Does Pokémon Go herald the arrival of mass customer engagement through Augmented and Virtual Reality? Alan Riley of KPMG’s Customer & Digital practice discusses the potential impact of the new technology on the way businesses sell and how consumers buy.
The sales profession across nearly every sector and industry is currently emerging from digital transformation that has both changed the way businesses interact with customers, but also enabled businesses to boost productivity. Like other customer-facing business functions, sales organisations have been forced to reinvent themselves and their customer experience design to keep pace with the respective technological changes that have now settled into our lexicon as “social”, “mobile” and “digital”. This has been most disruptive in Business to Consumer (B2C) sectors but increasingly B2B businesses are recognising value from the levels of digital, mobile and even social investment that was once deemed relevant, only when facing off to a mass consumer market.
Just as the vast majority of companies have now shifted their business model strategies and customer experience design to leverage these new technologies and gear operating model capabilities to cope with cross-channel, cross-platform customer interaction, another wave, less powerful, but still with transformative power, of platform innovation seems to be emerging on the horizon.
Just as social and mobile platforms have transformed the way we interact with banks, utilities, local councils, telecoms, transport and media providers, the first buzz of excitement from the possibilities of Augmented and Virtual Reality-enabled products is being felt by the households of early adopting consumers.
Does Virtual Reality have the power to break out of its niche role in executive telepresence suites and top end product prototyping centres to transform the way we do business on a mass scale?
Virtual Reality (VR) products have the power to engage users like never before, drawing them into the complete immersion of a head mounted display and peripherals, most commonly driven via computer or smartphone. This technology can also be applied to create “Augmented Reality” (AR) experiences, “extending” the real world with some virtual elements – the most well-known example being Google Glass – which in Terminator and Minority Report fashion (depending on your age!) can supplement the real world environment with computer-generated sensory inputs. “Mixed Reality”, meanwhile, is an experience that can combine and switch between fully Virtual and Augmented Reality to draw the user in and out of full and partial sensory immersion.
The more sophisticated headset hardware driving these platforms is now being brought to market at affordable price points for the first time. The end of 2015 saw the release of the affordably priced Samsung Gear head-mounted display at less than $100. Earlier this year Facebook launched its Oculus Rift Consumer Edition. HTC Vive Consumer Edition meanwhile was launched on April 5th for $799. Just as supply chains are starting to catch up with demand for these products after high profile launches, augmented reality game Pokémon Go is putting Augmented and Virtual Reality into the mainstream public consciousness for the first time, raising awareness beyond the niche “next-generation gamer” consumer segment.
So what does this mean for customer interactions?
Business applications of VR are nothing new. Four years ago Domino’s Pizza toyed with taking Augmented Reality to the mass market by placing 6,000 posters that served an AR marker when viewed through the Blippar mobile application, while Jaguar Land Rover has used a Virtual Reality engineering and design studio to cut the cost of vehicle development since 2008.
The difference now is, just as the first smartphone and tablet models within a few years developed the performance levels, support and application ecosystem, ubiquity and secure connectivity that took them from novel push marketing sideshow to fully fledged mass customer interaction channel, so now Virtual Reality tools are at the brink of crossing the maturity chasm.
In sales specifically, real estate firm Sotheby’s International Realty is already using Samsung Gear VR to showcase luxury homes in Los Angeles, the Hamptons and New York City. For now this customer experience design remains limited to the luxury market, with the cost of scanning a home for VR ranging from $300-$700.
As VR devices and the market for supporting services and talent matures, it is inevitable that in coming years Virtual and Augmented Reality will become a core platform within the Digital channel for a plethora of customer interactions across sectors.
This, perhaps most disruptively, will include sales activities that are currently carried out face-to-face due to their need for greater customer intimacy or requirement for the customers’ physical presence to receive geo-spatial or tactile information.
What are the benefits of AR and VR capability?
AR and VR are particularly useful technologies to sales organisations because they afford three major benefits – these are:
• Emotional resonance
• Information accessibility
• Hypothetical experiences
Firstly, this technology has the potential to give greater emotional resonance to objects and topics, both through the sensory impact of the experience and the ability to develop greater intimacy remotely.
Secondly, the technology is a highly flexible medium that affords much greater information accessibility. It can provide information in an instant, easy-to-understand format, supporting multi-sensory learning including tactile kinesthetic interaction that can flex to the content and the user’s preferred experience type.
Thirdly, by immersing users in a virtual or augmented reality, the technology can create a highly compelling Hypothetical Experiences, allowing the user to experience multiple different scenarios in real time without the need for prototyping or making judgments based on one-dimensional representations.
In particular, AR and VR can help to improve the customer experience and optimize the customer journey where emotional engagement, customer understanding and complex, tailor-made or unfinished product sales are creating commercial sticking points.
For example, Doosan Infracore, a Korean machinery company, last year offered guests at its International Machine Tools Fair, a gamified Augmented Reality experience to unlock scaled 3D models of their latest machine tools, which could then be viewed and explored in detail. This customer experience design emotionalized the highly technical product showcasing phase of the customer journey, as well as serving information to customers in an easily digestible way, and allowing the hypothetical viewing of machine tools which otherwise would need to be experienced in a less dynamic medium.
These three benefits, then, make VR and AR exciting new developments to consider within the capability roadmap for customer-facing sales interactions.
How can I leverage AR and VR to increase productivity in my sales organisation?
At KPMG, we think VR could mean more to sales organisations than just a new and powerful customer interaction channel. Just as affordable mass market mobile technology has been leveraged to step-change the productivity of field sales reps across multiple sectors including consumer goods, real estate and utilities, and social platforms are being used internally to connect account teams across customer-facing functions, we also think VR will become an asset for internal business enablement in future years.
We see the most promising use cases for AR and VR in providing a new solution to age-old operational sales challenges – efficiently managing field sales resources, upskilling salespeople to meet increasing customer expectations, and improving communication and collaboration across customer-facing teams.
For many sales organisations, one of the biggest cost items is the standing field sales force. AR and VR technology has the potential to digitise many field sales activities that currently require physical presence. AR and VR can not only digitise many customer-facing interactions, but can also substitute for high intimacy internal interactions, bringing together geographically disparate team members to bridge mobility gaps. For example, Field Sales Mangers in Consumer Goods organisations can use VR to virtually accompany Field Reps conducting retail audits, increasing their productivity in providing training and performance management oversight, with less need for extensive travel.
AR and VR has the potential to be a powerful and flexible e-learning tool. It also has the potential to enable much more realistic sales training, for instance simulating a negotiation situation with an avatar or practicing pitching in front of a virtual group.
Using AR and VR in future could also enhance collaboration for complex or technical proposal development leveraging disparate communities of experts. Engineering, Procurement and Construction (EPC) companies for instance, could use VR to bring together global experts to generate a world class response to a local market Request for Proposal (RFP).
Is AR and VR a game changer?
KPMG’s view is that AR and VR is a nascent business technology and it is not a game changer – yet. Clearly though there is a first mover advantage to be had both in terms of customer differentiation and unlocking early operational performance benefits. Getting to this stage will take time, but with the increasing pace of platform development and integration, this may be sooner than many will expect.
For further information contact:
Alan Riley, Executive Advisor, KPMG Customer & Digital