AR/VR gets real: 3 promising pilots of augmented reality and virtual reality in business

AR/VR gets real: 3 promising pilots of augmented reality and virtual reality in business

Augmented reality and virtual reality implementations are building steam at Kimberly-Clark, Farmers Insurance and Foot Locker, say CIOs for those leading brands.

General Electric, Boeing, Ford are among the several leading companies that prize augmented reality (AR) and virtual reality (VR) technologies for enabling employees to inspect and design machines more efficiently. But companies are also embracing AR/VR as ways to freshen up the customer experience and train employees.

AR and VR both leverage digital information, but use different interfaces. AR solutions leverage software on smartphones or heads-up displays such as smartglasses to overlay digital information, including images and text, atop physical objects in the real world. Conversely, VR is about immersion, with users typically strapping on headsets loaded with applications that replace the real world with a virtual environment.

While AR experiences are relatively more mature, VR is encumbered by costs and challenges with implementation and integration within business processes that hinder its ability to scale, says Forrester Research analyst Thomas Husson on a recent podcast. “Both technologies have been around for quite some time but they are just starting to enter the broader consumer space,” Husson says. “Both technologies are going to be quite disruptive, but … it’s going to take several years for these technologies to scale and become mass market.”

Yet CIOs, intrigued by the potential for AR/VR to fortify consumer service and employee productivity, are piloting these emerging technologies. A few IT leaders shared their AR/VR business cases and experiences with

AR games and virtual shelf placements

Kimberly-Clark, a consumer packaged goods provider whose brands include Cottonelle, Kleenex and Huggies, is piloting AR/VR solutions to boost consumer loyalty and more rapidly plan store layouts with its retail partners, says Renee Pearson, global director of innovation. "It’s about identifying the right use cases that will deliver a unique personalized experience for consumers," Pearson tells "And it enhances our ability to collaborate and turn around the expectations of our retailers and customers in a much faster time period."

Renee Pearson, global director of innovation, Kimberly-Clark Kimberly-Clark

Renee Pearson, global director of innovation, Kimberly Clark

Kimberly-Clark worked with a retail partner on an AR game that enabled children to seek and find Halloween characters that would appear on signs located in store aisles, says Manish Rege, Kimberly-Clark's global director of IT services and business partner. Prompted and assisted by store greeters, consumers downloaded a special app with the AR game on it before starting their shopping trips. The idea, Rege says, was to occupy children while mom or dad filled their shopping carts.

"We thought of this as a way to elevate the retail experience," says Rege, adding that 97 percent of the shoppers who tested the AR app said they would try the app again. Rege says that while he would like adoption of such capabilities to happen more quickly, he recognizes that the market adoption will evolve as quickly as the consumers drive it. He expects AR adoption will improve with the addition of Apple's AR toolkit on iOS 11 and similar capabilities in other hardware and software products.

Manish Rege, global director of IT services and business partner, Kimberly-Clark Kimberly-Clark

Manish Rege, global director of IT services and business partner, Kimberly-Clark

Kimberly-Clark is also using virtual reality technology to help plan store layouts, including product and shelf placements, in conjunction with retail partners, Pearson says. It's a departure from the CPG company's traditional method of inviting retail partners to "physically recreate a store" in centers. Changes to such physical mock environments previously took days; the CPG company does it much more quickly with VR. "It's gone from 100 percent physical travel to 100 percent virtual, where we can do it remotely, and investigate and test multiple scenarios quickly," Pearson says.

Pearson says that Kimberly-Clark is also looking into how to leverage AR to enhance employee productivity for machine repairs and maintenance in its manufacturing plants and mills.

Key observation: Pearson says the AR/VR pilots require close collaboration between Kimberly-Clark's IT and business teams, signaling a shift in which IT is becoming more aligned with the business to bolster consumer engagement and user experiences. "It's not just, 'Tell me what to do with technology,' but, 'Let's come together and be true partners as these business processes become more tech enabled,'" Pearson says.

Related video: Virtual reality and augmented reality for the enterprise

VR training comes to insurance

Collaboration between business and IT on VR is also afoot at Farmers Insurance Group. Chief Claims Officer Keith Daly and CIO Ron Guerrier worked with VR startup Tailspin to create virtual mock-ups of damaged cars and homes for training purposes.

Donning Oculus Rift headsets, claims representatives in Farmers experience labs walk around vehicles and homes, observing what damage to, say, a front quarter panel of a Lexis looks like, or water damage to a house. The simulations allow reps to "touch and feel open cabinets and doors," Guerrier says. For the home simulations alone, Guerrier says Farmer's has conceived more than 500 damage combinations for the training. “It’s always a different leak; it’s so unique," he adds. “An adjuster can be doing this for three weeks and they’ll never have the same scenario going into the home."

Ron Guerrier, CIO, Farmers Insurance Farmers Insurance

Ron Guerrier, CIO, Farmers Insurance

Virtual training has the potential to save Farmers as much as $300,000 annually in travel costs. Farmers trains nearly 300 property claims reps annually. Training starts in a classroom environment followed by three weeks of study at the University of Farmers in Agoura Hills, Calif. Today, trainees can learn remotely via the VR headset and software, reducing travel. Emboldened by the success of the training, Farmer's is creating a VR studio in Kansas City, which he says will cost a tenth of what it would cost to rent and fill another experience lab with broken cars and to re-create damaged homes.

Guerrier says Farmer's is also adding "role-playing" to the training, simulating interactions between an adjuster and a bound-to-be-upset customer grappling with some form of property damage. Ideally, this training will make adjusters more empathetic as they begin to engage with customers in real event scenarios.

What’s next: As VR technology becomes more pervasive, Guerrier says, reps will be able to access such capabilities from their own home to simulate damages. “That is the ultimate mobility in training — leveraging AR so they don’t have to fly," Guerrier says. "The adjuster can be at their best helping the customer when they need it.”

Even better than the real thing: Virtual sneaker unboxing

Show retail may seem like an unlikely scenario for consumerizing AR. Foot Locker CIO Pawan Verma is trying to change that, using AR solutions to help engage the company’s sweet spot: 13- to 27-year-old customers for whom mobile device and application penetration is high. “In many cases, they start their journey way before they connect with our properties,” via Instagram, Facebook and other social media channels, Verma says.

Pawan Verma, CIO, Foot Locker Foot Locker

Pawan Verma, CIO, Foot Locker

To foster more brand loyalty, Foot Locker this past Christmas enabled Snapchat users to “unbox” Gatorade AJ1 sneakers by placing images of the shoes within their photos and videos on Snapchat before they became available in retail stores. Foot Locker added an AR feature to its Eastbay brand app, allowing iPhone and Android smartphone users to scan physical pages of the Eastbay catalog to discover videos, stories, products, and other content. 

Verma says he is looking to hire 120 to 150 people to work on personalization, data analytics, AR and other digital skills in the company’s Chicago office.

Lesson learned: A well-crafted, personalized user experience is key. “AR enables you to get immersed into that experience and once you start to experience that your likelihood of recommending is high,” Verma says. He says that while consumers may not actually purchase products after making use of unboxing or other AR features, the data they create consuming such tools is valuable once Foot Locker applies machine learning algorithms to it.

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