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How do Online Customer Experiences on

Different Sensory Levels affect

Customers’ Purchase Intentions?

Tessa Prinz 11145196 26-01-2017- Final version MSc. BA – Marketing Track University of Amsterdam Supervisor: dr. Umut Konus

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Statement of originality

This document is written by Tessa Prinz who declares to take full responsibility for the contents of this document. I declare that the text and the work presented in this document is original and that no sources other than those mentioned in the text and its references have been used in creating it. The Faculty of Economics and Business is responsible solely for the supervision of completion of the work, not for the

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Table of Contents

Statement of originality ... 1 Table of Contents ... 2 Abstract ... 3 1. Introduction ... 4 2. Literature Review ... 8 2.1 Customer Experience ... 8

2.2 Sensory levels within Customer Experiences ... 10

2.3. The effect of Customer Experiences on Purchase Intentions ... 14

2.4 The effect of Customer Experiences in different Sensory Levels on Purchase Intentions ... 16 2.4.1 Sight ... 16 2.4.2 Sound………..18 2.4.3 Smell ... 20 2.4.4 Taste ... 20 2.4.5 Touch ... 21

2.5 Sensory experiences in E-commerce ... 22

3. Factors Affecting the Online Customer Experience and Purchase Intentions ... 25

3.1 Demographic characteristics... 25

3.2 Psychographic characteristics ... 26

3.3 Product categories ... 29

3.4 Research gap and question: ... 29

4. Conceptual Framework ... 31

5. Research Design and Methodology ... 37

6. Results ... 44

7. Discussion and Conclusion ... 61

8. References ... 66

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Abstract

A lot is known about how touch, taste, smell, sight and sound affect customer’s behavior and how small sensory changes can make a huge difference. However, despite the increasing e-commerce, little is known about how different senses affect customer experiences and customers’ purchase intentions in the online environment in a relative and comparative manner. Much is known about how senses have a big impact on our behavior in the offline environment, but there is a knowledge gap concerning the online context. The purpose of this research is to determine how sight and sound affect the online customer experience and customers’ purchase intentions. An experiment and online survey were distributed among 260 respondents to collect data. A key finding is that the stimulation of sight has a negative effect on purchase intentions. Results also show that sound has a different impact on customers depending on their shopping frequency. Sound decreases the purchase intention for frequent shoppers and increases the purchase intention for non-frequent shoppers. Obtaining more knowledge about this field will help managers to make decisions concerning their webpages in order to increase the customer’s online experience and sales.

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1. Introduction

In recent years, there has been an increasing interest in customer experiences. Shops like Apple Store and NIKETOWN are perfect examples that attract many customers because of the experience they provide to them among others. According to Pine and Gilmore (1998, p.98) “An experience occurs when a company intentionally uses services as the stage, and goods as props, to engage individual customers in a way that creates a memorable event”. Managers have become more and more conscious of the fact that value for customers needs to be created in the form of experiences. Offering only products or services is not sufficient anymore. The question is, how can brands create a good shopping experience for their customers? There are multiple approaches to succeed in creating this experience, but in this current study we will focus on creating online customer experiences by engaging the human senses. This research will try to answer the following question How do Online Customer Experiences with Different Sensory Levels affect Purchase Intentions?

Engaging the five human senses (sight, smell, touch, sounds and taste) can have a big impact on our decisions and buying behavior (Krishna, 2012). This type of marketing is also called Sensory Branding, where senses are used to relate with consumers on an emotional level (Hultén et al., 2009). Many attributes of products are based on interactions between the senses or on senses consumers may not even be aware of. Managers can use sensory marketing to create “subconscious triggers that characterize consumer perceptions of abstract notions of the product” (Krishna, 2012, p.2). For example, background music (sound) has subconsciously an effect on consumers because people spend more or less time in a store depending on the background music. Also ambient scents, when perceived as pleasant, increase spending when there is no music playing (Krishna, 2012). Many

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companies make use of this knowledge, e.g. Nike introduced scent into their stores which increased purchase intention by 80%. Also, Diageo showed that changes to the multi-sensory environment increased enjoyment of whisky up to 20% (The Guardian, 2016). Think about Ikea, when did you leave this shop with buying only the singly item you came for? Ikea stimulates your sight sense by creating a lifestyle in its shops which makes people see themselves living in this lifestyle. This causes customers to buy much more than just the lamp you came for. But what if there is no physical store, and you shop online?

As we know, in the past years the E-commerce is upcoming and it is therefore important to know what E-shoppers appreciate and what they are looking for. E-commerce sales more than doubled from 2006 to 2014 (US Department of Commerce, 2015) and also in the Netherlands customers are buying more often products and services on the Internet. In 2015 71% of the Dutch population bought and shopped online. This number has more than doubled in the last ten years. In 2005, only a quarter of Europeans was considered an E-shopper, now this is more than half (CBS, 2015). How are online websites and companies able to develop and maintain a customer experience? While there exists much literature on customer experience, the focus lies primarily on different types of experiences and experiences for offline shoppers. In addition, the research to the effect of senses on consumer behavior is conducted in different offline contexts but with respect to the online environment, there is very little known. Therefore, this study will look into the impact of sensory effects on online shoppers and their attitudes. There appears to be a knowledge gap about if and which of the five senses an organization should focus on to increase a customer's attitude and purchase intention while shopping online. Nonetheless, there are some senses (smell, taste, touch) that can only be influenced in an offline environment and

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not yet in the online environment. Therefore, in this study, we will be focusing on only two of the five sensory levels: hearing and sight. This paper attempts to respond to the question how these two senses should be used in the online environment and looks at them in a comparative manner.

The results of this research conducted on different types of senses will contribute to both academic researchers and marketers. Academically, the study provides new insights in sensory marketing and its impact on customer attitudes and purchase intentions. There have been many researches investigating the concept of customer experience and the types of experiences but no study investigated the relationship between online customer experiences on different sensory levels and customer attitudes and purchase intentions. This study will bring new insights in how sight and sound are relative to each other in different settings and the impact of different factors. Do senses have a different impact on people with different shopping motivations? It might be the case that impact of the online stimulation of senses on purchase intentions differs in age groups. Maybe it even differs in gender? These questions and more will be answered by taking a look if different product categories, demographic and psychographic characteristics moderate this relationship. In this study the purchase intention is measured for the same product with or without sense stimulation. By manipulating sense stimulation on the same product, the difference in purchase intention can be really explained due to the differences in sight and sound. Knowing that, for example, the customers’ purchase intention for a product offer with sound is higher than for the same product offer without sound is a very valuable finding and could be put into practice directly by managers.

