Consumers' perception on the use of innovative technologies in creating store atmosphere

Sîrbu, Mirela Octavia; Săseanu, Andreea Simona; Ghiță, Simona Ioana Article Consumers' perception on the use of innovative technologies in creating store atmosphere Amfiteatru Economic Journal Provided in Cooperation with: The Bucharest University of Economic Studies Suggested Citation: Sîrbu, Mirela Octavia; Săseanu, Andreea Simona; Ghiță, Simona Ioana (2015) : Consumers' perception on the use of innovative technologies in creating store atmosphere, Amfiteatru Economic Journal, ISSN 2247-9104, The Bucharest University of Economic Studies, Bucharest, Vol. 17, Iss. 39, pp. 567-582 This Version is available at: https://hdl.handle.net/10419/168934 Standard-Nutzungsbedingungen: Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden. Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen. 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If the documents have been made available under an Open Content Licence (especially Creative Commons Licences), you may exercise further usage rights as specified in the indicated licence. http://creativecommons.org/licenses/by/4.0/ Retail Technologies for the 21st Century Innovation and Competitiveness in the Retail Trade Industry AE Vol. 17 • No. 39 • May 2015 567 CONSUMERS’ PERCEPTION ON THE USE OF INNOVATIVE TECHNOLOGIES IN CREATING STORE ATMOSPHERE Mirela Octavia Sîrbu 1, Andreea Simona Săseanu2 and Simona Ioana Ghiță3 1) 2) 3) Bucharest University of Economic Studies, Romania Please cite this article as: Sîrbu, M.O., Săseanu, A.S. and Ghiță, S.I., 2015. Consumers’ perception on the use of innovative technologies in creating store atmosphere. Amfiteatru Economic, 17(39), pp. 567-582 Abstract The increase of competitiveness in retail sales generates the diversification of purchase options, increase of consumers’ demands and, implicitly, the change of their purchasing behaviour. In this context, the selection made by consumers regarding the stores where to purchase from represents a complex decision-making process, conditioned upon the functional and psychological characteristics, among which store atmosphere plays a special part. Moreover, in order to obtain some competitive advantages within an environment that generates specific emotional effects on the buyers, the sellers allocate significant investment resources aimed at implementing some innovative technologies to create store atmosphere. Starting from these considerations, our research aims to identify consumers’ perception of the use of innovative technologies in creating store atmosphere. This paper was performed on the basis of an original questionnaire and, for the specialty literature in Romania, it represents the first research elaborated on this subject. The direct research has been conducted by means of a questionnaire-based survey to which 492 persons answered during September-November 2014. The research intended to establish the criteria for stores selection and the role atmosphere plays in this choice, as well as the identification of interest and level of knowledge of some innovative technologies in this field. The research results emphasise the fact that over 75% of respondents have a positive perception on the use of innovative technologies in order to generate a pleasant atmosphere and they are interested in the advantages they bring to the purchasing process. Keywords: atmosphere in the store, innovative technologies, purchasing behaviour, consumer perception, show store, image of the store JEL Classification: C13, M21, M31  Corresponding author, Mirela Sîrbu - [email protected] AE Consumers’ Perception on the use of Innovative Technologies in Creating Store Atmosphere Amfiteatru Economic 568 Introduction Perceived through the human senses, store atmosphere is intended to attract and make consumers be loyal to the respective stores, and it customizes the store, conveying specific messages intended to encourage sales. Therefore, the constructive ambiance, the set up of the selling surfaces, the music, the olfactory ambiance, as well as the enhanced product visibility represent factors that determine shoppers to return to the store, thusly increasing sales (Vișean, 2004). As regards the markets in Romania, considering the Romanian culture as well, a significant influence on buyers is exerted by the human variables proposed and studied by Berman and Evans (1995) and Turley and Milliman (2000): crowded spaces, consumers’ features, employees’ features, the company employees and their appearance, behaviour of sales force towards buyers. The methodological framework used for this research was designed starting from the current context characterized by the access into Romanian markets of large chains of stores as a result of market globalization. The retailers’ need to obtain some competitive advantages in this field of activity has generated some strategies that would help them stand out and create a specific, customized and innovative atmosphere in their stores. Consequently, the assessment of consumers’ interest in new technologies used for creating atmosphere in stores generates a specific impact on purchasing behaviour and represents the main objective of this paper. The questionnaire was designed closely correlated with the theoretical (Mehrabian and Russell, 1974; Kumar and Kim, 2014) and practical aspects emerging from literature dedicated to store atmosphere and from the relevance of specificities of SOR (StimulusOrganism-Response) and PAD (Pleasure-Arousal-Domination) models. In selecting the advantages of innovative technologies included in the research, the authors aimed at emphasising the main components of atmosphere, with a special focus on virtual technologies. 