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5. Discussion

5.1 Discussion of results

The hypothesis testing provides evidence that the store visit intention is positively influenced by adding digital elements to a physical luxury fashion store. Furthermore, it shows that store visit intention is positively influenced by adding personalized elements in a physical luxury fashion store.

Also, the testing has proven that social elements in a physical luxury fashion store have a positive effect on store visit intention. These results indicate that offering the ‘in-store social retail

experience’ (which consists of these three elements) has a positive effect on store visit intention. The research also showed that gender has no effect on all of those relationships, and neither does age.

Both millennials and Generation Z respond the same when it comes to these three elements in their shopping experience. However, an unexpected and interesting finding was that males seem to like elements in a store slightly more than females.

The results indicate that there is indeed a positive relationship between social, digital and

personalized elements and store visit intention, and that all these positive relationships exist in the context of luxury fashion. Therefore all hypotheses are supported.

When it comes to digitalization, the first element of the in-store social retail experience, the findings of this research support the previously discussed literature about digital elements in a luxury fashion store. From this research followed that this element significantly increased store visit

intention of participants compared to a store with no elements. 90% agreed (to a certain level) that they would like to visit a store with digital elements and 87% would keep visiting this store. The most prominent reasons they gave for this are firstly the extreme convenience it brings to the shopping experience. It gives the ease and comfort of online shopping, while also being able to interact with the products in person. Furthermore, they like the fact that they can shop independently using these devices, and do not need any help from employees. Another big reason is the sense of entertainment they get from these digital features in the store, it is fun, they feel engaged and they get excitement out of this experience. Lastly, they feel that digital features in-store are a requirement

in the 21st century; it should not only be an offline store anymore, but the store also needs to be immersed with online, digital features: the best of both worlds. The full 90% agreed that this would elevate their customer experience enormously. Therefore, the second research question “what effect do digital elements have on the store visit intention of millennials and Generation Z when it comes to luxury fashion stores?” can be answered with: a positive effect. These findings match with the previously discussed literature about the effects of digital elements and could be explained by previous research. Ho (2020) already mentioned that digital elements positively influence the customer experience. Berry et al. (2002) and Heller et al. (2019) also found that digital in-store elements increase decision, access, transaction, benefit and post-benefit convenience enormously, which further increases consumers’ shopping experience and satisfaction. Also vivid in previously discussed literature (Kim, 2001; Kim and Kim, 2008; Kozinets et al., 2002; Diep and Sweeney, 2008); Soderlund and Julander, 2009; Pantano and Tavernise, 2009; Burke, 2002; Michon et al., 2006; Chang and Burke, 2007; Kim et al., 2007; Yoo et al., 2010) is that digital elements in a store increase interactivity, entertainment, fun, excitement and enjoyment in the experience of consumers, increasing satisfaction and user experience, making them more likely to purchase and keep visiting the store. This is because when the shopping experience is more enjoyable, overall experience (Diep and Sweeney, 2008), consumer satisfaction (Soderlund and Julander, 2009) and user experience (Pantano and Tavernise, 2009) is positively influenced and also their behavioral intentions (Kim and Kim, 2008).

When it comes to socialization in-store, the second element in the in-store social retail experience, the findings also support previously discussed literature, because the results of this research indicate that social elements do have a significant positive effect on store visit intention.

87% of the respondents would be willing to visit stores with social elements and 84% would continue visiting this store. The most chosen reasons for this are firstly that they love the

combination of social media with social interaction in real life. They want to connect and interact both offline and online while in the store. This is because they love the aesthetics and

instagrammableness of the store, but also the desire to connect with others. Another reason is that this element gives them a sense of belonging, to be part of a community and gain new friends. This

store lifts their spirit and mood. Advice from employees is also a reason. All of the 87% again agreed that these elements would enhance their experience in-store. That is why the third research question “what effect do social elements have on the store visit intention of millennials and

Generation Z when it comes to luxury fashion stores?” can be answered with a positive effect. This is in line with the previously discussed literature and can be explained by the following insights from previous research:. Brocato et al. (2012), Hu and Jasper (2006), Pan and Zinkhan (2006) have established that physical stores provide a good opportunity for interaction between people, and this is exactly what consumers want in their experience, through communication and friendliness. This research supports the social identity theory: the emotional need and knowledge of belonging to a social group (Tajfel, 1981; Carlson et al., 2007). When the customer feels belonging to a group, he categorizes himself and the ones he interacts with in the store (Carlson et al., 2007) and this implies the psychological and social connection with other groups and individuals that appreciate strong emotional ties (Reed, 2002). The intensity and quality of the arised relationships between the individual, his ideals, and other people who the individual interacts with in a social environment, is what makes the social component in an experience powerful (Ouwersloot and Odekerken-Schröder, 2008). The social environment in-store significantly influences consumers’ brand experience, which also means that social cues in the store environment are important in developing brand experience (Kumar & Kim 2014), because it makes consumers feel more aroused and pleased in the store (Hu and Jasper, 2006). The social media reasons are in line with the finding that customers love socially engaging on social media platforms while shopping in a physical store. (Morris, Inkpen and Venolia, 2014). It enhances their experience. In this study, the same reasons surfaced.

