Retail Experience Research Articles

Analyzing the Influence of COVID-19 on the E-Commerce Customer’s Retail Experience in the Supermarket Industry: Insights from Brazil

Background: E-commerce’s convenience, speed, and ability to overcome geographical barriers have made it increasingly popular across industries. This study analyzed the impact of the COVID-19 pandemic on customer experience and satisfaction in supermarket retail e-commerce in the Brazilian market. The objective was to understand how the pandemic influenced satisfaction in this sector. Methods: A survey research method was employed, utilizing the Critical Incident Technique to identify key quality dimensions important to customers. A total of 133 valid responses underwent exploratory factor analysis. Results: Data analysis identified three dimensions significantly affecting overall customer satisfaction. “Presentation of Products in the Application (app)” had the highest correlation, while “Delivery Logistics” had the lowest. However, when considering the COVID-19 factor, “Delivery Logistics” showed the highest correlation. This indicates that the dimension most affected by the pandemic has the least impact on overall satisfaction in supermarket e-commerce. Conclusions: The study emphasizes the significance of understanding customer satisfaction in supermarket e-commerce, not just during the COVID-19 pandemic but also its post-pandemic consequences. Retailers should prioritize improving product presentation in apps, as it greatly influences overall satisfaction. Addressing the pandemic’s impact on delivery logistics is also crucial to ensure competitiveness in the e-commerce market.

Nykaa: retailing decisions in an emerging market

Learning outcomes By working through the case and assignment questions, students will be able to conduct a marketing environmental analysis to aid strategic decisions; analyse the first-mover advantages of a retail firm and how these can be sustained; comprehend online retail business models and the challenges therein; understand the trade-offs of online/offline retail experiences specific to an emerging market’s beauty and personal care sector; conceptualize and formulate actionable growth strategies that balance the individual and collective requirements of brick and mortar and retail e-commerce environments. Case overview/synopsis The case is set in 2022, right after Nykaa – the pioneer of beauty and wellness e-commerce platforms in India makes a blockbuster stock market debut in 2021. Starting in 2012 with a disruptive online model for selling beauty and wellness products online in India, Nykaa had come a long way with expansions in physical retail and other segments such as fashion. The firm, which initially aimed to be a virtual store, is now thinking of aggressively expanding in the brick-and-mortar retail space as it opens its 85th retail outlet. Falguni S. Nayar, founder and CEO of Nykaa, wanted to roll out 300 physical stores targeting 100 cities in India in the next couple of years. She aspired to establish Nykaa as a category leader as the “Indian Sephora” in the beauty and personal care market. Nykaa’s first-mover advantage in the online beauty and personal care marketplace worked well to establish it as a brand with positive endorsements by digital shoppers that enhanced the investment potential with potential financiers. However, the pandemic had brought every physical retailer to the online platform. Most e-commerce platforms dealing in grocery to lifestyle had added personal care products to their existing merchandise. Additionally, several start-ups had ventured into the online marketplace. Online was a cluttered marketplace with little to no differentiation. In this bloodbath, would the first-mover advantage for Nykaa in the online space still count as a competitive advantage? Nayar was all set to expand Nykaa’s physical presence aggressively. The concern was that the beauty and personal care segment had also moved online as a function of long stay-at-home periods. In the post-pandemic times, would the customer indeed revert to brick and mortar once again? Nykaa was also into product formulations, but so was every big and small player in the space. What was the differentiated winning formula for the consumer’s heart and mind? Complexity academic level The case can be effectively used in foundation courses in marketing and a wide range of specialized courses on marketing management (core/foundation course), retail marketing and e-commerce/digital marketing and e-commerce for B-school learners. The complex decision points faced by an innovative e-commerce start-up firm on its road to market expansion make the case suitable for niche courses such as Marketing for Start-ups. Moreover, learners in executive MBA programs with considerable experience can benefit from the case analysis that balances a growing retail company’s long- and short-run objectives. Supplementary materials Teaching notes are available for educators only. Subject code CSS 8: Marketing.

