Bosung Lee (Barun ICT Research Center, Yonsei University)
VR/AR technology involves the use of technologies of VR and AR to integrate reality and the virtual world in expanding users’ senses and perceptions. From this, new experiences unavailable in actual reality are generated, and a real time interaction between the virtual world and reality is created. The development of VR/AR technology is expected to influence a variety of realms, such as entertainment and education. Therefore, it is necessary to consider the positive and negative socioeconomic ripple effects. This article explores the positive and negative ripple effects on consumer behavior arising from developments in VR/AR technology and offers ways to maximize the positive effects while reducing the negative effects.
The positive ripple effects in consumer behavior that arise from VR/AR technology are the stimulation of consumption and the reduction of social costs.
The primary example of a positive ripple effect is the stimulation of consumption and reduction of trading costs. Unlike online clothing stores, which simply share an image of an article of clothing or of the model wearing the item, Tobi.com provides an online fitting room service, generating an image simulating the consumer wearing the item selected through the technology of virtual reality and the consumer’s webcam. Similarly, Uniqlo’s Magic Mirror AR fitting room offers a three-dimensional (3D) fitting room that uses AR from an offline store to allow consumers to see how the item would look, were they to wear it. These are means of minimizing concerns regarding an ítem after its purchase, speeding up the decision to make the purchase, and stimulating consumption.
Furthermore, IKEA’s VR Kitchen incorporates the Building Information Modeling (BIM) Cave from McCarthy Building Company, a construction company, with HTC Vive VR headsets to show how larger products appear after purchase and offer a final overview of the interior architecture and design. This is a method to reduce consumers’ complaints following purchases and increase overall consumer satisfaction.
Reducing Social Costs
As online experiences comparable to using an actual product become available, offline shops are likely to change rapidly into a VR/AR base of online stores. Additionally, while the construction of high-rise buildings presents various issues regarding blocked views and environmental changes, social costs can be diminished by utilizing VR/AR technology to simulate what the situation would be like after a building has been constructed. This reduces both the need for design changes and the duration of the construction, thereby lowering social costs.
On the other hand, there are negative ripple effects, such as information distortion and the digital
divide, caused by VR/AR technology
VR/AR technology focuses on sharing information regarding a product’s visual and auditory aspects, imposing the risk of neglecting to consider the other senses, such as touch and smell, and creating an imbalance in which information is distorted. However, consumer satisfaction depends not only on how a clothing item looks but also on the way it feels, whereas the the product’s safety and durability. Meanwhile, the core of VR/AR experiences are the details of the visual and auditory considerations, creating the likelihood of making a bad purchase owing to distorted information.
In addition, whereas the VR/AR experience offers insight into environmental changes such as view and sight, changes to temperature or wind speed cannot be predicted easily through VR/AR technology. Therefore, there are still many potentially dangerous issues. For instance, consumer disputes against VR/AR experiences might arise, as businesses are likely to argue that sufficient information was provided through VR/AR, if dissatisfied consumers request to return a product.
Another consideration regards the difficulties in making purchases through VR/AR experiences for consumers who lack the VR headsets and AR cameras necessary. The increase in the number of online stores with VR/AR experiences will reduce the number of offline stores and create a divide in consumption. Likewise, new or small/medium-sized businesses that lack the capacity to provide stores and advertisements with VR/AR experiences will face restrictions in delivering products to consumers, causing a VR/AR divide between businesses.
To maximize the positive ripple effects and minimize the negative ripple effects, the first step that is required is to establish clear guidelines on regulations for online trade regarding the senses that apply to VR/AR experiences. Rules to assist consumers in seeking returns for products due to limitations of VR/AR experiences (touch, quality) and against rejecting consumer returns on the basis of having already provided a virtual experience must be issued. In addition, environmental assessments and construction regulations must distinguish categories for prior agreements between outcomes that VR/AR is able to predict (views) and others, such as safety, durability, and wind speed, which are more difficult to determine.
Furthermore, just as web accessibility requirements and standards currently exist, VR/AR accessibility and standards must be available to groups facing barriers in accessing VR/AR experiences. In addition, new and small/medium-sized businesses that struggle with supplying VR/AR experiences and advertisements require the assistance of affordable technology for developing and standardizing the VR platform.