As e-commerce continues to thrive, one of the last remaining challenges in the industry is replicating the fitting room.
When shopping for clothing, consumers tend to either go to a brick-and-mortar store to try the clothes on first, or with the growing ubiquity of free shipping, they order a bunch of sizes or styles online and return the ones that don't fit.
Neither of these options is a perfect fit for online apparel retailers, but a new solution may be approaching in the not-too-distant future. Technology companies are perfecting 3D body scanners that can create a digital avatar of a consumer and help him or her find the perfect fit without entering a fitting room.
These scanners have been around for a while, but they're finally nearing an advanced enough level where they could actually be implemented on a wider scale.
Back in 2007, Macy's (M) gave the technology a shot with a pop-up scanning booth in partnership with Lori Coulter's swimsuit line. Using [TC]² scanning technology, a consumer could get scanned in-store and then order a personalized bathing suit from Lori Coulter.
Their 3D scan was then saved so that they could order more bathing suits whenever they wanted without having to revisit a physical Macy's store. Macy's offered this experience in about 15 stores, but ended the trial in 2012.
"The economics had changed as far as how the capital buildout and requirements in-store did not justify [having the experience] at that time coming out of the recession," Lori Coulter told TheStreet. "At the time, the scanners were more expensive as well."
Now that the scanning technology costs about the quarter of the price and is more accurate, and a larger portion of consumers are likely interested in spending more for a better fit, it's possible that the timing could be right for body scanners in the retail industry.
Artec's 3D body scanner creates a 3D avatar and turns it into a figurine
There are already a few niche cases, like menswear store Alton Lane, which uses 3D body scanners to design custom-made suits for their customers.
Walmart (WMT) is also testing a 3D scanner from a technology company called Artec, but for now it's just an entertaining experience that creates a 3D avatar and allows customers to print a miniature figurine version of themselves. Right now they have the 3D experience in 15 stores in the UK.
But Artec founder Artyom Yukhin told TheStreet that the company is in talks with Walmart and other large retailers and brands to figure out how to apply the scanning technology in apparel. He sees two different models for how 3D scanning will fit into the fashion world: for tailor-made clothing, or to match off-the-shelf garments that will be the best fit for a customer.
Either way, the implications for e-commerce are huge. Consider that about 49% of retailers offer free return shipping, according to the National Retail Federation. That costs retailers a ton of money, especially in apparel.
According to a report from IHL, preventable returns cost the global retail economy $642.6 billion every year. If retailers could ensure proper fit with the help of 3D scans and digital avatars, that could significantly lower return rates and save retailers a huge amount of money.
It could also help new brands attract customers who aren't yet used to the brand's sizing. Customers often are loyal to brands for which they know exactly what sizes to order. But if they could upload a 3D scan to make sure they got the right size, they could be more easily persuaded to check out a new brand.
Cappasity's 3D scanner creates a virtual 3D image of the shoe
Another way 3D scanning could help the e-commerce industry in the short-term is by helping brands depict 3D versions of their merchandise online. A company called Cappasity is working with brands on this approach, which simply makes it easier for consumers to know exactly what they're getting when they order online instead of being shocked when a package comes in the mail.
To be sure, it's unlikely that 3D scanning booths will completely take over the retail industry in 2016. The technology may be improving, but until a service provider offers an all-in-one experience for retailers that connects the body scanning with the virtual fitting and the actual apparel production, it's unlikely that the experience will spread.
But according to Dan Levine, the managing partner at investment firm Tenfore Holdings, in the next two to three years we could see some more tests, especially with direct-to-consumer brands like Bonobos that have the ability to go straight to the manufacturer with a customer's 3D scan to get the right fit.
Greg Portell, a partner in A.T. Kearney's Consumer Products & Retail and Media Practices, expects to see pilots in particular from more upscale retailers where the clientele would be willing to pay more for a better fit.
"As you have the technology becoming more ubiquitous, it'll be easier for retailers to emphasize and develop that virtual selling capability particularly at a Nordstrom or Macy's," Portell said. "It'll be the norm in most A-class types of stores within three years, the main flagship type of stores. It may not be in JCPenney in Wichita, Kansas, but in every main city."
And then one day when we all have 3D scanners in our homes, the physical fitting room may finally be obsolete. Lower-tech solutions such as XBox's Kinect motion-sensing technology and Intel's sense technology are starting to work on the really early stages of at-home virtual fitting rooms, but it seems like the real first step will be getting scanners in stores.