Everyone has been trying to visualize the future of retail in the age of Metaverse, a 3D sequel to the Internet since Mark Zuckerberg has introduced the concept in 2021. 

The rising penetration of the Internet has fuelled the growth as consumers are becoming increasingly comfortable with digital shopping as compared to brick-and-mortar stores. However, online stores lack the live shopping experience to satiate the customer’s need of trying the product before buying. 

Metaverse is waning the line between the physical and virtual world with AR (Augmented Reality) taking the lead by improving the traditional omnichannel retail journeys by empowering the customers to ‘try before buy’. Imagine a normal day of your life wherein you have decided on trying a few brands on your purchasing list. Instead of visiting multiple stores usually located at different locations, just sit in the comfort of your home. For example, by focusing your smartphone’s camera on your feet, you can check how a pair of sneakers will look on you. By visiting famous fashion brands, you can check out their latest fashion collection on your online avatar. Similarly, you can explore the latest car models and their features through 3D technology. 

Interior and furniture stores are leading in using AR to transform their customer’s experience. Customers can simply download a mobile app and try a paint color on their walls to check how a particular paint color looks at the walls of their homes or how a piece of furniture fits in their room. According to the French Federation of E-commerce and Distance Selling, “This type of functionality will minimize returns, which are the biggest problem for online retail brands today resulting in the loss of 2–3 percent of revenues each year”. That’s the kind of retail therapy we are talking about through the introduction of Metaverse. 

In the metaverse, consumers will use augmented and virtual reality technology to digitally engage with each other and their surroundings. This is the future of retail today however brands still have a long way to go in transforming the customer’s shopping habits. 

According to Luke Weston, Brand Experience Strategy Director at design agency Household, “The Metaverse could have a profound impact on the way that we shop. Retail in this digital space will not be confined by channel, device, or medium. It will be all around us, serving as a multi-layered, extended reality in which the world becomes interactive, connected, and shoppable.”

Future of Retail in the Metaverse

The future of metaverse commerce in retail appears bright as it will provide consumers with a non-traditional design experience wherein brands can transform their old-fashioned malls to new-age shopping hubs for customers in the virtual reality domain. Platform designers such as Obsess are building a great shopping experience connecting major retailers and shoppers across the world. Virtual reality sites are using experiential devices such as Oculus headsets for helping customers in exploring the virtual world.

According to a new consumer survey, ‘The Metaverse Mindset: Consumer Shopping Insights,’ from experiential e-commerce platform Obsess indicates that 70 percent of all consumers who have shopped online in a virtual store have purchased at least one product. The 70 percent group includes 69 percent GenZ, GenX, and 77 percent of the millennials. The survey findings further reveal that 60 percent of the customers including 68 percent millennials, 67 percent Gen X, and 54 percent of Gen Z are likely to repeat shopping.

As per the current knowledge of the Metaverse, 38 percent of the respondents who participated in the survey comprised 56 percent GenX, 42 percent GenZ, and 44 percent of the millennials know how to do shopping in the Metaverse enabled online stores.

Other important findings of the Obsess survey are the following-
a)    Around 75 percent of GenZ customers have purchased a digital item such as an accessory, garment, or skin for their avatar within an online videogame with 41 percent of the GenZ shoppers saying that brands should sell their products in the Metaverse as it offers them a convenient place to purchase digital products such as NFTs as well as physical products.

b)     53 percent of the customers confirmed that they are more or somewhat familiar with the Metaverse term.

c)   More than half, around 52 percent of the customers who participated in the survey confirmed that they would spend around $49.99 for purchasing an online product for their avatar of an online video game.

d)     Four out of 10 respondents think the metaverse is currently in the conceptual stage and eventually evolve into a form of integrated online technology platform which people can navigate using a digital avatar.

e)    Around 27 percent of the customers have a wrong perception about Metaverse. They think it is a technology owned by Facebook.
 
Although the concept of Metaverse may appear new to many users however it has already been embraced by many big brands beyond avatar shopping:

•    AI (Augmented Reality) - Popular retail brands such as Amazon, Walmart, IKEA, Future Group, etc. have invested in AI hereby empowering customers to visualize the products using phone apps and understand how they will appear physically in the offline world.
 
•      NFTs - A brand like Crockpot is selling NFTs (Non-fungible tokens) for the digital rendering of products purchased in the digital world.
 
•    Integrated Branding - Companies are collaborating with popular gaming platforms to market their products and become an intrinsic part of the expanding digital environment.
 
•     Virtual Reality - Retailers across the world are geared up to develop platforms that take advantage of the experience of the virtual world through reality gear such as the Oculus headsets.

With the integration of Metaverse in their online platforms, the retail industry is standing at the cusp of disruption. Companies such as Alibaba have already taken the lead in introducing the virtual shopping experience to its customers where customers can pair their smartphones with VR headsets or disposable cardboard for exploring a virtual store that is like any other physical store. This exciting and new experience promotes the brand of being proactive in providing a unique shopping experience to customers hence strengthening their brand loyalty and boosting sales. 

The Future Ahead

Integrating Metaverse to enhance the shopping experience in the virtual world requires technology that is affordable and acceptable to the public at large. Additionally, it will require devices offering complete freedom of movement and almost real rendering of virtual items. Detailed textures and 3D models of the original product will need high bandwidth connectivity (5G), advanced cloud computing solutions, extended (XR) graphics calculations, and fiber cables. Besides the technology, it will also need gears such as AI-enabled reality glasses.