Customer experience is one of the last bastions for competitive differentiation in many industries. Retailers understand this better than most – they’ve always had to deal with fleeting trends, ephemeral consumers and new technologies. But rather than be reactive to disruption, some brands, like H&M Group, are catalyzing innovation through incorporating immersive technology. H&M’s Tomas Stocksen and I discussed our collaboration in this area at the National Retail Federation’s recent 2020 Big Show in New York.

With hundreds of billions of dollars of investment in the underlying infrastructure that is making 5G and higher speeds, larger bandwidths and lower latencies possible, the time is right for technologies like spatial computing to take off. Spatial computing’s ability to leverage computer vision and AI allows it to seamlessly integrate virtual content into the real world around us. That’s how we’re helping retailers like H&M to re-imagine what the customer experience could look like.

First, a quick primer: Spatial computing is distinct from virtual and mobile augmented reality. Whereas VR creates a digital environment that isolates the user from the physical world, and AR overlays digital content on top of the physical world, spatial computing actually interacts with and integrates into our world.

From a retailer’s perspective, key use cases range from internal, enterprise-focused deployments to external, customer-facing activations. On the enterprise side, spatial computing can increase operational efficiency (e.g., improving employee training, supply chain and inventory management or assisting with manufacturing and production) and enhance the design and creative process (e.g., leveraging 3D visualization for product design and development or store planning and visualization). On the customer side, retailers can enable at-home interactive shopping experiences that leverage 3D products, digital goods and AI-powered personalization, as well as create immersive, engaging location-based experiences. Through these experiences, brands such as H&M are able to naturally place digitally-created objects into physical environments such as their existing brick-and-mortar storefronts.

Re-envisioning the Customer Experience with H&M

Our first public showcase with H&M was born from developer agency Warpin Media’s early-access partnership with Magic Leap. This led to a high-profile experiential installation at the New York runway show for the global launch of H&M’s collaboration with Moschino in 2018, where guests could literally step into a physical set and explore items from the collection, while simultaneously interacting with digital content connected to the collection campaign.

Leveraging learnings from that collaboration, H&M and Warpin then used Magic Leap in a more robust way for H&M’s Redesign Lab showcases at the Copenhagen Fashion Summit and the Berlin Change-Makers Lab. As Warpin described in their case study, the experience “focused on maximizing Magic Leap’s potential around hand gestures and eliminating the need for a controller.” Customers were invited to use Magic Leap 1 to digitally design their own personalized print on an existing physical H&M garment, which was then textile printed with the design, on the spot, for them to take home. This allowed customers to take on the role of the designer and better appreciate the design process, while also enabling a more sustainable approach to fashion by upcycling and extending the life of an existing garment.

Stocksen explained, “People were highly engaged in this experience, taking time to think about the designs and evaluate the look. We brought new life to an existing garment, added personal value and delighted the customer.” By using existing garments, the environmental benefits have also been significant – according to H&M, it is calculated that it can take 2,700 liters of water and 0,8kg of carbon dioxide to grow the cotton needed to make a single t-shirt.

For the most recent iteration of the Redesign Lab, H&M teamed up with Disney to offer the experience at an H&M retail store for the first time in Tokyo, timed to coincide with Disney’s release of the latest Star Wars movie in December. The store hosted a weeklong activation that offered customers, media and VIP the chance to use Magic Leap 1 to design their own Star Wars-themed garment. Guests were “blown away” and the experience became so popular that meeting customer demand was almost a challenge.

Since its launch, the Redesign Lab has been customized and showcased in Berlin, Copenhagen, Toronto and Tokyo. “It is a great example of how technology can help give a garment added value through product customization and on-demand production,” said Lucas Seifert, Country Manager for H&M Japan.

Extending the Immersive Experience to Enterprise

Seifert believes such technology will create new future business models that are more sustainable through the avoidance of over-production and the creation of more meaningful products for customers. Research agrees.

Many studies have highlighted the value — and the mandate — of the experience economy. According to Harris Group, 72% of millennials are more willing to open their wallets for experiences rather than for material items. Of course, if they can be combined, even better.

McKinsey & Company found that spending on experiences has grown four times faster than expenditure on goods. And that’s not all. The Event Marketing Institute along with Mosaicreported that consumers are 74% more likely to buy a product after a meaningful brand experience, and a memorable retail experience can result in up to 140% lift in spend.

We also see that such experiences are driving foot traffic to stores. With the state of brick and mortar, retailers can leverage immersive technology to turn their expensive real estate into must-visit destinations for customers. So how can you, as a brand, start experimenting with spatial computing to deliver break-through customer experiences?

Take into consideration a few best practices. On the creative side, focus on designing experiences that leverage what is truly unique and only possible with spatial computing – for example, persistent content that makes use of 3D space and plays around with scale (shrinking objects down to tabletop size to allow for a more intimate experience, or blowing things up to larger-than-life proportions). Explore new, more natural interaction modalities possible with Magic Leap 1, such as eye gaze, gesture and voice, and create experiences that encourage social and multi-user interactions.

Operationally, give yourself time to iterate – we recommend at least six months for development time. Leverage the cross-platform compatibility of Magic Leap – create a mobile companion piece to enable higher throughput for your experience or to allow for more spectators to watch what participants are doing. Don’t underestimate the importance of optimizing your employee training, user flow and logistics to ensure smooth operations. And finally, incorporate a capture and broadcast component to make it easy for guests to share their experiences on social media.