Retailer Adoption Research Articles

Influence of Technology Readiness in the Adoption of Augmented Reality Applications in Retailing

Forget crowded aisles and unending product comparisons. Imagine yourself trying on clothes virtually, visualizing furniture in your living room before making a purchase, or even discovering information about products that are hidden behind interactive labels. Augmented reality (AR) promises to revolutionize the shopping experience, but widespread adoption depends on understanding user motivations. This study explores what motivates consumers to interact with this emerging technology to determine the “why” behind AR retail adoption. Although AR has the potential to transform many industries, consumer technology readiness is a critical factor that will determine how widely adopted AR becomes. This research investigates how a person’s ability, willingness, and confidence in their ability to use technology serves as a vital link between the potential for innovation and its practical implementation. The study investigates the effects of performance expectancy, price, effort expectancy, hedonic motivation, and technological readiness on adoption behavior using a partial least squares-structural equation modeling analysis of data from 306 online survey respondents. The results show that price and performance expectancy are significant drivers, but hedonic motivation and effort expectancy have no impact on adoption behavior. Notably, one factor that strongly influences the adoption of AR apps is technological readiness. These findings provide retailers with insightful advice, telling them to prioritize app value, affordability, and user-friendly design while also realizing how crucial it is to accommodate different degrees of technological comfort. Retailers can effectively use AR technology to improve customer engagement and accelerate adoption in the retail space by knowing these key drivers.

Optimal livestream selling strategy with buy-online-and-return-in-store

To reduce the adverse impacts of consumer returns, retailers have taken a series of measures to reduce the return rate and improve the consumer purchasing experience. These measures include opening a self-run livestream channel and allowing online consumers to buy-online-and-return-in-store (BORS). In practice, there are remarkable heterogeneities between the two strategies: Some retailers provide one or both strategies, while others do not. Furthermore, it is unclear how the introduction of a self-run livestream channel will impact a retailer's adoption of BORS. This paper develops a theoretical model to investigate a retailer’s optimal decisions on adopting a self-run livestream selling or BORS service. By comparing the retailer’s equilibrium profits under four strategies, we identify the conditions for adopting each strategy. The retailer’s optimal strategies mainly depend on the in-store return handling cost and the face value of the coupon in the self-run livestream channel. Furthermore, we find a counterintuitive result that if consumers are offered a relatively high coupon, the introduction of a self-run livestream channel reduces the threshold for the retailer to provide BORS service. We extend the model by considering an endogenous coupon face value and find the main results are still valid.

Mobile application e-grocery retail adoption challenges and coping strategies: a South African small and medium enterprises’ perspective

AbstractThis paper explores how small and medium-sized e-grocery mobile application retailers evolving within the geographical context of South Africa and operating in the urban, township, and rural areas respond to theoretically and emerging field-based e-business and e-grocery adoption challenges, respectively. The study used semi-structured qualitative interviews to explore the coping strategies of e-grocery mobile application retailers to mitigate technological, organizational, and environmental (TOE) adoption challenges. The significance of small grocery adoption strategies related to context informs e-grocery adoption from the evidence generated in other small e-grocers and for the superior grade of TOE (or theoretical) knowledge sought from the inevitable evolving mobile application and digital grocery markets. The findings reveal that specialist skills and unified team production are crucial conduits for lowering the TOE barriers to e-business and e-grocery adoption. They also reveal the interconnected resource orchestration, shared value, and social inclusion strategies used to mitigate various e-business and e-grocery challenges.

Crypto Trading and Bitcoin Prices: Evidence from a New Database of Retail Adoption

Crypto Trading and Bitcoin Prices: Evidence from a New Database of Retail Adoption

