300mkt dissertation master copy pdf

A Smart Idea: An exploratory study into the role of smartphone technology as part of in-store

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A Smart Idea: An exploratory study into the

effect smartphone technology has on in-

store customer experience

By Rhiannon Owen

The work contained within this document has been submitted in partial

fulfilment of the requirement of their course and award


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300MKT Advanced Marketing Study (Project) Submission Form

Submit to Turnitin by 11.55pm on 27th April 2015

Student’s Family Name: Owen

First Names: Rhiannon

Student ID No.: 4077185

Email address: [email protected]

Course Details:

BA Advertising and Marketing

Supervisors Name: Ellie Hickman

Project Title: A Smart Idea: An exploratory study into the role that smartphone

technology has to play as part of an integrated in-store customer experience

Declaration:

I certify that this project is my own work and has not been copied in part or in whole

from any other source. Any short quotations have been clearly marked up in inverted

commas with their exact source, including page number provided. This project

complies with Coventry University’s regulations on plagiarism, which I have read and

understood.

I am willing to allow Coventry University to use my project as a sample for future

students

Signed: Rhiannon Owen Date: 19th April 2015

Please submit this form with the electronic version of your project to Turnitin by

11.55pm on 27th April 2015.


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Abstract

This study analyses existing literature from both customer experience and other retail-based

academia, and also conducts qualitative primary research to investigate the ways in which

consumers use smartphones in physical retail environments. Gaps within the literature

available showed a need for greater investigation into the affect which mobile devices have

on a consumer’s overall experience within a bricks and mortar store, thus leading to the

basis of this research.

Results have shown that consumers use mobile devices in order for them to achieve pre-

existing goals and needs, with their smartphone also allowing them the opportunity to save

time and money. This then assists in creating an overall positive experience which is shown

to link to increased consumer loyalty.


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Table of Contents Abstract ................................................................................................................................................... 3

1.0 Introduction ...................................................................................................................................... 5

2.0 Literature Review .............................................................................................................................. 7

2.1 Antecedents & Outcomes of Customer Experience ..................................................................... 9

3.0 Methodology ................................................................................................................................... 17

3.1 Research Purpose........................................................................................................................ 17

3.2 Research Philosophy ................................................................................................................... 17

3.3 Research Approach & Instrumentation ...................................................................................... 17

3.4 Sample ......................................................................................................................................... 20

3.5 Interview Design & Data Analysis ............................................................................................... 20

3.6 Ethical Considerations ................................................................................................................. 20

3.7 Summary ..................................................................................................................................... 21

4.0 Data Analysis & Findings ................................................................................................................. 22

4.1 Saving Time ................................................................................................................................. 23

4.2 Saving Money .............................................................................................................................. 25

4.3 Goal Achievement ....................................................................................................................... 26

4.4 Loyalty ......................................................................................................................................... 27

5.0 Conclusions ..................................................................................................................................... 30

5.1 Managerial Implications .............................................................................................................. 32

5.2 Limitations ................................................................................................................................... 32

5.3 Recommendations for Future Research ..................................................................................... 32

6.0 References ...................................................................................................................................... 34

7.0 Appendices ...................................................................................................................................... 39

7.1 Ethics ........................................................................................................................................... 39

7.2 Participant Information Leaflet ................................................................................................... 40

7.3 Informed Consent Form .............................................................................................................. 42

7.4 Health & Safety Assessment ....................................................................................................... 44

7.5 Interview Questions .................................................................................................................... 48


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1.0 Introduction

Research in the field of customer experience is not new to the marketing world, having

being previously written about multiple times under the arguably out-dated label of

‘experiential marketing’ (Holbrook & Hirschman, 1982; Schmitt, 1999). Until recently

however, customer experience did not exist as a stand-alone concept, with it instead being

considered a contributor to service quality frameworks – the SERVQUAL model established

by Parasuraman et al. (1985) in particular - as it is well-known throughout literature on the

topic.

Modern society is becoming increasingly inseparable from their mobile devices as they

become integrated further into the lives of the consumer (Baker et al., 2002; Klaus &

Maklan, 2012). As consumers now look towards a more cross-channel platform, where

shopping and other activities both on- and offline comes very naturally to them, it has been

suggested that retailers should also adopt a more mobile-savvy approach in order to

capitalise on this (Ryu, 2013).

