Embracing New Realities in Retail

By ShiSh Shridhar, Global Industry Solutions Director, Retail, Microsoft

March 21, 2017

With all the recent advances in technology, we are rapidly approaching the point where science fiction is actually science fact. We’ve all become fairly accustomed, if not addicted, to having the internet in our pockets and living in a paradigm of constant connectivity.

Well, the retail space is making more science fiction come to life with their adoption of holograms and fully immersive virtual stores and experiences. Imagine if consumers could see, hear, and feel the presence of the experiences and goods you are selling—without leaving the comfort of their couch. Mixed and virtual reality devices are bringing customers’ imaginations to life—and transforming how companies personalize their products, bridge the gap between their online and physical storefronts, and acquire deep customer insights.

Delight customers with new powers of personalization

In today’s increasingly digital landscape, customization is key. With online, mobile and social channels, it’s never been easier for consumers to explore the array of competitive choices; making it more important than ever to drive customer loyalty. Personalization is one way for retailers to better attract and, more importantly, retain consumers. Surveys show that 78% of consumers are more likely to be repeat customers if they receive relevant, personalized offers[1]. Mixed and virtual reality represent more than just cutting-edge technology that consumers are increasingly interested in—they provide a powerful new path for personalization.

Lowe’s has a long history of helping people reinvent spaces, and with the power of holograms and mixed reality, the company is revolutionizing the remodel design process. From within a simple, skeletal showroom kitchenette, Lowe’s customers personalize a life-like holographic representation of a completely new kitchen. Large items like cabinets, appliances and countertops are represented in the proper size and scale, with incredibly high-definition features and detailed finishes. Customers can adjust colors, finishes and other options instantly, then save and share their designs online. The reactions have been pure delight.

Lowe’s is just one company that is already embracing this new technology. Legendary Pictures is making it possible for fans to interact with and share holograms of their favorite characters. Volvo is radically altering the car-buying experience, enabling customers to personalize the exact car they want—even open up a car to inspect the chassis or watch the drivetrain in action. And the NFL is bringing football to life beyond the television screen, empowering fans to experience games that play across whole rooms and providing new ways to interact with the brand. Embracing virtual and mixed reality is a great way for retailers to personalize customer experiences, expand their brand, and delight customers.

Expand your presence into new realities and reach new customers

Mixed and virtual reality devices are an extremely low-cost way to bridge the gap between physical and digital storefronts, reach new people, and provide a personalized shopping experience regardless of location. Taking up precious floor space with physical show rooms is very costly, but with HoloLens, Lowe’s only ever needs one small area to show customers infinite options—that they can personalize on the spot. Similarly, IKEA can pop-up an empty showroom and let customers customize the space with limitless furniture combinations. As these mixed reality devices become more pervasive, retailers won’t even need the showroom—customers will engage with their favorite brands at home, in a storefront tailored to their tastes and stocked with their preferred products.

Singles Day, a primarily Chinese shopping holiday, has quickly become an annual retail event that is impossible for global brands to ignore. This year, Singles Day saw $17.8 billion in sales—more than Black Friday and Cyber Monday’s combined $13.5 billion[2]. Virtual and mixed reality devices offer a new way to boost sales and cost-effectively expand to new markets. This year, Macy’s participated in its first ever Singles Day by creating a virtual copy of their famed New York Flagship store that Chinese customers could stroll through and shop in. Today, any retailer can make their physical store, or a version personalized for the consumer, available to customers anytime, anywhere.

Leverage deep customer insights to reach new heights of personalization

Mixed and virtual reality provide new opportunities for a greater level of customer insights than ever before. For example, the Lowe’s HoloLens kitchen design tool analyzes a customer’s Pinterest board and defines their personal style before they even get started. By starting with product and design recommendations based on the look and feel they want to create. Then, Lowe’s captures real-time feedback as customers use the mixed reality device, utilizing deep insights to further tailor recommendations to their customers and understand the trends and preferences involved. Using telemetry data from HoloLens, Lowe’s is able to see what items in the holographic kitchen customers are looking at, generate heat maps of customer focus, and conduct sentiment analysis from captured verbal feedback to determine how customers really feel about products.

Virtual and mixed reality devices can provide deeper levels of customer insights than ever before, enabling retailers to see precisely what draws consumers’ eyes to digital storefronts and products. Aggregating this data and combining it with other consumer information is key to creating the powerful personalization required to keep up in today’s increasingly competitive, digital, and demanding retail landscape. Virtual and mixed reality offer an exciting new way to delight customers, boost sales, and become a more data-driven organization.

Retail Personalization from Microsoft and Plexure

While new devices like HoloLens are just starting to permeate the retail industry, solutions built on more mature technologies are widely being used to deliver deep retail personalization. Plexure’s Retail Personalization solution, built on the Microsoft Cloud, transforms the acquisition and retention of customers with tailored, persuasive experiences. Personalized onboarding programs drive quick customer activation, increasing visit frequency and spend in the initial weeks. Custom loyalty solutions provide powerful, personal incentives to boost the number of return visits and dramatically reduce churn across a retailer’s customer base. And the solution’s personalized engagement capabilities enable companies to create highly tailored customer experiences. These personal experiences influence customers to adopt new behaviors and vastly improve the lifetime value of any retailer’s customer base.