1. Literature review Introduced by Kotler, the concept of store atmosphere reflects ”the effort to create the environment that generates emotional specific effects on the buyer, effects which increase the probability of the buyer to purchase" (Kotler, 1973, p.50). During the years, the literature regarding store atmosphere (Kotler, 1974; Markin et al., 1976; Milliman, and Fugate, 1993) has developed, through its studies, several concepts that define store atmosphere, such as: store ambiance; atmosphere specific to the field of services; virtual atmosphere; psychology of the environment. Another specific term is the “show store”, which describes the commercial premises as an attractive permanent or occasional environment based on decorations and accessories adapted to specific events and on organizing promotional, cultural actions, etc. The researchers Turley and Milliman (2000) identified 58 variables specific to store atmosphere, this being considered as the most comprehensive classification, which includes, naturally, the most frequently studied variables of atmosphere: colour, lights, smell, and music. In order to estimate how store atmosphere impacts the customers’ behaviour in terms of approaching and/or avoiding the store, the researchers have used variables specific to store Retail Technologies for the 21st Century Innovation and Competitiveness in the Retail Trade Industry AE Vol. 17 • No. 39 • May 2015 569 atmosphere in terms of: time spent in the store, amount of money spent, intention to return to the store, intention to recommend the store, communication with the staff in the store, assessment of products offered, satisfaction regarding the store (Turley and Milliman, 2000; Berman and Evans, 1995). Concerning the generic variables of store atmosphere, recent approaches grant special emphasis to the influence of external variables, as well as human variables (Pantano and Di Pietro, 2014; Shankar et al., 2011). Starting from these assumptions and from the existence of the direct connection between emotional status and consumers’ behaviours, the literature has come up with several models to assess how the purchasing process is influenced by store atmosphere. Thus, Donovan and Rossiter (1982) introduced the S-O-R (Stimulus Organism-Response) model, studying the impact of store atmosphere on the consumers’ purchasing behaviour. According to this model, the S (Stimulus) represents the variables of store atmosphere influencing the emotional status, O (Organism) represents the so-called PAD (Pleasure-StimulationDomination) that influences the consumers’ behavioural responses, and R (Response) represents the behaviour of approaching/avoiding the store. Generally, the response obtained through the S-O-R model refers to the buyer’s behaviour regarding the following aspects: more time spent in store: spending more money than planned; assessing the degree of attractiveness of store atmosphere for buyers; exploring the store; intention to return and to recommend the store; communication with the staff in the store (Donovan and Rossiter – 1982; Donovan et al., 1994). Another representative model, developed by Meharabian and Russell (1974) refers to consumers’ emotional responses when they are exposed to the variables of store atmosphere. The model presented by the two researchers represents three emotional states known as PAD (pleasure-displeasure; stimulation-non-stimulation; predominationsubmission). The conceptual model designed by Kim (2006); Chebat and Morrin (2007) presents the connection between store atmosphere and emotions, respectively, the relation between emotions and the approaching/avoiding behaviour, which determine the reasons for shopping accompanied by the fulfilment of a task, be it for utility reasons or for relaxation, pleasure. The role of atmosphere in the purchasing process is increasing and developing the more so as the qualitative differences between the purchased or consumed products are lower and lower. The focus on the use of innovative technologies in order to create store atmosphere in the purchasing process refers mainly to the impact of a set of stimuli of store atmosphere, which influence the consumers’ behaviour. Among the most famous innovative technologies there are: lights and colours, volume and rhythm of the music, perception of the smell felt in the store. Other researchers have demonstrated that the window displays influence the buyers’ decision to enter the store and sometimes the decision to purchase (Oh and Petrie, 2012; Mower et al., 2012; Cornelius et al., 2010). Apart from these innovative technologies, many researchers (Baker, 1986; 1994; Bitner, 1992) also insist on the social factors that can influence the volume of sales in stores. Thus, employees’ attitude towards the buyers and crowded stores represent components that determine the approaching/avoiding behaviour concerning the store. AE Consumers’ Perception on the use of Innovative Technologies in Creating Store Atmosphere Amfiteatru Economic 570 Nowadays, researchers in the field of innovative technologies employed to create store atmosphere focus on technologies specific to the virtual environment, characterized by a strong interactivity with consumers and by a customisation of the purchasing process (Shankar et al., 2011; Kumar and Kim, 2014). 