Improving Customer Experience Using Artificial Intelligence in Online Retail

Abstract This paper presents research on precursors that can generate unique and attractive retail experiences when using artificial intelligence. Among them are safe technology, ethical aspects, and customer-friendly technology. The motivation for choosing this topic is that it gives a global, current perspective and arouses interest, curiosity, uncertainty, even fear. Quantitative research was implemented with the help of an online questionnaire. The conceptual model derived from the literature was then analysed through regression analysis. Data collected from 272 consumers allowed the research hypotheses to be validated. The results reveal that artificial intelligence applied in retail is the solution for achieving higher performance in the retail field, but without being used unethically. The results provide an overview of AI in retail today, with survey participants expressing confidence in AI’s ability to improve their shopping experience. The originality of the research consists of approaching for the first time in the considered emerging market the perception of consumers toward the vectors that enhance their in-store shopping expectations. Considering the direction in which technology is evolving and based on the arguments of specialists, it can be stated that Artificial Intelligence will represent an element of distinction and competitive advantage. Companies in the retail sector that will invest in the development of Artificial Intelligence will benefit in the long term. Artificial intelligence should not be absent from the retail context, and further investment should be made in its development. The present study did not determine the actual purchase experience in virtual retail stores but was based on a hypothetical situation. Also, this study used a limited sample of respondents, with only Millennials participating. A future research perspective could be based on this study, but using a larger and more representative sample.

Co-creating affective atmospheres in retail experience

Despite substantial research focusing on retail atmospheric elements and the creation of social atmospheres, a holistic theory of atmosphere addressing consumer heterogeneity remains elusive. This research examines how embodied interactions with retail socio-material elements and consumers’ expertise levels create affective atmospheres. Through a three-year-long ethnographic study of winery tours, we identify three core elements in the co-creation of affective atmospheres: material features, sensory modalities, and social interactions. We use text mining to build corresponding dictionaries and analyze customer review data from several retail sites, demonstrating the positive effect of retail atmospherics on customer sentiment. Focusing on consumer segmentation, we further show that different levels of consumer expertise (novices, enthusiasts, and experts) influence the subjective perception of atmospheric elements and the way staff members are expected to behave to jointly create affective atmospheres. Based on our multi-method findings, we offer theoretical and managerial implications that are generalizable to broader retailing contexts.

Offering Memories to Sell Goods? Pricing and Welfare Implications of Experiential Retail

Problem definition: In an environment where consumers’ rising valuation of Instagrammable memories drives their spending from products to experiences, retailers offer experiences to attract consumers back to their stores. Yet, it is not obvious under which settings consumers can benefit from these experiences and raise retailers’ profits. Methodology/results: We use a random utility model for consumer choice in both monopoly and duopoly settings. For the latter, we pose a game-theoretic model to analyze the equilibrium prices, profits, and consumer welfare for various problem cases. We show that medium-quality experiences can lower the product sales and store traffic below the level when no experience is offered. Sufficiently low- or high-quality experiences overcome this issue, making the consumers better off. Yet, the former presents the only profitable option when a single retailer in the market offers an experience. In contrast, when both retailers adopt experiences, low-quality experiences may not be profitable, and the retailers would need to adopt even higher-quality experiences, which lead to a “win-win-win” outcome for the two retailers and consumers. A fee structure for the experience elevates retailer profits but can turn stores into outlets where consumers visit to purchase experiences and not products. When experiential retailing is the common practice in the market, it enables “win-win-win” outcomes when free experiences fail. Managerial implications: Being the first to study this new retail format, our results contribute to the ongoing debate on the settings under which experiential offerings are beneficial for the retailers and consumers and highlight that there is no one-size-fits-all strategy. Our results show that experiences affect main product sales in nonobvious ways, especially in competitive markets. In a (post-)pandemic world where retailers try to attract consumers back to stores, we offer insights that can guide retailers in the process.Supplemental Material: The online appendix is available at https://doi.org/10.1287/msom.2021.0339 .

