The retail technology investment arm of Wal-Mart Stores Inc. wants to uncover innovative ways to apply virtual reality to commerce and has partnered with Arianna Huffington's startup Thrive Global to create a competition for developers.
Store No. 8, which was created as a stand-alone entity by Wal-Mart earlier this year, said its Innov8 competition will be the first of its kind by centering on virtual reality in commerce.
Katie Finnegan, principal with Store No. 8, said Wal-Mart's innovation hub is spearheading the event as part of efforts to identify, invent and invest in emerging retail technologies.
"Our mandate is to look at technologies that will really have a transformational impact on retail and, in particular, on consumer experience three-plus years out," Finnegan said. "Virtual reality is one of those that we feel pretty strongly has the opportunity to really enhance the customer experience."
The competition is open to companies or individuals with ideas that have the "potential to change the way we shop and live," according to the announcement. The application process remains open until Aug. 4. Companies will then be selected to participate in an exhibition in Los Angeles on Oct. 18.
Winners of the open invitation will receive capital to help fund development costs. They'll also have mentoring opportunities and a chance to work with Wal-Mart, Jet.com, Thrive Global and others. Accenture, a global consulting firm, is participating as a strategic innovation adviser.
Organizers are hoping to use the competition as a way to shine the spotlight on retail in a virtual reality industry that is projected to reach $7.2 billion globally by the end of 2017, according to research from Greenbright Insights. The research firm projects the industry will grow to $74.8 billion by 2021.
Much of the current revenue potential, according to Finnegan, lies in the gaming and entertainment industries. But she said there are opportunities to enhance shopping in commerce and used examples such as preparing for a fishing or camping trip as potential applications for virtual reality.
"There really hasn't been a reason or a catalyst to get a lot of these extremely bright minds excited about commerce," Finnegan said. "What we're really excited about is getting some of those minds thinking about commerce because we haven't seen much of that mindshare there.
"It's not about taking an e-commerce experience and just putting it in a headset. It's about creating an entirely new experience that's optimized for that situation and that customer expectation."
Carol Spieckerman, a retail consultant and president of Spieckerman Retail, said the competition should help Wal-Mart tap into talent and innovation in the virtual reality industry.
"Wal-Mart knows that, even with its ever-growing technology talent pool, innovation can't always be an inside job," Spieckerman said. "Just as Wal-Mart has held competitions to ensure that innovative products make their way onto Wal-Mart shelves, courting VR innovators ensures that Wal-Mart stays ahead of the crowd."
Finnegan will be one of nine judges selecting companies to participate in the exhibition in Los Angeles. The panel also includes Huffington, founder and former editor-in-chief of the Huffington Post, Wal-Mart U.S. e-commerce chief Marc Lore and fellow Store No. 8 principal Seth Beal.
Finnegan said getting Huffington involved was "no more than just a 15-minute phone call." The competition, according to a statement from Huffington, will "focus the industry's brightest minds and talent toward the development of virtual experiences that change the way we live for the better."
"The companies that will win the hearts and minds of consumers are those that shape our daily lives by making everyday experiences, like shopping, easier and less stressful," Huffington said.
The competition isn't Wal-Mart's first foray into virtual reality.
Last month, the company revealed it had been testing the use of virtual reality in 31 training academies with plans to roll it out to each location. Wal-Mart plans to have 200 academies by the end of the year. The technology submerges Wal-Mart workers into scenes such as a hectic Black Friday event, giving trainees a chance to simulate scenarios to prepare them for the sales floor.
Those types of applications are taking hold, according to Finnegan. But the technology is "just not there yet from a technical standpoint" in regard to consumer experiences.
Spieckerman agreed, saying virtual reality innovation and adoption remains in its early stages. But she believes Wal-Mart is demonstrating its determination to be on the leading edge.
"Make no mistake, VR isn't a nice-to-have in retail, it is an inevitability," Spieckerman said. "Wal-Mart has already put a stake in the ground through its comprehensive deployment of VR-driven training solutions. Now, through Store No. 8 and its outside partnerships, Wal-Mart will be poised to pick from the best and brightest to set the stage for innumerable VR applications.
"This will be particularly relevant as Wal-Mart and other retailers seek to inject a bit more excitement and personalization into the brick-and-mortar shopping experience."
Business on 07/13/2017