In building our typology of new technologies (see Fig. 1), we focus on two dimensions from the consumer perspective—convenience and social presence. Additionally, we predominantly focus on how in-store technology touchpoints can impact the customer journey (Lemon and Verhoef 2016). This is important because 90% of retail sales continue to take place in brick-and-mortar stores; online sales account for less than 10% of total retail sales (Danziger 2017). To develop a more complete understanding of convenience and social presence, we first discuss existing literature related to these factors.
Copeland (1923) initially classified products that required minimal effort to purchase as “convenience goods.” As additional dimensions of convenience have emerged, the basic idea remains that, in many shopping situations, consumers seek to minimize the time and effort they devote to shopping (Berry et al. 2002; Seiders et al. 2005).
We examine convenience benefits that stem from use of in-store technologies.Footnote 1 There are five distinct dimensions of service convenience: decision, access, transaction, benefit, and post-benefit (Berry et al. 2002). Decision convenience pertains to the time and effort needed to reach make-or-buy decisions; at Build-a-Bear Workshops for example, consumers can either make their own bears or buy premade versions that offer greater decision convenience benefits. Access convenience instead entails the resources needed to request a service, such as when consumers physically dial a telephone number to order pizza (more effortful) versus using a voice-activated system (Bandaranayake 2018). Transaction convenience involves payment-related tasks, such as standing in line, completing online registration forms, or entering credit card information. Benefit convenience reflects the resource expenditures needed to experience the core benefit of the product or service, such as locating and evaluating them. Finally, post-benefit convenience refers to the time and effort needed to follow up with a company if the consumer experiences a service failure or needs additional services after the purchase (e.g., maintenance, exchange). Overall, the less time and effort that consumers expend in each area, the more likely it is that their service evaluation will be favorable.
Each type of convenience could be uniquely affected by the infusion of technologies. Technology now enables consumers to explore, shop, and evaluate their experiences in ways that did not exist previously (in-store or in an online environment). For example, augmented and virtual reality allow customers to further explore the product and experience it in different settings, thus, enhancing decision convenience (Heller et al. 2019). 3-D printers can produce customized products providing greater access convenience. Scanning quick response (QR) codes into a mobile phone to access detailed information about the product enhances benefit convenience. Augmented reality (AR) that depicts products together with virtual elements also increases benefit convenience making it easier for consumers to visualize the output. Post-benefit convenience can be enhanced by using AI to send targeted emails at the time when that individual customer might need to reorder.
Social presence arises when products or situations trigger a feeling that a human being is present (Biocca and Harms 2002; Biocca and Nowak 2001; Heeter 1992). For example, collaborative technological features such as shared website navigation and voice chat features allow consumers to feel the presence of others when shopping online (Zhu et al. 2010). Importantly though, a human being does not need to be physically present for a person to experience a sense of social presence (Dahl et al. 2001). For example, inanimate objects such as handwritten typefaces (Schroll et al. 2018) and robots (van Doorn et al. 2017) have been shown to trigger social presence feelings. Things that signal humanity, warmth, or human involvement are expected to trigger feelings of social presence.
Some technologies can create social presence. Consider how both embodied and disembodied robots can trigger human presence feelings (van Doorn et al. 2017). Embodied robots have features which look like humans and thus trigger social presence. Disembodied robots, such as Siri or Alexa, don’t look like humans, but can engage in two-way conversations thus enhancing social presence. “Scatter walls” in the stores that display social media posts from consumers around the world create social presence. Virtual reality can also transport consumers into some aspect of the retailer’s story enhancing social presence. North Face, for example, offers shoppers (in certain stores) to put on virtual reality glasses and be transported to trekking through Yosemite (Dua 2015). Similarly, the ‘Omnistory Ayrton Senna’ store in São Paulo uses virtual reality to help consumers connect with Ayrton Senna, a beloved racecar driver, by virtually transporting them into one of his racecars or other interactive experiences with his story (Yamashita 2019).
Technology configurations that produce convenience and social presence
Building from the ideas of convenience and social presence, we next propose a 2 × 2 typology that addresses how different in-store technologies might be categorized. Technologies can move across quadrants as they encompass more levels of a dimension. For example, augmented and virtual reality solutions appear in multiple quadrants, as different companies use these technologies in ways which vary in terms of the degree of convenience and social presence it offers to the customer.
The four quadrants, which will be described in detail below, represent low convenience and low social presence (LoCo-LoSo), high convenience and low social presence (HiCo-LoSo), low convenience and high social presence (LoCo-HiSo), and high convenience and high social presence (HiCo-HiSo). Thinking about how each new technology relates to these dimensions is important for retailers and service providers to consider as they experiment to determine which technologies should be infused in the store. In-store technology possibilities are quite varied (see Table 1) with both service providers (e.g., Marriott, Renew) and retailers (e.g., Sephora, Lowes, IKEA) pioneering technologies. Introducing technology in a store just for the sake of technology is unlikely to impress busy consumers. Rather, the technology should help them achieve an outcome they could not have reached otherwise (or achieve the outcome quickly) and/or feel a presence of others in the experience.