Finally, when it comes to the third element of an in-store social retail experience,

personalization, the findings again support previously discussed literature: personalization in-store influences store visit intention positively, a significant effect. 87% of the respondents would like to visit a store with personalization and 85% would keep visiting this store. The most prominent reasons that surfaced are for starters that it provides them solutions to their specific needs and style.

They love being the center of attention and getting a focus on them. Getting a product that fits them personally makes them happy, because they associate it with themselves. They also love getting

recommendations, the ability to choose and a virtual style assistant. Personalization gives them the opportunity to buy something they 100% like. The fact that it is so personal gives them positive emotions. This is why the last research question “What effect does personalization have on the store visit intention of millennials and Generation Z when it comes to luxury fashion stores?” can be answered with a positive effect. These reasons are in line with previously discussed literature.

According to McKinsey (2019), consumers love personalization so much, they also want it offline.

They find it important to receive the right content and solutions specifically for them at the right time, because then, favorable consequences occur (Tam & Ho, 2006). It creates self associations, providing a good match with the preferences of consumers and an enhanced elaboration of relevant information and drawing more attention to the product, which positively influences purchase decisions by creating gratitude, delight and customer satisfaction (Bock, Mangus, & Folse, 2016;

Vesanen, 2007). Technology-enabled personalization (TEP) in-store, like virtual personal stylists, engage customers further (Riegger et al., 2021). With a combination of emotional and cognitive technologies, companies strive to build customer relationships (Huang & Rust, 2017). An important consequence of personalization is the provided emotional value. To make customers more engaged during the experience in-store, the personalization needs to provide emotional value. This can happen through technology that entertains customers and inspires them beyond customers’ common search behaviors (Riegger et al., 2021). This could take place in the form of intrinsic satisfaction, inspiration, the pleasure of discounts, or the shopping experience itself. When the consumer appreciates his experience, hedonic value in retail increases through entertainment and consumer delight (Babin et al., 1994; Arnold et al., 2005). The consumer wants inspirational content that enables him to discover new things besides his common search behavior (Vesanen, 2007. All of these findings came back in the insights of this research and are therefore reasons for their choices.

It is clear that these three elements have many benefits that engage customers and make them want to visit physical luxury fashion stores. However, each element has its own challenges as well. Some consumers have worries or doubts regarding these elements.

When it comes to digital elements in the store, some consumers are still skeptical about the technology’s capabilities and believe that human input, with its empathic features, is necessary to create truly personalized experiences in-store. A lack thereof may lead consumers to reject the technological innovations (Ram & Sheth, 1989; PwC, 2018). In this research, about 10% of the respondents were hesitant about this element. One reason is because they found it too impersonal.

This is a big contrast with the opinion of not wanting to interact (with the sales staff) in the store, which again shows that stores will benefit from both social elements (like employees present) and digital elements combined, so both personal and digital elements are provided. Moreover, just like with physical sales staff, consumers also get that feeling of being watched from technology which also leads to a perceived loss of control over privacy and thus negative consumer reactions (Esmark et al., 2017). The last possible objection is that some consumers doubt its convenience (Burke, 2002). Many consumers are not willing to switch to digital environments if it is an inconvenient and cumbersome process. Another thing that consumes doubt is the abilities of the technologies, like its advice, recommendations or efforts to increase convenience. This lack of trust comes from the lack of confidence in the maturity of the technology. In this research, the hesitant respondents did not know if it would function properly. They also fear that the technology will be too complicated to use, even if they do believe in its abilities. Finally, when the technology makes an error, consumers refrain from using it and require human help (Howland, 2017; PwC, 2018). The fear of it not functioning also shows the importance of a combination of sales staff (social elements) and

digitalization in-store, so they hear from another human that the machine offers positive interaction and results. If the staff is around, they can fix the machine immediately and explain its relevance to the customers.

A social aspect in-store that many people do not like in their shopping experience is the interference of sales staff (Meuter et al., 2000), checking up on them and starting unwanted conversations. Those consumers just want to shop in peace without being interrupted. Consumers’

often get the feeling of being watched by store employees, which causes them to perceive a loss of control over privacy and thus elicits negative consumer reactions (Esmark et al., 2017). In this current research, 13% of the respondents were hesitant about a store like this for these exact reasons.