Quick Response Under Strategic Manufacturer

Problem Definition: Quick response is a classic operations strategy, under which a retailer can place a second order for rapid replenishment during the selling season after learning more about market demand. This paper examines the value of quick response when a strategic manufacturer can either dynamically charge wholesale prices for different orders or commit to fixed wholesale prices at the beginning. Academic/Practice Relevance: Quick response has been widely viewed as an effective strategy for firms to match supply with demand. In practice, however, a manufacturer may strategically react to a retailer's adoption of quick response. This paper aims to investigate the value of quick response under strategic manufacturer, which has not been explored in the literature. Methodology: We develop a game-theoretic model to analyze the main drivers behind the interaction between the retailer and manufacturer. Results: We find that quick response can harm the retailer and the entire supply chain when demand uncertainty is in a medium range. This is due to the interplay of four different effects that will be delineated in the paper: the risk mitigation effect, the information surplus extraction effect, the strategic inventory effect, and the wholesale pricing flexibility effect. In addition, upfront commitment on wholesale prices does not mitigate the negative effect of quick response, and will even lead to a lose-lose outcome in most situations. Managerial Implications: The above results caution firms to be careful when adopting quick response, especially with strategic manufacturers. This research also characterizes the conditions under which quick response will be valuable, which offers a useful guideline for managers when assessing the quick response strategy.

A Systematic Literature Review and Analysis of Mobile Retailing Adoption

The purpose of this study is to provide a comprehensive updated review and analysis of mobile retailing adoption. Although research on mobile channel utilization has increased significantly in recent years and many new studies on this topic have been published, research has not yet provided a clear structure regarding how consumers’ expectations have advanced in relation to mobile retailing adoption. Thus, this study synthetizes the mobile retail adoption literature and develops a framework for it. Our systematic literature review analyzed 94 scientific articles that were published between 2010 and 2018 to determine customers’ different expectations and demands during different mobile channel adoption stages. Our findings enhance the understanding of how retailers can serve customers in each stage. In addition, our framework provides opportunities and provokes questions for further research as well as shifts the focus from technology adoption-oriented topics toward customer journeys.HighlightsCustomers’ previous mobile shopping experience, their stage of mobile channel use, and the retailing context determine which features are the most valuable.In the initial stages of use, when customers are unfamiliar with mobile technologies and thus lack experience on mobile channels, they prefer utilitarian benefits.In later stages, when customers are familiar with mobile channels, they value more hedonic aspects.A mobile channel is not seen as a purchasing channel but rather as a searching channel. If retailers succeed in turning a mobile channel into a purchasing channel, they can provide deeper and more satisfying customer experiences.

Money-back guarantee and personalized pricing in a Stackelberg manufacturer's dual-channel supply chain

We examine customer returns and pricing strategies in a manufacturer's Stackelberg supply chain using game-theoretic models. In the supply chain, the manufacturer sells a high-quality product through an independent retailer, and considers whether or not to open a direct channel to sell a similar but lower-quality product. We discuss how the retailer and the manufacturer with a direct channel should choose their customer returns and pricing strategies. We show that when the retailer implements a personalized pricing strategy (PPS), the addition of the direct channel benefits the manufacturer but always makes the retailer worse off, and this differs from the case when the retailer adopts a uniform pricing strategy. We find that if its net salvage value of the product is positive, the retailer should offer a Money-Back Guarantee (MBG) and implement PPS. In the direct channel, however, the manufacturer may offer an MBG even if the net salvage value is negative, and may implement PPS only if customer satisfaction in the direct channel is low. Under certain conditions, a win-win may result from both the retailer's adoption of MBG and PPS and the manufacturer's adoption of MBG in its direct channel, while the adoption of PPS by the manufacturer in its direct channel may lead to lose-lose for the retailer and the manufacturer. The implications of customer returns and pricing strategies, as well as the impact of these two strategies on prices, demands, and profits, are discussed.

FACTORS INFLUENCING E-COMMERCE ADOPTION BY RETAILERS IN SAUDI ARABIA: A QUANTITATIVE ANALYSIS

This paper presents the preliminary findings of a study researching the diffusion and the adoption of online retailing in Saudi Arabia. It reports new research that identifies and explores the key issues that positively and negatively influence retailers in Saudi Arabia regarding the adoption of electronic commerce. Retailers in Saudi Arabia have been reserved in their adoption of electronically delivered aspects of their business. Despite the fact that Saudi Arabia has the largest and fastest growth of ICT marketplaces in the Arab region, ecommerce activities are not progressing at the same speed. Only a tiny number of Saudi commercial organizations, mostly medium and large companies from the manufacturing sector, are involved in e-commerce implementation. Based on qualitative data, collected by conducting interviews with a sample population of retail sector decision makers in Saudi Arabia, both positive and negative issues influencing retailer adoption of electronic retailing systems in Saudi Arabia are identified. A number of impediments which include cultural, business and technical issues were reported. Facilitating factors include access to educational programs and awareness building of e-commerce, government support and assistance for ecommerce, trustworthy and secure online payment options, developing strong ICT infrastructure, and provision of sample e-commerce software to trial. While literature reveals that government promotion has had limited effects on the diffusion of e-commerce in most countries, this study significantly indicates government promotion and support as a key driver to online retailing in KSA.

