Gimmick or sales tool? Retailers catch virtual reality fever for the holidays

Brands are virtually getting into the holiday spirit. By tapping into virtual reality, retailers are hoping to enhance their holiday campaigns and bring customers into stores to shop. The challenge lies in making a branded virtual reality experience that’s useful, rather than gimmicky.

This week, JCPenney launched a virtual experience at four of its shopping mall locations. The Oculus Rift activation takes participants on a North Pole adventure that includes a ride on Santa’s sleigh and a snowball fight with elves. The VR experience becomes a spectacle not just for those with the strapped-on headset, but for anyone standing by as the VR experience is also streamed on a TV for outside entertainment. To draw attention to JCPenney’s virtual reality, the experience is situated outside of the JCPenney stores, in the shopping mall corridors.

“Our goal is to drive traffic to our mall store,” said JCPenney’s senior manager of communication Kate Coutlas. “By capturing shoppers inside the mall, we can get them in a place where some of our competitors aren’t, as well as attract customers who might not have otherwise entered the store.”

Coutlas added that a major point of JCPenney’s 2016 marketing platform is focused on reviving mall store traffic. The VR displays will be outfitted with promotions meant to show off JCPenney’s lesser-known offerings, like Sephora products. Sephora stores located inside the department store have been a major source of revenue, contributing to a 12 percent same-store sales growth at the end of fiscal 2014.

Anyone who participates in JCPenney’s virtual world will be awarded with a gift card or coupons redeemable in stores, taking a piece of the game outside the headsets.

The retailer is one of the first to use Facebook’s 360 video ads in order to promote the North Pole VR adventure. Without a headset, Facebook’s 360 video ads come close to a VR experience, with toggles in the upper corner of the video that allow viewers to change perspective. Star Wars has also used the ads to promote its upcoming film, depicting an immersive scene from the movie.

Virtual reality is front of mind for retailers looking for the next way to evolve with technology. The headsets combine the ease and immediacy of e-commerce with the tangibility of brick and mortar, and brands from Dior to Tommy Hilfiger to Target have incorporated it into their marketing strategies this year.

Gimmick or sales tool? Retailers catch virtual reality fever for the holidays.

Posted by Digiday on Thursday, December 17, 2015

“E-commerce is flat. Virtual reality brings traditional retail to the e-commerce experience which will aid in sales and fill a void,” said Gary Koepke, chief creative officer at SapientNitro North America, a  digital agency. “It lets customers experience product in a new way, and brands can tell their story in a new way.”

This holiday season, Toys ‘R Us used virtual and augmented reality to capture the hearts of kids — and the wallets of their parents. The toy retailer built a mobile app for the holidays called “The Geoffrey Shuffle” that has both augmented and virtual reality modes. In augmented reality, kids can explore holiday scenes filled with toys, and zoom in and learn more about each product featured. The virtual reality mode provides a 360-degree, immersive experience in each scene.

The virtual game is promoted in Toys ‘R Us’ winter catalog, alongside promotions for parents to use Toys ‘R Us new shop online, pick up in store offering.

In 2016, virtual reality is expected to continue to see more action from retailers. Retale, the shopping deals app owned by Axel Springer, announced Wednesday that it would be releasing a secondary mobile app in January that will allow shoppers to see and experience products from stores like Target, H&M, Crate + Barrel and Forever 21 in virtual reality before they buy.

Pat Dermody, president of Retale, thinks virtual reality will see a lift in utility beyond entertainment next year, but only for the most innovative retailers.

“If you look at all the things retailers have to deal with right now — for instance, we’re still on the outer edges of mobile pay,” said Dermody. “Still, you’ll see further experimentation in 2016.”

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