How Virtual Reality can provide the perfect test-case for a retailer omnichannel strategy

The evolution of online retail has happened quickly. By the mid-1990s, shoppers were told that they could order a product in ‘just a few clicks’. Then with the smartphone revolution introducing the app, it became ‘just a few taps’. Now Amazon’s Echo can place Prime orders for you with ‘just a few words’.

The trouble is that very few retailers have had the time to evolve at the same pace of the digital world. The dots of the traditional store and online often remain unconnected.

Why a move towards ominchannel makes sense

This is where omnichannel fits in. For those not yet familiar with the term, it’s about retailers focusing on how the customer shops, and how the shopping experience is from their point of view.

The modern shopper’s path to purchase isn’t as clear-cut as it used to be, and shoppers value retailers that cater to both digital and physical. This means retailers need to think about how their customers research, try out, buy, return and talk about products.

How is an omnichannel strategy different to a multichannel strategy?

A multichannel retailer is one that has both online and physical stores. Many retailers, whether small-scale or household names, are multichannel retailers.

However, omnichannel goes far beyond the channels of how a customer can buy a product. It is about making entire process as seamless as possible, understanding that customers likely start online, visit a store, and increasingly want to click & collect to a destination of their choice. The customer now sets the terms, and retailers have to adapt. This means being much more joined up in how inventory is managed, evolving customer interaction across Web, social and email, and ultimately treating each customer in a more personal fashion.

So how does VR come into it?

Virtual Reality is one of this year’s breakout products. High-end headsets from Oculus and HTC are on the market to critical acclaim, Sony is launching one for PlayStation in October, and Samsung has a popular version called Gear VR which uses their Galaxy smartphones.

The interesting thing about this technology is that it is an entirely experiential product. Until you try it out, you just cannot understand how effective it is. And as it is so new, people are extra eager to see it for themselves.

Our latest research into VR revealed that that nearly four in five people would value a demo opportunity when deciding where to buy a headset, and over half would seek expert advice. A retailer that created a dedicated area to let shoppers experience VR could not only drive greater footfall to stores, but also increase cross-selling opportunities for other products.

This ability to offer consumers the chance to try out the tech that they’ve heard so much about—and three quarters of European consumers already know about VR—is a crucial advantage over ecommerce only stores.

VR presents a perfect opportunity for shrewd retailers to pair this immersive in-store experience with online content that shows them more about its possibilities. The riddle for retailers, as ever, will be to stop customers from using the store as merely a place to browse, and going elsewhere online to complete their purchase.

This is where an omnichannel strategy comes to the fore, by forcing retailers think about what customers value. Our research showed that post-sales support for VR is valued by almost half of those surveyed, home installation by four in ten. Additional services like these, can be combined with social engagement initiatives—such as asking customers to tweet or share Instagram pics of them using their VR kit—to keep the retailer relevant to the customer. Retailers can also promote in-store exclusives, and develop an online click and collect model that takes VR from being just another commodity product.

Developing an omnichannel strategy is difficult, and requires investment and a mind-set change for some retailers. However, not focusing on the customer experience and standing still is no longer an option. New challenger brands, unencumbered by legacy processes, are running with the idea of omnichannel already. Virtual Reality, because it sits at the intersection of digital and physical, is ideally suited for those retailers looking to evolve how they engage with customers.

by AS

 

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3D Printing as a Marketing Tool

In a modern, fast-paced world, people typically spend only a few seconds to decide whether or not they are interested in a product. Marketing executives have the difficult task of finding ways to attract the attention of potential customers. In today’s highly saturated media environment it is really hard to get noticed. So is there a magic pill? Maybe!

The general public is hungry for sensation; it is drawn to anything out of the ordinary. I hope you agree when I say that 3D printing fits this profile perfectly. Anything published on this subject is met with huge interest. At the same time, the 3D-printing community reacts at lightning speed to any new product on the market, be it a movie or a game. Here is fertile soil in which to plant promotional seeds.