More than meets the eye: In-store retail experiences with augmented reality smart glasses

Augmented reality smart glasses (ARSGs) promise to enhance consumer experiences and decision-making when deployed as in-store retail technologies. However, research to date has not studied in-store use cases; instead, it has focused primarily on consumers' potential adoption of these devices for everyday use. Nor have prior studies compared ARSG uses with the now-common use of AR on touchscreen devices. The current research addresses these knowledge gaps by examining whether ARSGs outperform AR on touchscreen devices in the context of in-store retail experiences. Testing with an actual retail application (n = 308) shows that ARSGs are superior to AR on touchscreen devices for evoking consumers’ perceptions of immersion and mental intangibility. Furthermore, this superiority leads consumers to evaluate their shopping experiences more positively in terms of their decision comfort, satisfaction, and ease of evaluation, with significantly positive effects on their purchase intentions. These results highlight the relevance of implementing ARSGs in-store and provide retailers with recommendations for effective ARSG strategies.

Quantifying the influence of customer experience on consumer share-of-category

Customer experience is an all-encompassing construct, and most companies go to considerable lengths to create memorable, extraordinary experiences. Nevertheless, customers experience offerings, companies, and their brands very differently. Using one qualitative and three quantitative studies we explore customers’ experiences from a financial perspective by measuring and quantifying the linkages between these and customers’ share-of-category. When measured by means of customers’ share-of-category, customers demonstrate significantly different purchasing intentions and behavior. In addition, customer retail service experiences that influence the share-of-category differ significantly between customers with a low and a high share-of-category. We expand our knowledge of customer experience by highlighting that different customer groups may perceive a similar retail experience differently, leading to a different purchasing behavior and influencing their respective share-of-category. This study expands existing research by providing empirical evidence of the link between the customer experience and customers’ purchasing behavior.

Exploring the Role of Gamification in the Online Shopping Experience in Retail Stores: An Exploratory Study

Online retail shops increasingly implement gamified marketing strategies to enrich consumers’ online experience and increase engagement. This study aims to evaluate the ludic experience of consumers in online retail stores and the role of gamification and game mechanics in changing the online shopping experience. It seeks to assess, through a qualitative methodology, based on an exploratory study approach obtained through 30 interviews with Portuguese consumers, whether consumers have playful experiences when shopping in online retail shops and whether the introduction of game mechanics changes this experience by generating co-creation. The results show that online shopping can be playful and generate positive emotional benefits. However, gamification in online retail shops is not guided by a co-creation process, nor do game mechanics create greater online consumer engagement. There is a need to review how gamification is introduced in online retail shops, and strategies should be designed to co-create experience value and brand co-creation. This study is original, as it contributes to developing knowledge about gamification in the context of the online retail experience. Studies on this topic are scarce, and this study contributes to filling that gap.

Webrooming as the new retail experience: a smart-shopping perspective

PurposeWebrooming (i.e. searching information online and making the final purchase in a physical store) has become a popular shopping practice, but remains insufficiently studied. To address this, a research framework encompassing online and offline channel attributes (i.e. online review diagnosticity, online search convenience, expected price loss, offline purchase effort and offline after-sales service convenience), consumer traits (i.e. anticipated regret) and shopping experience (i.e. smart-shopping perception) as determinants of webrooming continuance intention is proposed.Design/methodology/approachThe proposed model was validated by conducting a questionnaire-based survey that yielded 354 useable responses. The data was subjected to partial least squares structural equation modelling and importance-performance map analysis.FindingsAccording to the obtained results, online review diagnosticity, offline after-sales service convenience and anticipated regret are the vital antecedents of webrooming continuance intention, while smart-shopping perception acts as the mediator.Originality/valueThe current study adds significantly to the body of knowledge about webrooming by validating the inter-relationships between online review diagnosticity, after-sales service convenience, anticipated regret, smart-shopping perception and webrooming continuance intention.