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In addition, many companies are investing money on customer's senses in offline shops, e.g. the smell when entering the shop, a live DJ to provide good music, lights etc. However, in the online environment they run behind on this customer experience, even when the importance of Internet is increasing. Managers simply do not know what works and what not because there is a huge knowledge gap concerning sensory effects in the online environment. However, because of the rapid expansion in E-commerce, it is of high importance that brands operating online, should adopt the concept of the experience economy. Online sales have increased over the years but it is still not that simple. Most consumers (85%) still prefer to shop in stores because they want to feel and touch products before they make a purchase decision and 30% like to have some advice on what products they should purchase (Timetrade, 2015). Hence, although E-commerce increases, there is still a big group of consumers that rather not purchases online because they cannot use their senses in an online environment. The results of this study will give managers insights on how to improve online customer experience related to senses on their website which in the end might improve their online sales. With this study it will be made clear if it is important to pay attention to senses in online environments or not. It might be recommendable to insert background music on your website, but no extra visual tools. With the new insights of this study, it may become clear that music is not appropriate for an older target group but it might be effective for the younger e-shoppers. Also, we might find out that the sensory experience is more important for high-touch products like a matrass or clothing than for low-touch products like a washing machine or services. With new information, managers can adopt their websites according to target group and the products they sell. In this research we will only investigate the senses sight and sound and we will

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leave touch, smell and taste out of this study since technically these senses cannot yet be fully implemented in a digital environment.

2. Literature Review

2.1 Customer Experience

Creating value for customers in the form of experiences is of increasing importance. Unfortunately, many consider that managing experiences is simply providing entertainment or being creative (Carbone and Haeckel, 1994). However, the customer experience is a much more complex issue than that. A customer will always have an experience when buying or receiving a product or service; good, bad or indifferent (Carbone and Haeckel, 1994). Providing a good experience will affect a customer's satisfaction (Liljander and Strandvik, 1997), but also their loyalty (Yu and Dean, 2001) and expectations (Johnson and Mathews, 1997). Lamentably, only 1 percent of consumers indicate that the customer experiences of brands and firms always meet their expectations. No less than 89 percent of consumers say they will do business with a competitor if the customer experience is poor with their supplier (Roman, 2010). Offering only products or services is not sufficient anymore. Organizations need to transfer satisfactory experiences to their customers (Carbone and Haeckel, 1994). According to Pine and Gilmore (1998) companies are competing on experiences as services are becoming more commoditized. Companies compete best when both emotional and functional benefits are combined in their offerings. Emotional bonds between customers and companies are hard to sever for competitors (Berry, Carbone, and Haeckel, 2002).

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In the past there have been many attempts to define what a customer experience is. Many agree on the fact that a customer experience arises from a set of interactions between a product or company and a customer, which provoke a reaction (LaSalle and Britton, 2003; Shaw and Ivens, 2005). An experience is personal and customers’ expectations are influenced by their previous experiences with a company’s offerings. Customers automatically compare each new experience with their previous ones and judge it accordingly (Meyer and Schwager, 2007).

According to Meyer and Schwager (2007), customer experience is a subjective and internal reaction customers have to any direct or indirect contact with a company. Direct contact normally is initiated by the customer and occurs in the course of purchase, use and service. On the other hand, indirect contact usually involves encounters that are unplanned, with representations of a company’s products and services and takes the form of WOM recommendations or criticism, advertising, news reports and so forth.

There has been a shift from traditional marketing to experiential marketing where traditional marketing focuses on functional features and benefits and pictures consumers as rational decision-makers, where on the other hand experiential marketing pictures consumers as rational and emotional decision-makers with a focus on accomplishing pleasurable experiences (Schmitt, 1999). This shift toward experiential marketing has occurred because of three developments in the business environment. First of all, business has become increasingly driven by information technology: (1) The Omnipresence of Information Technology. Secondly, nowadays, as a result of the information technology, information about brands is available instantly and globally: (2) The Supremacy of the Brand, products are there to enhance customer experiences and are no longer clusters of

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functional characteristics. Finally, the shift toward experiential marketing occurred because of (3) The Ubiquity of Communications and Entertainment. Firms have the need to communicate themselves as "customer-" and "community-oriented" and therefore providing fun and entertainment for their clients is more important (Schmitt, 1999).

2.2 Sensory levels within Customer Experiences

An interesting field in creating customer experiences is the experience a customer receives on sensory level. Krishna (2012) describes how senses can have a big impact on your decisions and buying behaviorwith a good example: there are a lot of books to read online, lots of time this is for free or for a reduced fee and it is easier to take with you on a tablet instead of carrying a heavy book with you. But for some reason, people still buy physical textbooks, course packs and so forth because they like the touch and smell of the pages or simply the ability to cozy up with a book. This example describes perfectly that although there are more convenient alternatives, people make decisions based on their senses. Many attributes of products are based on interactions between the senses or on senses consumers may not even be aware of.

Marketers use this knowledge within Sensory branding, a type of marketing that includes all the senses, relating to the brand. The senses are used to relate with customer on an emotional level (Hultén, 2011). A multi-sensory brand experience creates a certain brand image in the customers’ mind by creating certain feelings and beliefs (Hultén, 2011). It is vital for brands to create an experience for customers because in this way a brand can distinguish and differentiate itself from competitors and it can enhance the brand’s identity (Hultén, 2012). This experience can be achieved by applying sensorial approaches in relation

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smell, hearing, taste, sight and touch where sight is the most dominant sense (Krishna, 2013).

Figure 1: The five human senses

Khrisna (2012) defines sensory marketing as “marketing that engages the consumers' senses and affects their perception, judgment and behavior” (p.2). There is no doubt that senses can influence customers’ behaviors. When a consumer visits and leaves a store, he automatically evaluates the experience he just had. The atmosphere within a store has a big influence on people’s behavior and this atmosphere can be created and managed with the engagement of the human senses (Spence et. al, 2014). According to Hultén (2011) the sensory strategies can differentiate the brand by approaching the consumer’s mind and senses both from an emotional point of view, and from a cognitive one. Each sense can have an impact on behavior or attitudes, both together as separately. Since a lot of sensory marketing is used to influence a consumer’s reaction subconsciously, for the analysis, methods such as Eye tracking are used in order to evaluate how consumer respond to advertisements or different fragrances. Eye tracking is an effective method to evaluate a

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shoppers behavior and purchases but also in evaluating how customers perceive your website and to what they pay attention (see figure 2).

