Welcome to the future: Bricks-and-mortar retail undergoes a revolution
For those who think the bricks-and-mortar concept in retail is dead, think again. Companies like digital art gallery Teleport in Hong Kong are bringing a new meaning to immersive experiences that can be translated into physical spaces.
Edward Eremyan, founder and CEO of Teleport, explains that its immersive art experience that debuted back in November last year promises innovative ways for people to view the art form of NFTs, digital projections, interactive installations and online auctions.
Teleport’s 5000 sq ft. exhibition space has been transformed into a cinematic adventure that blends interactivity with fractal art. Artificial intelligence (AI), augmented reality (AR), computational design and 3D hyper-real sound are incorporated into a 360-degree audiovisual work. A 10-minute fractal film created by a digital artist, Julius Horsthuis is featured.
If you are asking just how all of this is relevant to retail, stick around. Eremyan is excited about how physical retail spaces can take advantage of these technologies to make really interactive journeys for their customers.
“Physical retail is not dead, bricks-and-mortar is not dead, and even after the pandemic, it’s still alive, “ Eremyan said. He cited the Meta store in California as a perfect example, selling VR goggles and demos of popular game titles that can be played in the metaverse.
Companies like Meta still need offline channels to build a relationship with customers and educate them about the Metaverse. In his opinion, stores should become ‘experience centres’ where one can truly understand the story of the brand and get a feel for its products.
Eremyan feels Teleport has a role to play in store design as its cutting edge visual technologies could revolutionise storytelling when it comes to branding in stores. The potential for branding and connecting with customers is a huge factor in this space, which can go a long way to rejuvenate physical stores.
“Our exhibition space triggers curiosity, and when it comes to retailers, you want your customer to be curious about your brand and they should leave your store with a lasting impression even after they’ve made the purchase,” he noted.
Philippe Holthuizen, CEO at Fused footwear, also mentioned that 3D printing is fast becoming the next big thing in fashion. There are companies in Hong Kong, like Unspun, which allow customers to scan their bodies with an app to provide a 3D image that can be used to print jeans. This store also has physical scanning booths too.
For Holthuizen’s business, 3D printing is a boon as he can make custom shoes, particularly for those with foot problems. Holthuizen echoed Eremyan’s thoughts on creating brand experiences and believes that in-store experiences can work hand-in-hand with online storytelling too.
“For example, Balenciaga’s latest collection was presented in a video game walkthrough format, and this had a connection to their store displays and the fashion catwalk too,” he noted, referring to the Fall 2021 collection that was also featured in the video game, Afterworld: The Age of Tomorrow.
According to Holthuizen, even Balenciaga’s catwalk format was different, as the audience sat around the exhibition area, and the models walked around them, almost like in a movie sequence. The overall effect and impression that audiences got from the experience was memorable.
“These are all important things to think about for brands. If you have a global presence, you need to have a flagship store, not necessarily a big one, but have one in at least every city for buyers to touch and feel the product as well,” he noted.
Holthuizen moved on to the topic of collaboration. The 3D printing paradigm allows shoppers to collaborate with brands to create custom designs, but brands are of course doing their own collaboration with artists and renowned designers too.
“Collaborations are key for brands, as they get to tap into the audience of other brands, and it’s really synergetic,” he noted.
Holthuizen emphasised customer service is very important in this day and age. Brands that are responsive and handle feedback constructively can normally maintain a good roster of repeat customers. Those who do not often only end up with one-time customers.
In a related development, McKinsey & Company recently released a report titled Value creation in the metaverse, stating that large technology companies, venture capital (VC), private equity (PE), start-ups, and established brands are seeking to capitalise on the metaverse opportunity.
Corporations, VC, and PE have already invested more than $120 billion in the metaverse in the first five months of 2022, more than double the $57 billion invested in all of 2021, a large part of it is driven by Microsoft’s planned acquisition of Activision for $69 billion.
From their survey of more than 3,400 consumers and executives, almost 95 per cent of business leaders expect the metaverse to have a positive impact on their industry within the next five to ten years.
The report estimates that the economic value of the metaverse, from a bottom-up view of consumer and enterprise use cases, suggests it may generate up to $5 trillion in impact by 2030, which is equivalent to the size of the world’s third largest economy today, Japan.
In the report, appliance company Dyson, for example, launched a digital store accessible through a VR headset, allowing customers to “walk” through and test its products virtually.
The report also stated that multiple US furniture retailers such as Crate & Barrel, Walmart, West Elm, and Wayfair have partnered with Pinterest to use AR to enable consumers to see how furniture will look in their living rooms.
Meanwhile, Samsung launched a virtual store in Decentraland at the beginning of this year, modelled on its physical Samsung store in New York City, enabling customers to complete different quests to earn NFT badges.
Retailers including Ralph Lauren, Urban Outfitters, and Walmart have filed trademarks related to opening virtual world stores,while a parcel of land within Decentraland was sold for almost $1 million for the establishment of an online shopping mall.
The report suggested that retailers could use VR technology to personalise store environments for individuals and groups of customers. For example, customers at a sporting goods retailer could shop for ski equipment in a virtual version of the alps and even try skis in virtual reality.
By 2030, it is entirely possible that 50 per cent of live events could be held in the metaverse, said the report. It also said that more than 80 per cent of commerce could be impacted by consumers discovering brands and by visiting a virtual store. At the end of the day, with a potential of up to $5 trillion in value by 2030, the metaverse is simply too big to be ignored.