Social media works perfectly for everyone,- you don’t have to be connected to 3D printing at all, and still use it to stand out from the crowd. On the other hand, an unknown 3D designer or ‘maker’ can publish his or her creation on a social site and become known to a much wider audience.

The new Pokémon Go game provides a number of great examples. While it was still only available in the US, 3D-printing enthusiasts around the world created dozens of miniature Pokémons. And who wouldn’t want to hold a cute little Pokémon in their hands after catching its virtual twin?

Pikachu

Pikachu caught in the park

 

One designer came up with a 3D-printed phone cover with a targeting tool for catching Pokémons and became a mini-celebrity. Initially, his profile on myminifactory.com had about 10,000 views. When someone liked his design idea and placed a picture on Twitter, the previously unknown designer accumulated nearly 75,000 views within 2 days! By the end of that week about 180,000 people visited his page on the 3D-printing community website. For this type of niche community it is a huge success.

So has anyone thought of using 3D printing as a clever marketing tool? Doing so raises the question of who promotes whom: those in the 3D-printing community who make innovative designs can become the talk of the town, while the producer of a new product who places a 3D-printed replica on a popular social site stands to increase sales. Both sides reap the benefits.

by NF

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Virtually Yours

Since the launch of the major consumer head-mounted displays earlier this year, very little research has been conducted into what the general public and gamers think about VR and what sort of intentions to purchase they might have. We’ve all read time and time again that VR is going to forever change entertainment, and make Oculus Rift’s Palmer Luckey truly live up to his name as the world’s most fortunate man. But are we getting ahead of ourselves?

In an attempt to shine some light on what consumers are actually thinking, we at CONTEXT teamed up with Oculus, AMD, Dell, and others to form a VR Research Group, commissioning surveys to take the pulse of Joe Public, as well as dedicated gamers.

VR who?
The first bit of good news is that at least three in four consumers in the UK have heard of VR. Those surveyed were most familiar with Google Cardboard, with half claiming to have experienced it already. Basic form-factors such as the Cardboard appeal most to consumers, with 43% stating the untethered headset paired with a smartphone would be the format they would be most likely to use.

Those in the UK certainly do not see VR as a gimmick, with over half of the British public (56%) agreeing that VR has serious applications in fields such as medicine, science, and education. Awareness aside, there is still a lot more education which needs to happen to boost adoption, with 78% agreeing that they do not understand enough about VR products.

I want a go!
Seeing the technology in action is the most important factor to consumers, even overtaking price at 68%: of those sampled, 79% consider a demo opportunity an important motivator in deciding where to buy. This is where VR could potentially play into the hands of high-street retailers. Interestingly, Amazon did not come on top of target shopping destinations. A third of consumers chose a large specialist technology retailer as their preferred VR shopping location, compared to Amazon’s 18%.

How much?
Consumers are excited by the potential of VR, but convincing them to invest in the technology is still a considerable challenge. When asked how much they would be willing to spend on their first VR headset, consumers showed hesitancy in parting with substantial sums. 37% would prefer (unsurprisingly) to pay nothing for the headset, whilst 21% would only be willing to pay under £100. Moreover, the research shows that 8% of the general public and 26% of gamers are willing spend the £500 necessary to buy a high-quality VR headset.

I believe I can fly!
In terms of applications, consumers in the UK and around Europe are most excited about watching sport, film and TV in VR. Half of those surveyed in the UK (51%) would relish the opportunity to experience something they would never do in real life, such as sky diving. As you might expect, for VR game genres sports came top for the general public, as well as dedicated gamers in the UK.

But what did come as a surprise was the popularity of space and flight simulations. Taking a European average, flying and space simulators was the genre of VR game that most excited gamers. Elite Dangerous supports head-mounted displays on PC, and on mobile platforms games like Vanguard are showcasing the potential for these kinds of games for mobile VR.