2. Research methodology This research aimed to establish the consumers’ perception regarding the use of innovative technologies in the creation of store atmosphere. In order to gather the data necessary for the analysis of consumers’ interest in the new innovative technologies used to create store atmosphere, a survey-based statistical research was organized. The research included direct interviews with the persons selected, which were conducted during September-November 2014. The survey was conducted face to face, by intercepting the respondents in three intensely busy areas in Bucharest. The statistical population of interest was made up of consumers from Bucharest, the sample being made up of 492 persons residing in Bucharest. The limit error was of ±4.42% for a 95% likelihood of guaranteed results. The sample size was determined depending on the argument of probability function z, on the sample variance and margin of error ∆𝑥 2, according to the relation: =(𝑧2∙𝑠2)∆𝑥 2 ⁄ . The type of surveys used was based on quotas – as the sampling frame is unknown, but what is known is the relative frequency distribution of the total population based on some key characteristics (gender, age, education and income) and this is a way to ensure that the sample is representative, a method largely used in socio-economic research. The sample is representative for the stable population in Bucharest, from the point of view of the abovementioned variables. Thus, 48.78% of the respondents are men and 51.22% are women, similar to the structure of the population in Bucharest, according to the data provided by the National Institute of Statistics. The sample distribution by income is positively skewed, with small values being quite predominant (the sample distribution being similar to the population distribution). Referring to the levels of education, 56.1% of the respondents graduated from high-school or post-high-school studies, while only 14.58% of them graduated from higher education. Comparatively, according to the data provided by the National Institute of Statistics, 59.16% of the employed population in Romania graduated from secondary level of education while 17.57% had an higher education level (National Institute of Statistics, 2014). The non-response rate was low (2.4%) and it did not affect the representativeness of the sample. The goals of the research were the following:  to identify consumers’ purchasing habits in terms of store profile where purchases are made and frequency of visiting these stores depending on the motivation: information, purchasing, entertainment;  to establish the importance that consumers attach to the main features at the basis of store selection and to the value of store atmosphere and its components in the purchasing process;  to assess the level of knowledge and interest in the innovative technologies used in creating store atmosphere; Retail Technologies for the 21st Century Innovation and Competitiveness in the Retail Trade Industry AE Vol. 17 • No. 39 • May 2015 571  to establish consumers’ perception over the usefulness of advantages brought by the digital interface shelves for product display, the LED technologies used for lighting, the panoramic digital window displays and holograms;  to establish the correlations between the segmentation variables and the factors that influence the choice of stores (image, atmosphere and show store);  to model the purchasing behaviour depending on the importance of store atmosphere and of the innovative technologies used. In close correlation with the research objectives, the following hypotheses emerged, which were subjected to testing:  the type of preferred and most frequently visited stores for shopping is the proximity store.  2.most of the respondents consider that the atmosphere, its olfactory component in particular, has an important impact when choosing the place where to shop;  the innovative technologies employed in order to create store atmosphere have a great influence over the purchasing process;  consumers have a positive perception of the advantages brought by the innovative technologies analyzed in terms of product visibility and attractiveness of the point of sale;  there are significant correlations between the “show store” as a factor that influences the choice of the store and variables such as age, gender and level of education;  the impact of store atmosphere on the decision to purchase and the importance of the new technologies applied to produce store atmosphere have a significant influence on the shopping frequency. According to the goals set, the research was structured on three parts and it included 16 questions. The first part of the research (questions 1-6) was intended to identify consumers’ purchasing habits regarding the store profile where they currently shop, store visit frequency depending on motivation (information, purchase, entertainment), ranking of the main features at the basis of store choice and assessment of the role atmosphere has in store selection The second part of the questionnaire (questions 7-13) was intended to assess the level of interest and awareness with respect to the innovative technologies that generate store atmosphere. The respondents were questioned on how they appreciate the usefulness of implementation and advantages of the following innovative technologies: shelves with digital interface for product display, LED lighting technologies, panoramic digital windows and holograms. The above-mentioned technologies were selected based on the documented research conducted by the authors in order to identify some representative technologies for the commercial activity in terms of innovation and which directly influence store atmosphere and, implicitly, consumers’ behaviour (Shankar et al., 2011; Sorescu et al., 2011; Kumar and Kim, 2014; Pantano and Di Pietro, 2014). The last part of the questionnaire (questions 14-17) included the variables for the identification of interviewed persons: age, education, income and gender, variables necessary for modelling the purchasing behaviour depending on the importance of store atmosphere and innovative technologies used. AE Consumers’ Perception on the use of Innovative Technologies in Creating Store Atmosphere Amfiteatru Economic 572 The SPSS 20 programme was used for information processing, by applying a diverse range of scaling methods, nonparametric tests for analysing the association between the segmentation variables and the criterion for store selection, and the ordinal logistic regression model with conditioned probabilities, based on proportional odds, for the impact of atmosphere and new technologies on the purchasing process. 