Retail Strategy Research Articles

Action research on circular economy strategies in fashion retail

PurposeThe aim of this study is to explore the role and impact of action research in the adoption of circular economy strategies by a fashion retail brand. This exploration is motivated by the need to address the underutilization of action research in management studies, despite its potential to foster a deep understanding of organizational processes and to drive positive transformations. The study seeks to illustrate how action research can contribute to the practical implementation of sustainability initiatives, specifically within the context of new environmental legislation and growing demands for sustainable practices in retailing.Design/methodology/approachThis research employs an action research methodology, particularly suited to the retail field, where understanding and influencing organizational processes are key. Through a detailed case study of a fashion retail brand, the study illustrates how action research facilitates the adoption of circular economy strategies.FindingsThe findings of this study underscore the effectiveness of action research in implementing circular economy strategies within the fashion retail industry. Specifically, it highlights how this approach has led to the successful reduction of waste and reintegration of products into their lifecycle.Originality/valueThe originality of this study lies in its thorough application of action research to measure and refine the outcomes of circular economy strategies in retailing. This novel approach provides substantial insights into the potential of the circular economy to drive practical innovations in business practices within retail.

Tailoring customer segmentation strategies for luxury brands in the NFT market – The case of SUPERGUCCI

This study navigates the intersection of luxury fashion brands and Non-Fungible Tokens (NFTs) in the digital realm. By examining customer segments within the luxury NFT market, this study unfolds insights into changing market trends, consumer behaviors, and brand strategies. Employing data mining approaches, XPath analysis and the k-means clustering algorithm, this study examines user characteristics and behavior on the OpenSea platform, the largest NFT marketplace, with a specific focus on the SUPERGUCCI NFT collection by Gucci. This study identifies three distinct clusters, namely, speculators, casual collectors, and cryptocurrency natives, as well as their characteristics and behavior. The findings illustrate the significant impact of NFTs on customer segmentation and engagement, offering strategic insights for luxury brands navigating technological advancements. As the luxury sector evolves, this study enhances understanding of NFTs' role in consumer engagement and retail strategy within the digital age.

Supply Strategies and Business Model Options for Online Retailers of Agricultural Products

Supply Strategies and Business Model Options for Online Retailers of Agricultural Products

Enhancing Environmental Awareness for Sustainable Retail: Analysis of the Buy-Online-and-Return-in-Store Policy Adoption Using Theory of Planned Behavior

This study explores the context of buy-online-and-return-in-store (BORS) policy from an environmental perspective and conducts a comprehensive analysis through the theory of planned behavior (TPB). Adding environmental awareness and awareness of consequences provides a new perspective on how sustainable practices can be enhanced through an omni-channel retail strategy. Survey responses from 405 participants were analyzed using structural equation modeling. Results show that attitudes, subjective norms, and perceived behavioral control are key determinants of practical BORS policy. The study found that environmental awareness significantly influenced BORS adoption directly and indirectly by enhancing perceived behavioral control, whereas consequence awareness primarily affected adoption by shaping consumer attitudes. Compared with consumers who choose to return online, consumers who prefer in-store returns show higher environmental awareness, highlighting the environmental advantages of BORS. In addition, the BORS policy improves overall shopping satisfaction by integrating the convenient process of online purchases and offline returns, allowing consumers to switch freely between different channels. These findings provide valuable insights for retailers and policymakers seeking to promote sustainable consumer behavior to effectively promote the importance of sustainable retail practices.

Channel-switching behaviour and customer deviance

PurposeUnacceptable behaviour in retailing – negative customer deviance (NCD) is rising, damaging retailers financially. Current research investigates forms of NCD by addressing its impact on employees but overlooks its effects on bystander-customers and their retail channel preferences. As channel switching within retailing is increasing unprecedentedly, this research investigates its correspondence with NCD encounters.Design/methodology/approachThis research uses structural equation modelling, based on data collection administered through a web-based survey of 1,008 customers of at least 16 years of age, to analyse the research model.FindingsThe findings reveal unexplored forms of NCD perceived by bystander-customers in retailing and their consequences, linking it to bystander-customers' ill-being, dissatisfaction with the shopping experience, a decrease in store commitment and an increase in their retail channel-switching intentions. Additionally, the research uncovers moderating variables.Practical implicationsThis research tests NCD dimensions and effects on bystander-customers, which indicate the need for retailers to address shopping values, attitudes and commitment through corrective, proactive and long-term strategic actions.Originality/valueAs one of the first studies to investigate the impact of NCD on bystander-customers' intentions to switch from store-based to online shopping, strategies for retailers are developed to help diminish and control NCD-induced threats to bystander-customers.

