The Augmented Retail Store for Augmented Customer Experiences

Introduction

The wide availability of technological tools such as smartphones, other mobile devices, virtual reality, and augmented reality (AR) has increasingly reconfigured the retail landscape (Fuentes et al., 2017; Shankar et al., 2021; Qin et al., 2021) in ways that have not only digitalized the physical environment but also physicalized the digital environment. In parallel, amid ever-growing competition between retailers, the increased use of online commerce (Fuentes et al., 2017) and digital technologies (Shankar et al., 2021), along with the general acceleration of retail digitalization (Hagberg et al., 2016; Pantano, 2020; Amankwah-Amoah et al., 2021), have forever altered the structure of retail. For customers, today’s shopping journeys (i.e., pre-purchase, purchase, and post-purchase) (Lemon & Verhoef, 2016) thus typically involve integrating various online and offline channels and touchpoints. The journeys may start at home as consumers search for, collect, and compare information about products before completing purchases in physical retail stores in city centers, or what is called webrooming (Arora & Sahney, 2017). Alternatively, consumers may start by seeking out and evaluating products in physical stores before purchasing them online, which is known as showrooming (Gensler et al., 2017), possible due to the lower prices and greater convenience sometimes afforded by shopping online. Similar to entire shopping journeys, post-purchase activities such as services and returns can also be conducted via numerous channels and touchpoints.

Such changes have altered the conditions of brick-and-mortar retailers, who have been affected by transformations in shopping due to changing technologies and shifting behavior among consumers (Hagberg et al., 2017; Pantano, 2020; Grewal et al., 2021). Some retailers have been forced to close their physical stores, whereas others have struggled to adapt to new patterns of consumption. Facing those circumstances, retailers with physical stores now seek to find new ways to interact with their customers and to attract new categories of customers. Thus, now more than ever before, understanding consumers’ experiences and customers’ journeys (Lemon & Verhoef, 2016; Bonetti et al., 2019) is essential for retailers’ strategic performance. A common response of retailers has been to create new kinds of shopping experiences that consider consumers’ changing needs and shopping journeys (Holbrook & Hirschman, 1982; Gentile et al., 2007; Meyer & Schwager, 2007). As stated by Reinartz et al. (2019), “a shift in stationary retailing from a transaction-oriented POS [Point of Sale] to one that is experience-oriented” has occurred (p. 362), which requires retailers to acknowledge that consumers shop for several reasons, which may or may not include the need for a specific product or service (Puccinelli et al., 2009).

This chapter explores how AR enables digital and physical elements to coexist in retail environments and to be combined in ways that generate new experiences for customers (Azuma, 1997; Azuma et al., 2001; Reinwald et al., 2014; Bonetti et al., 2019; Caboni & Hagberg, 2019). In particular, the chapter presents and develops the notion of what we call augmented retail stores as places that combine the benefits of the physical and digital worlds thanks to augmented content offered by AR. In our thinking, augmented retail stores offer a way to adapt to the changing needs and desires of consumers seeking immersive experiences by facilitating the development of immersive store environments (Mankodiya et al., 2013) augmented by merged physical and digital elements. Augmented retail stores may thus represent the evolution of physical retail stores in prioritizing not the quality of goods but the quality of experiences (Chen & Chen, 2010). Along those lines, the chapter analyses the physical and digital elements that constitute augmented environments and exploit AR technology to meet consumers’ need for entertainment, social interaction, and intellectual stimulation during their shopping journeys (Arnold & Reynolds 2003) and contribute to creating augmented experiences for them.

The chapter next presents a review of literature on AR along with practical examples of AR applications. Based on that combination, it proposes a new form of retail store in which physical, digital, and augmented elements coexist and where the customers’ experience is considered to be an augmented experience (Caboni & Hagberg, 2019). The chapter also proposes a definition of augmented retail store and discusses future prospects and opportunities for further research.