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Adding Value through In-store Self-Service Technology in Retailing
University of Borås, Faculty of Textiles, Engineering and Business. (Swedish Institute for Innovative Retailing, Handelsgruppen)
University of Borås, Faculty of Textiles, Engineering and Business. (Swedish Institute for Innovative Retailing)ORCID iD: 0000-0003-2219-1525
University of Borås, Faculty of Textiles, Engineering and Business. (Swedish Institute for Innovative Retailing, Handelsgruppen)
2016 (English)Conference paper, Oral presentation with published abstract (Other academic)
Abstract [en]

Introduction

Technology-facilitated transactions have become an increasing part of retail encounters and customers, in some instances, are interacting with technology more than firm employees to create service encounters. Acceptance and adaption of new technology in store is dependent on several factors such as personality. Previous studies (Demirkan & Spohrer, 2014) suggest that product information and search process in store can be supported with the help of digital technology. It is suggested the infusion of technology can enhance service encounters by making them more expedient and efficient and thus, satisfying (Bitner, Ostrom, and Meuter 2002; Meuter et al. 2000). Giebelhausen et.al. (2014) suggest that the interplay between frontline technology use and service encounter evaluations may be more complex than it seems, and it is also suggested that technology-enriched retail environments affects relations between consumers, employees, and retailers (Pantano, and Migliarese, 2014).

Academic literature has very much focused on the interpersonal dynamics of service-encounters (Bettencourt and Gwinner 1996; Bitner, Booms, and Tetreault 1990; Fischer, Gainer, and Bristor 1997; Goodwin 1996; Hartline and Ferrell 1996) that has extensively been explored, but to a lesser extent has research investigated customer interactions with technological interfaces (Bitner, Brown, and Meuter 2000; Dabholkar 1996). In their extensive exploration of a wide range of SSTs Meuter et.al. (2000) called for further research examining what motivates people to use an SST, how people would go about learning their role as it relates to interacting with an SST, and also what factors that limit perceived ability to interact with SSTs.The purpose of this study was to evaluate the value added by retail in-store self service technology for consumers. Important aspects of the SST interaction include the perceived service, the purchase intentions and interaction with the sales personnel.

Experimental design and methodology

Depending on their complexity, certain products are perceived as more difficult to buy than others. Within a retailing context complexity dimensions regarding products is not so often heard of, however, many customers perceive products as difficult. This is due to the fact that consumption of the product is important and mistakes are often made. In a research program within the University of Borås and Swedish Institute for Innovative Retailing, the Academic environment gather retailers that strive to innovate and help raise customer perceived value in the fixed store setting. While significant investments in innovative technology systems such as self-scanning, mobile platforms or digital payment methods, continue to transform the customer’s experience it also help retailers being more effective. One of the Swedish retailers (a large retail chain within home textiles) wanted to develop a new tool for customers in store, helping them to decide on what product to buy. The system developer connected to the research institute programmed an IT-pilot designed to help customers decide the right product, with the help of a decision tree-model. Products chosen to be a part of the decision tree were pillows and duvets/covers. For most people this may sound like an easy product to choose, but studies made within SIIR contradict this opinion, showing that these kind of products are perceived as very difficult to decide upon. You need to know how your pillow must be in terms of filling, material, size etc. You also need to know how warm your cover should be compared to how you sleep at night and how the temperature is in your bedroom among other things. The IT-pilot was programmed into a touch-screen based self-service computer station, and the layout was made according to the retailer’s format and colour.

The overall design of the field study was a structured three day in-store experiment with a touch-screen based self-service device aiming for three groups of respondents. These were 1) loyalty card members 2) voluntary participants in the SIIR survey registry and 3) Walk-in customers. The respondent were either assigned to the SST-based IT-pilot, or the sales clerk, to simulate a purchase in a real retail environment. When the respondents had selected and located the chosen merchandise the mock purchase was interrupted, and the structured interviews were conducted.

 

The IT-pilot was a computer with touch screen, where a software prototype of a SST-program was installed. The customers made choices on the screen and the software gave them appropriate recommendations based on a hierarchy of choices the customer made on the touch screen. The IT-pilot was placed centered on a wall, by duvets and pillows. When the customer had gotten a recommendation from the IT-pilot they searched for the item of preference in the store, without help from sales personnel. The simulated purchase was concluded and the respondents were asked questions from a questionnaire with different design depending on whether the respondent had experienced a SST-encounter or a sales clerk encounter. Two research assistants, collecting the data and reporting it to the researchers in the study, performed the questionnaires. The research design was experimental in the sense that the respondent never actually performed a real purchase; they were invited and asked to participate in a fictional purchase, going through the different phases in the purchasing process. Total sample in the experiment was 78 customers contributing to the data set.

