In Conversation With … IORMA Board Member: David Wortley

As CEO of GAITSS, David consults on the use of Gamification and enabling technologies such as serious games, virtual worlds and social networks as strategic solutions. 

A conference speaker, writer and globetrotter, David also has a strong foothold in research and education globally.  He is currently in Asia, having been working at University Putra Malaysia in Kuala Lumpur and was, in 2006, appointed Founding Director of the Serious Games Institute (SGI) at Coventry University which, in four years,  became a global brand.  Throughout his career he has been an innovative early adopter and the mix of skills he brings to IORMA’s board represents a unique and valuable addition to its knowledge centre.

PML: David, IORMA is delighted to have you on board and our associates are keen to learn from your knowledge and experience of disruptive technologies, what was it that appealed to you about IORMA?
DW: I’ve known John Andrews for many years through the Serious Games Institute. John played an important part in our activities and is highly respected in the retail community; he is a pioneer of new technologies like me.  John engaged in activities around virtual worlds platforms such as Second Life and I like his forward looking approach to commerce. It was really based around this longstanding relationship with John and the quality of people he has brought together that compelled me to be part of this community.   IORMA is a gateway for me to make the best use of my knowledge and expertise in the sector.

PML:  Indeed that is where I met John and yourself first.  John helped me set up a virtual retail art gallery in Second Life.  We often surmised that in a few years, all shopping would be done in a virtual reality environment!  Whilst retail has moved rapidly to digital, it has not developed as a virtual reality space.  Can you comment on that?
DW:  The problem is that they don’t create such a simple shopping interface such as our familiar websites with the ability to be able to find what you want quickly and not have to navigate through a 3D world.  We are way off from where 3d immersive environments will become mainstream and they may never do as it makes shopping more complex.   It is also just too expensive to reconstruct a virtual shopping mall realistically. I see the main application of 3D immersive environments in commerce as being used to test out physical retail designs in conjunction with virtual reality headsets such as the Oculus Rift. By evaluating user behaviour and reactions to different designs and merchandising strategies in a virtual world, vendors can avoid the potential costs of physical construction.

PML: I suppose it takes massive amounts of bandwidth?
DW:  Not always and the tech is improving all the time, but bandwidth is less of a problem.  The novelty has worn off except for some specialist apps where you can create a rich virtual environment but that is generally not cost effective except for pre-construction evaluation..

PML: What about the use of virtual worlds for training in retail as it has previously been used successfully in the medical field?
DW: It is already happening and there are various apps to train retail staff in a virtual world environment. However I can see that this will take place in more of a Skype environment than in virtual reality.   The problem with 3D is that you either have to have an avatar (a bot with artificial intelligence not controlled by humans with a database of typical questions and responses to create virtual customers using AI or you need a human controlling the avatar and what it does in the virtual environment – again it is often better done over a video link.

PML: Where do you feel gaming and virtual reality will develop in business as opposed to games?
DW: My focus is on gamification rather than games – games typically are designed to entertain and engage you, Gamification applies the same kind of techniques to motivate and influence in a non game context.  I have noticed particularly in Asia, notably in KL, a number of people in commerce are using games, gamification and incentives to build consumer loyalty.

PML:  It would be interesting to have your perspective on how this is applied to consumer commerce in the Asian market, what have you observed?
DW: One example is loyalty being developed using a mobile app called Line. It’s similar to Whats App whereby you make free calls and texts to anywhere in the world.  However, in order to be able to get these free, you need to buy goods or services from Line partners. Every time you buy through an approved merchant you get points; this then acts as a currency to get calls and texts free.

Recently I was given a scratch card by Guardian, a pharmaceutical retailer in KL. In order to use it, I had to activate a QR code with my mobile phone which loaded the LINE app onto my phone and created a profile with Guardian as being my ‘friend’.  So they have a gateway they use to get me to play games and competitions where I get rewards for products and services from the Guardian stores.  Watsons, another pharmaceutical company uses gamification in terms of incentives and prizes you win whereby you buy certain goods with your points.

Retailers are combining as consortia linked to something like the Oyster card so you use a touch-and-go card in your travel and you get discounts and competitions. Rather than providing pure entertainment like the Angry Birds app, they are using gamification incentives to build brand loyalty to win commerce and relationships.

PML: Surely this will have huge consequences for the revenue departments of governments around the world?  What about the taxation component on the benefit here?
DW: Indeed!  In the UK I wrote an article about future of currency. Currencies will most likely be replaced by digital currencies and if that happens, what you will find is that the nature of commerce will change we will go back to a barter type of existence.

