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PacSun built a reputation as a staple of the mall. Now, the youth-focused apparel retailer is bringing a mall to the metaverse.
PacSun on Thursday is launching a fantasy mall experience on the gaming platform Roblox. Called PACWORLD, the experience allows players to build a mall within the platform where they share, market and sell goods. They’ll have the keys to create or remove shops, and make upgrades to those that do well. They can also decorate and take other steps to market the mall. Plus, they can invite friends.
It’s one of the ambitious initiatives to emerge over the last year that shows how retailers are seeking to forge a presence in the metaverse, which is a fledgling framework for interaction across physical and virtual worlds which is characterized by immersive digital experiences, economic tools such as currency and social interaction. While virtual reality headsets often come to mind when it comes to entry points for this space, gaming platforms such as Roblox, which allows users to build and play games with each other, are also gateways to the metaverse.
PACWORLD comes at a time that interest in the metaverse is rising. According to data released in December by National Research Group, two-in-three consumers are excited about the metaverse, while 46% of consumers say they intend to spend more time in the metaverse in the future. Eager to reach consumers where they are interesting in spending time, brands and retailers have been exploring the area. According to Forrester, 76% of B2C brand executives plan to invest in metaverse-related activities this year. The first-ever Metaverse Fashion Week was held earlier in March. Brands like American Eagle and Nike both recently launched marketing campaigns in Roblox, while Wendy's launched a virtual restaurant on Meta's platform.
PacSun's moves show a role for shopping. The company has been laying the groundwork for its metaverse presence over the last year. At ShopTalk this week, PacSun President Brieane Olson said the LA-based company was keen to enter the metaverse because of its focus on youth consumers. Seeing that many in Gen Z were already in the metaverse via gaming, the company partnered with Roblox to create a virtual plain on which to meet its audience, and forged a partnership with game development studio MELON to design them. It also began accepting cryptocurrency in October 2021, ensuring that payment can be accepted in this space, as well.
Virtual products followed. PacSun has released a series of nonfungible tokens (NFTs), which are digital tokens stored on a blockchain that can be stored and traded. The first was designed around its logo. A series dubbed Pac Mall Rats followed in January, and it dropped a second series of Pac Mall Rats along with the launch of PACWORLD on Thursday.
A look at the first Pac Mall Rats drop. (Image via PacSun)
PacSun offered a brand T-shirt and tie-dye sweatpants for Roblox users to sport on their avatars. It also offered "fantasy" items that users could add, including gold-tipped wings. These proved to be the most popular of all of its offerings.
It shows how the metaverse offers an opportunity for brands to explore beyond the products they offer in the physical world.
“The consumer is really looking for that sense of imagination, creativity and the ability to transform their identity,” Olson said.
PACWORLD is designed to bridge that reality and fantasy as Roblox users create a new mall. Players start at a sunny beach. Then, they choose a plot of land and can bring their own style to a mall they build within Roblox. Users also earn virtual income. Adding a social element, they can visit each other to compare malls.
With PACWORLD, players can sell the virtual goods released by PacSun, and the company plans to expand these offerings by releasing more goods in the near future.
When it comes to commerce, it's important to note here that players aren't just shopping for virtual goods. They are creating the virtual space in which the goods are sold. This can also foster an environment where brands are building alongside users, Olson said, as players create their own goods.
It's a new plain on which brands can become influential in fashion. By allowing players to open their own stores, the metaverse presence can also create a space where ideas for products come from users. PacSun is already seeing emulation of product, and Olson sees duplicating of items as a positive. Quoting the iconic fashion designer Virgil Abloh, Olson said the fact that a brand is being copied shows it has affinity with its audience. It presents a space where a brand’s community is driving growth.
“Arguably, some of the product that we see in terms of product emulation is stronger than what we put out in the first place,” she said. “Crowdsourcing both virtual product and physical product is the way of the future.”
Building in the metaverse also means a new role for a company's team. As it works to build more products and experiences, Olson said PacSun is seeking to integrate its metaverse focus across the company. There’s not a single department dedicated to it, but rather an approach in which executives across all departments are taking a role. More hiring focused on digital design talent is likely to come.
As for the PacSun team, the company also has a presence. It is holding cross-functional meetings in the metaverse monthly, Olson said.
Trending in Shopper Experience
Microservices architecture allows the company to give retailers ownership over omnichannel software.
With the growth of digital commerce, providing consumer choice is at the center of all of a retailer’s operations.
In recent years, that became especially evident in the area of fulfillment.
Ecommerce made the process of moving an order into place for delivery a crucial function, as the ability to source products close to demand quickly was an imperative.
“Retailers are looking to own more of their fulfillment destiny because consumer expectations have increased,” Chap Achen, VP of product strategy and operations at Nextuple, told The Current on the floor of the NRF Big Show 2023. “Fulfillment is now a competitive weapon.”
As digital operations increasingly blend with the physical store, a host of new fulfillment options are coming online. They can have an item delivered from the store on the same day, or they pick it up. Even a wider offering such as in-store pickup has a host of different choices inside of it. Consumers can pick up an item at a counter, or a locker. They can stop by anytime, or schedule a pickup on Saturday.
While this optionality helps retailers meet customers where they are, it also adds complexity to the systems that run them, and requires operational adjustments to put them in place.
It means the software that powers fulfillment operations must also meet retailers where they are, Achen said. Many retailers have specific setups and processes. They may have a store located in a mall with a nearby distribution center, or a series of small storefronts. At the same time, retailers need to have flexibility with the software that they use so they can provide options to consumers.
For Nextuple, the vehicle to provide this is microservices, which describes a software architecture in which the parts of an application work independently, but are also built to work together. The company harnesses microservices to offer an ownership-centered approach to deploying its software through a product called Nextuple Fulfillment Studio.
“Today, there are only two ways to buy software: [software as a service] or custom building,” Achen said. “You can do it yourself or with a partner. We are a third option. We will help you accelerate your time to market because we've already developed 80% of your requirements, and then we'll give you that as source code.”
The software is composable. Retailers own the source code, and they can iterate. Along the way, they have the ability to swap out components of the software for pieces that enable them to better respond to the needs of customers, if they choose.
It shows how composable commerce is spreading throughout retail operations. A first wave of development applied the approach to the “front-end” of commerce, such as operating an ecommerce store and marketing. With fulfillment software such as Nextuple coming online, there are signs it is being applied to backend operations, as well.
In all, Nextuple offers 14 microservices as part of the Studio, including engines for same-day delivery, storage, inventory management and sourcing.
At the NRF Big Show, Nextuple announced that it is live with five national omnichannel retailers. Together, they have $50 billion in annual revenue and 7000 store locations.
The company is aiming to serve a group of retailers that are widely known, but still looking to hone operations for omnichannel retail. When it comes to fulfillment technology, the retail landscape has distinct tiers.
The largest players have built their own fulfillment tech to power logistics networks that reach across the country.
Name brand retailers with a national presence also want to offer competitive fulfillment, but haven’t made the move to acquire platforms or developed their own software in-house. Typically, they would seek out a software provider that offers a set platform on a subscription model. But the particular needs of commerce require software that powers physical operations with digital tools. That requires a different type of solution, Nextuple believes.
“We want to level the playing field,” Achen said. “We're helping the mid-tier [retailer] compete with Target, Amazon and Walmart.”