Figure 2: Eye tracking of website in case study of Techwyse (2010)

The five human senses in consumer behavior have an increasing role in marketing, since research under the experiential paradigm has pointed to multisensory stimuli as intensifiers of consumers’ experiences (Agapito, Oom do Valle and da Costa Mendes, 2013) but there is still plenty of research needed.

Although sensory marketing for many sounds unfamiliar and innovative, according to Krishna (2012) the concept is not new. The evolution of marketing can be divided into three

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were centered on practical aspects of goods, underlining utility and expenses. The second stage, start 1970s, saw a massive increment in branding. Organizations started to understand that a brand name, for example, Levi's could have esteem all by itself. The third stage, which is the modern era, has been set apart by the ascent of the Internet and the expanding consciousness of organizations of the sensory attributes of products. Unwittingly, senses have been controlling us for a long haul, the distinction is that now numerous organizations are only becoming aware of the presence and existence of sensory attributes. The difference is the awareness and not the execution. We can state that the traditional mass marketing, which once overwhelmed the marketing field, is being addressed like never before as a productive and successful approach to reach consumers (Krishna, 2010). The cost benefits related to mass marketing, are no sufficiently more to make an impression on everyone.A few researchers assert that the transition from mass marketing to relationship and micro marketing can be seen as a paradigm shift (Sheth and Parvatiyar, 2000). Sensory marketing is differentiated from mass and relationship marketing by having its source in the five human senses. It is in the human brain, in both the left and right hemispheres, that the mental streams, forms and mental responses occur that result in an individual's sensory experience. The image, created and formed by the brain with its five senses, is a result of the experiences and encounters between the individual and the firm or brand. Every individual has a subjective experience that is called ‘experience logic’ which is a result of how the individuals five human senses interpret and perceive an experience, either singly or together (Hultén et al., 2009). In a later chapter each sense will be discussed separately with their effect on purchase intentions.

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The table below shows an overview of the five human senses with their sense expressions. A sense expression is the way an organization clarifies a brand’s identity and values in relation to the human brain. “Sense expressions create an individual’s mental picture of a brand’s emotional and rational features” (Hultén et al., 2009, p. 162). In short, the sense expressions applied should stand for the characteristics that a brand has and wants to communicate to customers.

Table 1: Overview of sensors, sensations and sense expressions

Sensors Sensations Sense expressions

Smell sensor Atmospheric Product congruence, intensity, and sex

Atmosphere, theme, and advertency Scent brand and signature scent

Sound sensor Auditory Jingle, voice, and music

Atmosphere, theme, and advertency Signature sound and sound brand

Sight sensor Visual Design, packaging, and style

Color, light, and theme

Graphics, exterior, and interior

Taste sensor Gastronomic Interplay, symbiosis, and synergies

Name, presentation, and setting Knowledge, delight, and lifestyle

Touch sensor Tactile Material and surface

Temperature and weight Form and stability Source: B. Hultén, N. Broweus, and M. van Dijk, Sinnesmarknadsföring, (Malmö: Liber AB, 2008)

2.3. The effect of Customer Experiences on Purchase Intentions

Earlier in this paper the definition of what a customer experience exactly consists of, was explained. We saw that customer experience has changed over the years, but most

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interesting is to know in what extent customer experience affects purchase intentions of customers.

Pine and Gilmore (1999) stated that creating a distinctive customer experience can provide enormous economic value for firms. But in order for companies to compete by providing customers with satisfactory experiences, managers must orchestrate “clues” that can be detected in the buying process. Companies must gain an understanding of the whole customer’s journey, from expectations to the evaluation. Utilizing that information, organizations can arrange a series of "clues" that aggregately meet individuals' needs and desires (Berry, Carbone, and Haeckel, 2002). Once a good customer experience is achieved this customer experience may provide new means of competition (Pine and Gilmore 1999; Voss, 2003; Meyer and Schwager, 2007).

Many studies found that, providing a good experience affects customer satisfaction (Liljander and Strandvik, 1997) which in turn drives loyalty (Caruana, 2002; Shankar et al., 2003). Furthermore, a customer experience can influence expectations and supports the brand (Berry and Carbone, 2007). But one of the most useful consequences of a good customer experience is that it not only drives customer satisfaction and loyalty, but also word-of-mouth (Keiningham et al., 2007). The influence on WOM is investigated both in offline media (Babin et al., 2005), online media (HennigThurau et al., 2002) and experiential settings (Voss and Zomerdijk, 2007). Word-of-mouth is viewed as important for various reasons. First of all, WOM communication provides face-to-face information and is perceived as highly credible (Brown et al., 2005). This information can impact others’ beliefs around an organization and their offerings, therefore altering consumers’ intentions to purchase from the organization (Sheth and Parvatiyar, 1995).

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The problem is, that it is getting harder to gain an edge over competitors just by providing good service and customer experience. Therefore, new and innovative marketing strategies must be developed by marketers: a paradigm shift from 2-D (sight and sound) to 5-D. In the next chapter we will discuss the effect of the five senses on purchase intentions.

2.4 The effect of Customer Experiences in different Sensory Levels on Purchase Intentions

2.4.1 Sight

People rely very strongly on their sense of sight and out of the five human senses, sight is the most noticeable one. Most choices and experiences in our daily life depend on visual impressions (Hultén et al., 2009). Also Krishna (2013) expresses that sight is unmistakably the most dominant sense and there is a lot of research on visual stimulation inside the field of marketing. Sight is a standout amongst the senses in advertising and the sense advertisers and brand manufacturers has customarily focused on the most (Lindstrom, 2005). Various types of sight stimulations are put away as encounters in the consumer's mind, which thusly permits them to relate to prior experiences. One method to stimulate consumers’ sight to create an experience is by utilizing diverse colors and shapes. This helps brands to separate themselves from competitors (Hultén et al., 2009). The logo, color and shape of a brand are components that could create a memorable experience for customers (Hultén et al., 2009).

