How Are Digital Twins Used in Retail?

Key Takeaways: 

• Definition & Complexity: A Digital Twin is a highly complex virtual model of a physical object, process, or even an entire store. Unlike a simple simulation, it allows for testing multiple variables and “what-if” scenarios simultaneously in a real-time digital environment.

• Operational Efficiency: Retailers use digital twins to model entire supply chains and store layouts. This allows them to predict and prepare for “bottlenecks,” such as sudden sales peaks, staffing shortages, or supply chain disruptions, without risking real-world assets.

• Cost-Effective Testing: Tasks like “shelf auditing”—determining the most attractive way to display products—can be done virtually. This eliminates the manual labor and lost revenue associated with trial-and-error testing in a physical brick-and-mortar store.

• Enhanced Customer Experience: Technologies like virtual fitting rooms allow customers to try on digital twins of clothing from their own homes. This bridges the gap between online shopping and the physical experience, increasing customer satisfaction and reducing return rates.

• Strategic Insights: By building a complete virtual store, brands can monitor the “customer journey” in a digital space. The data gathered helps optimize store layouts and navigation to create a smoother, more convenient shopping experience in the real world.

Digital twins are software models of real-world items that are most commonly used in retail to test changes to a product before making costly, real-life adjustments. In this article, we delve into this topic further – read on if you wish to learn more about the use cases of digital twins in the retail industry.

What Is a Digital Twin?

A digital twin is a virtual representation, a digital model of a physical object. An object is first studied, mostly with the key functionalities in mind, and its behavior is measured. Then, the data is transferred and used to build a virtual model.

Virtual twins, unlike simulations, are complex. They can be studied and experimented with from different angles, as it is possible to test various scenarios and functionalities at once, whereas a simulation includes insights only into one particular process.

Despite the initial digital twin definition, they do not need to represent something purely physical. Instead, it is possible to create a digital twin of a particular process, a branch of a company, or a particular store.

Digital Twins in the Retail Industry

Digital twins can be utilized for two purposes in the retail industry. The first one includes improving processes and operational procedures of a store or chain, thus is business-related. The second one is aimed at enhancing the experience and satisfaction of the customers – it’s customer-oriented.

Digital Twins for Improving Processes in Retail

Major retailers employ digital twins in the metaverse to improve the efficiency of their stores or even whole chains.

For instance, a popular use case of digital twins in retail includes making a model of a store with all the resources (stock, employees, shipment) included. Combining it with the systems used on a daily basis makes it possible for a store to manage and overview all the resources in real time. Additionally, it makes it possible to simulate and test various scenarios, like sales peaks, to find potential bottlenecks in the procedures in such situations and to find ways to improve them.

Testing is especially important in this case – it makes it possible to prepare for unpredicted peaks, being understaffed due to sick leaves, or even supply chain disruptions. This lets retail leaders avoid the negative consequences of such scenarios, as they are prepared in advance due to digital twins.

Another way in which retail businesses leverage digital twins is shelf auditing – making sure that the products are displayed in the most attractive possible way. In a physical store, it would require a lot of manual labor and would cost a lot of money in the form of lost revenue when the display is not optimum. But, with digital twins, it’s possible to test various solutions quickly and without revenue loss.

Digital Twins in Customer-Oriented Retail

Having analyzed the use cases of digital twins in retail optimization, we may now proceed to discuss the ways in which it can be utilized to enhance customer experience.

The first example is virtual fitting rooms. In them, customers may try on digital twins of the clothes offered in brick-and-mortar stores without the need to leave home. It’s a quick and effective way to acquaint customers with the whole stock, which is impossible to achieve with any other means, as simple simulations would be insufficient.

It is also possible to enhance customer experience by building a whole virtual store. Letting customers navigate through hundreds of digital twins and monitoring their journey is a way to gather information on the layout of the store and possible fields that require improvement. In the end, this can be utilized to build a smooth, quick, and convenient customer journey.

The Takeaway

Digital twins are commonly used in retail to improve processes and boost customer experience. Created in the metaverse, they may represent a product or a whole store with all its equipment. The main benefit of using digital twins is that they enable easy, resource-efficient testing of new and improved solutions. Therefore, we advise you to leverage them to your advantage.

You may also read: Shopping In The Metaverse