How customers ‘learn’ to work for retailers

Abstract

The purpose of this paper is to investigate how learning style affects the performance of the ‘working’ customer in one self-service context – retail Self Check-Out Tills (SCOT). For the purposes of this paper, we have adopted the UK term Self Check-Out Tills (SCOT), also known as ‘self-service registers’ in other countries, to describe this form of self-service in retail stores). The study uses qualitative and quantitative data collected from users of retail SCOT. Initial exploratory factor analysis of 232 SCOT users revealed significant differences in learning styles. Three categories emerged: ‘regular reassurance’, ‘motivated practice’ and ‘cautious discovery’. Customers adopting different learning styles varied in their perceptions of ability and enjoyment with SCOT, and in their capability of helping other customers with SCOT. The demographic make-up of customers adopting the different learning styles was also shown to vary. Previously, little has been done to identify the specific training needs of working customers. This research begins to address this knowledge gap.     

Crosswise and reciprocal interdependencies within retailers’ multichannel structures

Understanding consumer behavior across channels is the fundamental basis for implementing successful multichannel retailing strategies. This study analyzes the crosswise and reciprocal relationships between offline and online brand beliefs, offline and online retail brand equity and consumers’ conative loyalty to a retailer in multichannel structures. The relationships are contextualized by investigating fashion and grocery retail sectors and different prior channel performances that are likely to affect the paths to loyalty across channels. To provide insight into these issues, two cross-sectional and two longitudinal models are employed. The results show that former brick-and-mortar retailers are able to significantly increase consumers’ loyalty to the firm by primarily designing offline (secondary online) attributes and beliefs. The results hold for retailers in both fashion and grocery retailing, however, with stronger effects in fashion, as well as for retailers with strong vs. weak prior channel performance. However, indirect effects indicate that online brand beliefs and offline retail brand equity are the central strategic levers for prior strong (vs. weak) retailers. Reciprocal relationships between online and offline retail brands underline important channel interdependencies. Managers thus need to take these crosswise and reciprocal interdependencies between channels into account when designing successful multichannel retailing systems. This study introduces the novel idea of simultaneous crosswise and reciprocal relationships within multichannel retail structures and shows that paths to loyalty vary for retailers in different retail sectors and retailers with strong vs. weak offline and online channel performances.     

International strategy’s effects on retailers’ local implementation and performance

Retailers dynamically expand abroad and strategically seek local performance because their business is local. However, knowledge of the contribution of retail firms’ international strategies to subsidiaries’ local performance is limited. Based on the prominent I/R strategy framework, the authors conceptualize integration/responsiveness as the transfer/local generation of firm-specific advantages and analyze (direct and indirect) paths of varying degrees of I/R via local implementation decisions to performance. Because retailers’ firm-specific advantages have a limited geographic reach, different successful paths are expected in close and distant countries. Empirically, a survey based on face-to-face-interviews with 126 retail CEOs and expansion managers, partial least squares structural equation modelling and bootstrapping-based mediation analyses were conducted. The results reveal only indirect paths of international strategy to local performance through local standardization/centralization. Unique insights into the paths of firm? strategy to subsidiary performance emerge, such as important tradeoffs between superior paths in close countries.     

Dominant retailers’ incentives for product quality in asymmetric distribution channels

This paper investigates the diverging incentives for product quality in a channel with two asymmetric retailers and a common supplier. When retailers differ in terms of service provision and channel power, changes in manufactured quality cause channel conflicts. In particular, our results show that if the low service retailer becomes dominant in the channel, it may induce a low level of quality that is detrimental for the other members of the channel. The low service retailer benefits from quality reduction first by improving its competitive standing against its rival retailer by lessening the importance of quality for consumer choice and second by strengthening its relative bargaining position vis-à-vis its supplier. Our results also show that consumer surplus may increase as a result of quality reduction.     

Global retailers and logalization: ‘thinking locally and acting globally’

Abstract

This research provides theoretical rationale to explain how global retailers are able to harvest multiple ideas from diverse host-markets and add relevant new ideas into a standardized retail mix that is rolled out globally. To capture this bottom-up harvesting of local information embedded in host-markets, this study adopted the term ‘logalization’ from the economics literature and applied the absorptive capacity framework. Under the activation of absorptive capacity, host-market subsidiaries play a critical role in acquiring and assimilating relevant knowledge from the host market and disseminating it to headquarters. The home-country headquarters (HQ) then transforms relevant knowledge into an innovative standardized retail mix to exploit at the global level. The concept of ‘logalization’ differs from ‘glocalization’ found in the literature; glocalization incorporates the local context to establish a strategy at the local level, while logalization uses local information as a resource to develop a standardized strategy at the global level. The development of propositions is informed by semi-structured interviews with 10 managers employed by global retailers. By illustrating the logalization orientation, this research describes how global retailers can create an innovative retail mix by exploiting heterogeneous information from various host-markets to create and sustain a competitive advantage in the global market.     