A key part of this technological adaptation is the investigation of how consumers are

currently using their smartphones in bricks and mortar retail stores (Zhang et al., 2010;

Spaid & Flint, 2014). This study aims to uncover consumer’s behaviours regarding

smartphones and how this impacts their experience. The results can then be used to focus

further on how – and indeed if – retailers can include a smartphone experience as part of a

wider multi-channel strategy.

Following this, this research project will additionally look into the reasons why consumers

are currently using their smartphones in physical retail environments, and whether this has

an impact on their overall customer experience of the retail brand. As such, the objectives

that will be set to achieve the aims of this study are:

To critically analyse existing literature surrounding customer experience and

technology in retail.

To investigate the reasons for the use of smartphones in physical retail

environments.


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To explore how retailers can adapt their in-store marketing strategies to include the

use of smartphones in order to improve the experience of their consumers.


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2.0 Literature Review

In order to prevent duplication of research, it is first important to ensure that a thorough

review of the literature is conducted to uncover any gaps which exist and can be used as a

basis for further research to be conducted.

More up-to-date academia now recognises customer experience as an entirely separate

construct to service quality. There is growing interest from companies regarding this new

marketing paradigm as they seek new ways to differentiate themselves from their rivals and

gain competitive advantage (Berry et al., 2002; Gentile et al., 2007; Klaus & Maklan, 2012;

Bagdare & Jain, 2013).

Whilst there is no standardised definition for customer experience, there has been

substantial groundwork in establishing common customer experience characteristics, which

can be seen in Table 1 below.


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Table 1: Customer experience definitions


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From Table 1 it can be seen that customer interaction with a brand is essential (Gentile et

al., 2007; Meyer & Schwager, 2007; Klaus & Maklan, 2012; Bagdare & Jain, 2013) and that

this interaction is usually across multiple touch-points (Gentile et al., 2007; Verhoef et al.,

2009; Klaus & Maklan, 2012; Bagdare & Jain, 2013).

There is also a general consensus regarding the various levels of customer involvement

whilst experiencing a brand, and that the resulting experience of the retailer throughout the

entire buying process is subjective and unique to the individual (Gentile et al., 2007; Meyer

& Schwager, 2007; Verhoef et al., 2009; Klaus & Maklan, 2012; Bagdare & Jain, 2013).

An aspect of customer experience which has been neglected in several of the definitions in

Table 1 is the importance of a holistic and integrated customer experience (Klaus & Maklan,

2012), although this has been mentioned by both Verhoef et al. (2009) and Bagdare & Jain

(2013). Due to the inclusion of all attributes featured in Verhoef et al.(2009)’s

characterisation of customer experience as well as additional consumer behaviour-related

elements such as the purchase process, the working definition of the concept for this

research will be:

“The sum total cognitive, emotional, sensorial, and behavioural responses produced during

the entire buying process, involving an integrated series of interaction with people, objects,

process and environment in retailing”.

- Bagdare & Jain (2013:792)

2.1 Antecedents & Outcomes of Customer Experience

Customer experience generally falls into two categories – that which the retailer can control

and that which they cannot, as whilst the retailers can design store experience attributes in

an attempt to sway the customer’s experience whilst in the store (Chakravorti, 2011;

Sathish & Venkatsakumar, 2013), the consumer’s reaction to these retailer-instigated

prompts are entirely dependent on factors such as past encounters, and a customer’s pre-

disposition among other perception-altering occurrences (Gentile et al., 2007; Verhoef et

al., 2009).

Whilst literature which discusses the potential outcomes of the customer experience

paradigm reaches similar conclusions to one-and-other (Lemke et al., 2011; Sathish &


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Venkatesakumar, 2011;Klaus & Maklan, 2012), antecedents of customer experience differ

significantly throughout existing research due to the varying ways in which the concept has

been approached.

There has been considerable discussion for instance, regarding the various levels of

involvement during a customer’s experience within a store (sensorial, emotion, cognitive,

pragmatics, lifestyle and recreational), and is regarded an important area for consideration

within customer experience frameworks as they affect a consumer’s assessment of their

individual experience (Gentile et al., 2007; Verhoef et al., 2009). Positive experience is

believed to enhance retail performance, with feelings of pleasure, satisfaction and

engagement alongside an upbeat mood being noted in particular as being consumer-led

thoughts and feelings which influence their experience assessment (Bagdare & Jain, 2013).