A Missing Site of Black Beauty History: The Black Beauty Supply Store

With(in) retail spaces, Black Americans operate in a space with historical ties to inequality, dehumanization, and exclusion. This qualitative study situates the Black beauty supply store within these political and culturally relevant histories. Millennial perceptions of beauty, relationship to their hair, and the history of Black beauty supply stores are briefly covered in the literature review. Black feminist thought and Black feminist geographies informed the data analysis of interview transcripts from 20 millennial Black women. The findings reveal that millennial Black women shop at the Black beauty supply store due to convenience and the variety in product assortment. Yet, the in-store surveillance and assumptions of criminality affect their psyche, resulting in disengagement from the store. Participants realized that fully satisfying beauty retail experiences do not exist for Black women. Despite this, millennial Black women continue to return to the store where they embrace and cultivate Black stylistic and beauty innovations.

Consumer-brand Relationships with AI Anthropomorphic Assistant: Role of Product Usage Barrier, Psychological Distance and Trust

ABSTRACT Human likeness in technology (i.e. AI anthropomorphic assistants) continues to transform and build relationships with consumers today. This study aims to examine the role of product usage barrier, psychological distance, and trust between physical AI anthropomorphic assistants and consumers to build brand relationships in the retail sector. Data was collected through a questionnaire from Indian consumers, and was analyzed, using the AMOS and SPSS PROCESS macro. The findings reveal that both product usage barriers and psychological distance do mediate the relationship between AI anthropomorphic assistants and consumer-brand relationships, while trust plays the role of a moderator. These findings are unique, and could assist retail managers in leveraging AI anthropomorphization of retail brands as part of building effective relationships with their consumers. We believe that the brands stand to benefit when retail managers make AI anthropomorphization an integral part of the retail experience.

Green Consumers’ Responses to Integrated Digital Communication in the Context of Multichannel Retail

Because of the fast rise of Internet commerce, a firm now has access to a plethora of new communication channels in addition to conventional ones and the problem is determining the best balance of physical and online channels. Due to the fact that their role in the value chain is to be close to green consumers, these businesses can effectively implement multichannel communication strategies. The purpose of this study is to determine how the use of integrated digital communication could change how green customers act in multichannel retail. The data from 396 respondents with multichannel retailing experience were collected to conduct an empirical investigation on social media platforms, i.e., Twitter, Facebook, and Instagram, which was then analyzed using structural equation modeling (SEM). The study’s findings emphasized the significance of planning, implementing, and regulating multichannel communication on the one hand and the impacts of recognizing the unique demands of integrated information and communication of green customers in multichannel retail on the other. The relevance of this study is that it provides insights into green consumer decision-making research and integrated digital communication to manage consumer relationships.

Offering Memories to Sell Goods? Pricing and Welfare Implications of Experiential Retail

Offering Memories to Sell Goods? Pricing and Welfare Implications of Experiential Retail

The Epic Game of Creating a Successful Gamified Co-Creation Strategy

This paper aims to explore consumer engagement with online retailers through gamification, the use of game mechanics, and co-creation. A qualitative methodology was used through an exploratory case study approach. The interviews were conducted with 30 Portuguese consumers. It was found that the majority of respondents do not consider online shopping as a substitute for other entertainment activities. Respondents stressed that in online shopping, the important thing is personal satisfaction and their needs. According to the Hexad model, these characteristics fit the free spirit gamer, the Barttle model the explorer and the BrainHex model the seeker. As far as co-creation is concerned, the results indicate that most of the interviewees do not value the tools that exist on the retailers’ websites which allow them to create their own product. This study provides recommendations for retailers to implement a successful co-creation gamification strategy. Companies need to include gaming elements to enhance the retail experience and increase sales. In turn, this can increase competitive pressures among retailers by improving the services and products they offer. This paper provides empirical support for the current dearth of qualitative studies on the role of gamification and co-creation in the online retail experience. Many of the findings of this study are not in line with existing literature, allowing the conclusion that gamification alone is no longer enough to engage the online retail consumer with products and brands, requiring co-creation for the effective engagement of this consumer.