Retail fairness: Exploring consumer perceptions of fairness towards retailers’ marketing tactics

The concept of fairness has received great attention in consumer behavior research lately. However, the focus of these studies has mainly been the understanding of fairness in terms of pricing rather than exploring the consumers’ perceptions of fairness itself. This study explores the consumers’ perceptions of fairness as an outcome of a retailer’s marketing tactics. Based on 36 in-depth interviews this study submits a conceptualization of retail fairness from the consumers’ point-of-view. The concept of retail fairness constitutes of three dimensions and nine sub-dimensions, expanding our knowledge of the construct. The study posits a crucial link between increased honesty, ethical, and moral behavior and the understanding of retail fairness. Theoretical and managerial implications are discussed.     

The impact of retailers’ sustainability and price on consumers’ responses in different cultural contexts

Consumers want sustainability, but at what price? With growing demands for environmental and social sustainability, retailers aim to understand how consumers might react to adaptations in retail practices. This research examines consumers’ perceptions towards retailers’ environmental and social sustainability practices and the moderating effect of price in different cultural contexts. Quantitative research methodology using scenario-based experiments was employed. Two experiments were conducted using research participants from the US (a more individualist country) and Turkey (a more collectivist country) and measured one dimension of culture, individualism versus collectivism. The results reveal that high prices negatively moderate consumers’ response to retailers’ sustainability efforts. Even though there is no significant interaction between either type of sustainability and price on purchase intention, high sustainability along with a low-price strategy leads to an increase in consumers’ commitment, satisfaction, and loyalty. Furthermore, the results demonstrate that high prices have a more negative effect on consumers’ responses in a collectivist country. This study highlights the importance of price in both individualist and collectivist cultures and provides a better understanding of a neglected dimension of sustainability, social sustainability. Managers need to be aware of the increasing demand from consumers for environmentally and socially sustainable practices but need to recognize that consumers may not be willing to pay more for these products. Companies need to formulate business strategies based on low priced-sustainable products and the cultural context of the country in which they operate.     

Chatbots in retailers’ customer communication: How to measure their acceptance?

Currently, online retailers evaluate whether chatbots—software programs that interact with users using natural languages—could improve their customers' satisfaction. In a retail context, chatbots allow humans to pose shopping-related questions and receive answers in natural language without waiting for a salesperson or using other automated communication forms. However, until now, it has been unclear which customers accept this new communication form and which factors determine their acceptance. In this paper, we contrast the well-known technology acceptance model (TAM) with the lesser known uses and gratifications (U&G) theory, applying both approaches to measure the acceptance of the text-based “Emma” chatbot by its target segment. “Emma” was developed for the prepurchase phase of online fashion retailing and integrated into Facebook Messenger by the major German online retailer Zalando. Data were collected from 205 German Millennial respondents in a usability study. The results show that both utilitarian factors such as “authenticity of conversation” and “perceived usefulness,” as well as hedonic factors such as “perceived enjoyment”, positively influence the acceptance of “Emma”. However, privacy concerns and the immaturity of the technology had a negative effect on usage intention and frequency. The predictive power of both models was similar, showing little deviation, but U&G gives alternative insights into the customers’ motivation to use “Emma” compared to the TAM.     

Motives behind retailers’ post-entry expansion - Evidence from the Chinese luxury fashion market

This study aims to examine the motives behind retailers’ post-entry expansion in foreign markets. Through case studies of eleven participating luxury fashion retailers in China, qualitative data was collected from twenty-two executive interviews. Although their initial market entry was driven by both reactive (push) and proactive (pull) factors, the motives behind their post-entry expansion have become predominantly proactive, especially long-term growth strategies, the ambition to extend their brands and retail formats to more cities, and the experiences gained in entry markets. The desire to optimize the retail store portfolio through multiple channel strategies have slowed down the expansions of physical stores.     

