Target (TGT 0.76%) is expanding its small format store initiative by opening a new concept focused on the $61 billion digital gaming industry.

Tech industry site Protocol said the retailer had a soft open for its new store called The Game Room, which is located in San Francisco on the site of its Target Open House location. Previously targeting the Internet of Things (IoT) and set up as a display room for connected home gadgets, the space is now geared toward the future of digital gaming.

People wearing virtual reality headwear and playing a video game.

Image source: Target.

Come and play

The purpose of The Game Room is to do more than just introduce you to cool, new gadgets -- it wants to immerse you in them. "We aren't just showing you tomorrow's gaming. We hand you a controller and invite you to take it for a spin," the company says on its website.

That means customers can access Google's Stadia or Apple Arcade via smartphones and tablets on display while exploring other virtual and augmented reality possibilities. There are areas to play the latest online games as well as to participate in tournaments.

The store lets Target understand not only what gamers want to play but how they interact with the technology, information they can transfer to their more traditional retail store formats. 

The IoT displays began as a way to introduce customers to what, when it first opened five years ago, was still a new concept, but the smart speakers and other connected devices eventually made their way onto Target store shelves. 

With an estimated $61 billion spent on digital gaming downloads, there's a good chance what consumers see in The Game Room will also eventually be found in one of Target's large format locations.