**Virtual Humans Transforming the Retail Industry: A Passing Trend or the Future of Marketing? **
Virtual humans are becoming increasingly prevalent in the distribution industry, which is particularly keen to pique the interest of younger generations. Compared to human stars, virtual humans are not only cost-effective but also involve less risk management. However, challenges such as building deep customer relationships and diminishing curiosity about virtual humans are also noted. There are also discussions that the craze for virtual humans might be a mirage.
SSG.com recently appointed virtual human ‘YT’ as the official show host of its content commerce platform, SsukTV. YT, a Z-generation female concept virtual human created in collaboration between Shinsegae Group and graphic specialist company Pulse9, is planned to appear in various contents such as product experience reports and live commerce. During a test broadcast over the past two months, SSG.com recorded over 30,000 views and sales of 200 million won through YT’s appearance in Swarovski and SK-II content. SSG.com plans to continue presenting products and services targeting the MZ generation with YT.
Lotte Home Shopping is also utilizing a virtual human, ‘Lucy’, as a show host in lieu of human hosts. After show host Jeong Yun-Jeong was indefinitely suspended due to on-air swearing, Lotte Home Shopping suffered a decrease in related product sales. ‘Rozy’, the first virtual human in South Korea, earned more than 1 billion won as an advertising model in 2021.
Virtual humans have grown influential enough to be compared with human stars, particularly among the MZ generation (born in 1980â?¼early 2000s) who are familiar with digital and social media. They can rapidly absorb and maintain various images according to changing public trends, and there is no risk of issues arising from personal life or past behavior. Plus, virtual humans can advertise in various places without restrictions of time and space.
According to global market research firm Emergen Research, the virtual human market, which was valued at $10 billion in 2020, is projected to grow to $5.275 trillion by 2030. One industry insider noted that, while collaborating with human stars can be challenging, virtual humans can operate infinitely without these concerns.
However, there are also predictions that the virtual human marketing trend may decline. Its popularity was significantly influenced by novelty and curiosity. The virtual world was an interesting element for digital-friendly young consumers, and the non-contact consumption trend during the COVID-19 pandemic also played a role. However, the distribution industry trend is changing with the pandemic becoming endemic.
The emphasis is shifting towards experiential elements involving direct touch, hearing, and experience. Conversely, virtual humans can only communicate through non-face-to-face content. To maintain popularity, they need to move beyond simple curiosity and convert topics of conversation into fan affection. Establishing a fanbase through face-to-face interaction with fans, like human stars, is essential, but it is a fundamental limit of virtual humans.
As more virtual humans begin to saturate the market, people’s interest could wane more rapidly. The popularity of virtual humans currently depends on the MZ generation, known for their quick shifts in interest. There’s a growing sentiment that the hype around virtual humans is dying down due to their frequent exposure.
Currently, home shopping is the main industry actively using virtual human marketing. Other distribution industry fields are largely interested in drawing attention. One food industry insider explained that while the image and behavior of human stars are important marketing elements, virtual humans do not yet have a comparable narrative. They suggest that the usefulness of virtual humans should be observed further.
http://news.bizwatch.co.kr/article/consumer/2023/05/10/0032
http://news.bizwatch.co.kr/article/consumer/2023/05/10/0032