Can free-shipping hurt online retailers?

Quantitative Marketing and Economics - In this paper, we investigate optimal pricing strategies for an online grocery retailer that derives its profits from delivery fees and grocery sales. We base...     

An exploration of consumers’ experiences in physical stores: comparing consumers’ and retailers’ perspectives in past and present time

Abstract

In this paper, we explore consumers’ in-store experiences and their components, from both a consumer and retailer perspective. This is a replication of a study we performed in 2006 and thus we also examine how the role of the physical store has changed over the last decade. We use the Critical Incident Technique (CIT) to improve our understanding of consumers’ in-store experiences. Moreover, we conduct in-depth interviews with Swedish retailers to achieve an understanding of how retailers use aspects of the store environment to enhance the consumer experience. Interestingly, our results suggest that consumers’ in-store experiences to a large extent are created by the same aspects today as ten years ago (e.g. personnel, layout, atmosphere). Furthermore, while retailers today emphasize the importance of fulfilling new and more advanced consumer demands, they often still accentuate the weight and use of traditional values (e.g. personnel and layout) ahead of advanced technology.     

The impact of retailers’ sustainable development on consumer advocacy: A chain mediation model investigation

This study explores the impact of retailers' sustainable development (RSD) on consumer advocacy. Drawing on the theoretical foundations of institutional theory, this study presents and confirms a model that investigates the mediating role of retailers' legitimacy and consumer trust, and the moderating role of consumer ecological literacy between RSD and consumer advocacy. Using the sample of 942 consumers and PLS-based structural equation modeling technique, the results revealed that RSD positively correlates with consumer advocacy. Additionally, retailers' legitimacy and consumer trust mediate this correlation by a respective mediating role and a chain-mediating role. Besides, consumer eco-literacy negatively moderates the direct impact of RSD on consumer advocacy and consumer trust, and the indirect impact of RSD on consumer advocacy through consumer trust. However, the direct impact of RSD on retailers' legitimacy, the mediating effect of RSD on consumer advocacy through retailers' legitimacy, and the chain-mediating effect of RSD on consumer advocacy through retailers’ legitimacy and consumer trust are not moderated by consumer eco-literacy. This study has implications for retailers seeking practical ways to increase consumer advocacy.     

Should retailers encourage couples to shop together?

Many purchase decisions take place in social relationships, and yet few studies have specifically investigated couples’ purchase decisions made during shopping about products for later joint consumption. We hypothesize that romantic partners purchase more when they shop together than individually and that this effect is strong for vice products, particularly those without an organic label. For our empirical study, we asked romantic partners shopping together in a real-life context to make purchase decisions together or individually (our main experimental condition) in a self-programmed web store that offered 88 product variants (differing in category [vice/virtue] and labeling [with/without organic label]). Participants then filled out an online questionnaire on site. Results of a sequence of nested generalized linear models show that making purchase decisions together increases purchase amount (number of items selected) and purchase value (quantities selected multiplied by the corresponding willingness to pay), especially for vice products without organic labeling. In a second study, we benchmark these effects by comparing them with the effects of individual decision making and varying consumption mode (joint vs. individual consumption), using data from an online survey that followed the same structure as the main study. These effects, again estimated through generalized linear models, are negligible. Our findings strongly support the “accomplice” (rather than the “minder”) role of romantic partners in shopping. Therefore, retailers should target couples, encourage them to shop together, and emphasize joint consumption as a shopping goal.     

Assessing customers’ perceived value of the online channel of multichannel retailers: A two country examination

Given the constant and often dramatic technological advancements that facilitate retailing, especially online channel adoption by industry and customers, research focusing on customers perceived value of the online channel of multi-channel retailer’s requires conceptual and empirical elaboration. This study advances understanding of customer perceived online channel value and how customer perceptions of value effect online channel satisfaction and online channel loyalty. Using data from a multi-country study, we provide a deeper understanding for multi-channel retailers of how to balance investments in various value drivers to enhance online channel satisfaction and customer loyalty.     