The Emergence of the Deconstructed Consumer: Exploring Shopping and Buying Behavior During the COVID-19 Pandemic

The coronavirus (COVID-19) that swept across the US has dramatically impacted consumer behavior. The abruptness of pandemic for individuals brought forth an opportunity for understanding the influence of COVID-19 on consumer responses. While there is a growing understanding that household spending has changed in response to COVID-19, there is a lack of a deeper understanding behind changes in consumer behavior, including consumer sentiment and motivations to alter consumption during this critical time. Therefore, this study explores the nature of buying behavior during the pandemic using an in-depth qualitative approach. Through semi-structured in-depth interviews, four major themes emerged from the data that comprise what authors term the “deconstructed” consumer. The deconstructed consumer was based on the following thematic areas: (i) “Do-it-Yourself” culture or DIY, (ii) passionate pursuits, (iii) community, and (iv) self-reflection and discovery. By exploring changes in consumption attitudes and behaviors as the crisis unfolds, we can develop an understanding of the consumer and suggest potential retailer strategy shifts that can be deployed to maneuver during uncertain times of crisis.

Gender differences in the effects of nostalgia on conspicuous consumption and impulsive buying

PurposeThe current study investigated the relationship between nostalgia, conspicuous consumption, and impulse buying and compared gender differences in the effects of nostalgia on conspicuous consumption and impulse buying.Design/methodology/approachA total of 307 college students in western Singapore were recruited. Confirmatory factor analysis and structural equation modeling were conducted to assess the psychometric properties of the scales and estimate model path coefficients. A multi-group analysis was conducted to test if the path coefficients in the research model varied across genders.FindingsThis study found that nostalgia had a positive influence on consumers’ conspicuous consumption, which in turn had a positive impact on their impulse buying of sport products. The results of the multi-group analysis also revealed significant differences across gender groups in that the impacts of nostalgia on conspicuous consumption and impulse buying were stronger for male consumers.Originality/valueThis study forges new ground by investigating the intricate dynamics among nostalgia, conspicuous consumption, and impulse buying in the context of sport. By delving into the relationships between them and exploring gender disparities in their effects, this study enhances our understanding of the pivotal role nostalgia plays in shaping consumer behavior in sport. In addition, the identification of gender-specific patterns underscores the significance of tailored marketing approaches for effectively engaging both male and female consumers. Overall, this study presents fresh perspectives that can inform the development of targeted marketing strategies for sport marketers and retailers aiming to optimize their offerings and promotional endeavors.

When should the fresh-food retailer embrace near-expired food commercialization?

Despite the potential of near-expired food commercialization (NFC) to recover value from unsold food, skepticism persists due to concern about its impact on fresh food margins. This study introduces a game-theoretic model to explore the optimal strategy and price-setting timing for the fresh-food retailer considering NFC. We find that the optimal strategy transitions from no NFC to partial and then to full NFC as the order quantity increases. Specifically, under full NFC, the fresh-food retailer with strong bargaining power and high perceived quality benefits from adopting clearance-priority pricing, which prioritizes the pricing of the near-expired food. Conversely, the retailer with limited power and lower perceived quality prefers fresh-priority pricing, which sets the retail price of fresh food first. Under partial NFC, while clearance-priority pricing generally yields profits, the high disposal cost may compel even powerful fresh-food retailers to switch to fresh-priority pricing to mitigate the risks associated with negotiation failures. We further analyze extended models to confirm the robustness of our findings. Our research contributes to the literature and guides practice by addressing common misconceptions about NFC.

