Is retail ready for the phygital future?

Discussion
Source: BeyondXR
Jan 06, 2022

Through a special arrangement, presented here for discussion is a summary of a current article from the Spieckerman Retail blog and a synopsis of the key takeaways from the latest Spieckerman Speaks Retail podcast.

Brands have focused their brand stories and customer relationships with determination to reach their digital destiny, yet traditional two-dimensional experiences haven’t evolved to meet the opportunity. Luckily, the landscape is set to change with a wave of innovation that will be unleashed in 2022 and beyond.

The CEO of ByondXR, Noam Levavi, is getting the ball rolling by creating immersive interactive 3D journeys in shoppable virtual environments.

Mr. Levavi defines XR, or extended reality, as an umbrella term for all immersive technology that merges both the physical and virtual worlds. He sees the metaverse as the next evolution of the internet that will be based on a 3D environment in contrast to the 2D feeds that still dominate e-commerce. Mr. Levavi claims that the current 2D feeds and layouts bring “no real experience” for consumers shopping online and that brick-and-mortar experiences are far more customized and engaging.

The company’s mission is to fuse the best properties of the physical world with the latest commerce and display technology to create compelling “phygital” experiences. ByondXR’s data confirms that its shoppable 3D virtual environments and gamification elements exponentially increase engagement. In Japan, for example, users play branded games hundreds of times over, even though rewards kick in after only one session.

Mr. Levavi explains that the company’s collection of more data helps continually optimize customer experiences. “Eventually you will be able to personalize the store for each user, so the customer will see exactly the product they want in the colors they like.” To further enhance virtual experiences, influencers will be brought into virtual stores to introduce potentially millions of followers to brands.

He predicts that, even though now “closed gardens of mini-metaverses” operate primarily in gaming, “eventually, everything will be connected.” Mr. Levavi anticipates a flood of new devices to hit the market starting next year, including headsets, bio-wearables, XR contact lenses and brain machine interfaces. After five years, usage will expand beyond gamers and early adopters. Then the market will reach a “tipping point” and massive adoption will follow, at which time he expects familiar screen devices like mobile phones and desktops to disappear entirely.

DISCUSSION QUESTIONS: What do you see as the next evolution in the merging of physical and virtual shopping spaces? Do you agree that 3D-gamification and aspects of the metaverse will be integral to the online shopping experience within five years?

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"Before embarking on some of these enhancements a lot of retailers need to get the basics – stock levels, merchandising, staffing – right."

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24 Comments on "Is retail ready for the phygital future?"


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Bob Phibbs
BrainTrust

You know what I don’t get? All these brands running to the promise of a compelling and shoppable experience in Meta, et al. when they abandoned having that in their physical stores where still, during a raging pandemic, online only got 20 percent of the business.

Georganne Bender
BrainTrust

Yes! People are still choosing brick and mortar over e-commerce but that’s all we talk about. There are some pretty sad looking stores out there. How about giving them the attention customers deserve?

Neil Saunders
BrainTrust

Ain’t that just the truth. The allure of shiny new gimmicks is stronger than the hard work of getting the basics right!

Georganne Bender
BrainTrust

One only has to look at our Twitters, Neil, to see that!

Eran Galil
Guest

Actually a lot of the brands that are coming to us looking for virtual experiences want them to be very well connected to their physical versions. So we build with them a new consumer journey which usually also involves the physical store. It’s strengthening their brand and in many cases helps bring people back to stores — eventually it is an evolvement of omnichannel strategies coming into play.

Neil Saunders
BrainTrust

Bringing together physical and digital experiences and creating more overlap between the two is important and will become more significant over time. However it comes with two cautions. First, there are a lot of gimmicky technologies out there and retailers need to ask what they add to the customer experience. Second, before embarking on some of these enhancements a lot of retailers need to get the basics – stock levels, merchandising, staffing – right as this is where there are still major failures.

David Naumann
BrainTrust

Your comments are spot on Neil!

Eran Galil
Guest

Couldn’t agree more Neil. Especially with regards to the stock part. In order for a virtual store to be successful it has to be integrated to the brand’s backbone and not as an external gimmicky site.

Ken Morris
BrainTrust

Virtual reality in a retail store? This has got to be the next Will Ferrell and John C. Reilly movie, or at least a scene. I can’t understand why so many people think life is so uninteresting that they choose to put robot goggles on and flail about. It clearly will be for some folks, though: gamers and technophiles. But those with disposable income will be very slow to adopt until we figure out a different user interface than exists today. The current Oculus models will end up with slip-and-fall lawsuits as well as motion sickness. The gamification part might be fun, though. I’d love to get points for dwell time in the ice cream aisle.

Bob Phibbs
BrainTrust

^ Truth^

Paula Rosenblum
BrainTrust

I actually quite like Virtual Reality. Why? Because it takes me places on my bucket list that COVID-19 just isn’t letting me go to. But in a store? I have never understood it. Technology that’s useful will find its way into the stores, mostly in the hands of consumers. VR, not so much.

Jeff Sward
BrainTrust

I find myself agreeing that the evolution of the business as described will happen — to some degree — and then immediately I wish and hope that it doesn’t happen. Let the early adopters have their fun, but I really hope that most people are slow, late adopters. Instead, let’s make retail the fun and social experience it can be. Of course tech and digital tools will have a role, but real people interacting with other real people and real product is what I crave. Life can be so much more than an enhanced 3-D Zoom meeting.