In the LoCo-LoSo Quadrant, in-store technology infusion scores low on both convenience and social presence. However, it is important to note that low levels of convenience and social presence should not be taken as evidence that the role of these technologies are ineffective. It is important to remember that our typology is considering the technologies from the consumer perspective—do they add convenience and/or social presence for the customer. However, many technologies are also infused into a retailer or service because they offer benefits to the company’s operations. Consider digital price tags, scent machines, or smart shelves. Digital price tags, such as those used in the physical Amazon 4-Star Store (see Fig. 2, Panel A), provide no time savings and little effort savings for consumers, but offer operational efficiency for retailers as staff can easily update pricing information. In addition, they do not create social presence. The small convenience savings for customers comes in the fact that the screens can provide rating information and can display lower prices for Prime members (Rubin 2018).
Scent machines, which can subtly introduce a smell into the retail store, can activate olfactory senses and trigger emotional memory (Krishna 2012). They add additional multisensory elements to the retail experience (Spence et al. 2014), helping retailers and services providers distinguish themselves from competitors, but they do not provide enhanced convenience for the consumer or a strong sense of social presence.
Smart shelves have recently incorporated a feature of LED displays that change with shoppers’ proximity. When shoppers are far away, the display flashes logos and images to attract them. As the shopper approaches the shelf, the LED images change to highlight product names. When the shopper is at the display, pricing information appears (AWM Smart Shelf 2019; see Fig. 2, Panel B). Although attention grabbing and informative, the shelves offer lower levels of convenience or social presence elements for consumers. Other types of digital signage in stores, such as more traditional digital screens on endcaps, are similarly attention grabbing and can add to the in-store experience (Törn 2018) but, offer lower levels of convenience or social presence elements than technologies in the other quadrants. Again, their value is better captured at the provider level, rather than the consumer level, in that smart shelves and other digital displays help companies draw attention to their products over competitors.
The HiCo-LoSo Quadrant in-store technologies provide strong convenience benefits, but little social presence. These include self-checkout options, 3-D printers, augmented reality (AR) applications, in-store kiosks, digital communication recycling bins, and narrowcasting. Some of these technologies are more established, such as self-checkout options and 3-D printing. Other technologies in this quadrant are newer introductions to the marketplace. For example, digital communication recycling bins, which can be placed in stores, town centers, etc. are traditional recycling bins, with the added feature of being able to track unique identification numbers on consumers’ phones. The bins recognize consumers’ phones as they walk by and send them retailers’ and service providers’ targeted advertisements (Ridden 2012; Datoo 2013). Geissler grocery has added in-store kiosks that list recipe ideas, deal promotions, and other types of information; consumers can review the deals and recipes to find ones that meet their needs (Ingram 2017). As these examples illustrate, the technology offers consumers’ convenience benefits in terms of targeted promotions and readily available information, but little social presence. Below we touch on other examples of these new technologies.
Pushing self-checkout to a higher level of convenience, retailers like Amazon and Albertsons are experimenting with grab-and-go options. This technology is based on AI and cameras (Terdiman 2018). As shown in Fig. 3, Panel A, cameras can be installed in the ceiling that capture consumers as they select products. If consumers put the product back, even if on the wrong shelf, the cameras still capture this choice and adjust the shopping cart accordingly. These technologies offer great transaction convenience, because consumers can simply leave the store with their selections, without having to wait in line or pay with cash or credit card as the purchases are charged automatically to the consumer’s account.
Augmented reality (AR) is now being used by retailers such as Kate Spade and IKEA to help consumers create their desired looks. When shoppers in a Kate Spade store touch a handbag, an AR display activates and encourages the shopper to personalize the bag. The personalized bag is then displayed to the shopper along with various styling options (Gonzalez 2018). IKEA allows consumers to upload pictures of a room to their IKEA place app (Joseph 2017) and then insert different furniture pieces to that picture to determine what looks best in the room (Joseph 2017). These technologies evoke access and benefit forms of convenience, but they have little social presenceFootnote 2 (see Fig. 3, Panels B and C).
Artificial intelligence (AI) is now making narrowcasting possible. Narrowcasting entails the real-time dissemination of information enabled by artificial intelligence (AI) and digital displays. It differs from broadcasting in that specific information or messages are sent to specific stores (see Fig. 4). With this technology McDonalds is working to bring together big data and AI to make sure they have the right products on the digital menu boards to drive sales (Holmvik 2018). For example, if the temperature outside reaches a certain temperature, the menu board might make the displays of ice cream more prominent, but if temperatures drop, they may highlight coffee options. Because this information is targeted to specific stores, it should enhance customers’ benefit convenience. According to our key informant, this narrowcasting technology is expected to lead to an average 1%–2% sales lift. While currently we categorize narrowcasting as being low on social presence, there are opportunities to highlight behaviors of other similar customers. This would then increase the social presence of this technology.
