Walmart Inc.'s innovation hub has acquired a virtual reality startup to aid the retailer's efforts to develop uses for the technology in its stores and online.
Store No. 8, the Bentonville company's Silicon Valley-based retail technology incubator, added software platform creator Spatialand to its portfolio for an undisclosed price late Monday. Spatialand founder Kim Cooper will remain with the company as part of the acquisition, while Store No. 8 principal Katie Finnegan has been named the startup's interim chief executive officer.
"The team will develop and explore new products and uses of VR through immersive retail environments that can be incorporated by all facets of Walmart, online and offline," Finnegan said in a blog post.
Finnegan said Spatialand will operate in "stealth" mode inside Store No. 8, which was created as a stand-alone entity intended to help Walmart identify, invent and invest in ideas and startups that would transform the future of commerce. In announcing Store No. 8 last year, Walmart said the incubator's companies would be given the freedom to operate without the constraints of short-term expectations.
The retail technology hub predominantly focuses on innovation that could affect retail in the next 5 to 10 years.
Virtual reality is one area Store No. 8 is exploring as it reimagines the role of technology on in-store and online shopping. The immersive technology has primarily been associated with gaming and entertainment, but Finnegan said in the blog post that the majority of virtual reality creations have ignored the "range of possibilities available in retail."
"At our core, we are merchandisers and storytellers which drives us to believe that virtual reality has the potential to reinvent the consumer experience," Finnegan said.
Analysts believe the acquisition of Spatialand makes sense for Walmart and Store No. 8 as it tries to develop potential applications in the rapidly changing retail environment.
Augmented reality -- which was popularized by Pokemon Go -- is "more real" in retail now as companies like Sephora introduce ways for customers to try on products in the digital domain, according to former retail executive and RSR Research managing partner Brian Kilcourse. Virtual reality remains in earlier stages of innovation and adoption, but Kilcourse has no doubt it will become more prevalent as the technology improves.
"If you want to understand how people are going to shop in the future, it's important to understand how they entertain themselves now," Kilcourse said. "Increasingly, people entertain themselves in the digital space and virtual reality fits right into that. So I see [the acquisition] as a very practical move on Walmart's part to anticipate how people are going to enjoy shopping in the future."
Carol Spieckerman, a retail consultant and president of Spieckerman Retail, believes the acquisition is more proof Walmart will continue to pursue initiatives aimed at setting industry standards.
"The potential for VR to transform the shopping experience both online and in store is multi-faceted, and Walmart is in a position to bring millions of shoppers along on this innovation journey," Spieckerman said. "As Walmart tests and deploys new VR applications, other retailers will have to formulate some kind of response. This is groundbreaking for all of retail, not just Walmart."
Spatialand is Store No. 8's third portfolio company. Code Eight, which is being run by Rent the Runway co-founder Jenny Fleiss, formed last year and is working on personalized shopping experiences. Bart Stein, the former CEO and co-founder of Wim Yogurt, Inc., was hired to lead Project Franklin in January. Details weren't specified, but Store No. 8 said in its announcement that Stein and his team have "created some of the most thoughtfully-designed home devices on the market."
Store No. 8 did not reveal specifics about what Spatialand will try to create at Walmart, either, but the two previously worked together as part of the tech incubator's Innov8 competition. The event, which was held last October, centered on virtual reality in commerce.
Store No. 8 and Spatialand developed a virtual reality experience that placed campers at a campsite in Yosemite National Park. Users could see how camping items -- like a tent -- fit into the environment as they try to determine if the products met their needs before making a purchase.
Finnegan said the Spatialand team -- which will be led by Cooper and Store No. 8 consultant Jeremy Welt -- will continue the work it began last summer.
"While it's too early to share more about what the team will be working on next, we're excited to get to work and share more in the future," Finnegan said in the blog post.
Business on 02/07/2018
Print Headline: Walmart buys virtual reality startup