Results

The average respondent in the study was a woman 47.1 years-old. Two respondents were male, thus reflecting the age and sex of the store’s targeted segment. Most respondents were relatively frequent visitors to the retail chain. 75.6 of the population visit a store one to two times every month, indicating an interest in the category. Less than 4% were highly infrequent visitors. Some used the internet regularly, but mobile platforms were seldom used, indicating a low internet maturity in the population.

When asked how they perceived the importance of personal service, a majority of the respondents claimed it was high. However, the willingness to pay for better service was low. The self-stated computer literacy was high but their experience and willingness to use the internet retail options was low. The respondents were reluctant to try the SST-device, or at least hesitating, however, when educated they wanted to test the service. When asked which service was the best, the sales clerk or the SST, they preferred pre-purchase information sources such as employee encounters, and signs (including hang tags).

The expected service level at the fixed store setting was high or very high before the experiments were carried out. Both the sales clerk and the SST, proving that both SST and sales personal delivered customer perceived value, fulfilled these expectations. The service experience, information quality and the match with preference were very good with the sales clerk. The SST received a somewhat lower rating compared to the personal encounter. The likelihood that the subject would actually purchase the product was slightly higher for the respondents who received service from sales personnel.

Even if the recommended product is a good match for the customers’ preferences, we cannot conclude that there will be a purchase to finalize the sale. The product may not be important enough, or it can be difficult to find in the store. The product category in our experiment was considered very important by both the group serviced by the sales clerk and the SST group. However, those serviced by the sales clerk stated it was easier to locate the shelf where the recommended item was located, and to locate it n the shelf, than the group serviced by

Discussion and Conclusions

The study shows that customers perceive the SST as both simple and logical with a good layout and as a good basis for decision making. This is in line with previous research that suggests that customers can perceive an added value if SST is present in-store. Given the results it is also indicated that acceptance for SST such as the IT-pilot in this case is dependent upon both outcome and expectations. Customers in this study, who are customers of the home textile company that was the setting require high service but are not willing to pay for the higher service level. Their focus is on value for them personally as customers (i.e. price and service related to price), more than the ultimate shopping experience. It was also revealed that the SST-based IT-pilot used in this study was best utilized when used in combination with personal selling and was most appreciated when the store was very busy. This indicating that consumers appreciate having the option of customizing their own service experience given the variables of time, access to sales personnel and readiness and willingness to use SST devices. Further research should view the combination of SST and personal service in order to view consumer choice of medium for service encounters, particularly when purchasing so called complex products. Methodologically further research should view the results when a SST device is placed in-store and respondents are not invited to an experiment but interview after having used the device uninitiated by researchers.

References

Bettencourt, Lance and Kevin Gwinner (1996), “Customization of the Service Experience:

The Role of the Frontline Employee,” International Journal in Services Industry Management, 7 (2), 2–20.

Bitner, MJ. and Mary Stanfield Tetreault (1990), “The Service Encounter: Diagnosing

Favorable and Unfavorable Incidents,” Journal of Marketing, 54 (January), 71–84.

Bitner M.J., Brown S.W., Meuter M.L., (2000) Technology Infusion in Service Encounters,

Journal of the Academy of Marketing Science, vol. 28, n. 1, pp. 138-149.

Bitner M.J., Ostrom A.L., Meuter M.L., (2002) Implementing Successful Self-Service

Technologies, Academy of Management Executive, vol. 16, n. 4, 2002, pp. 96-109.

Dabholkar P.A., (2003) Understanding Consumer Motivation and Behavior Related to Self-

Scanning in Retail, International Journal of Service Industry Management, vol. 14, n. 1, pp. 59-95.

Demirkan, H., Spohrer, J. (2014) Developing a framework to improve virtual shopping in

digital malls with intelligent self-service systems, Journal of Retailing and Consumer Services, Volume 21, Issue 5, pp. 860-868.

Giebelhausen, Michael, Stacey G. Robinson, Nancy J. Sirianni, and Michael K. Brady (2014)

Touch Versus Tech: When Technology Functions as a Barrier or a Benefit to Service Encounters. Journal of Marketing: July 2014, Vol. 78, No. 4, pp. 113-124.

Meuter, Matthew L., Amy L. Ostrom, Robert I. Roundtree, Mary Jo Bitner (2000) Self-

Services Technologies: Understanding Customer Satisfaction with Technology-Based Service Encounters. Journal of Marketing: July, Vol. 64, No. 3, pp. 50-64.

Place, publisher, year, edition, pages
2016.
National Category
Business Administration
Research subject
Bussiness and IT
Identifiers
URN: urn:nbn:se:hb:diva-11862OAI: oai:DiVA.org:hb-11862DiVA: diva2:1068923
Conference
Bridging Asia and the World: Global Platform for Interface between Marketing and Management, Hong Kong, July 21-24, 2016
Note

Enbart extended abstract

Available from: 2017-01-26 Created: 2017-01-26 Last updated: 2017-01-26Bibliographically approved

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Anita, RadonSundström, MalinBehre, Martin

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