Virtual Reality: Growth Engine for Fashion?

LONDON, United Kingdom — When Apple’s iPhone first appeared nearly 10 years ago, few could fathom the extent to which it would transform our daily lives. Today, much like mobile before it, a rising technology platform has the potential to create what Canadian media theorist Marshall McLuhan called “new patterns of human association,” unleashing a tsunami of innovation.

For years, Virtual Reality (VR) and Augmented Reality (AR) — a view of the real world that has been “augmented” by layers of computer-generated content — have been the stuff of science fiction. Both still have their fair share of sceptics. Yet, driven by Moore’s Law and the rapid advancement of processors, screens and other commodity components coming out of the smartphone supply chain, VR and AR are finally poised for mainstream adoption with some calling them nothing less than a “new medium of human experience.”

Back in 2014, early VR pioneer Chris Milk explained the profound power of VR: “You read a book; your brain reads letters printed in ink on paper and transforms that into a world. You watch a movie; you’re seeing imagery inside of a rectangle while you’re sitting inside a room, and your brain translates that into a world. And you connect to this even though you know it’s not real, but because you’re in the habit of suspending disbelief. With virtual reality, you’re essentially hacking the visual-audio system of your brain and feeding it a set of stimuli that’s close enough to the stimuli it expects that it sees it as truth. Instead of suspending your disbelief, you actually have to remind yourself not to believe.”

So what does this mean for fashion?

In the past decade, the fashion industry has driven growth largely by tapping emerging markets, opening hundreds of new stores, particularly in China. But as Chinese demand has cooled, many have sought new growth online, which Luca Solca, head of luxury goods at BNP Exane Paribas, has called “the new China.”

“A number of things have changed in the luxury industry. As you know, the luxury industry was growing 8 percent before — now it is growing 2 to 4 or 5 percent in the next year and it’s going to stay there,” said Olivier Abtan, a partner at the Boston Consulting Group. “Now, in this slow growing market [brands are] considering digital very seriously,” he added.

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For some, virtual and augmented reality technologies offer a powerful new digital growth channel. “When one thinks how engaging VR could be, I imagine that this will indeed be even more important than mobile in the grand scheme of things,” said Solca. “However, it took 20 years for e-commerce to reach an inflection point,” he cautioned. “I’d imagine VR would need a similar amount of time to really shape our everyday experience in the same way as our mobile phones.”

But momentum in the VR/AR space is building quickly. Late last year, HTC Vive announced a venture capital alliance for virtual reality technologies; comprising 27 firms, the initiative has amassed $10 billion dollars of deployable capital. Last October, digital distribution platform Steam reported adding 1,000 new VR users daily, with over 600 VR apps already on the platform. And technology heavyweights are doubling down in virtual and augmented reality. See Facebook’s Oculus Rift to Snapchat’s Spectacles.

In this early stage of development, accurate projections of future market size are difficult. But according to Goldman Sachs, revenue from VR- and AR-related hardware and software is expected to reach from $80 billion to $182 billion by 2025.

Virtual reality and augmented reality could certainly become a powerful channel for brand-consumer interactions, much like mobile and social are today. But current pricing ($600 for an Oculus Rift headset, $800 for an HTC Vive) will slow mainstream consumer adoption for the moment, according to Goldman Sachs.

In the meantime, there are plenty of enterprise opportunities for fashion companies. “The obvious first step in the apparel industry is designing and development tools, and we are working with a lot of brands and a lot of supply chain companies behind the scene on this,” said Ari Bloom, CEO of Avametric, a San Francisco-based startup working in VR/AR. “You think about the ability to have a more digital experiences: the amount of time and money you can save not having to sample thousands of garments to get to three or four hundred!”

Virtual simulations of store environments could also be useful to retailers. “In VR, specifically, you can [test] two different environments — and that is really powerful,” explained Bloom. ShopperMX, a virtual reality platform developed by Chicago-based firm InContext Solutions, allows retailers to experiment with signage, product display and layout without the time and resource commitment required to build and test these elements in the physical world.

Source:

https://www.businessoffashion.com/articles/fashion-tech/virtual-reality-growth-engine-for-fashion

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