A Risk Management Strategy under Transfer Pricing for Multi-National Supply Chain along the Belt and Road Initiative

The “Belt and Road Initiative” (BRI) drives international trade more and more frequently, making exchange rates and taxes unavoidable issues for multi-national companies. Thus, exchange risk uncertainty and tax saving planning should be considered in the operational decisions of a multi-national supply chain. This paper constructs a Stackelberg game model with four composite modes to explore the risk-taking and hedging strategy of retailers with reference-dependent psychology. The results show that: (1) exchange rate risk is transmitted through all subjects under the cost-plus transfer pricing strategy, while it is transmitted only between headquarters and retailers under the resale-price transfer pricing strategy. (2) No matter which subject bears the exchange rate risk, the motivation is stronger under the resale-price transfer pricing strategy. (3) The effect of futures hedging exchange rate risk is influenced by retailer reference-dependent psychology. When the reference dependence coefficient is low, and the risk of positive exchange rate fluctuations is too high, the retailer chooses to hedge its exchange rate risk. At this time, the transfer pricing strategy should shift to cost-plus, and the exchange rate fluctuation range that each entity can afford is larger than before hedging.

Sale of second-hand goods by consumers: mediating role of satisfaction between perceived value and behavioural intentions

ABSTRACT Sustainable retail strategies are promoting product reuse and recycling, and the current trend of shifting retail environment in a socially and ecologically conscious market requires understanding second-hand merchandise transactions. The present study on second-hand product sellers examines perceived value and their effects on satisfaction (mediator) and behavioural intentions. The results show that economic, social, emotional, relational, and moral/ethical values are unrelated to satisfaction and behavioural intentions. While popular and well-regarded Expectancy-Disconfirmation theory underpinning hypotheses contradict the findings, thus, concluded that differential consumers-to-consumer behaviour intentions exists while selling or purchasing second-hands goods vs. new products. The research contributes by empirically testing additional theoretical linkages of perceived value with satisfaction and behavioural intentions relationship in the context of the second-hand goods market.

Does outsourcing enhance consumer services and profitability of a dual-channel retailing?

In the era of digital commerce, the concept of dual-channel retailing has attracted increased attention. Dual-channel retailing increases the importance of outsourcing for an imperfect production process to enhance customer satisfaction. This study explores a sustainable dual-channel retailing strategies for an imperfect production process under a flexible production system. The manufacturer runs a production process prone to defects utilizes both offline and online channels for product sales. The manufacturer contemplates green investments to enhance the production efficiency and reduce waste and carbon emissions, alongside the possibility of outsourcing a portion of production to a partner. A mathematical model is developed to accounts for these factors and analyzes the optimal allocation of products between channels, pricing strategies, production rates, and investments amount to reduce carbon emissions. The model incorporates demand sensitiveness to green practices and channel's selling price. Results of this research are directed towards offering significant perspectives for organizations that aspire to attain a harmonious equilibrium among financial profitability, ecological sustainability, and addressing deficiencies in their manufacturing procedures in a dual-channel retail setting through subcontracting. Numerical illustrations exhibit that partial outsourcing enhances system's profit by 2.03%, whereas investments to reduce carbon emissions enhance the profit by 4.95%. Flexibility in the production process helps to increase the profit by 13.50%, and channel coordination helps to enhance the profit by 38.54%.

Low-Carbon Supply Chain Decision-Making and CSR Strategy Evolution Analysis Considering Heterogeneous Consumer Preferences

Decision-making regarding the low-carbon supply chain, considering corporate social responsibility (CSR) and the heterogeneous preferences of consumers, has become an urgent topic to be explored. This paper explores the decision-making problem of a low-carbon supply chain considering the heterogeneous preferences of consumers under different CSR situations, analyzes the influence of important parameters on each equilibrium solution, compares the size relationship of each equilibrium solution under different CSR situations, and verifies the conclusions obtained through numerical simulation. Then, based on the obtained equilibrium solution, a CSR evolutionary game model of the low-carbon supply chain is constructed, and the evolutionary stability strategies of the two sides on the CSR game are solved. Finally, the evolutionary trajectory of the game system is intuitively presented using a simulation method, and the influence of the main parameters on the evolutionary trends of the two sides is analyzed. The findings are as follows: (1) When both manufacturers and retailers undertake CSR, the retail price and wholesale price are their lowest, while carbon emission reduction, total market demand, manufacturer utility, retailer utility, and supply chain total utility are the highest. (2) When a company undertakes CSR, carbon emission reduction, total market demand, manufacturer utility, retailer utility, and supply chain total utility all increase with the increase in the CSR degree of the company and the ratio of the potential scale of low-carbon consumers to the potential scale of ordinary consumers. (3) The evolutionary stability strategy for both manufacturers and retailers is to undertake CSR. In addition, the initial proportion of manufacturers and retailers that undertake CSR, the low-carbon preference of low-carbon consumers, and the increase in the ratio of the potential scale of low-carbon consumers to the potential scale of ordinary consumers can encourage both members of the supply chain to undertake CSR.