One of the most prominent aspects of any visual sensation is color. Color can be perceived amongst the most agreeable and artistic expressions. The perception of specific colors can bring particular and predictable responses that can be utilized by advertisers to build up a mood for a product, area or commercial. For example, shorter wavelengths,

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which are seen as blues, are quieting and relaxing, yet longer wavelengths, which are seen as reds, are all the more stimulating and energizing (Valdez & Mehabian, 1994). You can use different colors to create and stimulate impressions and associations. Wu et al. (2013) directed a study with respect to the impact of various visual display strategies on the customer’s shopping experience in a fashion retail environment. It was demonstrated that the shopping experience could be enhanced by style coordination e.g. while showing how things can be worn together. Color was likewise appeared as an essential component and the study demonstrated that customers favor colorful stores since it has a pleasant atmosphere and visual attractiveness. According to Wu et al. (2013) one should consider the different types of colors depending on what kind of effect you want. Also the environment and visualization inside a store has an impact on customer’s daily life. It is vital to pay attention to store outline, space and materials of the environment to improve customers shopping experience (Pecoraro & Usitalo, 2014). The figure below illustrates that color changes shopping behavior and even attracts different types of shoppers.

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Besides color, sight can be manipulated with for example, the perception of a product’s weight through package design. A classic way is through situating of the item’s image on the package. Item pictures that show up in the upper or left portions of a package convey lightness, while those set in the bottom or right areas convey heaviness. See figure 4 and 5 for examples of the study (Deng and Kahn, 2009). Altogether, we can conclude that sight is a strong sense that can be manipulated in different ways for marketing purposes.

2.4.2 Sound

Another powerful sense that can change one’s perceptions of an experience is sound. The stimulation of sound is one approach in order to change the conduct of customers. Sound does not only have an impact on emotions and attitudes, but additionally on states of mind and buying behavior. This the reason why numerous stores today use in-store music to stimulate the sense of sound. Interesting about background music is that its effects are completely subconscious; most people do not realize that they spend more or less time in a store because of the pace of the background music. Sound can be used as a

Figure 4: Deng & Kahn (2009), in Krishna (2013)

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firm’s strategy to strengthen the image and identity of a brand (Hultén et al., 2009). Concerning music, congruence is one of the key parts of understanding the effects of sounds in advertising. A specific piece of music or sort of voice may be perfectly suited for one goal, yet may fail regarding another (Hultén et al., 2009). Usually, music is used in advertising to enhance the message of the advertisement rather than constituting the central message of the advertisement itself. Hence, the congruence between the nature of the commercial and the music utilized is very important. Studies even show that when congruence is achieved, music helps viewers of an advertisement better process its message (Park,1986). With respect to the shopping experience, a common use of music is an ambient sound in stores. Milliman (1982) found that when background music is played in a store, it can have an impact on people’s perception of the passage of time. When music is played slower, it causes people to spend more time browsing in a store than when music is played with a faster pace. Andersson et al. (2012) examined the impacts that music has on buyer conduct in various retail settings. The results of the study uncover that shoppers who are presented to music have a tendency to spend more cash and time in a store.

Apart from music you have sonic branding, a type of sensory signature, that appeals to the sense of hearing. An example is a slogan : L’oreal: Because you’re worth it. Usually, when we hear a male voice, we relate lower tones with power and strength, while higher tones are connected with stress and weakness. (Zuckerman and Miyake, 1967). Concerning female voices, a research of female telemarketers demonstrated that on average higher-pitched voices caused more sales than lower higher-pitched voices (Oksenberg, Coleman and Cannell, 1996).

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2.4.3 Smell

A lot of research is done about how the smell sense influence product and store evaluation and also how it influences time spent by the customer inside the store (Krishna, 2013). Bosmans (2006) found that a pleasant scent can improve customer experience in the store and customer evaluation of products. Scents that appear to be connected to products have a tendency to contribute more positively to the sensory experience. Especially scents of vanilla and clementine influence customers’ behavior by making them unknowingly stay longer in in shops or supermarkets than they would otherwise have done (Krishna,2010). A study conducted by Anggie (2011) confirms this with the prove that a pleasurable smell influences customer behavior in a way that they are more probable to spend more time at a place. Consumers are also positively affected by nice smell in terms of increased money spent and satisfaction (Morrison et al., 2011). An ambient smell can even improve people’s recognition of brand names (Morrin and Ratneshwar, 2003). Just as with music, it is very important to have product congruence, that the scent matches the product. A customer’s brand or product evaluation will be positively affected when the smell is congruent with the product type, regardless of how salient the smell is (Bosmans, 2006). Smell is not possible to implement in the online environment, which is why this sense will be left out in this current study.

2.4.4 Taste

Taste is the sense which is most hard to use when creating experiences within sensory marketing. It is quite uncommon to use taste as a marketing tool since customers cannot really express their preferences regarding their taste experience. Sight, smell and sound have a major part in how a taste is perceived by customers (Hultén et al., 2009).

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According to Krishna (2013), taste is a combination of how it looks, feels, smells. The sense of taste is also being impacted by outer components, for example, brand name, packaging and the marketing. A good taste also improves the likelihood that someone stays longer with a brand but in general it is harder for taste to create an extra customer experience than for other senses.

2.4.5 Touch

All the senses we have discussed so far are not always enough for consumers to evaluate products or to make purchase decisions. Consumers want information such as on the texture, the form or weight of a product and therefore the sense of touch is of great importance. Holbrook and Moore (1981) stated that the visual and tactile senses ought to be distinguished as the most active of our five senses. Consumers like to assess products and assemble information about them through touch (McCabe and Nowlis, 2003). Many studies found that the encouragement of touching products can lead to increased chances of impulse buying and unplanned purchases (Peck and Wiggens, 2006). Consumers prefer store environments because it allows them to inspect products physically, to touch them and then decide. Balaji et al. (2011) stressed that touch has a big and significant impact on the customer’s evaluations of products and that people’s attitudes and purchase intentions are significantly more impacted by tactile than visual information. It also shows that customers have larger undesirable feelings when the ability to touch a product is denied then when the vision of the product is taken away.

Haptic marketing is confronting a big challenge namely the absence of haptic interaction provided by the internet. When we are only touching a mouse and a keyboard it is difficult to have new or different haptic experiences. Therefore it is interesting to see how

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organizations can deal with both the increasing importance in sensory experiences and the digitalization. In the next chapter the sensory experience in e-commerce will be discussed and the problem discussion of this current study will be made clear.