Lee Peterson
BrainTrust

Billions in e-commerce and phygital efforts later, I still think the best brand experience you can get is talking to an actual person. But I guess that’s beside the point. I’ve used Oculus and other AR/3-D tools many times as we employ them to help show our designs to clients but, that’s a LOT different than an average customer’s shopping experience. This is an “OK Boomer” comment but, the 3-D world, including everything mentioned in the piece, seems great for fun (like gaming, duh). For a true in-store vibe? I don’t know the metaverse that well so far, but I just don’t think we’re there yet.

Dave Bruno
BrainTrust

In my mind, the question isn’t “when” virtual shopping experiences will take hold, or even “if” shoppers are ready to embrace them, but rather “if” developers can design experiences that add actual value to the shopping experience. Until experiences transition from novelty to meaningful value, these tools will remain compartmentalized as niche experiences.

David Naumann
BrainTrust

I am a proponent of immersive customer experiences and the metaverse will eventually become a reality, but it won’t be widely available in five years. As Neil Saunders pointed out, retailers still have a lot of work to do to shore up basic technology capabilities, such as real-time inventory management, mobile apps for customers and associates, digital shelf labels and interactive displays. These core technologies will have a greater impact on customer satisfaction and associate efficiency than metaverse apps (IMHO).

Andrew Blatherwick
BrainTrust

This is missing the point of why people go into retail stores. It is a social experience and one where touching, feeling and trying products is the core engagement shoppers are searching for. This is just the next phase of online retail. It’s better and there will undoubtedly continue to be an increase in the level of retail that moves online, but it will not replace the physical retail experience.

Liza Amlani
BrainTrust

Marrying physical and digital experiences is the future. Learning from customer engagement across all channels is how retailers can make better product decisions and, let’s face it, it should always come down to product.

Meeting and engaging the customer in Meta or in a physical store or on TikTok should delight the customer and encourage them to buy product and create brand loyalty. That’s it.

Carol Spieckerman
BrainTrust

Thanks, Liza! ByondXR isn’t in the business of replacing stores (many of its customers operate physical flagships) but rather, enhancing online experiences. That’s what it’s all about.

Lisa Goller
BrainTrust

Yes, online shoppers will come to expect personalized, immersive experiences and gamification.

Digital natives will welcome this fusion of physical and virtual shopping. Younger consumers already spend an inordinate amount of time online; immersive tech will make e-commerce more engrossing.

That’s why Nike, Adidas, Mondelez and Forever 21 are experimenting in the metaverse to deepen Gen Z’s engagement and loyalty.

Nikki Baird
BrainTrust
We’ve all contemplated these questions for a long time, about how to bring digital more firmly into the store experience. Even before the pandemic, there were equal parts of “this is a gimmick in stores” that quickly loses luster and is impossible to keep fresh, alongside “the current store experience just isn’t going to cut it” – even if they did invest to make it what even the bare minimum in-store physical experience should be. My current thinking is that retailers need to look at things that add value to BOTH physical and digital, rather than trying to force the two together. Virtual closets could be a good example of that, where the digital representation of your purchases adds value to your online shopping as a customer, but could also seriously enhance the in-store purchase where you could see the new item side by side with the virtual one you own. And then the retailer would need to continuously invest in building on the value that capability could provide – build my daily outfit or… Read more »
Raj B. Shroff
BrainTrust

I think Levavi is spot on in that the virtual 3-D will improve e-commerce experiences which have been the same since my first agency built e-commerce sites in 1999. E-commerce is dull, uninteresting and hard to shop. As for whether 3-D will be integral within five years, depends on the brand and channel.

Do I need a 3-D grocery experience like the concept Walmart just put out? I don’t. Would I want to experience a Nike 3-D flagship and then shop for shoes in a different way, ordering from NBA 2K24 in a meta-type environment? Absolutely. More importantly, my kids (11 and 8) would. To them, being online in these environments IS social. And they don’t care about touching and feeling things, they order from the Nike app after seeing a shoe on Hypebeast. I think we have to be careful evaluating future possibilities through the lens of our current feelings and biases when a digitally native cohort doesn’t think that way — or when a “meta-native” cohort gets spending power.

Ananda Chakravarty
BrainTrust

The real phygital future is not in AR, VR or XR, it’s part of real experiences customers encounter and don’t need to be ‘immersive’. The digital component needs to be relevant more than it needs to be glittery. If the customer can use digital to make their selection process easier, enable appropriate buying, and provide an experience that enhances brand, product, purchases, and loyalty, then it makes sense. In most cases, digital is just a convenience factor for the consumer, not the main purchase reason anyway.

The real phygital experience still relies upon both the digital and physical worlds combining — but usually at different times, where a customer would see the digital purchase, review comments, understand the specs, validate availability dates, or access size charts to help make a decision, then a physical experience in the store to touch, review, compare and make their purchase.

How the new digital innovations contribute to making shopping easier and customer centric — any way the customer wants it — will be the benchmark for the phygital future.

Casey Golden
BrainTrust
8 months 26 days ago

There’s no stopping Web3, it will be weaved into the overall brand experience and the faster we integrate commerce components, the sooner customers will be able to shop seamlessly across digital and physical sales and experience channels. The metaverse fits the luxury space better than that of mass merchants and commodity CPGs. Consumers will have easier access to connect with brand’s through the initial product discovery and replicate the “spur of the moment” purchases that have been difficult to mimic on traditional e-commerce.

Karen Wong
BrainTrust

So the metaverse is already going to replace “traditional” e-commerce? The only thing consistent today is that shoppers want to discover and buy across all channels, even from the same brand. While a retailer will likely be physical-first, online-first and eventually metaverse-first, it’s going to be a mix of all throughout the entire customer journey.

wpDiscuz
Braintrust
"Before embarking on some of these enhancements a lot of retailers need to get the basics – stock levels, merchandising, staffing – right."

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