Sustainable Brand Resilience: Mitigating Panic Buying through Brand Value and Food Waste Attitudes Amid Social Media Misinformation

This study investigates the relationship between user-generated content on social media and panic buying, with a focus on how attitudes towards food waste and brand value act as moderating variables. Using Partial Least Squares Structural Equation Modeling (PLS-SEM), data from an online survey with 370 responses were analyzed. The findings show that user-generated content significantly contributes to the dissemination of inaccurate information, which in turn triggers panic buying. However, the impact of inaccurate information on panic buying is moderated by consumer attitudes towards food waste and brand value. Specifically, consumers with negative attitudes towards food waste and high brand trust are less likely to engage in panic buying when exposed to misinformation. These results suggest that promoting responsible consumption and leveraging brand value can mitigate the adverse effects of misinformation during crises. This study contributes to sustainability by providing insights into developing strategies for retailers and policymakers to manage consumer behavior, emphasizing the importance of accurate information and brand communication in reducing panic buying tendencies.

Premium pricing and capacity rationing for advance selling with consumers regret

Retailers of iconic products commonly implement premium advance selling, which typically triggers regret in consumers. A premium advance selling strategy is centered around differences in pricing and capacity rationing between two selling periods. We develop a decision-theoretic model to capture the key dynamics of a retailer and a unit mass of consumers. We analyze the retailer's decisions on premium pricing and capacity rationing both separately and jointly. We characterize the retailer's strategy equilibrium under certain market conditions and investigate the effect of consumers anticipated regret on the outcomes. Our findings highlight the importance of the relative strength of regret and the difference between premium and spot pricing when a retailer adopts premium advance selling. Our analysis further identifies the forces driving a retailer's use of disparate selling strategies. We contribute to the field by offering tangible insights into whether and how premium advance selling should be adopted to help retailers more proactively leverage or mitigate consumers' regret.

The Drivers of Omnichannel Shopping Intention: Assessing the Role of Gender as a Moderator in Apparel Industry

The purpose of this study is to explore the influence of the drivers of omnichannel retailing on omnichannel shopping intention and the role of gender as a moderator in the retailing apparel industry. The findings highlight the significance of customer perception of research shopping (including showrooming and webrooming) behaviors, compatibility, and risk to their intention towards omnichannel shopping, implying a profound understanding of designing an effective omnichannel retailing strategy. This study adopted the quantitative research method approach. The data were collected through a survey method using a close-ended questionnaire. The sample for this study were the individuals who have done shopping in three months period – from the last three months till the time of data collection, physically or virtually. The data were analyzed using Statistical Package for Social Sciences (SPSS) version 23 and Smart PLS. Regression techniques and correlation factor analysis and reliability test were the top priority in data analysis. The study expands the understanding of omnichannel shopping intention and its drivers while assessing gender as a moderator.

The influence of manufacturer encroachment on the supply chain: the conditional role of traditional retailer retail service investment

PurposeThis paper investigates the dual interactive effects of manufacturer encroachment on the supply chain and retailer provision of retail services.Design/methodology/approachConsider a supply chain dominated by manufacturers, retailers, and e-commerce platforms, with the manufacturers selling the same product online and offline. Utilizing Stackelberg’s game theory, examples of wholesale and retail prices and profits of participants in the supply chain under different channels are analyzed. An effective encroachment strategy for manufacturers facing different retail service investment strategies of traditional retailers is given.FindingsWhen traditional retailers do not invest in retail services, they will lose more profit due to competition with the manufacturer. At this time, the retailer does not want the manufacturer to encroach. The traditional retailer’s investment in retail services will enhance its and the manufacturer’s profits, incentivizing the manufacturer to pursue an aggressive expansion strategy.Originality/value(1) Considers a situation where the selling efficiency of the manufacturer is lower than that of the traditional retailer. (2) The interaction between traditional retailers’ retail service investment strategies and manufacturers’ encroachment strategies is investigated where the manufacturer is the dominant player. The three modes of online direct sales, resale, and third-party platform agency are compared to provide a basis for decision-making on different types of manufacturers’ encroachment. (3) Offline retail services not only directly increase sales in the offline market but also indirectly have a negative effect on the online market.