The LoCo-HiSo Quadrant comprises in-store technology infusions that are low on convenience, but high on social presence. These include embodied inventory robots, scatter walls of social media posts, and ceiling projection systems. Augmented reality and virtual reality are also being used in creative ways to enhance social presence. As will be expanded on below, each of these technologies evoke social presence in different ways. In addition, across all of them, they offer little convenience to the customer. To reinforce the point made earlier, being low on a convenience or social presence dimension does not diminish the potential importance to the retail firm. It may be that the benefit and value of the technology is more for the retailer (e.g., operational efficiency), than the consumer, as noted previously and exemplified by Schnuck’s embodied inventory robot example below.
Embodied robots feature a human-like appearance or animated features. This can readily create a sense of social presence (van Doorn et al. 2017). At Schnucks grocery stores, embodied inventory robots roam stores, assessing inventory levels. Although not intended to interact with consumers, their design features two blinking “eyes” on a digital screen, to portray a friendly appearance (Barker 2018) (see Fig. 5, Panel A). Although there is fewer convenience aspects for consumers, one potential benefit is that consumers will not be faced with stockouts. Greater convenience benefits are at the company level, in that, inventory robots reduce employee costs and stocking efficiencies.
Scatter walls and ceiling projection systems project social media posts and pictures that show diverse consumers using, enjoying, and styling the products available in stores (Edelson 2014). By projecting these images, retailers are fostering a sense of connection between customers as part of a worldwide network of brand customers. The ceiling projection system in Kate Spade stores beams “Pick me up” signs onto tables, encouraging consumers to interact physically with the products. When they do so, the system starts to project images from social media onto the same tables (see Fig. 5, Panel B). Although these technologies offer few convenience benefits to consumers, they encourage them to sense as if they are communing with others (Biocca and Harms 2002; Biocca and Nowak 2001; Heeter 1992).
Augmented reality is also being used to create high social presence. LEGO uses AR to merge physical and digital forms of playing (Buckley 2018). Children can build their designs using the physical LEGO blocks, add a photo of the design into a smartphone, and then enrich the play experience by interacting with the design in an AR app. The experience prompts social presence by bringing the design to life, with characters superimposed over the structure they have built. This blend of physical designs and digital characters encourages a storyline that should increase engagement with LEGO products.
Finally, the HiCo-HiSo Quadrant technologies combine high convenience and high social presence. These technologies include augmented and virtual realities, consumer-facing robots (embodied and disembodied), click-and-flick smart windows, avatars, smart displays, as well as Hero, an omnichannel platform connector.
The AR technologies in this quadrant offer all the convenience benefits of those we described in the HiCo-LoSo quadrant, but also heighten social elements by enabling consumers to share the images they create with friends and family. For example, on Sephora’s website, consumers can upload pictures of themselves and try different makeup looks, then save and share these looks with friends through social media platforms (Carman 2017; Sephora 2018).
Both social presence and convenience are possible in VR applications as well. Consider the virtual car showroom of Cadillac cars created by All Things Media (ATM) in partnership with Cadillac and the gaming software firm Unity. This technology was featured at the 2019 NFR Big Show. In this virtual showroom, consumers could customize Cadillacs, which appeared in 3D through the VR headsets (see Fig. 6, Panel A) (Han 2017). The headsets provide visual connections, such that while consumers virtually explore the car, others can view their 3D experience simultaneously through monitors—either in the store or at home. They also support voice communications, such that the consumers can interact with other users, whether those users are in the store or at home (Bailey 2019). The consumer wearing the headset engages with others throughout the experience—a form of social presence that is unique to this VR application (ATM 2019).
Other VR technologies rely on storytelling to humanize the brand and create social presence. McCormick and Company uses VR to allow consumers to experience the McCormick flavor journey (Kemet 2019). Consumers scan product codes in a store, such as the one on a cinnamon container. This then prompts their smartphones to play related videos, such as stories of cinnamon tree fields in Saigon, cinnamon harvesting, and local farmers. Consumers can virtually walk through the cinnamon fields and watch its harvesting, which creates a human element to the spice and its production process (see Fig. 6, Panel B) (Kemet 2019). The videos also provide product information, establishing convenience benefits too.
Disembodied robots (e.g., don’t have a human like appearance), such as Alexa or Siri, both enhance convenience by providing immediate information and action, but also instill a sense of social presence by enabling two-way communication flows. At select Marriott hotels, guests can ask Alexa for information, to turn on lights, and to order room service (Bandaranayake 2018). In homes, consumers can ask Alexa to tell them a joke or the weather.
