IBM: IBM and Circuit City Join to Explore the Application of Virtual Worlds to Business
IBM and Circuit City Join to Explore the Application of Virtual Worlds to BusinessPrototype Virtual Circuit City Store to Open on IBM Island in Second Life ARMONK, NY — (MARKET WIRE) — December 15, 2006 — SECOND LIFE — IBM (NYSE: IBM) today announcedit is working with Circuit
City Stores, Inc., a leading specialty retailerof consumer electronics, to explore how to apply virtual worlds and 3-Denvironments to retail business models.
The relationship aims to experiment with the introduction of virtual worldsand 3-D environments into the multi-channel retailing environment. Asretailers focus on improving the customers’ experience, connecting thevirtual world with the real world to solve business problems can create aricher, more immersive experience for Circuit City’s customers. This workis an extension of IBM and Circuit City’s existing systems collaboration.
To kick off this experimental work, the companies have opened a prototypevirtual Circuit City store, which replicates in 3-D products available inreal Circuit City stores and on circuitcity.com. The Circuit Cityprototype store is part of an IBM complex opening to the public next weekin the virtual world of Second Life.
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IBM and Circuit City are teaming to explore and experiment
with the applications of virtual worlds and 3-D environments
on retail business models. The prototype virtual Circuit City
store replicates in 3-D, products available in real Circuit City
stores and on circuitcity.com. The companies are experimenting
with using virtual worlds for commerce, customer service and collaboration.
“Teaming with IBM in the virtual world is as much about sensing andlearning from the community as it is about commerce. These immersiveenvironments provide an interactive forum for testing and feedback as wefocus on the next generation of customer service,” said Bill McCorey,senior vice president and chief information officer of Circuit City. “Ourultimate goal is to understand the implications of virtual 3-D worlds onmulti-channel retailing and to extend the connection we have with ourcustomers to new spaces.”
A number of experiments are already underway with the virtual store. Forexample, instead of browsing through a catalog on a Web site, consumers canuse their “avatars” — a 3-D virtual representation of themselves — towalk the aisles of the virtual Circuit City store and pick up and examineproducts in a way that is closer to real life. Customers can then orderthose items to be delivered to their homes, much like the way they wouldorder on the Internet.
Some of the richer features under development will showcase Circuit City’sstrategy of providing multi-channel touch points to the consumer, drivingcustomer service and extending its community of customers and experts fromits stores and forums online to the virtual world.
An immersive feature that IBM and Circuit City are experimenting withincludes an interactive home theater setup, where customers can easilyrecreate their own home environment, and figure out the optimal sizetelevision to purchase based on room dimensions. These features allow auser to have their avatar move a couch back and forth to set it at theproper distance from where they would like to position a new TV, and itautomatically tells them the optimal size TV to purchase for their roomdimensions. The companies will explore additional features, such as whereto set up speakers and other audio and visual components.
The companies are also researching the potential to add other features incustomer service. For example, instead of a customer calling in with atechnical issue, they can actually go to the 3-D virtual environment andfigure out exactly how and where to fix or examine the product to find theproblem and get it resolved. If someone purchases a new digital camera oncircuitcity.com and wants to learn how to use all of the features, insteadof reading a product manual they can immerse themselves in the 3-Denvironment and actually “see” how to use the camera and all of itsfeatures.
Circuit City is also exploring how to extend its online forums — where itscustomers help each other by rating and reviewing products they havepurchased — into the virtual worlds. The virtual worlds are built aroundcommunities and provide a natural forum for people to connect andcollaborate.
IBM’s Virtual Worlds and 3-D Internet Strategy
These experimentations — with innovative companies like Circuit City –are part of an IBM-led initiative to collaborate with clients and partnersin three ways — conducting business inside virtual worlds; connecting thevirtual world with the real world to create a richer, more immersive Webenvironment; and to solve business problems in a new way.
IBM is opening up areas in Second Life previously inaccessible to thegeneral public. On these “islands” — which are spaces where people canbuild three-dimensional objects and interact with other people in a waythat is more visual and real — IBM has been experimenting on extendingvirtual worlds for business. Three key areas in business include: virtualcommerce and work with clients to apply virtual worlds to businessproblems; driving new kinds of collaboration and education; andexperimentations on pushing the limits with a broad community on what mightbe possible in virtual worlds.
IBM is working with dozens of clients to experiment and help themunderstand and apply virtual worlds to their business. While IBM isprototyping and developing in Second Life, it has a bigger strategy tocollaborate with a community in an open source fashion to build out thenext generation Web, which IBM and others call the 3-D Internet. IBM alsoaims to build a platform for “serious” business, including 3-D Intranetsinside of a company firewall where private and confidential business can beconducted.
In addition to virtual commerce, IBM works with clients, employees andalumni to use virtual worlds to drive collaboration and provide a moreimmersive online educational experience. For example, IBM uses virtualworlds to connect with its alumni population and for on-boarding andeducating new and current employees. Virtual worlds have proven aneffective tool to help simplify the complex, with 3-D models andinteractions that cannot be recreated in a Web conference or phoneconversation, and have been useful in connecting people around the globe todrive collaboration.
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