2.5 Sensory experiences in E-commerce

In today’s globalized world, where e-commerce is sometimes even threatening the physical stores, it is important for an organization to provide a good online customer experience. There are a number of studies that looked into the drivers of online experience, for example on trust (Tan & Sutherland, 2004), perceived benefits (Corner, Thompson, Dillon, & Doolin, 2005), perceived control (Koufaris, Kambil, & LaBarbera, 2002), perceived usefulness (Gefen, Karahanna, & Straub, 2003) and enjoyment (Wolfinbarger & Gilly, 2001).

However, only a few studies has been done regarding the use of human senses in creating online customer experiences. Of these studies, most have been done regarding the sight sense whereas Khakimdjanova and Park (2005) uncovered that a shopping experience could be improved by adding visual features such as human models, zoom-function or automatic rotation. This could create a sensory experience for consumers that would compete with traditional retail channels. Ha and Lennon (2010) investigated the importance of personalization. They uncovered that there is a contrast between highly involved online consumers and those without purchase intention. Highly involved customers felt excited and aroused by extensive product-related visual stimulation, while online consumers without purchase intention were pleased by websites with rather irrelevant cues e.g. patterns and color of the background. Ha and Lennon (2010) further uncovered that it is recommendable for companies to use different strategies for different consumers to create and ensure a superior shopping experience.

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Regarding sound, Fiore and Kelly (2007) argue that only a small amount of existing online stores uses sound as a marketing tool for the brand and its items. They also stress that the use of sound both improves the social and experiential qualities among the customers when they shop online.

Both taste, smell and touch are hard to investigate concerning the online environment. Jiang and Benbasat (2007) argue that the lack of direct experience limits the ability of consumers to judge product quality and leaves them less emotionally engaged in shopping experience which leads to lower online purchase intentions. However, Hultén et al. (2009, p.148), state that even in a two-dimensional environment, such as a website, the touch sense can be stimulated. This can be done through pictures or descriptions of something that says: “feels soft and smooth against the skin”. Along these lines customers can get a feeling of how an item feels physically, regardless of the possibility that physical interaction is missing at that moment, since individuals can recall the feeling of prior touch experiences. This way the need for a customer to touch those products decreases. On the other hand, digital innovation can produce a touch experience through simulated pressure and vibration. Technology is likewise accessible that stretches the skin when a digital item is touched, which makes it possible to duplicate the feeling of touching something that is envisioned on a screen. Of all five senses, in this study the focus lies on sight and sound since we focus on the online environment and not on the offline environment. Unfortunately, in the current study, it is technically not possible to manipulate taste, touch and smell in the online environment. Therefore sight and sound are chosen in two different settings and with interesting moderators.

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Authors Factors

Sight Valdez & Mehabian, 1994 Hultén et al., 2009 Deng & Park, 2009 Wu et al., 2013 Krishna, 2011

Pecoraro & Uusitalo, 2014

Colors Shapes Logo’s Design

Sound Zuckerman & Miyake, 1967

Oksenberg, Coleman & Cannell, 1996 Millaman, 1982 Hultén, 2011 Andersson et al.,2012 Music Sonic Branding Auditory Storytelling Noise Smell Bosmans, 2006 Parsons, 2009 Hultén et al., 2009 Krishna, 2013 Aroma’s Congruence

Taste Krishna, 2013 Combination of senses

External elements

Touch Holbrook & Moore, 1981 McCabe and Nowlis, 2003 Peck & Childers, 2003 Krishna et al., 2010 Balaji et al., 2011

Congruence Need for touch Impact on purchase behavior Online Sensory Customer Experience Ha and Lennon, 2010 Fiore and Kelly, 2007

Khakimdjanova and Park, 2005 Hultén et al., 2009

Sight Sound

Website design (zoom function)

Touch

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3. Factors Affecting the Online Customer Experience and Purchase

Intentions

There are a few factors that might affect the relationship between online customer experiences with different sensory levels and the purchase intention. Both demographic as psychographic characteristics will be discussed.

3.1 Demographic characteristics Gender

It would be interesting to see if there is a difference in reaction in gender. Man and women might react differently to the stimulation of senses while online shopping since there appears to be a difference in gender concerning online shopping. Male shoppers make more online purchases and spend more money online than females (Stanford et al., 2004). Maybe this is because women demand more of shopping environments than men do. Men take less pleasure in the shopping journey, whereas women are more patient and inquisitive (Underhill, 2010). Women spend more time browsing, research available options and are shopping for fun (Cleaver, 2004) while men tend to buy quickly in order not to spent time shopping, they are “quick shoppers” (Hansen and Jensen, 2009). It is important to find out if there is any difference in gender and preference for online sensory experiences because websites can adopt changes regarding to the results of this study. If we find out that women like to have background music but man do not, the choice can be made to only insert background music on pages that are directed to women ( e.g. women clothing page).

Culture

Despite the globalization, there still exist many differences between cultures. Also in internet usage, we see that consumers from an individualistic culture are more likely to use

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the Internet for e-commerce than those from a collectivistic culture (Park and Jun, 2003). An individualistic culture is a culture in which an individual and his personal goals are more important than the wellbeing of the whole group. Ties between individuals are loose and people are expected to look after themselves and only their immediate family, while in a collectivistic culture people are integrated in strong, cohesive in-groups (Hofstede, 2011). In addition, a more masculine culture society has more predominant male shoppers and is more negatively related to the amount of time spent online (Park and Jun, 2003). Hofstede (2011) explains that the cultural dimension of masculinity refers to the distribution of emotional roles between genders. It is important to know if there is a difference in preferences for experiences between individualistic and collectivistic cultures since we know they have a different look at things. Practically, international companies might change the website lay-out and shopping experience for certain countries. It is not possible to assume that all cultures like the same websites, therefore it is important to investigate culture as a moderator in the relationship of online sensory experiences and purchase intentions.

3.2 Psychographic characteristics Need-for-touch

Peck and Childers (2003) describe the need for touch as a preference for touching products before purchase. NFT incorporates two dimensions: autotelic and instrumental. The first relies on subjective and psychological information and touch results in pleasurable emotions. The latter is more goal-oriented, focused on objective and tangible details. Citrin et al. (2003) found that the need to touch products were negatively related to online purchasing and that a reason not to buy a product is the lack of accessibility to touch. Peck and Childers (2003) confirm this in their study when likewise, internet purchase and need

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to know if there is a difference in purchase intentions related to how high someone’s NFT is. It might be that people with a high NFT are extra sensitive to an online experience where sound and sight are stimulated which again affects their purchase intention.