Sustainability Through the “Nested” Luxury Retail Experience

The sustainable luxury retailing debate remains in its infancy, with a gap concerning the modalities to integrate sustainability into the luxury retail brand experience. This paper aims to shed light on the sustainability implications for competitive luxury stores embedded in their hosting cities. It addressed the relationship between place and luxury retailing, discussing the research hypothesis of the store-hosting city connections as modalities to integrate sustainability into the luxury store experience. This study proposes two case studies, Favotell in Shanghai (China) and Luisaviaroma in Florence (Italy). A cross-case analysis supports the definition of a multi-level framework explaining the concept store experience. The three “nested” spatial levels are the store, the fashion city and the urban brandscape. Findings reveal drivers facilitating, differentiating, and innovating the luxury store experience and suggest research avenues on the social and territorial dimensions of sustainable retailing.

Research on the Business Model of Luckin Coffee Under the Background of New Retail

The term “new retail” first appeared in 2016, when Ma Yun, the co-founder and former executive chairman of Alibaba Group, put forward the concept in his speech. Since then, “new retail” has become a hot word and means that traditional e-commerce has begun to change into new retail. The new retail concept and development mode has brought a great impact on the development of the traditional retail industry, and also opened up a new way for its development. Since its birth, the implementation of the concept has brought the most direct impression to the public that a variety of unmanned retail experience stores have sprung up on a large scale nationwide. The experience stores take mobile payment and face recognition as the development basis, and show the concept in front of the public more intuitively, so that people can understand the concept of online payment and offline experience better, helping new retail win a lot of markets. This article will focus on the exploration of Luckin Coffee as a new retail coffee in terms of business model. Compared with the traditional coffee mode, the new retail coffee breaks the shackles of the physical space of the traditional coffee shop with the help of the Internet and meets the coffee consumption needs of users in multiple scenarios. At the same time, Luckin Coffee can accurately portray users and carry out targeted marketing through the data about consumption frequency and period of ordering coffee and light food category retained by users in the mobile app. Operation management, intelligent replenishment and scheduling and membership system establishment will be determined by the big data system of Luckin Coffee. The thesis makes an introduction of the realization means and profit analysis of Luckin Coffee’s new retail mode and briefly summarizes the reference significance of Luckin Coffee for other new retail industries.

Equity-Promoting Strategies in Online Grocery Shopping: Recommendations Provided by Households of Low Income

ObjectiveTo explore barriers and facilitators of online grocery shopping and identify community-driven strategies to promote equity in online food access. DesignThis qualitative study used a purposive recruitment strategy to conduct 11 focus groups and 5 in-depth interviews between November 2020 and March 2021. SettingData collection was conducted virtually with participants residing in diverse (majority urban) regions of Maryland. Paricipants44 primary household food purchasers with young children (aged < 8 years) eligible for the Supplemental Nutrition Assistance Program (SNAP). Phenomenon of InterestBarriers and facilitators of online grocery shopping and strategies elicited by the community to leverage SNAP and online food retailer services to reduce inequities in healthy food access. AnalysisWe coded and analyzed transcripts on the basis of the Socioecological Model, Theory of Planned Behavior, and an Equity-Oriented Framework. ResultsOverall, we identified 10 themes across all socioecological levels, all of which reflected both barriers and facilitators to online shopping: (1) individual: trust of shoppers, technology, (2) interpersonal: spousal/children needs, (3) community: safety and security, (4) organizational: retail experience and food quality, and (5) policy: SNAP and structural inequities. Participant recommendations included improving food access and communication with hired shoppers, implementing more payment/cost-saving options, and offering educational programming for SNAP participants on using benefits online. Conclusions and ImplicationsHouseholds of low-income identified barriers and facilitators of online grocery shopping across the socioecological levels, emphasizing the need for a multilevel approach to equity promotion. We recommend future work to explore the suggested actionable pathways, which involve delivery providers, grocery stores, nutrition educators, and policymakers leveraging online grocery features (ie, meal planning support) and policies (ie, expansion of the SNAP Online Purchasing Pilot to more retailers) to reducing deterrents (ie, delivery fees waived) for an equity-promoting online grocery environment.