The emerging VR market needs to be tracked very carefully and public perception will no doubt evolve fast. Pokémon GO’s rocketing success throws an augmented reality (AR) spanner in the works, and head-mounted displays are now being adapted to respond to this new market. Many in the industry are looking ahead to the launch of Sony’s PS VR as the real test for mass-market VR adoption, and we at CONTEXT will be watching the 2016 Christmas market very closely.

by JW

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Channel to Print Vendors: Clearer labeling is needed!

According to the latest CONTEXT ChannelWatch, European channel players believe print manufacturers could do “a lot more” to stop counterfeit toner cartridges flooding the market.

The call to action for vendors to label their products better comes from over 2,000 business owners and senior managers at key channel businesses across Western Europe. The in-depth report is compiled from interviews with these organisations including resellers, vendors, retailers and distributors.

When asked who they thought could do the most to stop the growing problem of illegal printer consumables in the region, a clear majority (55%) claimed print vendors could do “a lot more”, although a significant minority claimed the channel (37%) and government (35%) could do the same.

When it came to government, however, a large number of respondents (30%) claimed they “don’t know” what role it should take.

The problem as the channel sees it lies in the packaging of illegal toner cartridges.

Over half (58%) of resellers told us it would be easy for them to spot counterfeits, but just 15% of them said they thought it would be simple for their customers.

Clearly labelled packaging (73%) for re-manufactured and legal compatibles was called out as the best solution to the counterfeit problem amongst other suggestions.

Some major print vendors are taking the initiative, raising public awareness, training channel partners, monitoring sales via distribution channels, and most importantly – seizing counterfeit goods and taking their manufacturers and resellers to court.

HP Inc. seized more than 12 million items and enforced over 1800 actions across EMEA between 2011 and 2015, while Kyocera seized €10m worth of counterfeit goods in FY 2015. But between just April and May this year Kyocera reported the capture of goods worth over €5m – an indication of the escalating scale of the problem.

Some vendors have also responded with secure holographic seals, serial numbers and other innovative features to help distinguish genuine from counterfeit products.

The new ChannelWatch report from CONTEXT covers this and other key channel trends in detail, shining an important light on what resellers from the UK, Spain, Portugal, France, Germany and Italy really think. To request a copy of the report or to speak to someone, please contact tgibbons@contextworld.com.

by TG

 

 

 

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Why Makers are not Consumers in 3D Printing

The mainstream curiosity for 3D printing seemed to hit its apex between 2012 and 2014: a period in which the market witnessed sizable growth with sales of personal/desktop 3D printers doubling each consecutive year. Sales subsided a little in 2015 when there was year-on-year market growth of just 33% rather than the 124% seen from 2013 to 2014. Demand remains, however, as shown by lower prices, new brands entering the market and the emergence of even lower price points. The interest in this area is especially evident from recent Kickstarter campaigns from Tiko and OLO, both of which set records and saw pre-orders in excess of 16,000 units each!

But who is buying these printers? General, at-home consumers? Surely not. To the uninitiated, 3D printing can seem novel and fun and, no doubt, some uninformed consumers have purchased devices only to be disillusioned by how hard they are to actually use. This is what separates Consumers from Makers. Makers like to tinker and “make” things (not just consume them). For example, one of the details of desktop 3D printing that is rarely talked about is the effect that the materials used have on how easy the printer is to use.

I am a maker who purchased a 3D printer over a year ago and I use my printer on a daily basis, with my usage growing all the time. Here is what I’ve learned. I purchased a delta-style FDM printer (the most popular type of desktop machine) and have come to recognize that even when considering only the various plastics suitable for material extrusion printers there is quite a variety and each operates in its own way.

