The Battle of Realities
Fashion customers often regard shopping online as a convenience-based event rather than an experience-bearing touch point, lacking both relational and sensory attributes (Cai et al., 2012; Mintel, 2015). In a clear attempt to add further dimensions to online retailing, virtual reality (VR), augmented reality (AR) and, more recently, mixed reality (MR) have emerged as promising solutions to enhance customers’ experiences by bridging the gap between physical and digital dimensions. Recent studies show that the augmented reality and virtual reality segments have absorbed approximately $668 million of investments in 2016 and nearly $4bn since 2010 with sales of headsets expected to hit $2.7bn by 2020 (Chandler, 2016; Vanian, 2015). Investment bank Digi-Capital estimates that the market value for these solutions will total $30bn within the next 4 years (Merel, 2015). Fashion retailers including Tommy Hilfiger and Nike have already started experimenting with the new medium (Painter, 2016; Tabuchi, 2015), acknowledging the need for innovation amid changing demographics, and the emergence of new distribution channels and business models, in conjunction with a demand for more personalised marketing approaches.
Virtual reality has undoubtedly been one of the key priorities in the world of technology for a few years, but questions now arise as to why the level of investment is suddenly escalating and why key industry players are finally pushing for its diffusion. Figure 1 illustrates the key potential drivers of the increased interest and investment level in virtual reality solutions.
Figure 1. Key drivers for VR investment
The opportunities for VR and its business application do not lie only within its obvious potential for the gaming industry but are spread across several sectors. For example, businesses could streamline activities and hold virtual conferences, products could be tested in a more realistic way, hotels could be toured virtually before being booked, and fashion items could be bought directly from an immersive runway experience. To some extent, businesses could expand their value proposition without physically expanding.
Within the context of virtual games, neuroscientists have been investigating the interdependencies of human and avatar relationships and their effects on the human brain (Kilteni et al., 2013; Ganesh et al., 2012). The medical sector has been very interested in the use VR for the rehabilitation of patients, to better understand the anatomy of organs that are difficult to access and to develop pre-surgery scenarios in order to operate more effectively (Blascovich & Bailenson, 2011). Evidently there is a plethora of possible applications of VR across many different areas and functions, but limited research has been conducted to date to explore whether these solutions are feasible and commercially sound within the context of fashion retailing.