Frequency of online purchases

Frequency of purchases is positively related to online shopping and negatively related to the probability to end an online transaction (Yang and Lestler, 2004). When you compare Internet shoppers to non-shoppers, Internet shoppers are more impulsive, less risk-averse and more convenience and variety seeking. Internet shoppers are perceived to be less brand and price conscious than non-shoppers (Yang and Lestler, 2004). Furthermore, according to Min et al. (2012), increasing shopping frequency reduces perceived risk and improves the probability of repetitive purchasing. Besides that, frequent shoppers are tend to have higher levels of trust (Chiagouris and Ray, 2010). Since it is already known that these differences exist between frequent and less frequent online shoppers, there could also be a difference in reaction to the online sensory experience. Practically, this could have implications for loyal online customers of your website. If this study reveals that frequent e-shoppers have a higher preference for the online sensory experiences, you could choose to expose them to another websites lay-out with e.g. background music and less frequent shoppers might prefer to visit a site without extra sight and sound stimulation.

Shopping motivation

There are two kinds of shopper motivations: hedonic value and utilitarian value. Hedonic value is about the shopping experience and reflects emotional and psychological aspects of this experience. On the other hand, the utilitarian value is all about achieving the

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shopping objective in an efficient way (Hirschman and Holbrook, 1982). According to Babin and Attaway (2000), utilitarian shopping value concerns the task-related value of a shopping experience, while hedonic shopping value concerns the value that comes from the shopping experience itself. Several studies looked into the correlation between shopping value and retail variables, e.g. Customer satisfaction (Babin et al., 2004, 2005), Customer share (Babin and Attaway, 2000) and purchase repetition (Stoel et al., 2004). The difference between both motivations is large and therefore also in this study, different results are expected.

In our case, it might be that people that shop with a utilitarian value do not have the patience for extra sensory stimulations like music and video’s while people that shop with hedonic motivations do appreciate these extra features. A website should determine with which motivation customers are visiting their website. Booking a vacation is probably more hedonic than buying garbage bags. Websites could be adapted according to shopping motivations, it is important to have more knowledge about this moderator otherwise it might be even counterproductive to insert extra sensory stimulations if the customer is visiting your website to leave as quickly as possible.

Innovativeness

Innovativeness concentrates on the one hand on a cognitive style, which includes a person’s intellectual, perceptual and attitudinal attributes, hence this sort of innovativeness is an essential indicator of the adoption of innovations (Joseph and Vyas, 1984). The second approach is the domain-specific innovation scale, developed by Goldsmith and Hofacker (1991). According to Goldsmith and Flynn (1995), innovativeness is ought to be considered as a domain-specific phenomenon, connected to broader innovative traits but more predictive of real behavior in a particular product than is global innovativeness. With respect

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to the Internet, Citrin et al. (2000) research found that domain-specific innovativeness moderates the relation between internet usage and online shopping adoption. It might be that people who score high on innovativeness are also more open-minded to an online sensory experience than people who score low on innovativeness.

3.3 Product categories

To make this study more representative, different product categories will be used since each product category might have a different effect on a customer’s purchase intention. Since this study will investigate customer experiences with different sensory levels, it would be interesting to see if there exists any difference between high-touch products and low-touch products. With high-low-touch products, there is a need to inspect the product before purchasing, like for example clothing (Lynch et al., 2001). On the other hand, with low-touch products, or intangible products, there is no need to touch and here shopping rapidly is of greater importance, for example, software and services. Therefore, people who shop low-touch products have a preference to shop online since it goes quicker than in the offline channel.

3.4 Research gap and question:

There has been done a lot of research about the customer experience in general. Previous studies talk about definitions, shifts to experiential marketing and also about sensory marketing. It has been made clear in several studies that it is important to engage the customers’ senses to create a long lasting experience. However, these studies only investigated physical shops or the offline environment. Regarding the online customer experience, there has been looked into perceived risk, trust, loyalty among other things but there seems to exist very little research about the use of senses when creating an online

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customer experience. This is contradictory since the Internet ,and therefore E-commerce, is growing each year. Since we know that sensory marketing enhances the customer experience in offline environments, it is just as important or maybe even more important to know if sensory marketing also enhances the customer experience in online environments. In addition, there is a knowledge gap about the impact of several moderators, i.e. product categories, demographic and psychographic characteristics on the online customer experience. Therefore, this study is trying to answer the following research question:

How do Online Customer Experiences with Sight and Sound stimulation affect Customer Attitudes and Purchase Intentions?

What effect do product categories, demographics and psychographics have on the relationship between Online Customer Experience with Sight and Sound stimulation and Purchase Intentions ?

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4. Conceptual Framework

This chapter will show the conceptual framework, depicted in figure 6, where the expected relationships between the variables are described.

Figure 6: Conceptual framework

The main purpose of this study is to determine whether the online customer experience with different sense stimulations, has an effect on the purchase intention. This research will focus on the senses sight and hearing. Touch, taste and scent are left out of this study since it is not yet possible to investigate these senses in the online environment. Furthermore, the purchase intention for both low as high touch products will be measured. The challenge is to find out if different senses have different effects on a customer’s purchase intention and it aims to find out what happens when senses are combined in the online environment. Purchase intention can be utilized to predict actual purchase behavior (Morrison, 1979). In addition, there will be investigated how psychographic and

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demographic characteristics influence this relationship. In the following section the relationships between components and the different hypotheses will be discussed.

4.1 The effect of online customer experience on different sensory levels on purchase intentions

Regarding sight, it is suggested that consumers, when shopping online, enjoy visuals (e.g. virtual models, moving clothing items) and might look for these when browsing among websites (Allen, 2000). In addition, clear visual images in the online environment can

enhance perceptions of trustworthiness of both the product and store (Slyke et al., 2002). Therefore, the first hypothesis is as follows:

H1a: Customers are expected to have higher purchase intentions when websites include moving images instead of static images.

