The Moderating Effect of Customer Trust on the Interaction between Strategic Innovation and Business Outcomes of Selected Online Retail Stores in Lagos State, Nigeria

Abstract

Business outcomes are fundamental to business continuity. Given the contributions that online retail stores have made in most developing and developed countries of the world by reducing buyers' stress, saving shoppers' time, and increasing sales and profits faster compared to traditional stores. However, the online retail stores' business outcomes are challenged by low management satisfaction, a decline in market size, market share, reduced competitiveness, and a reduced survival rate, which are probably due to the inadequate application of strategic innovation. Hence this study examined the moderating effect of customer trust on the interaction between strategic innovation and business outcomes of selected online retail stores in Lagos State, Nigeria. Survey research design was adopted. The population was 325 management and technical staff of six selected online retail stores in Lagos State, Nigeria. Total remuneration method was adopted and a sample size of 298 was found usable. A multistage sampling technique was adopted. A structured and validated questionnaire was adopted for data collection. Cronbach’s alpha reliability coefficients for the constructs ranged from 0.662 to 0.922. The response rate was 91.6%. Data were analysed using descriptive and inferential (multiple and hierarchical regression) statistics. Findings revealed that the effect of strategic innovation on business outcomes of the selected online retail stores in Lagos State, Nigeria was moderated by customer trust (β = -0.504, ΔR2 = 0.003, ΔF = 21.527, p = .000). The study concluded that strategic innovation dimensions affect the business outcome of the selected online retail stores in Lagos State, Nigeria. The study recommended that Online Retail Stores owners and managers should practice strategic innovation as well as promote customer trust so as to ultimately increase their business outcomes and achieve sustained market leadership. Keywords: Strategic innovation, Technological resources, Process innovation, Customer trust, Business outcomes.