The energy and zeal Walmart has displayed in competing with rival Amazon over the past few years has been nothing short of amazing. The retailer has never shied away from embracing technologies that leverage customer experience.
One of the key ingredients in Walmart’s success story has been its appetite for game-changing deals, primarily involving tech-focused businesses.
Walmart forays into VR space
The retailer recently acquired a small Los Angeles-based virtual reality (VR) firm Spatialand, founded by Kim Cooper. Spatialand had collaborated with Walmart’s tech incubator Store No.8 on a project last year. It is known to make software tools that convert existing content into VR experiences.
Launched in 2017, Store No. 8 aims at reshaping retail experience across websites and stores by integrating technology in its business. According to incubator head Katie Finnegan, they are focusing on retail experiences that will not go mainstream for the next five to 10 years; and they believe VR qualifies for it.
The list of companies Walmart acquired that helped lift the company’s online sales over the last one-and-half years include Jet.com, ShoeBuy Moosejaw, Bonobos, Parcel, Hayneedle and ModCloth. Unlike these, Spatialand will not offer any profit immediately. Instead, it will boost Walmart’s growth over a period of time to go toe-to-toe with Amazon and make money doing it.
A clever move by Walmart!
A few years ago, Walmart CEO Doug McMillon stated, “It is important that we all understand the shift that has happened in technology and retail, what it means for us, and what we’re doing to win.”
Spatialand will not offer any profit immediately. Instead, it will boost Walmart’s growth over a period of time to go toe-to-toe with Amazon and make money doing it.
The potential in virtual reality market is huge and largely untapped. According to a report by Statista, the augmented and virtual reality market is expected to reach a market size of $215 billion in 2021. You never know, when VR will goes mainstream, Walmart could be a dominant leader.
Amazon has already explored the world of VR
Meanwhile, Amazon already has some footing in the virtual reality world. Its subsidiary Amazon Studios had hired Genna Terranova, formerly of the Tribeca Film Festival, as the head of its VR department. The retailer is exploring how VR can be used to enhance future shopping experiences. Plus, Amazon plans to wield the technology as a weapon to resist competition in the video streaming industry from rivals including Neflix and Hulu.
This year, Amazon aslo received a patent for a smart mirror that allows users to try on clothes virtually.
Walmart’s next move?
Not much is known about what Walmart intends to do with the virtual reality startup Spatialand. Most of it remains a mystery. Whether it plans to create a VR shopping app or offer some VR shopping experiences, investors need to wait and watch. But currently, Walmart is working on ‘Project Kepler’ that is aimed at creating stores without cashiers — quite similar to ‘Amazon Go’. One thing is for sure, Walmart is betting big with these latest acquisitions.