A novel approach to alleviate data sparsity and generate dynamic fruit recommendations from point‐of‐sale data

SummaryRecommender systems have become a core part of the retail experience. Retailers often rely on recommender systems to help them drive more conversions through targeted communication and advertisements. However, recommender systems are not one size fits all. Specialized retailers require specialized recommender systems to consider various features, attributes, and dynamics about the product category. In this paper, we have proposed a novel fruit recommender system that generates dynamic recommendations while remediating the problem of data sparsity. We have developed a novel fruit recommender system that considers the temporal dynamics in the fruit market, like price fluctuations, fruit seasonality, and quality variations that occur throughout the year. To perform this task, we have used Recurrent Recommender Network (RRN), which uses the deep learning method Long Short‐Term Memory (LSTM) to implement the system model. To ensure that our work and results obtained are practical, we have worked in a real‐world setting, by tying up with a specialty fruit retailer based in New Delhi to get the real‐world Point‐of‐Sale (POS) data of consumers. The result of the study suggests our algorithm performs better than other benchmark algorithms along NDCG and RMSE metrics.

Predicting Order Cancellations for E-Commerce Domain: A Proposed Model Based on Retailing Experience

E-Commerce technologies enable contact between businesses and their suppliers for the aim of exchanging information such as purchase orders, invoices, and payments thank to the rapid development in information technologies. E-Commerce has become a particularly important concept and has revolutionized the retail space. Understanding customer behavior patterns is key to gaining competitive advantage and achieving business goals. Predicting the probability of order cancellations has become a very urgent need as it causes loss of revenue for the retailer. When dealing with day-to-day operations such as order processing, tracking and order cancellations, finding enough time to grow the business is difficult. Cancellations are an important aspect of retail industry revenue management. In fact, little is known about the factors that cause customers to cancel or how to avoid them. The aim of this study is to propose a model that predicts the tendency to cancel an order and the parameters that affect the cancellation of the order. This solution can identify key factors that cause orders to be canceled by analyzing historical transaction data. A custom modeling application has been created that helps automate the process of tracking order cancellations in real time and predict the probability of an order being cancelled. For this purpose, machine learning techniques (ML) such as Artificial Neural Network, Support Vector Machine, Linear and Logistic Regression, XGBoost, Random Forest are applied to provide a tool for predicting order cancellations. The Random Forest algorithm achieves the best performance with 86% accuracy and 88% F1-Score compared to the other algorithm. This work will help firms manage their inventories well and strengthen their actions regarding customer behavior.

The physical frictionless experience: a slippery slope for experience memorability of retail services?

ABSTRACT Service industries are increasingly creating physical frictionless experiences to reduce effort for customers so they are able to ‘just walk out’. However, frictionless experiences can reduce memorability which can in turn reduce share of wallet. The purpose of this paper is to explore the relationship between customer effort and experience memorability in a just-walk-out physical frictionless experience. Interviews were conducted with 30 customers using a simulated frictionless retail experience. The data were analyzed using thematic analysis. This study found that a just-walk-out physical frictionless experience consists of transferable positive and negative effort with physical, cognitive, and interpersonal components. A second finding was that the reduction of customer effort is facilitated by removing high interpersonal effort which is associated with a more forgettable, or slippery, experience. Individual differences that appear to play a role in desire for effortful human interaction, shopping value type, attitude towards technology and age were identified.