insights! #99: Too expensive, too complex – or the future? The truth about VR in online retail

Sonja Fuhrmann

VR in e-commerce, is that a real revolution or maybe just hype? I'd like to talk about that with Joubin now. Can you briefly explain what VR actually is? Without jargon, please.

Joubin Rahimi

Without jargon? Okay, VR, Virtual Reality. Typically you have something in front of your eyes, often in 3D, which simply depicts a reality that is nevertheless virtual and fed by software. And besides VR there's also AR, Augmented Reality. That's exactly where I still see something real, with a layer of digital content overlaid on top.

Sonja Fuhrmann

So is it all just hype or a revolution, what would you say?

Joubin Rahimi

That wasn't original question, was it? Right. This is a really, really exciting situation now, because we've had glasses for a while and de facto that was, I think, a lot of hype. It didn't catch on. I don't know who of you has glasses at home and how often, if you have them at home, they get used. Still fairly rare. But whoever had chance to look at Apple's new Glass division, that's another leap forward. It's a bit like iPhone arriving now, because real working environments get represented quite differently there. And if we manage, I think, to support working world with a lightweight pair of glasses, then it won't be hype either, it'll be a trend, but chances are very, very high it becomes one, question is only: how big is the device and how seamlessly is it integrated? Yes.

Sonja Fuhrmann

How can VR replace the in-store shopping feeling? I mean, I'd also like to touch things physically.

Joubin Rahimi

Yes, well of course that doesn't quite work that way as it is, because you only see it and you said, touch it haptically. If I look very far ahead, there might one day be something where I have parts that play back a haptic feeling, the way we've now also slowly invented scent machines and can even produce those, but not in the B2C space. So I'd say that's still a long way off. But having the experience of being in the shop and being able to try things out, I don't think that's the right way, but rather the question again: what do you want to do with it? And there are already the first applications going mainstream, IKEA for example, or also Amazon. There you can say, I now have, for example, a laundry chest, and it's a metre high, 30 centimetres wide, 50 centimetres long. What does it look like at my place? Does it fit or not? You can already do that quite smartly just with your smartphone, but it would be cooler if you could really see it in 3D. Absolutely. That's roughly where things stand right now.

Sonja Fuhrmann

What potential do you see for e-commerce going forward?

Joubin Rahimi

The combination of the visual and a shopping advisor, I think that is really powerful. Let's take this room here. We had to imagine ourselves how the sofas would look. We've now used different sofas. Whether the panels look good or not could have gone really wrong. I think this setup here turned out great. And if I can say that upfront to an AI: I'd like us to shoot an interview format here, that we have a table, that it looks a certain way, this is our target group. We need to do something about the sound or the sound feedback, show me examples in this room. I think that would be really cool. But there you see the combination of VR plus artificial intelligence, which then translates all these voice inputs and makes suggestions.

Sonja Fuhrmann

But probably not suited for everyone. You watching at home probably tech-savvy, I'd say, but that's not everyone's thing either. Doesn't that lead to split in buyer segment?

Joubin Rahimi

I think that's a matter for everyone. So very, very clearly.

Sonja Fuhrmann

Well, Aunt Anna at 89, I don't know.

Joubin Rahimi

No, but maybe she watches television or looks at other … There are other shops too, like the perfect housewife or something like that. Yes, that's really the name of a shop. That's a different target group, that's quite clear. But I think that's something for B2B and B2C, for a small and large budget, wallet, you could say: What should my work setup look like? Office suppliers can use this for doctors' surgeries, for warehouse fittings, so B2B, but also for a private individual on a small scale. And then perhaps also, how big does the sofa look in my living room, or the wardrobe, or what does the toilet roll holder look like?

Sonja Fuhrmann

Many possibilities. Yet there are also some companies that hesitate to use VR still. Why?

Joubin Rahimi

Because it's expensive. You need a huge amount of content, and simply having it there doesn't help you – the question is how you embed it into this purchase story. And if you consider who will do it at your organisation, then you need people who suddenly bring new skills, or you have to teach existing staff these skills, because this is suddenly the third dimension. So far in e-commerce we've only been in two dimensions. And that's definitely considerably more demanding to do well.

Sonja Fuhrmann

In your view, is there no way around this trend anymore? Or what happens to companies that can't or won't go along with it?

Joubin Rahimi

If the first one did it so well that it's a breakthrough, the rest have to follow suit. The internet showed us that. Whoever brings it online first and did it brilliantly is the one who sets the standard. I think we're still right at the beginning with this, and it hasn't really been set yet. So the IKEA shopping planner support already helps immensely, but it's also not yet completely visible in VR. That will come in the next two, three years.

Sonja Fuhrmann

That would be the question now: we're at the beginning, you say, what time horizon do you see here, two, three years?

Joubin Rahimi

Yes, with the introduction of the Apple headset, a lot is going to happen. It is fairly expensive, though, just as the first smartphone was unbelievable compared to all phones, and that will simply catch up in two or three years, and then we'll reach the point where we say, okay, we can use so much more.

Sonja Fuhrmann

Exciting. Curious to see what's still coming our way. Thank you very much, Joubin, for the conversation.

Joubin Rahimi

Sure, Sonja.

Sonja Fuhrmann

And thanks for watching.

Joubin Rahimi

And if you have questions, ideas, food for thought, or even think this won't catch on at all, let us know your thoughts. We'd really love to discuss this with you. Just drop a comment below.