Secondly, it is known that sound has an impact on the buying behavior of customers in stores and Fiore and Kelly (2007) stress that sound improves social and experiential qualities among customers when they shop online. Since we know that in the offline environment music affects consumer behavior, it might be the same for the online environment Therefore, the second hypothesis is as follows:

H1b: Customers are expected to have a higher purchase intention when visiting websites with background music than when visiting websites without background music.

Finally, according to Hultén (2012) there is a need of plenty of research regarding the concept of engaging multiple of the human senses when creating customer experiences.

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Spence et al. (2014) conclude in their study that a combination of senses is likely to have a greater impact on a customers’ experience than what independently.

H1c: The purchase intention is expected to be higher when sound and sight are combined compared to both independently.

4.2 Moderating Effects of Demographic Characteristics

We know that male shoppers make more online purchases and spend more money than females (Stanford et al., 2004) but this is especially because men take less pleasure while shopping, whereas women are more patient. Since women are researching available options and are shopping for fun (Cleaver, 2004) it is more likely that women are positively affected by the online customer experience with different sensory levels. They will stay longer on the website if the experience is pleasant which in the end might increase their purchase intention. Therefore, the following is hypothesized:

H2a: The positive effect of the online customer experience with sound stimulation on purchase intentions is stronger for female than for male customers.

H2b: The positive effect of the online customer experience with sight stimulation on purchase intentions is stronger for female than for male customers.

As we have seen in the literature review, consumers from an individualistic culture are more likely to use the Internet for e-commerce than those from a collectivistic culture (Park and Jun, 2003). Therefore, customers from an individualistic culture might adapt themselves easier to new online features than those from a collectivistic culture.

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H3a: The positive effect of the online customer experience with sound stimulation on purchase intentions is stronger for consumers from an individualistic culture than for those from a collectivistic culture.

H3b: The positive effect of the online customer experience with sight stimulation on purchase intentions is stronger for consumers from an individualistic culture than for those from a collectivistic culture.

4.3 Moderating Effects of Psychographic Characteristics

People with a high need for touch have a preference of touching products before purchase. Therefore, they have a preference for online shopping compared to offline shopping since they are not able to touch anything. However, when the online customer experience is improved by including different senses, it might be that they create a more positive attitude towards online shopping than before. On the contrary, people with a low need for touch might not even notice the adjustments on the website since touch is less important for them.

H4A: Sight stimulation is expected to have a greater effect on customers with a high need for touch than for customers with a low need for touch.

H4B: Sound stimulation is expected to have a greater effect on customers with a high need for touch than for customers with a low need for touch.

As discussed in the literature review, domain-specific innovativeness is a moderator of the relation between internet usage and the adoption to shop online (Citrin et al., 2000). Since we can state that the new features on a website to engage senses like e.g. zoom-functions and background music are also innovative, there is a need for consumers to adapt

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to these sort of websites. Therefore, customers who score high on the domain-specific innovation scale, are likely to be positively affected by the online customer experiences with different sensory levels.

H4C: The impact of online customer experiences with sight and/or sound stimulation on purchase intentions is expected to be positively related to domain-specific innovativeness.

H5a: Frequency of purchases has a positive effect on the relationship between online customer experiences with sight stimulation and purchase intentions.

H5b: Frequency of purchases has a positive effect on the relationship between online customer experiences with sound stimulation and purchase intentions.

Regarding shopping motivations, we know that there are two kinds of shopper motivations: hedonic value and utilitarian value. Since hedonic value is really about the shopping experience and about the emotional aspects of this experience, people with these shopping motivations are probably positively affected by an online customer experience with different sensory levels. Since utilitarian value is about shopping in an efficient way (Hirschman and Holbrook, 1982), these people might find music popups annoying since this increases the shopping experience but not the shopping objective.

H6a: The positive effect of online customer experiences with sight stimulation on purchase intentions is bigger when customers shop with hedonic values.

H6b: Online websites with music have a negative impact on customers’ purchase intentions when they shop with utilitarian value.

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Finally, with respect to product categories, there will be made a difference between high-touch products and low-touch products. With high-touch products, like clothing, there is a need to inspect the product before buying (Lynch et al., 2001), while with low-touch products there is no need to touch. Since high-touch products require more touch, the expectation is that sense stimulation will affect customers’ purchase intention more when buying high-touch products than when buying low-touch products.

H7: The difference in purchase intention between websites with and without sight and sound stimulation is larger for high-touch products than for low-touch products.

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Hypotheses overview

H1a:

Customers are expected to have higher purchase intentions when websites include moving images instead of static images.

H1b:

Customers are expected to have a higher purchase intention when visiting websites with background music than when visiting websites without background music.

H1c:

The purchase intention is expected to be higher when sound and sight are combined compared to both independently.

H2a:

The positive effect of the online customer experience with sound stimulation on purchase intentions is stronger for female than for male customers.

H2b:

The positive effect of the online customer experience with sight stimulation on purchase intentions is stronger for female than for male customers.

H3a:

The positive effect of the online customer experience with sound stimulation on purchase intentions is stronger for consumers from an individualistic culture than for those from a collectivistic culture.

H3b:

The positive effect of the online customer experience with sight stimulation on purchase intentions is stronger for consumers from an individualistic culture than for those from a collectivistic culture.

H4a:

Sight stimulation is expected to have a greater effect on customers with a high need for touch than for customers with a low need for touch

H4b:

Sound stimulation is expected to have a greater effect on customers with a high need for touch than for customers with a low need for touch

H4c:

The impact of online customer experiences with sight and/or sound stimulation on purchase intentions is expected to be positively related to domain-specific innovativeness.

H5a: Frequency of purchases has a positive effect on the relationship between online customer

experiences with sight stimulation and purchase intentions.

H5b:

Frequency of purchases has a positive effect on the relationship between online customer experiences with sound stimulation and purchase intentions.

H6a:

The positive effect of online customer experiences with sight stimulation on purchase intentions is bigger when customers shop with hedonic values.

H6b:

Online websites with music have a negative impact on customers’ purchase intentions when they shop with utilitarian value.

H7:

The difference in purchase intention between websites with and without sight and sound stimulation is larger for high-touch products than for low-touch products.

