Mannequins have done their job in store windows for over a century. But as brick-and-mortar stores increasingly fight for attention, they’re due for a digital upgrade. Namely, a talking human hologram that greets you and asks if you’d like to buy the designer sweater she’s wearing. You say yes, and she offers you a coupon you scan on your mobile phone to redeem in-store or online.
The idea of shopping with a hologram alongside you is not a fantasy. ARHT Media, a startup founded in 2012, has celebrity backers like Larry King and co-founder Paul Anka. The company says its HumaGrams—a patent-pending technology—can be used for digital signage, advertising, convention presentations—and, yes, the aforementioned store display window. ARHT recently partnered with Canadian retail chain Harry Rosen to display a human hologram named “Vincent” during the 2014 holiday shopping season.
A handful of companies now are creating holographic and augmented reality technologies to engage consumers in more personalized ways. Now that holograms may have been used to resurrect dead musicians like Tupac and Michael Jackson, companies like Ford, Disney, and Guess have used it to promote new products. eBay recently bought PhiSix, a company that develops 3-D models of clothing for virtual dressing rooms.
Paul Duffy, the CEO of holographic platform ARHT Media, says holograms aren’t just the latest shiny gadget for companies to dazzle consumers. They’re a necessity if brick and mortars want to compete.
“Everyone is experiencing the proverbial death by a thousand cuts with groups like Amazon in the last several years,” Duffy says. “And it’s only going to continue.”
Holograms previously have been too expensive for large scale applications, but experts say that is changing as the tech simultaneously becomes more advanced and cost-effective.
Since their beginnings in the ’60s, holograms have had a few commercial incarnations. In 1972, Cartier projected a hologram of a jeweled hand from its Fifth Avenue store window out onto the sidewalk to attract consumers. But today, the technology is still more common in industries outside of retail, such as health care, museums, military, and defense.
“The problem is that as consumers and retail, we don’t pay very much. To get this kind of technology, it really needs to be very cost-effective,” says Daniel Smalley, an engineering professor at Brigham Young University who has created color holographic video displays.
David Rose, CEO of PRSONAS, a North Carolina startup that creates interactive customer service holograms, says companies are more interested in holograms because they provide valuable data about consumer behavior.
“We’re gathering real-time analytics from all these customer interactions,” Rose says. “If a brand can learn what their customers’ preferences and interests are, it’s a much better way to give them better service and products.”
The growing field of proximity marketing–where companies allow consumers to buy products at the point of sale through their mobile phone–also may have an impact. The global market for proximity marketing is expected to reach $2.3 billion by 2016. Companies are currently using QR codes and beacons to drive these experiences, but ARHT Media, which is pilot testing with several clients, is betting holograms also can grab a slice of the real-time commerce pie.
The first sale to be made, though, is to retailers who, experts say, will be cautious before they devote their most precious commodity–physical in-store space–to hologram displays.
“Right now you definitely get that wow effect [with the technology], but it needs to have a use beyond this wow effect,” says Matt Szymczyk, CEO of Zugara, an augmented reality company. “When retailers start seeing consistent feedback that these solutions have started increasing conversions, then we’ll see more proliferation of them. Right now, they’re in trial and pilot mode.”
Both PRSONAS and ARHT Media are launching pilot programs early this year. PRSONAS already has worked with pharmaceutical and high-tech companies for trade shows and event presentations. The company is still determining its pricing model, but currently the technology costs $9,500 apiece, with an additional monthly service fee for the hardware, software and analytics. PRSONAS plans to launch an expansive pilot test with a big retailer in February, Rose says.
ARHT Media, which charges a license fee and one-time fee to create ad content for its HumaGrams, is currently building advanced holographic display technology that will be on the market in the coming months. Duffy, its CEO, says there will be a handful of these installations through the 2015 holiday season, and he expects more in-store implementations in 2016.
The holograms may come in step with the evolution of brick-and-mortar stores. “Stores are becoming smaller with a much larger digital presence,” says Ivailo Jordanov, a retail analyst and co-founder of Styloko, a shopping discovery engine. “Over time, physical stores will simply become showrooms where holographic technology will be instrumental to transforming the retail experience.”