Optimal Pricing and Retailing Strategy for an Assembled Product Manufacturing–Remanufacturing Process under Carbon Emission Regulations and Autonomation

Online-to-offline (O2O) retailing offers unique opportunities for customizable assembled products with spare parts. Customers can browse and configure their desired product online, selecting from various components. Imperfect production, where a certain percentage of products have defects, can be amplified in the manufacturing system. Stricter carbon emission regulations put pressure on manufacturers to minimize waste. This creates a tension between discarding imperfect products, generating emissions, and potentially offering them at a discount through the O2O channel, which could raise quality concerns for consumers. In this study, an imperfect single-stage production process is examined, incorporating manufacturing–remanufacturing within a single stage for assembled products containing various spare parts. The study explores an investment scenario aimed at enhancing the environmental sustainability of the product. Additionally, two carbon emissions regulation strategies, specifically carbon cap-and-trade regulation and carbon taxation, are evaluated for their effectiveness in mitigating carbon footprints. The identification of waste, particularly in the form of defective items, is achieved through automated inspection techniques. The demand for spare parts associated with the assembled products is intricately linked to the selling prices set across diverse channels. Finally, the total profit of the manufacturing system is maximized with the optimized value of the selling prices, order quantity, backorder quantity, and investments in autonomated inspection, setup cost, and green technology. Numerical illustrations show that system profit was optimized when the defective rate followed a triangular distribution under carbon cap-and-trade regulation and when green technology investment helped to enhance retailer profit by 18.12%, whereas autonomated inspection increased retailer profit by 10.27%.

Return strategies and channel pricing in omni-channel retail considering heterogeneous customer perceptions

As Internet technology advances, the retail industry is increasingly adopting omni-channel operational strategies. This research delves into the interplay between return losses and customer perceptions of online products, and how these factors influence profit-maximizing omnichannel retailers’ optimal return strategy and channel pricing. Previous studies have primarily focused on cross-channel aspects and have not thoroughly explored the impact of return loss on profitability in an omni-channel context. The study assumes that profit-maximizing retailers allow consumers to choose their purchase channels based on perceived utility of different channels, while adhering to the retailer’s stipulated return strategy. To this end, we introduce three distinct return strategies (returning products via the original purchase channel, offline return, and online return) for omni-channel retailers. We aim to identify the most profitable return strategy by considering diverse return losses associated with each channel and consumers’ perceptions of online products. Our analysis identifies scenarios in which a particular return strategy either boosts or reduces retailer profit, thereby facilitating optimal channel pricing decisions. Our findings reveal that customers’ purchasing channel selections are affected by their perception, retailer’s return strategy, and net return loss. We also find that no matter what kind of operation scenarios the retailers adopted, the retailers should let all customers return to the online channel to generate maximum profit when the difference between the retailer’s online and offline net return loss is less than the difference between the customer’s online and offline return hassle cost. Conversely, an offline return strategy proves more profitable. Our findings are supported by numerical simulations, guiding omni-channel retailers in making informed decisions regarding return strategies and channel pricing.

The influence of cognitive technologies on the decision-making process and the purchasing experience in retail

This study explores the impact and use of cognitive technologies in the retail sector, which has recently attracted considerable interest from businesses, consultants, academics, and researchers. Through eight interviews with professionals from different areas within the retail sector, this paper aims to understand how industry professionals adopt these technologies and their role in shaping retail strategies. Our findings confirm that cognitive technologies significantly impact strategic decision-making within retail. These technologies drive new practices and investment decisions toward automation and optimization of internal operations and serve as key tools for understanding and gaining insights about consumers to shape purchasing behavior.

A strategic analysis of timing of wholesale pricing and information sharing strategy in dual-channel retailing

A strategic analysis of timing of wholesale pricing and information sharing strategy in dual-channel retailing