Other literature however, analyse facets that are managed more so by the retailer such as

service interface, product experience and atmospherics (Verhoef et al., 2009; Klaus &

Maklan, 2012; Sathish & Venkatesakumar, 2013). By placing these ‘clues’ for consumers in

the store, organisations can lead their customers to form the opinion that they have had a

positive experience with the brand (Berry et al., 2003). As consumers will assess their

environment regardless of whether the retailer attempts to manage the results of their

judgements or not, it is suggested that these company-controlled drivers should be

consciously managed by retailers to ensure the creation of the best possible experience

environment for consumers (Verhoef et al., 2009; Bagdare & Jain, 2013; Sathish &

Venkatesakumar, 2013).

One way in which consumers may assess their experience is through the retailer’s ability to

fulfil their goals. Whilst research discussing the evolution of shopping into a socially

interactive, pleasurable experience has shown that a consumer’s goals may not be entirely

utilitarian in nature (Lemke et al., 2010; Bagdare & Jain, 2013; Sathish & Venkatesakumar,

2013), it must also be noted that the fulfilment of a utilitarian goal will always take

precedence when it comes to evaluating the success of their overall shopping experience

(Klaus & Maklan, 2012).

As the world moves towards one which is ever-more technology focused, retailers have

begun to integrate technology into their service offerings to increase process ease for


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consumers (Baker et al., 2002; Verhoef et al., 2009; Sathish & Venkatesakumar, 2013) and

therefore assisting in goal fulfilment. This has become particularly prevalent in supermarket

shopping environments where many have added self-service technologies (SST) to their

service interface (Slack & Rowley, 2002; Giebelhausen et al., 2014). These have been widely

accepted by consumers due to the ways in which they have been able to save time, solve an

intensified need, or deliver increased performance (Meuter et al., 2000). As a result of this

prevalence, the majority of research surrounding the use of technology in retail

environments has been done using SST as focus (Slack & Rowley, 2002; Keeling et al., 2006;

Elliot et al., 2013; Giebelhausen et al., 2014).

Research regarding technology in retail stores which falls outside of customer experience

literature is slightly more present, however still under-developed when compared to the

speed with which the market is attempting to adapt to the new behaviours of its consumers

(Meuter et al., 2007; Sanusi & Palen, 2008; Ferdianti et al. 2013).

Pantano (2014) summarises technology’s ability to satisfy the consumer’s need for

innovative product and services, whilst Lusch et al. (2007) discuss the importance of

innovative information technology in aiding competitive advantage for companies. Whilst

not specifically speaking with regards to customer experience, these pieces do create ways

in which one is able to be link technology back to the customer experience-based literature

which has been mentioned previously regarding how firms can increase the likelihood of

differentiation from their rivals (Berry et al., 2002; Gentile et al., 2007; Klaus & Maklan,

2012; Bagdare & Jain, 2013).

There are also links between technology and increased customer loyalty outside of

customer experience academia. Pantano & Migliarese (2014) argue that the reduction in

human interaction between store employees and consumers could lessen the potential of

relationship-building – and consequently loyalty intentions as a result, which contradicts the

customer experience concepts of Verhoef et al. (2009) and Klaus & Maklan (2012) who

include technology as being of importance when attempting to create a positive customer

experience.

Other than this, literature surrounding the impact of technology on a consumer’s shopping

experience is small and relatively un-investigated. There is a significant gap in current


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research literature when the growth of alternative digital channels such as mobile is taken

into consideration, as this has resulted in increases in multi-channel – and indeed omni-

channel – business practices (Cassab & MacLachlan, 2009; Verhoef et al., 2009; Zhang et al.,

2010; Pantano & Migliarese, 2014).

Multi-channel retailing is regarded as being a set of activities involved in selling merchandise

or services to customers via more than one channel (Zhang et al., 2010), with customers

being expected to evaluate the functional quality of the retailer and its technologies across

all channels of retail (Cassab & MacLachlan, 2009). Literature on the subject generally

separates the channels which are available for retailers operate within as being either online

or offline (Zhang et al., 2010). Little is said however, of how/if multi-channel experience is

impacted upon when the line between online and offline is blurred.