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5. Research Design and Methodology

For this study, a combination of an online survey and an experimental design is used. The survey research design is chosen because it is a valuable tool for assessing opinions and the experiment is chosen to measure if there are any causal relationships and to manipulate different conditions. As discussed before, the independent variables in this study are online customer experiences on hearing and sight. The dependent variable is the customer’s purchase intention. In addition, various moderators between the independent and dependent variables are analyzed. These are demographic factors as gender and culture and psychographic factors as frequency of online purchases, shopping motivation, need for touch, innovativeness. Finally, there has been made a difference between high-touch products and low-touch products.

The online experiment is a 2 (with / without music) x 2 (with /without extra sight) x 2 (high-touch product / low-touch product) design and will therefore have eight different conditions. Fictitious websites have been developed to manipulate the online shopping context and online customer experience. For both high and low-touch products there are 4 conditions on this website as you can see in the figure 7 below.

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Treatment Object

The experiment has 4 different conditions both within a high-touch product category and a low-touch product category. In this study, only one product is chosen within each product category, this way the manipulation is only about the senses and not about the product itself. For the high-touch product category, a matrass is chosen. Many people prefer to touch and lay down on a matrass before purchasing this product. Feeling the product is really important which makes it a high-touch product. On the other hand, a washing machine is chosen as the low-touch product. We all know what to expect from a washing machine. Feeling the product is not important, all washing machines feel the same way. This makes a washing machine a low-touch product. In addition, both products fall in the same price-range which makes it good to compare.

Furthermore, concerning the different conditions, the hearing conditions will be manipulated with background music. Past research found that listeners have a preference for tempos in a range from 68 to 178 BPM (Kellaris & Altsech, 1992). Therefore, in this study a music tempo with a BPM between this range will be chosen. An instrumental song was chosen, this way no consideration had to be given to female versus male vocalists or lesser known versus popular artists. The song was originally from the website of the washing machine and has been recorded to insert in all 4 conditions with music. Regarding to the sight conditions, instead of a static image, a dynamic video of the product is shown. This way the sense sight will be more stimulated compared to a static image.

Sample

The online survey is distributed among men and women between the age of 18-75 years old. Young customers, 12-25 years old, especially buy clothes online (69%), while people above 55 years especially book online vacations and consumers above 65 years buy

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online e-books, magazines or newspapers (CBS, 2013). Since this study compares different product categories, it is also important to include respondents of different age categories since they have different interests. The respondents were randomly assigned to the different shopping conditions and the experiment and survey were implemented in the respondent’s natural environment. It was not hold in a computer lab since this can influence the respondent’s purchase intention since it is not her/his usual environment. The sampling size will be at least 250 respondents in order to have enough data to analyze correctly. Each condition has at least 20-25 observations in order to be able to use an ANOVA analysis for the results. Respondents were reached through Facebook and E-mail and therefore the response rate is hard to predict.

Procedure and questionnaire

Before distributing the definitive survey, a pilot study was done to make sure that the questionnaire was clear and that everyone could fill it in independently. Pilot studies are so-called mini versions of a full-scale study or a pilot study can also serve in order to ‘try out’ in preparation for the major study (Baker, 1994). One of the benefits of leading a pilot study is that it may give information about where the survey could fail or whether proposed instruments are improper or unclear. Thus, pilot studies are to prevent risks by identifying possible problems and to make sure that the chosen instruments are adequate (Teijlingen and Hundley, 2001). The current pilot study is conducted by having the questionnaire filled in by 3 offline respondents in order to observe them and receive immediate feedback, and 3 online respondents in order to make sure people can fill it in independently without doubts and problems. After the pilot study, the questionnaire was revised and corrected where necessary. Then, actual data was collected by sending the anonymous link of the survey via

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email and Facebook. Also friends, family and colleagues filled it in and passed it on. Qualtrics randomly assigned respondents to one of the eight conditions.

Participants were asked to shop independently at the fictitious websites and the procedure was described to them once they opened the link of the questionnaire. Around 25-30 respondents were randomly assigned to each condition. All respondents received the same short introduction and description and after this they received a different website with a high-touch product (matrass) or low-touch product (washing machine). Participants were asked to imagine that they were looking to buy this product, e.g. “Imagine that you are looking for a new matrass. You arrive at a website where they sell matrasses. Look at the product below and consider that you can easily afford the price level given in the screen and that the characteristics of the product are also in line with your expectations. You can replay the video as many times as you want, make sure that the volume is turned on. After this, please proceed and fill in all the questions.”. After taking a look at the image/video the respondents had to fill in the questions. First their purchase intention was measured, then the questions about psychographic characteristics were asked and lastly the questions about demographics. Through enabling Force Response in Qualtrics, respondents were required to answer each question before they could progress. In this way, half-filled or forgotten answers were prevented.

Measures

The purchase intention was measured with a four-item, seven-point scale (e.g. “In the near future, I would probably buy the washing machine/matrass”) with a Cronbach’s Alpha of .82 which is very good (Becerra and Korgaonkar, 2011). The Need-for-touch (higher vs. lower NFT) by Peck and Childers (2003) was measured with an adapted, shortened 4-item, -3 strongly disagree to +3 strongly agree (e.g. When walking through stores, I can’t

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help touching all kinds of products) with a Cronbach’s Alpha measured from .76. To measure the shopping motivation (hedonic vs. utilitarian) a adapted and shortened 4-item version of the 7-point Likert scale of Arnold & Reynolds (2003) was used where 1 = strongly disagree and 7 =strongly agree with a Cronbach’s alpha of .67. The original scale includes also items about role shopping, value shopping and idea shopping, but these are left out in the current study because they will not provide relevant data to answer the hypotheses. Regarding innovativeness, a four-item, five-point scale was used (Goldsmith and Hofacker, 1991) e.g. ‘I like to try new and different products with a Cronbach’s alpha of .77. Lastly, there were 5 questions in total about Frequency of online purchases, Gender, Age, Culture.

Variable Measure Level

Purchase Intention Purchase intention 7-points Likert Scale Ordinal Attractiveness 7-points Likert Scale Ordinal

Engaging 7-points Likert Scale Ordinal

Attention 7-points Likert Scale Ordinal

Psychographics NFT 7-points Likert Scale Interval/Ratio

Shopping motivation

7-points Likert Scale Interval/Ratio

Innovativeness 7-points Likert Scale Interval/Ratio Shopping frequency 7-points Likert Scale Interval/Ratio

Shopping frequency Numeric Ratio

Demographics Gender Male = 0 ;Female = 1 Nominal

Culture Individualistic = 0 ;

Collectivistic = 1

Nominal

Referenties

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