3. Results and discussions In what follows, the paper presents the results of the research, which was conducted based on the following structure: (a) presentation of the survey outcomes (b) study of the association between the segmentation variables and the criterion of store selection and (c) purchasing behaviour modelling based on the importance of store atmosphere and the innovative technologies used. 3. 1. Main survey outcomes In order to meet the objectives proposed in the first part of the questionnaire an introduction was prepared aimed at identifying consumers’ preferences and interest for certain types of stores and a distinct section, which assesses the impact of atmosphere and of these components on the purchasing process. As regards the type of stores where they usually purchase from, most of the respondents indicated to almost an equal extent (30%), the variants of the “proximity store” and the “supermarkets”. And only slightly over 6% indicated that they usually make their purchases in malls (figure no. 1). According to the research outputs, the first hypothesis (the type of preferred and most frequently visited stores for shopping is the proximity store) is validated. Consumers’ preference of proximity stores, but also of supermarkets represents the consequence of store location in the vicinity of consumers’ residence or places they habitually visit. The prevalence in the offer of products currently in demand and the quickness of the shopping process also explain why consumers prefer proximity stores. Figure no. 1: Profile of stores where the respondents usually do their shopping Figure no. 2: Structure of respondents based on the frequency of store visits, depending on motivation (%) Retail Technologies for the 21st Century Innovation and Competitiveness in the Retail Trade Industry AE Vol. 17 • No. 39 • May 2015 573 In the case of the question regarding the frequency of store visits depending on motivation (figure no. 2) we notice a bipolarization of the respondents. Thus, 33% of them visit the store on a weekly basis for information purposes and 31.1% of them visit the stores for entertainment purposes (in particular during the weekends). The results obtained as a consequence of the participants’ ranking of the main features, which substantiate their store choice, revealed that the most important feature for choosing a store is product diversity followed by product quality and the store location. Therefore, figure 3 shows that the highest total score, granted to the features important in the choice of the store, was obtained by “Diversity”, followed by “Product quality”, while the lowest total score was given to “Store atmosphere”. Figure no. 3: Total scores given to the features used by consumers in order to chose stores The research took into account the following factors, which influence the choice of stores: image of the store, store atmosphere and the show that it can offer. The first two factors were almost equally relevant according to the respondents (figure no. 4). Hence, according to more than one third of respondents (37.85%), store image highly influences store selection. Similarly, almost 35% of respondents have considered that store atmosphere highly influences their choice of stores. The show inside the store was appreciated by the respondents as being important (for almost 36% of them) and of average importance (by 28.2% of the respondents). The role of atmosphere in store selection was assessed in order to obtain information regarding the extent to which respondents’ behaviour is influenced by store atmosphere. To this end, consumers expressed their agreement or disagreement with the following assertions regarding the impact of atmosphere on the purchasing process: (a) store atmosphere plays an important part in choosing the stores where I go shopping; (b) store atmosphere encourages me to spend more time in the store; (c) store atmosphere helps me make the decision to purchase; (d) store atmosphere contributes to the increase of impulsebased purchases; (e) store atmosphere makes me return to the store. Following the processing of answers, it resulted that over 40% of respondents agree that store atmosphere influences their choice of the stores where they shop, while almost 37% of them agree that store atmosphere plays an important role in encouraging the client to spend more time in the store (figure no. 5). AE Consumers’ Perception on the use of Innovative Technologies in Creating Store Atmosphere Amfiteatru Economic 574 Figure no. 4: Factors influencing the choice of stores where to purchase from Figure no. 5: Structure of respondents based on their opinions regarding the impact of store atmosphere on the purchasing behaviour The five components of store atmosphere have been ranked (figure no. 6) according