The increased usage of smartphones in stores has begun to be commented on (Chahal,

2013; Miller & Washington, 2014; Spaid & Flint, 2014), with it being suggested that retailers

should also become more mobile-savvy and embrace a more mobile lifestyle in order to

develop relationships with this segment of the market (Ryu, 2013). Modern technology

allows consumers to both browse the internet and purchase online via their smartphones,

meaning that the facilitation of mobile as part of a multi-channel shopping experience is of

increasing importance as there is huge potential for smartphones to be the bridge between

the online and offline worlds (Fulgoni & Lipsman, 2014; Krueger, 2015).

Advances in apps as well as in-built smartphone technology such as near-field

communications (NFC) and GPS have led to the creation of m-coupons, app-based loyalty

cards and ‘hyperlocal’ marketing (Dhar & Varshney, 2011; Cameron et al.,2012; Borrego-

Jaraba et al., 2013). Despite a wealth of research indicating that consumers are searching for

information on their smartphones more often, regularly downloading apps and purchasing

through their phones (DeStasio, 2012; Shields, 2012; Chahal, 2013; Nielsen Mobile, 2014;

Krueger, 2015), there is little research to how this impacts on consumer experience, their

perceptions of the retailer, or whether there is an impact upon customer loyalty as a result.

Similarly due to the newness of the technology and the rapidity of its growth there has been

little insight into how retailers can best utilise this new platform for approaching their


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consumers, with only vague indications of measurement and integration with other

platforms being available at best (Ryu, 2013; Fulgoni & Lipsman, 2014).

App-based loyalty cards in particular have solid footing for success based on academia

which currently exists for its physical, card-based counterpart (Mauri, 2003; Demoulin &

Zidda, 2007; Garcia-Gomez et al., 2012). Garcia-Gomez et al., (2012) originally theorised five

factors which may influence a consumer’s likelihood of joining a retail loyalty programme:

price sensitivity, a consumer’s search for variety, shopping enjoyment, attitude towards

loyalty schemes and privacy concerns.

Price sensitivity is however was discovered to not impact upon the decision to engage in a

loyalty scheme (Garcia-Gomez et al., 2012) - deemed to be due to a consumer’s desire for

variety having a negative impact on consumer participation. There is however research

stating the opposite of this, with some noting that those who have no real product

preference are more likely to shop around and are considered more likely to engage in

loyalty schemes (Mauri, 2003). This desire for freedom of choice establishes links between

customer experience literature and rewards scheme literature, showing a potential for

increased likelihood of customer retention through positive customer experiences of loyalty

and reward schemes (Mauri, 2003; Verhoef et al., 2009; Klaus & Maklan, 2012).

Privacy concerns were however shown to have a clear inverse correlation with loyalty card

participation (Garcia-Gomez et al., 2012), showing that there is a degree of distrust between

consumers and some retailers. Media reports about consumer data being leaked

For those who do engage in loyalty card and reward card schemes, the benefits for retailers

are huge if successful with satisfied reward card customers being much more store loyal and

less price sensitive, with frequent offers that are both individual and personalised to the

consumer being more likely to be successful programmes (Mauri, 2003; Demoulin & Zidda,

2007; Cameron et al., 2012).

That said, the engagement in loyalty card programmes whether physical or app-based is not

the only way of reaching out to consumers with more personalised offers. The

aforementioned increase in the capabilities of location-based marketing through improved

GPRS signals, Bluetooth etc, allows for very location- and time-specific m-coupons and

offers to be sent to the user’s device. There is a debate regarding whether consumers are


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happy to receive these messages or whether they will be considered annoying or ‘spam-like’

(Grant & O’Donohoe, 2007), however Shields (2012) has established that the key for

consumer acceptance of these promotional messages lies within the personalisation of the

offer to the consumer. That said, there are similar concerns regarding privacy of consumer

information – in particular the tracking of an individual’s location - which must be taken into

consideration (Grant & O’Donohoe, 2007; Basheer & Ibrahim, 2010; Richard & Meuli, 2013).