To take your question further, there is always a price to be paid if it’s a currency exchange too. If it is a digital token with universal value around the world you could get to a stage where so many minutes of mobile or miles of travel on train is equivalent to a product or service – trade by barter.  Many people will be seriously affected if this happens and electronic tokens and digital currency converge.

PML: Whilst we are talking about Kuala Lumpur and Malaysia, can you tell me a little more about your work here and your perspective on the retail environment?
DW: I produced a number of articles about the commercial and retail environment in KL and compared it to other cities. One analysis of the big picture of retail in KL in what we call the Golden Triangle, which looked at the different retail experience and identified key trends and factors.  In KL they are evolving away from traditional department stores in some areas into luxury, very modern retail experiences.  They have all the same big international brands so you see the disappearance of small independent traders in favour of a very luxurious experience combining entertainment with food and expensive prestige brands. What is special however is that they are connected through pedestrianisation of certain areas.

I’ve seen the same, but done better in Bangkok; the city centre experience is amazing with an aerial skyway along which you walk for a mile and go off into all of the big retail experiences without crossing the gridlocked roads. As a consequence the foot fall is huge, but in KL certain parts of the city are disadvantaged because you have to a cross a main road to get to the other area so it suffers.

This kind of integrated cultural heritage tourism with easy access for pedestrians makes for better revenues for the retailers.

PML:  I have seen this done well in Japan too where the focus is on the building not a street or mall.  You have all your entertainment, leisure and retail in one location with first class restaurants on the top floor.  In fact many people go to the retail tower because of the restaurants first rather than the shopping.
DW: Yes and this is a big pointer to future of commercial physical spaces with experience – especially in Bangkok where almost all major big modern retail stores have thematic events such as a motorbike festival or even a big conference, bringing in people every week because there is something different.  Transport too is integrated very well … and has to be.

PML: What about the digital shopping experience in Asia?
DW: Yes it exists and particularly in Singapore where urban planning got its act together to make commerce very successful.  They are exploring how you integrate physical and virtual worlds to create personalised shopping experiences which will take the form of using the internet of things to be able to detect where you go and where you buy from. Then they use that data in enterprising ways for location based marketing and commerce.  The digital experience builds relationships between you and the bricks & mortar experience so you will have a device which could be a mobile or an apple i-watch which will recognise when you walk into the space and bring up a profile, then use that intelligently to create a personalised service.

It’s the equivalent of walking into a hotel as a regular customer and being welcomed and recognised.

To take the analogy further it can be a personal concierge.  If you fancy something to eat, there will be data held in the cloud about your preferences for food and propose, say an Italian restaurant.

PML:  So are you talking about what we call i-Beacons in the UK?
DW: It’s similar, but intelligent enough that it does not pester you whether you are using augmented reality or location based services.  Your food preferences will be matched to the nearest Chinese or Italian restaurant for instance, so it goes further than that and is more personalised.

PML: Tell us about Augmented Reality as I understand you have expertise in this area.
DW:  There are different kinds – one is where you use Google glass when walking around so what you see in the normal world is overlaid with information about stores and restaurants that don’t interfere with your view of real world but add value in terms of exploration.

Another kind is where we made advances at the SGI where we can combine the physical world with a virtual world with a form of entertainment or engagement.

For instance at the SGI reception area, when you sit down and wait to meet someone you see yourself seated on a chair – blending the real with a virtual avatar so you also see yourself sitting with an avatar,  next to someone  who doesn’t exist.  In Singapore in a conference hall you can see yourself on a screen, there is a novelty value here, but innovators will find ways of using that to go beyond pure entertainment, such as the magic mirror where you try on virtual clothes.

PML: So what are you currently researching in education?
DW: I am looking at the impact of technology on the role of teachers and educators. The reality is that students and digital natives want to have self directed learning and this can be a problem for teachers as they are no longer the Subject Matter Experts, , who know more than the pupil.  There is now so much knowledge via the internet – anyone with a passion can learn more than the teacher.

The teacher’s role is no longer to disseminate a greater knowledge; they are mentors and coaches using their experience to direct students to where they will find the knowledge themselves.  The modern classroom is around peer to peer learning so we are seeing collaboration and shared knowledge where the teacher is coach and mentor.

PML:  So they are becoming facilitators?
DW: It’s knowledge facilitation. This first came home to me 15 years ago. I won a large government award to develop a community commerce and knowledge network.  The aim was to help small businesses in the UK adopt technology to make UK PLC more competitive.   I wanted to create network of champions in my local community believing nothing like this existed when I came across BigFern, a community portal which had many of the facilities I had planned for my project. .  I had no idea it was there and whoever had designed it had done a really good job, so I contacted them.  A guy walked into my office who looked familiar – then I realised it was my milkman!  He had created the network in his spare time, with a PC built from spare parts and he had taught himself to write html!