Embodied robots present a human appearance which enhances social presence. In addition, they offer enhanced convenience in terms of information search, ordering, and other tasks for the customer. Lowe’s in-store embodied robots roam stores, offering to assist consumers (Grosman 2017). The Mandarin Oriental in Las Vegas uses Pepper (an embodied robot) to support staff by greeting visitors, providing directions and answering property-specific questions. Pepper stands at four-feet and has large eyes, offers lifelike gestures, and even can use facial recognition technology to discern the gender, age, and even mood of the guest. Pepper can also tell jokes and pose for pictures (Walsh 2018).
Avatars can also be used to create high convenience and social presence. Consider Millie, an avatar that uses AI to engage consumers in conversation, functioning as a store greeter, navigator, personal stylist, or brand ambassador (see Fig. 6, Panel C). Millie encourages potential customers to try on sunglasses, then offers suggestions, compliments, and answers to their questions. Her social presence was demonstrable, through her appearance, interactivity, and mannerisms; her ability to answer questions also offered convenience benefits (TwentyBN 2019).
Smart windows are another new technology. Clas Ohlson stores are experimenting with windows that consumers can control with their smartphones (Esteka 2018; see Fig. 7Footnote 3). Outside the store, a welcome window activates and displays a QR code when a consumer walks by it. It also displays instructions to scan the QR code to take control of the window display. Once the consumer does that, the shopper can control the window display with his/her smartphone which functions like a remote control. As the consumer flicks their phones from right to left, it moves products across the screen. The products displayed on the window appear simultaneously on the consumers’ smartphones, so they can make purchases easily. Similar display screens appear throughout the store. Beyond its appealing novelty, this technology comes to life and interacts with consumers (high social presence) and offers access, benefit, and transaction convenience.
Smart displays can also evoke a felt human presence. H&M’s smart mirror in Times Square, New York is not in a dressing room like most mirrors, but in a prominent location in the flagship store. Developed by Ombori and Microsoft, the mirror activates and starts to talk when consumers are standing near it; such activation helps draw consumers in and helps them overcome any hesitation engaging with it, according to one of the developers (Hassellof 2019). Once drawn in the mirror asks if you want to take a selfie or get fashion inspiration. For fashion inspiration looks, the mirror will ask a few additional questions to ensure useful looks are presented. QR codes are shown with presented styles (see Fig. 6, Panel D, Left Side). If the selfie option is taken, the mirror will take a picture of the consumer and show the picture as a cover of an H&M magazine (see Fig. 6, Panel D, Ride Side). Consumers can then upload the fashion cover picture by scanning the QR code and share it on social media. According to Hassellof (2019) more than 100 consumers a day were taking a selfie with the mirror when it was first introduced and 86% of those taking a selfie also scanned QR codes—which helped redirect consumers into the e-commerce space. H&M’s smart mirror exhibits high levels of both social presence (i.e., mirror talks and interacts with consumers) and convenience (i.e., offers inspirational looks geared towards consumers’ preferences with downloadable QR codes).
More traditional smart mirrors, such as those in dressing rooms, connect consumers with sales associates at greater distances (Grosman 2017). In addition, consumers also can access online inventory through the mirrors, change color options, and see styling suggestions. Thus, they enjoy convenience during the experience, while also sensing a social connection to the sales associates. In a similar manner, Hertz has begun implementing kiosks with digital screens at the top of the kiosk. The digital screen on top of the kiosk creates a “face-time” like call with a customer service agent who can help you rent your car. The customer service agent is located in a different location and simply face-times into the kiosk when there is a customer requiring assistance. The kiosk prints the necessary paper work and allows the customer to input information (see Fig. 6, Panel E). Thus, by streamlining the allocation of workers on a real-time basis, the company has been able to enhance convenience for customers and maintain social presence. This technology connects remote agents to a customer in a physical rental location.
On the flip side of this is technology which connects remote consumers to a physical retail store. The Hero omnichannel platform connects online shoppers to retail associates in physical stores. When a consumer shopping online types in a question, Hero geolocates them and sends a message to retail associates in the area, who respond to the question and communicates directly with the consumer. Unlike online chatbots or call centers, these sales associates are proximate to the customer (according to a customizable range), and their shared location helps establish a stronger social presence. The sales associate also can invite online customers to visit the store. According to Marc Hruschka, President of Luxury Strategy and Partnerships, the program reduces product return rates by 40%, and stores achieve an 8%–10% lift in conversions (Hero 2019). Thus, the geolocation-based platform heightens the social presence of sales associates for online consumers while also providing them with a convenient way to gather information before making a purchase, whether online or after visiting the store.