Self-started versus Family Inherited Businesses: A Comparison of Managing Unorganized Food Grocery Retail Stores in an Emerging Economy

This study aims at analyzing the difference in food grocery retail store logistic management between self-started and family inherited retail businesses. The study has been carried out through in-depth personal interview of 40 unorganized grocery retail stores in Lucknow Uttar Pradesh, using a structured questionnaire. Simple statistical techniques such as descriptive statistics and cross-tabulation have been applied on the survey data. Chi-square test has been used to analyze the statistical difference in the processes of retail store management between self-started and family inherited business grocery stores. Findings indicate that those who joined the family run businesses are younger in age as compared to the ones who self-started their grocery stores. Similarly, the average retailing experience of self-starters is (10 years) and family inherited retails is (5 years), showing significant difference statistically, implying that both the groups have different level of retailing experiences. The study also analyzes the difference in methods of logistics management across the different types of unorganized retailers. Analysis indicates that both self-started and family inherited retail businesses follow similar management practices. There are a limited number of in-depth studies on unorganized retail operations based on primary data analysis. The findings of this study provide practical insights on difference in profile of self-started versus family inherited retail businesses and adoption of logistics processes in managing their stores.

Early Adoption of Modern Grocery Retail in an Emerging Market: Evidence from India

This paper investigates early stage “modern” grocery retail adoption in an emerging market using primary household-level panel data on grocery purchases in India’s largest city, Mumbai. Specifically, we seek insight on which socioeconomic class is more likely to adopt, and why. We model adoption as a two-stage process of modern retail choice followed by category expenditures within a shopping trip. We find a nonmonotonic (V-shaped) relationship between socioeconomic class and preferences for modern retail; specifically, modern retail spending and relative preference are greater among the upper and lower middle classes, relative to the middle middle class. Upper middle class preference of modern retail is driven by credit card acceptance, shorter store distance (relative to other segments), and higher vehicle ownership; whereas lower prices and low travel costs drive the preferences of the lower middle class. Modern retail is preferred more for branded and less for perishable categories. Interestingly, the lower middle class share of modern grocery retail’s revenues is largest, and this share is projected to grow as prices fall and store density increases. To address concerns of endogeneity and generalizability, we replicate the key results with a “conjoint” type study with exogenous variation in price and distance in two cities—Mumbai and Bangalore. We discuss implications for targeting and public policy in emerging markets.

A study on the impact of consumer risk perception and innovativeness on online shopping in India

Purpose – The purpose of this paper is to develop and empirically test a conceptual model to establish how consumer innovativeness can be used as a variable to positively influence online retailing adoption intention both directly and reducing consumer perceived risk (PR). Design/methodology/approach – The literature concerning personal innovativeness toward information technology and major components of PR have been systematically reviewed to develop a conceptual model. The impact of innovativeness and PR on online shopping adoption intention has been empirically validated by structural equation modeling using a sample of 433 internet users in India. Findings – Results reveals consumer innovativeness as a key construct to improve online retail adoption intention both directly and by its effective role in reducing consumer risk perception of using internet channel for making purchase of physical goods. Originality/value – There is a lack of studies which connect consumer innovativeness and PR in the online retailing context especially in Indian scenario. The results expand one’s knowledge on this relationship, propounding interesting empirical evidence of the model among current and potential online shoppers.