What is remarkable about this too is that it is far from unique all people are now empowered by technology.  It is also important to realise what is on your own doorstep, I needed to have some assistance with video and put out a notice on this network and found two people, one was a special effects man from Harry Potter and the other a BBC cameraman – both living within 5 minutes of my home!

PML:  Knowledge is all around us.  So, how will accreditation work in the future, surely it will be a challenge to maintain the benchmarks and standards we have now?  How can it be measured and the standards be ensured when we are moving away from traditional teaching?
DW: This is where the games industry will play a very big part.

When you play a video game, the sophisticated ones use AI to detect how good you are and how much you know.  So for education the game will seek to understand  ‘how much do you know’? It will then adjust the game to focus on areas where you need to improve.  This is the answer to the future of education. It is the assessment part which is not done by examinations.   Assessment will be continuous and done digitally and electronically.  It will enable you to identify where your competencies and strengths like and moreover to identify your personality and profile traits.

These details will go into an e-portfolio which stores knowledge about you and your learning competencies electronically.

It will be managed by humans at first but eventually when the AI technology gets more mature that is what we will find.  A more personalised, more self-directed learning path where you test yourself in areas of prime interest and that will direct you into career paths which are more suited to your capabilities. There will be mechanisms to test you and build your knowledge and competencies managed by AI.

PML:  What about the privacy issues here? It reminds me about the health passport with information being stored that can be used against you by an insurance company or prospective employers!?  Students might not want this type of material being openly available.
DW:  The cloud can be used to share data and then have that anonymised so you can choose to keep it private.

However it can benefit you if you choose to share it.  Imagine car insurance: young drivers can have a black box fitted in their car data about their driving behaviour.  This is shared with an insurance company called Ingenie.  It is entirely down to the individual,  if you want to share and improve your driving and benefit from that, you can choose to share this data with a third party for the benefit of the community.  However, it should be part of a contract that says I want to know how to manage my lifestyle or my health better.  I am happy to share it as long as I know it is secure and not used against me.  I would also like to see how I am doing against other people in my community and also get some help from the medical community.  You could go to an insurance company and show them what you are doing to manage your health to ask them to reduce your premiums.

PML:  Your knowledge in these areas is clearly very broad.  What can you bring to IORMA and how can this be used to help IORMA associates?
DW: My expertise is in future technology.  Specifically gamification and enabling technologies combined to provide competitive advantage.  I have a good vision of where technology is taking us, the cloud and AI.   I have written and researched much about this and how disruptive technologies will impact retail sectors and also what opportunities are out there that are going to impact this or indeed other sectors.  In fact I am writing an article for a new book based around impact of disruptive technologies on health care and all sectors of society which, incidentally, are in for a difficult period.

PML:   Why will it be difficult for them?
DW:  Technologies are appearing now which will change the way many sectors will operate. Sectors which used to be stable environments and which are used to the way things have always been done. I’m talking about the medical profession for instance and also banking as people will want more control over managing their own finances and won’t accept a lot of current practices – bankers are worried.  Just take the one example of the Starbucks card.  When you realise that collectively there are millions of pounds stored which would otherwise be in people’s bank accounts.

PML:   Are you talking about the growth of charge cards with money loaded onto them such as that Utility Warehouse is promoting?
DW:   Yes indeed, this may well be the thin end of the wedge and it will have a significant effect on the world of commerce.

PML:  This is fascinating and very relevant to the work IORMA is involved in – the future of consumer commerce.  Coming back to IORMA itself, could you explain from your perspective what the value is for prospective associates of IORMA and those using its services?
DW: IORMA  has a very rich core of talent with its board and advisory board and it is this experience which blends knowledge built up over many years together with people who have an understanding  and a vision of how commerce is going to change in the future, which is its unique feature.

Apart from this I would highlight two points:

The first is the data analytics side and the plans IORMA has for collecting and making available to its associates so that they will be able to use this to track better what is happening in the world of commerce.

The second is to make use of the pool of talent that IORMA has on its board for consultancy, for keynote presentations and for generally acting as a think tank on the way commerce is going to emerge in the future.

PML:  The ‘think tank’ side of the events I have attended have been incredibly  revealing.  Moreover I feel they have been reassuring in confirming where those at the hard edge of consumer commerce are on the same page, or not. The talent pool you describe represents a reliable and representative sample of the retail value chain. Thank you for your insights David.