Materials include nylon (very durable, but vulnerable to water), acrylics (for smaller items with much detail), PET and its derivatives (to make plastic bottles and food containers), ABS (made from petroleum products, strong and durable) and many others, such as glow in the dark plastic or even clay for making crockery. Some personal 3D printers can also create objects in “wood” which is, of course, actually a mixture of plastics and wood filament that can be melted without burning.

elephant

The most popular material for personal 3D printers is biodegradable thermoplastic PLA, produced from renewable resources such as corn. It is the best material for beginners as it sticks well to the surface of the printer’s bed (build plate), solidifies quickly, and provides fairly predictable results. I would recommend those who are taking their first steps in 3D printing use the same material until they start to get a feel for their printer. Once someone has chosen to become a 3D printing maker, learning the qualities of different materials is a priority because it is essential that the temperature, printing speed, extrusion rate, retraction distance and so on are adjusted to the correct levels for each material. Many of these adjustments can (or cannot) be done by way of “slicer” software – another nuance of desktop 3D printing that keeps it from becoming more mainstream.

FDM printers not only have different plastics that require different trial-and-error settings, but different brands’ versions of the same materials are often different (because manufacturers may use different additives, for example). The final print result may vary, even when using material from the same manufacturer, when a different colour is used.

As a result, when trying out a new material, there is always a risk of layers sagging or the printer nozzle becoming clogged. The same can happen if the wrong temperature is selected or as a result of inaccurate bed levelling. There is no WYSIWYG in desktop 3D printing, that’s for sure.

While these nuances might be quite frustrating for a general consumer, such tinkering is what makers live for. This is what makes 3D printing a hobby, which I continue to enjoy. The great variety of materials available creates a vast landscape where those who love new technologies and love to experiment can find many exciting turns and challenges and develop new skills. Here designers and engineers can implement their ideas and fulfill their ambitions – the possibilities are limitless!

by NF

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AR GO! Augmented Realities and Retail

On 12th July 2016 the share price of a tech company leapt up by $7bn – 25% in a single day – on the back of a free-to-download mobile phone app which is now installed on more phones in the US than Twitter or Tinder. The same app has resulted in multiple accidents, robberies from players lured to secluded locations, and unintentionally steered an unsuspecting woman to a fresh corpse. For those of you who have not yet heard of Pokémon GO, you almost certainly will very soon. Using a smart phone with a built-in camera, players can look at an area to spot and interact with the eponymous Pokémon which are superimposed over the environment on the screen. These creatures can then be used for trading or battles with other players. App users can also visit real locations which have been tagged on the in-game map as places of interest for trading and virtual activities.

The app is reported to have been created as an April Fool’s joke by creators Niantic, previously owned by Google. Indeed, Niantic’s CEO, John Hanke and many of his team are veterans of Google Maps and Google Earth. Much of the magic which allows for GO’s functionality is based both on this experience and a vault of user data collected from Niantic’s last game, Ingress, where players marked interesting places for use in the game. Niantic have also used geographical environmental data such as bodies of water to determine which Pokémon creatures should appear in that area. Hanke has more recently suggested that augmented reality (AR) headsets could also be used with the game, and wearable devices which vibrate when a player is near a Pokémon are already being marketed.

Context Pokemon

Pokémon in my office

Nintendo, who last year invested $30m in Niantic and now enjoying the equity fruits mentioned above, are generating revenue through in-app purchases – a common feature for free-to-play apps – but also in new ways which have great significance for high-street retailers. With their previous title, Ingress, businesses could pay for places of interest to be located inside their retail stores, drawing in players with promises of in-game goodies. The beauty of this system is that players do not have to give permission to be shown advertisements, and are inadvertently and willingly pulled into a retail space. Several US retailers are already looking into virtual awards for players who enter their location tied to a geomarketing deals with Niantic.

Hype aside, the mapping and tagging functions are by no means perfect and have already caused controversy. Criminals in the US have been using the app to target unsuspecting players heading to game locations, and Baltimore prison was recently discovered to be an in-game gym. As the Pokémon catchphrase goes: Gotta catch ‘em all!

AR combined with GPS and digital mapping is already being exploited in other sectors such as healthcare. Sweden’s Brighter have created a virtual bicycle experience, jDome, which allows dementia sufferers to pedal through their early neighbourhoods and has recently been adopted by care homes all across Scandinavia. The potential of these technologies for a gamut of industries was espoused at CONTEXT’s VR Summit last week by a number of leading experts including the University of Reading’s Dr Matthew Nicholls who over the last seven years has constructed a virtual model of ancient Rome: “VR allows people without a £250,000 research budget to pick it up and use it. Visitors to the department find it extremely compelling and it’s a great way of bringing an ancient space back to life”.