Retailer Adoption of Mobile Payment

This qualitative study aimed to identify the motivating factors and the challenges related to the adoption of mobile payment (mPayment) by small business retailers. Data collected from semi-structured personal interviews with a small group of participants were analyzed applying a content analysis approach. The findings indicate that retailer demand for mPayment was motivated mainly by perceived customer expectations for a convenient (faster) way to pay using the ubiquitous mobile technology, as well as by the perceived efficiency of mPayment leading to revenue increase. Challenges to mPayment adoption included, among others, the need to compete with already established point-of-sale payment technologies and the lack of information about mPayment leading to uncertainty about its comparative advantages. The study contributes to the body of knowledge by developing and exploring a merchant oriented mPayment adoption model. The factors identified as adoption drivers and challenges provide an insight into New Zealand retailer perspectives on mPayment, and the grounds for recommendations to mPayment service providers.

Should Modern Retail Target the Upper or Lower Middle Class? A Customer Selection Dilemma in Emerging Markets

The paper investigates early stage “modern” grocery retail adoption in an emerging market using primary household level panel data on grocery purchases in India’s largest city, Mumbai. Specifically, we seek insight on which socioeconomic class is more likely to adopt, and why. We model adoption as a two stage process of modern retail choice followed by category expenditures within a shopping trip. We find a non-monotonic (V shaped) relationship between socioeconomic class and preferences for modern retail; specifically modern retail spend and relative preference are greater among the upper and lower middle classes, relative to the middle-middle class. Upper middle class preference of modern retail is driven by credit card acceptance, shorter store distance (relative to other segments) and higher vehicle ownership; while lower prices and low travel costs drive the preferences of the lower middle class. Modern retail is preferred more for branded and less for perishable categories. Interestingly, the lower middle class share of modern grocery retail’s revenues is largest and this share is projected to grow as prices fall and store density increases. To address concerns of endogeneity and generalizability, we replicate the key results with a “conjoint” type study with exogenous variation in price and distance, in two cities—Mumbai and Bangalore. We discuss implications for targeting and public policy in emerging markets.

Towards a Further Understanding of the Antecedents of Retailer New Product Adoption

In addition to the traditionally investigated profit-drivers of retail adoption, such as gross margin, trade support, consumer marketing support, and product uniqueness, the authors investigate to what extent relatively under-investigated variables, such as relationship variables and category variables, are potential antecedents of retailers’ new product adoption decisions. Based on a sample of 392 new product adoption decisions by buyers of a Dutch food retailer, the authors provide evidence that both relationship and category variables do matter in new product adoption decisions by retailers. They show a significant negative effect of relationship dependence, and a significant positive effect of relationship length on a retailer's new product adoption probability. Furthermore, the authors show that higher levels of expected category growth due to the new product introduction are associated with higher levels of retailer adoption probability. Finally, in contrast with all previous retail adoption studies, this study shows a significant, positive relation between the relative gross margin of the new product and the retailer adoption probability.

Factors Influencing e‐commerce Adoption by Retailers in Saudi Arabia: a qualitative analysis

AbstractThis paper presents the preliminary findings of a study researching the diffusion and the adoption of online retailing in Saudi Arabia. It reports new research that identifies and explores the key issues that positively and negatively influence retailers in Saudi Arabia regarding the adoption of electronic commerce. Retailers in Saudi Arabia have been reserved in their adoption of electronically delivered aspects of their business. Despite the fact that Saudi Arabia has the largest and fastest growth of ICT marketplaces in the Arab region, e‐commerce activities are not progressing at the same speed. Only a tiny number of Saudi commercial organizations, mostly medium and large companies from the manufacturing sector, are involved in e‐commerce implementation. Based on qualitative data, collected by conducting interviews with a sample population of retail sector decision makers in Saudi Arabia, both positive and negative issues influencing retailer adoption of electronic retailing systems in Saudi Arabia are identified. A number of impediments which include cultural, business and technical issues were reported. Facilitating factors include access to educational programs and awareness building of e‐commerce, government support and assistance for e‐commerce, trustworthy and secure online payment options, developing strong ICT infrastructure, and provision of sample e‐commerce software to trial. While literature reveals that government promotion has had limited effects on the diffusion of e‐commerce in most countries, this study significantly indicates government promotion and support as a key driver to online retailing in KSA.