They did not want to be watched by employees and did not feel they could shop in peace. Another reason that surfaced from literature for this generally negative perception of sales employees is that they believe that technology-enabled content offers better quality assistance. This content can help them faster, remembers their characteristics and is more objective, ensuring the superior one-to-one personalized experience that they want, when supported by technology (PwC, 2017). In the current research, people also doubted the quality of the help from employees when it comes to their needs.

Another reason derived from this current research is that people have social anxiety and therefore are hesitant about employees, interaction and store restaurants. For these reasons, offering both social and digital elements is important in the experience, to get the best of both elements that also solve the challenges of each element. Then, customers can choose whether they interact or not.

In personalization, there are also certain barriers. The exploitation barrier relates to consumers’ fear of being taken advantage of by the retailer, in several ways. Firstly, when brands have opportunities to overreach financially and thus taking price discriminations too far after assessing a customer’s willingness to pay right in the store. Secondly, when brands abuse personalized information or limit decision options to manipulate consumers’ decision-making process. Consumers want to make their own journeys and only want help from brands to carve their paths, and not be manipulated and no longer in charge of their decisions (Arnold et al., 2005).

Consumers also have a fear that their privacy is invaded by the brands after they collected their personal data, through for example identity disclosures in unfamiliar environments or usage situations, irresponsible data sharing (with for example other businesses) without permission of the consumer, or monitoring without consumers being made aware (Riegger et al., 2021). The feeling of being watched is also seen as an invasion of privacy which is heightened by personalization (Brehm, 1966). They want their personal data to be protected and do not want to feel surveilled. The presence of other customers makes it even more complicated, because it elicits the fear of them getting hold of personal information of the consumer (Riegger et al., 2021). In this current research, 13% of the respondents were hesitant about visiting a store with personalization. Mostly, it was because they wanted to make their own decisions, and did not want to put the focus too much on them as it made them feel pressured and uncomfortable. The privacy fears were not much of an issue, except if the

personalization took place on a digital device. However, these concerns outweigh the benefits of personalization in the eyes of most consumers, and it is infeasible without some loss of privacy (Chellappa & Sin, 2005). Consumers still want personalization to make their experience more personal and more engaging in-store, regardless of the previously mentioned risks. Again, the brand can help by finding a balance between technological elements for convenience and personalization, but also employees (social elements) providing a safe, human factor and reassuring the customers while they are shopping that they get the best treatment possible, their information will stay safe, and that they are welcome to try anything without the pressure to buy.

Now that both the advantages and challenges are identified of these three elements, it can be concluded that combining the elements into one whole in-store social experience will increase store visit intention the most. This is because this way, both the enthusiasts of those elements and the people who are hesitant will be drawn to a store that provides all three elements, as the challenges of one element can be solved with the benefits of the other elements in this overarching experience. In a store that provides all three elements, the in-store social retail experience, there is something for everyone. This also surfaced from the extra ANOVA test conducted in this research. The result of this test was that the in-store social retail experience (all three elements in a store) increases the store visit intention significantly and has a very positive effect. 90% agreed that they would like to visit this store and more than half of the respondents even strongly agreed, also respondents that were hesitant about one or more (separate) elements. 89% would keep visiting this store. There were many respondents saying they loved the fact that there was something for everyone: not only people that adored all three elements, but also the ones that loved two and were hesitant about one. They could also still enjoy the store because there were enough features for everyone. Respondents were also enthusiastic about the fact that this store offers the best of both worlds: both the ease of online shopping and the cool digital features, but also all of the interactive social elements of offline shopping. And of course the personalization binds everything perfectly together, according to the respondents.

An unexpected finding in this current research is that while gender does not have a main effect on store visit intention, it does have a significant interaction effect on the store visit intention in the test of within-subject effects. A reason could be the following: Following from this research is that males like shops with elements slightly more than females (see appendix 1). This could be because males like to try new things and are more risk taking than women. Especially when there are new

technological features that provide new enjoyable tools in the stores that are innovative, they stimulate consumer interests. The male population is usually not attracted by conventional stores (Otnes and McGrath, 2001), but when special elements like digitalization and personalization are offered that are new and innovative, this segment of population is also attracted to the store. They increase their store visit intention because a new, fun experience is provided, which they like, because they get tools that satisfy their needs in a fun way that suits them better. This makes them want to visit these kinds of stores more and makes them purchase more as well (Otnes and McGrath, 2001). The reason for this significant interaction effect is that within this survey 80% of the shops are shops with an element and only 20% are normal shops. Within this survey the weight of the shops with elements is much stronger than the normal shops (so the slightly stronger positive effect on males comes forward stronger as well). Within the normal population of shops this is not the case, since these concepts are still relatively new. So this result cannot (yet) be directly translated to normal shopping areas.

Figure 3. Estimated marginal means by gender