to their importance for shoppers. This ranking shows the highest score was obtained by the olfactory ambiance, followed by the constructive one. The second hypothesis was validated as a consequence of information processing and result interpretation: most respondents consider that atmosphere, especially its olfactory component, has an important impact on store selection. The results obtained can be explained by the fact that atmosphere inside stores generates emotional effects on buyers. Particularly, consumer attraction depends on the olfactory sense, which influences customers’ state of mind. The second part of the questionnaire was intended to assess the buyers’ level of interest in the advantages of innovative technologies used to generate store atmosphere and to determine the influence of technologies on the purchasing process. Another objective was to assess the level of knowledge and the usefulness of implementing these technologies, as well as the advantages of the innovative technologies selected based on the methodology presented. The results obtained are presented below. The relaxation/entertainment function, which is to be provided by the innovative technologies used in order to generate store atmosphere, was rated by over one third of respondents as being highly interesting (figure no. 7). Adversely, respondents showed very little interest in the advantage of obtaining additional information regarding the products displayed in the store (40.76% of respondents), while only slightly over 5% of respondents were very interested in this respect. Similar results were obtained for the advantage of an increased interaction provided by new technologies in the store. The respondents had a clear opinion on how the technologies used in order to generate store atmosphere influence the purchasing decision: thus, almost three thirds of respondents consider that technologies have a high or very high influence on the purchasing process and over half of respondents consider the influence of technologies as being very high (figure no. 8). The analysis of the results obtained validates the third hypothesis: innovative technologies employed in order to generate store ambiance have a massive influence on the purchasing process. The importance granted by respondents to innovative technologies represents a natural consequence of the changes in the consumers’ lifestyle, including in the purchasing process, mutations especially based on technological aspects. The modern innovative technologies most known by the respondents referred to the digital interface shelves (24%), panoramic digital window displays (23%) and holograms (22%). Less than 20% of respondents stated that they Retail Technologies for the 21st Century Innovation and Competitiveness in the Retail Trade Industry AE Vol. 17 • No. 39 • May 2015 581 respondents consider that the technologies employed in order to generate store atmosphere have a very important or important impact on the purchasing behaviour. The analysis of the correlations between the sample segmentation criteria has reflected the differentiated perception of how potential buyers perceive the “show store” concept, while store image and atmosphere are not correlated with the buyers’ gender, age or level of education. These conclusions, together with the analysis of the motivation for visiting the stores for shopping and entertainment purposes, confirm the perception that stores are places that combine usefulness (purchase) and pleasure (entertainment, i.e. show store) where the innovative technologies play a key part. Another conclusion refers to the fact that, statistically speaking, the shopping frequency is heavily influenced by store atmosphere and the implementation of innovative technologies. Therefore, after using the regression method, we learnt that respondents, who think that store atmosphere and modern technologies used to generate atmosphere have a major influence on the purchasing process, visit stores more frequently. Last, but not least, the interest expressed by consumers for certain advantages of innovative technologies (in particular regarding the product visibility and store attractiveness) represent useful aspects in the process of their implementation as well as in the process of designing new innovative technologies, information that can be used in order to establish the coordinates for further research. This paper identifies the advantages of implementing innovative technologies in store ambiance and it, therefore, allows merchants to understand the opportunity of investing in this respect. By means of the methodology designed, this research was limited to investigating consumers’ perspective regarding the use of innovative technologies in order to create store ambiance. Future research directions are aimed at studying the efficiency of implementing these technologies from the merchants’ perspective. Another limit of the research refers to the extent to which there is an understanding with respect to the advantages of using innovative technologies with an impact on the purchasing process, which leads to the opportunity of conducting in-depth interviews with the merchants in the future. Furthermore, since technology is constantly evolving, an objective of future research might be updating the questionnaire in accordance with the new trends. References Baker, J., Grewal, D. and Parasuraman, A,. 1994. The influence of store environment on quality inferences and store image. Journal of the Academy of Marketing Science, 22(4), pp.328-339. Baker, J. and Cameron, M., 1996. 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