Research Note—Revisiting “Retailer- vs. Vendor-Managed Inventory and Brand Competition”

In a recent paper, Mishra and Raghunathan (Mishra, B. K., S. Raghunathan. 2004. Retailer- vs. vendor-managed inventory and brand competition. Management Sci. 50(4) 445–457) claimed that retailers prefer vendor-managed inventory (VMI) because it restores competition among manufacturers and encourages them to maintain a higher stock of their own brand under VMI than would be maintained under retailer-managed inventory (RMI). This paper shows that these results do not hold in general: each manufacturer's stocking level may be higher under RMI than under VMI and the retailer may lose by adopting VMI depending on the profit margin of the retailer relative to that of the manufacturers, the magnitude of the holding costs, and the intensity of brand competition. Numerical examples show that the effect of brand competition on the system is not so significant and the transfer of holding cost to the vendor is the key incentive for the retailer's adoption of VMI.

Efficient replenishment in the distribution channel

Efficient replenishment (ER), a business process that involves the reduction of order cost to facilitate deliveries of goods from the manufacturer to the retailer, is becoming increasingly important in distribution channel management. While a well-executed ER program is expected to lower total channel costs and increase channel profit, very little is known about how this incremental channel profit is distributed between the manufacturer and the retailer and how it varies across the two common channel relationship structures, retailer price leadership and manufacturer price leadership. In this paper, we develop the conditions under which the manufacturer and the retailer gain more or less from the adoption of ER based on a game theoretic channel model of bilateral monopoly under the two channel relationship structures. We develop analytic results on the impact of ER on purchase quantity, price and the distribution of profits in three cases, namely, (1) when only the retailer adopts ER, (2) when both the manufacturer and the retailer adopt ER, and (3) when the manufacturer and the retailer are vertically integrated in the distribution channel, which adopts ER. The results, which can be generalized for all demand functions, show that the manufacturer benefits from the retailer's adoption of ER only when the manufacturer's holding cost relative to the retailer's is sufficiently large, relative to its order cost relative to the retailer's. By adopting ER, the retailer gains more than what the manufacturer gains even if the manufacturer is the price leader. Both the parties are likely to gain more if they both adopt ER than if only the retailer adopts ER. The incremental channel profit due to the retailer's ER adoption is highest in a vertically integrated distribution channel and is greater in a retailer-led channel relationship than in a manufacturer-led relationship.

Market Roll-Out and Retailer Adoption for New Brands

This paper proposes a descriptive model of the spatial and temporal evolution of retail distribution for new packaged goods. The distribution model postulates separate processes for local market entry by manufacturers, and adoption by retailers given entry. Of special interest is whether retail adoption occurs along a competitive network with retailers as nodes and overlapping trade areas of these retailers as links. The model is calibrated on data covering the introduction of two very successful new brands in the frozen pizza category. For these brands, manufacturers sequentially enter markets based on spatial proximity to markets already entered (spatial evolution), and on whether chains in these markets adopted previously elsewhere (market selection). A retail chain adopts new brands based on the adoption timing of competing chains within its trade territory (competitive contagion) and on the fraction of its trade area in which the new brand is available (trade area coverage). The effects of market selection and of trade area coverage create dependencies between market entry and retail adoption. Because of these dependencies the attraction of a particular market as a lead market depends on its location in the geographic structure of the U.S. retail trade.

An Empirical Inquiry into New Subscriber Services under Interdependent Adoption Processes

This article estimates dynamic diffusion systems developed earlier by Mesak and Darrat (2002) for newsubscriber consumer services. Each system consists of two equations, one for the retailer adoption process and another for the consumer adoption process. Using diffusion annual data related to the cable TV industry in the United States, three alternative interactive systems based on the Bass (1969) model are estimated and contrasted in terms of their predictive power. The empirical results support a two-way diffusion system that includes price. The incorporation of price proves critical for the system’s predictive power. In addition, a noninteractive, two-simultaneous-equations model as well as a single-equation model fail to provide adequate representation of the data.

Optimal Pricing of New Subscriber Services under Interdependent Adoption Processes

This article develops and optimizes dynamic diffusion systems for new subscriber consumer services. Each proposed system is composed of two differential equations, one for the retailer adoption process and another for the consumer adoption process that incorporates price. Several of such systems are optimized using optimal control methods. Presence of interaction is found to significantly influence the qualitative characterization of pricing policies of new subscriber services. Furthermore, even when interaction is not present, the derived characterization of optimal pricing policies proved to be very different from those reported in the literature for new consumer durables.