Virtual-reality fitting rooms, magic mirrors and 3D printing are among innovations being trialled at a large-scale laboratory in Shanghai where businesses can experiment with omnichannel techniques and trends shaping the future of retail.
The initiative is led by the Fung Group, the Hong Kong-based multinational with international brands and retail operations across China, and parent of sourcing giant Li & Fung.
Named ‘Explorium’, the laboratory is being operated in partnership with data and analytics technology leader IBM, and brand activation company Pico. It is located within more than 23,000 sq m (nearly 250,000 sq ft) of trade exhibition space at LiFung Plaza, where it provides a controlled setting for businesses to observe and explore in real time how consumers interact with new technologies, products and environments.
Brands are also using Explorium to understand opportunities in China for their products and services, based on consumer feedback collected and analysed at the laboratory. Retailers are using it to test different store concepts.
Fung Group chairman Dr Victor Fung says the initiative is sparked by challenges occurring in retail across the world, especially in China.
“Everything we thought we knew about how consumers decide upon what they buy, where they buy, when they buy, how they buy and how they pay is changing,” he explains.
“Technology is the catalyst empowering consumers. The internet and mobile communications are disrupting the way consumers behave and, in so doing, providing unique opportunities for retailing to come up with new business models. Nowhere is this more evident than in China, one of the world’s most exciting, challenging retail markets.”
Dr Fung adds that he believes the future for retail in China and globally is omnichannel – either online-to-offline (O2O) or a combination of bricks and clicks.
“Chinese consumers are setting shopping trends globally, especially with their avid use of social media. And Shanghai is home, arguably, to China’s most vibrant, tech-savvy consumers. That is why we chose Shanghai as the launch pad for this major Fung Group initiative.”
Participating brands and retailers are encouraged to experiment, incubate and iterate at high speed “while minimising their cost and risk,” with no preconceived ideas about which omnichannel business models would emerge from Explorium.
IBM is gathering data in the Explorium and analysing it to help retailers “deliver personalised, relevant marketing interactions to consumers in real-time, delighting them and differentiating the retailer from the competition,” according to IBM global retail industry leader Stephen Laughlin.
Consumers will be able to opt-in to receive offers and rewards from their favourite brands via social media and their mobile device – all tailored to their location and unique preferences.
While children’s products such as toys are a special focus during Explorium’s first phase, it will go on to feature women’s and men’s apparel.
“Explorium’s priority in coming months is to design, build, run and measure a greater number and variety of experiments to produce a pool of data that will enable participating brands and retailers to obtain unique insights for their individual businesses,” explains the project’s Shanghai-based director Simeon Piasecki.