Interactivity,Inspiration, and Perceived Usefulness! How retailers’ AR-apps improve consumer engagement through flow

This study investigates the antecedents and outcomes of consumer engagement through AR apps and suggests a new conceptual model. The purpose of the paper is to examine how consumer engagement is shaped via AR apps, which eventually leads to a positive attitude towards brand and brand usage intent. To this end, a face-to-face survey instrument was administered to 350 participants in Turkey, where participants tried an AR app and then answered a questionnaire. The structural equation modeling (SEM) and Hayes' Process analyses were applied to test the hypotheses and moderated mediation relationships. Findings showed that interactivity and inspiration are two major antecedents of consumers' flow experience. The flow experience with AR can generate favorable attitudes towards AR apps and more trust in AR apps, which trigger consumer engagement with AR apps and then improve brand attitude and brand usage intent. The outcomes of flow experience with AR (i.e., attitude and trust) mediate the relationship between flow and engagement. Although perceived usefulness increases the effect of consumers' attitudes towards AR on engagement, it has no moderating effect on the relationship between trust in AR and engagement. Furthermore, the results of Hayes' Process revealed that the indirect effect of flow on consumers’ engagement with AR through attitude towards AR is moderated by perceived usefulness. So that, if AR marketers aim to strengthen the link between consumer flow experience and engagement via attitudes towards AR, they should therefore consider enhancing the perceived usefulness of AR. Surprisingly, perceived usefulness had no moderating effect on the indirect relationship between flow and engagement via trust. Finally, this paper discusses both the theoretical and managerial implications.     

An evolutionary game theoretic model for analyzing retailers’ behavior when introducing economy and premium private labels

The significant growth of Private Labels (PLs) has led to a growing competition between National Brand (NB) manufacturers, on the one hand, and retailers, on the other; while manufacturers strive to achieve enhanced customer loyalty through such measures as innovation and advertising, retailers focus their efforts on offering high-quality products. This paper considers for the first time a supply chain consisting of one NB manufacturer and a population of retailers under two scenarios. In the first, each retailer sells NB and chooses either to introduce an Economy Private Label (EPL) or not. In the second scenario, each retailer chooses either to introduce a Premium Private Label (PPL) or not. To solve the problem, an evolutionary game is introduced and the retailers’ behavior is analyzed. Using two numerical examples, parametric analysis and managerial insights are also provided. It is found that the entire population chooses the strategy of introducing a private label (EPL or PPL) and that this strategy yields greater profits for both the manufacturer and the retailers than other strategy profiles might do. In addition, it is shown that both the retailers and the manufacturer gain more profits by introducing a PPL rather than an EPL.     

Two retailers go global – the geographical dimension

The world-wide expansion of two specialist retailers is analysed. Looming market saturation at home is a potential and quantifiable trigger (‘Why?’). It is paralleled by strong entrepreneurial ambition and possibly the desire to pre-empt competitors (‘When?’). Centralized and standardized operations favour organic growth through owned stores (‘How?’). The process follows roughly decreasing cultural closeness (‘Where?’), to which the logistics function coupled with relative market size may cause aberrations. In unfamiliar and distant markets, franchising is used which calls for a separate and more random entry sequence.     

An empirical study on the timing of big retailers’ initial internationalization: Influence of the target market and entry-mode choice

This paper examines the timing of big retailers’ initial internationalization and proposes a theoretical framework. Then, the framework is tested with the proportional hazard model and data of European and U.S. big retailers. Empirical results show that retailers’ entry timing is jointly influenced by the economic conditions of both the home market and target foreign markets, cultural and geographical distance, and the entry mode. Based on these findings, this article offers suggestions to China’s big retailers whose initial internationalization has just started.     

Price versus service: Can retailers beat showrooming with competence?

Showrooming is a behavior of information gathering in offline stores before purchasing from an online retailer (usually at a lower price). As showrooming is a serious problem for offline retailers, this study investigates how they can compensate a price disadvantage against the online channel with service strategies. Two experiments examine the effects of (1) offline price disadvantage levels and service usage and (2) service quality and availability on showrooming. Results indicate that mere service usage can partly compensate price disadvantages. While service quality reduces showrooming, service availability only shows an impact when quality is high. Price fairness mediates these effects.     

WHY do YOU care about me? The impact of retailers’ customer care activities on customer orientation perceptions and store patronage intentions

The present research conceptualizes customer care activities as the process through which retailers satisfy consumers' needs by means of a set of interconnected services and address the role of warmth and competence perceptions, as well as consumers' inferred motives, in determining the downstream effects of care management activities on consumers' perceptions and intentions. The results from two experiments show that the number and framing of customer care activities affect customer orientation perceptions (Study 1) and that their fit with the overall retailer's image and the level of professionalism required to carry them out affects store patronage intentions (Study 2).