For Nintendo, the blurring of physical and virtual reality for gaming is nothing new; following the success of the Wii, and by combining this with their highly profitable franchises and the ubiquity of smart phone devices they have created a Pokémonster (sorry for the pun, but share prices speak for themselves), and one which could play into the hands of the brick-and-mortar retailers wanting feet through the door.

by JW

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The Democratization of Virtual Reality

Once as a pupil at my all-male state-school I was mocked during a history lesson on the ancient world for pointing out that the word “democracy” had its etymological roots in the ancient Greek word dêmos “people” and krátos “power”. In this instance I make no apology for such esoteric knowledge, as I cannot find a better word to describe what is happening this year to Virtual Reality. As with many gadgets we now take for granted, a substantial number were foreseen in works of speculative fiction, and even if they did exist, the cost of the technology made it accessible only to institutions or companies with large research budgets, or private individuals of considerable wealth with a penchant for the cutting edge, à la Richard Branson. What has driven down the prohibitive costs of producing head-mounted displays (HMDs) in recent years – and what has allowed for the first generation of powerful consumer HMDs – has largely been components developed for smart phones and tablets, allowing for cheaper and more lightweight high-density displays.

It is the increasing affordability of VR which is causing its democratization. Whereas in the past only certain laboratories and universities had a VR offering, this is all likely to change, with headsets which might have previously cost $50,000 now available for $500. Dr Andrew Glennerster at the University of Reading writes: “Recent developments in VR raise the prospect that high quality VR will soon be within the reach of most researchers in the field[1].”

What could be the biggest mass-market for VR is education. In his critically acclaimed novel Ready Player One, Ernest Cline writes of a dystopian future where students can learn in a virtual classroom to save them from a dangerous physical journey through a hazardous wasteland. Moreover, it gives teachers the added bonus of being able to silence students at the touch of a button, making behavioural issues a thing of the past, and giving students the ability to mute bullies – something I wish I could have done back in that history lesson. Herein lies the importance of VR in its current state and how it is starkly differentiated from other forms of media: the individual no longer sees something, they experience it. Kevin Kelly, co-founder of Wired magazine recently wrote: “With virtual reality and AI, what we’re going to get is an era of experiences, where we can not just know something, but feel it.[2]

When the system requirements for the Oculus Rift and HTC Vive were announced, many commentators demurred that the required PC hardware specs were prohibitively expensive for the majority of gamers, requiring many to upgrade to a $500 GFX card or completely replace their system. AMD recently announced a GFX card – the RX480 – which is VR-ready at the fraction of the cost of existing top-end hardware.

Next week, CONTEXT will be holding a VR summit at the British Museum in cooperation with Oculus, Dell, AMD, and others, to mark the beginning of what we consider to be a new epoch, an epoch of democratized VR, which will empower the young, old, students, researchers, and even those of modest income. What more fitting a venue than the British Museum which holds the treasures of the world’s first great democracies, to mark the arrival of revolutionary alternative and virtual realities available to far more than ever before.

 The CONTEXT VR Research Group which includes The University of Reading, Oculus, AMD, Dell and others mentioned in this article will be presenting demonstration technology and results from a major VR consumer study at The British Museum at 8am on 5th July 2016. If you are interested in attending please contact Charlotte Cornwell – ccornwell@contextworld.com.

[1] Peter Scarfe & Andrew Glennerster. “Using high-fidelity virtual reality to study perception in freely moving observers.” Journal of Vision (2015) 15(9):3, 1–11

[2] Carole Cadwalladr. “Digital Prophet Kevin Kelly: I’ve learned a lot from Spielberg”, The Observer, Sunday 12th June 2016

by JW

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