Many retail blog websites are already exploring the potential of the metaverse as a new technology for shopping.
My expectation is that more brands enter the metaverse market but in small steps. The metaverse shopping mall will likely become a major feature in future retail stores but I don’t think it will necessarily all come together in 2024.
The metaverse is a method for retailers to connect consumers on a global basis. In the medium and long term that will be hard to resist.
Consumers crave a highly personalized experience. Metaverse will do a nice job that. – Db
We haven’t yet seen the adoption of new technologies that will “revolutionize” retail. That doesn’t mean technology won’t.
In today’s discussion, it sounds like Meta is trying to find an application for their technology that no one is really looking for now. The ultimate revolutionary technology will obviously fit into retail rather than take the technology and shoehorn it into the environment.
We have yet to truly experience the metaverse (not to be confused with Meta the company…the metaverse was a thing before Facebook renamed the company). Virtual reality will still evolve and provide innovative solutions in the future. Did anyone know generative AI would be where it is at today two years ago? Nope. So it would be foolish to discount a tool just because it hasn’t “caught on” yet. The best is yet to come, as the saying goes.
Potential for training improvements? Sure. Potential for increased productivity? Absolutely. Timeframe? There will be well publicized wins, but no real adoption/rollout for at least 4 years. Add 5 more years for real customer experience enhancements.
A lot of money will be burned between now and then on this technology.
Metaverse could be a powerful tool for retail innovation. AI could well become an enabler and accelerator of metaverse. By integrating AI with immersive technologies like VR and AR, the metaverse could create personalized, engaging, and memorable customer experiences beyond physical limitations.
Metaverse could also enhance workforce development and training – providing realistic simulations, feedback, and assessment. Therefore, metaverse can still reshape retail by delivering unique marketing and customer experiences – even if indirectly, as long as retailers embrace its potential and invest in its development.
I’m going to go out on a limb and suggest that Meta’s name change was a really bad idea.
The consumer experiment has failed to date. There’s just not enough traction. That said, there are legitimate business use cases for training. Flight simulators have proved invaluable in the aerospace industry. But the cost to develop custom training programs to fit your business can be expensive. And training materials have a tendency to go out of date quickly. It will be interesting to see if generative AI solutions can be used to accelerate the development of training content and make it a cost effective option. There may be other slower moving industries, or back end operational use cases across the supply chain where this tech makes more sense than front line retail.
This falls under the Jurassic Park guide to development- Everyone asks, “Can we?” and no one asks, “Should we”? Consumers have told us clearly and at every opportunity that what they really want is frictionless, easy transactions. Injecting technology into those transactions simply because we can isn’t the path to the revolution. The Metaverse isn’t dead, but it’s also not going to become the preferred method of interaction with brands.
There is certainly a place for the metaverse, both within retail and outside of retail. However, with regards to retail, I do think that place is smaller than everyone imagined in the beginning.
Have you ever actually used VR? I have a set of Quest headsets. It’s great if you’re just sitting still in the metaverse, but as soon as you virtually move, you get nauseous. Even benign movements. Non-starter.
Yep, use it almost daily for working out with things like Supernatural and Beat Saber, as well as for a variety of other things like reviewing market areas. Even played laser tag with my kids. Never been nauseous.
No, I don’t think the Metaverse is a “thing” from a consumer perspective. Post-pandemic growth in travel and experience spending shows that the consumer is keen to get out and experience life after being confined during the pandemic. The Metaverse is the solution to a problem the consumer doesn’t really have, or have a need to solve. There could be other use cases for the technology that make it viable and useful, but retailing does not to be one of them.
The metaverse will still have some semblance and role for retail, but for now in a much smaller, more black and white ROI-driven capacity. The economy of four-five years ago introduced so many possibilities with investment money ready to expand the technology on both the operational and marketing/sales side of the business. This will come back eventually. There was too much money invested in it otherwise.
The metaverse was once the shiny new object with marketing buzz and infinite potential, now, all it has is infinite potential. Which, by all account, is still promising.
While many brands tested the metaverse waters, it was and still is unclear how to commercialize it. For consumer based business, this is key and we are no closer today than we were 2yrs ago. So, perhaps it’s smart, and timely, to shift focus from consumers to corporate.
Still there is a lot to prove on the realized value of corporate training and development. Of course, the early indicators are good but we need more time to compare this method vs traditional methods. Particularly, employee feedback would be valuable and is curiously missing from the case studies shared here.
Ultimately, harnessing the metaverse may prove to be no easier than harnessing the wind but when it finally does work, it can be life changing. Now that’s promising.
In my opinion, the metaverse’s initial setbacks shouldn’t overshadow its transformative potential in retail. While the buzz may have faded, the focus on employee training and development using immersive technologies like VR demonstrates a shift towards practical applications. The metaverse, when customized for specific needs like risk reduction in training or enhancing caregiver empathy, can deliver tangible benefits. It’s not just a novelty; it has the capacity to reshape retail by offering unique and effective solutions for marketing, customer experiences, and workforce development. The key lies in strategic, purpose-driven application rather than mere implementation.
While there are certainly hurdles to overcome – including technical limitations, privacy concerns, regulatory issues, and adoption barriers – the Metaverse still holds promise in the retail industry. The biggest opportunities for transforming retail include interactive shopping experiences that transcend traditional brick-and-mortar and e-commerce platforms; more personalization and customization for consumers through the use of data analytics and AI algorithms; expanded market reach by breaking down geographical barriers; and social commerce integration that fosters a sense of community. From a marketing perspective, the Metaverse also offers brands the opportunity to sponsor virtual events and collaborate with influencers to drive brand awareness and customer acquisition in innovative ways.