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Most specifically to in-store experience, NFC has begun to be introduced to the consumer,

and can act as a method of payment as well as method of transmitting messages to

smartphone users who are hyper-local, whether in a specific aisle of a supermarket or

having just crossed the threshold of a store (Ferdianti et al.,2013; Richard & Meuli, 2013).

Again, however, the aforementioned issues around privacy are cause for concern (Richard &

Meuli, 2013; Raschke et al., 2014).

Additional issue surrounding the use of smartphones are the restrictions on data-services

and the cost that the consumer incurs to use these services (Dhar & Varshney, 2011). Whilst

Wi-Fi connections are increasingly common in retail stores which reduces costs, bandwidth,

device memory and internet speed are still factors which need to be considered when

considering the use of mobile marketing as part of a business strategy (Sanusi & Palen,

2008; Dhar & Varshney, 2011).

With all of these methods of smartphone use in retail environments as well as others,

personalisation has shone through as being a key tool for success (Cameron et al., 2012;

Shields, 2012), with emphasis of the need for multi-channel integration as part of a larger

retail strategy in driving this personalisation across channels (Gentile et al., 2007; Cassab &

MacLachlan, 2009; Pantano & Migliarese, 2014). This can facilitate the creation of a holistic

experience which has been established as being of crucial importance for a positive

customer experience overall (Verhoef et al., 2009; Klaus & Maklan, 2012; Bagdare & Jain,

2013).

Ease of use (Baker et al., 2002; Verhoef et al., 2009; Sathish & Venkatesakumar, 2013),

convenience ( Gentile et al., 2007; Verhoef et al.,2009; Klaus & Maklan, 2012) and the ability

to search for information (DeStasio, 2012; Klaus & Maklan, 2012; Sathish &

Venkatesakumar, 2013) also rankly highly as common themes throughout the literature as

being of importance in creating a positive customer experience, and technology has been

identified as a way that this can be harnessed (Verhoef et al., 2009; Cameron et al., 2012;

DeStasio, 2012).

Although there are links relating customer experience to the use of smartphone

technologies in retail environments through the concepts of retail and mobile technology

academia, loyalty and customer experience literature, it remains that academia linking the


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three is sparse to non-existent. Advances in marketing tools and smartphone capabilities

such as location-based mobile marketing, NFC, and the improvement of mobile applications

have been identified as tools which can allow retailers to build on this experience (Richard &

Meuli, 2013), however the lack of information for retailers about how/whether this can

impact upon consumer experience as part of a wider strategy, and the further implications

this has on consumer-brand relationships, is lacking. Privacy concerns are an area which has

been deemed to require close scrutiny to reassure consumers of the security of their

personal information (Richard & Meuli, 2013; Ryu, 2013; Raschke et al., 2014), so should

also be included as a topic for discussion in any research conducted on the subject.


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3.0 Methodology

3.1 Research Purpose

The purpose of this study is to uncover ways in which bricks and mortar retailers can use

smartphones to enhance their customers’ experience within their store, with the focus

being on key themes which have been unearthed from the literature review.

3.2 Research Philosophy

The research follows an inductive approach, with an interpretivist epistemology as

behaviour is considered to be generated as a result of a human’s mind. Curiosity has driven

the research, with the data collection then allowing theoretical conclusions to be drawn

(Davies, 2007) as well as the research being based on the opinion that social reality is in the

mind of the individual with multiple realities possible as opposed to being singular and

objective (Collis & Hussey, 2014; O’Gorman & MacIntosh, 2014).

Research will also have a constructivist ontology which “asserts that social phenomena and

their meanings are continually being accomplished by social actors” (Grix, 2010:61) as

opposed to social phenomena occurring regardless of social actors, further cementing the

interpretivist stance of the study. This will best allow for the investigation of the use of

smartphone technologies in-store as it will take into account factors such as the past

experiences and the pre-dispositions of consumers.

3.3 Research Approach & Instrumentation

There are two ways in which the collection of data can be approached; qualitative and

quantitative (McGivern, 2009). Qualitative research is concerned with examining

characteristics, traits and qualities via research with the aim of understanding an individual’s

perceptions of the world, whereas quantitative data looks more towards finding general

patterns and relationships among variables with the aim of quantifying the results (Bell,

2010; Grix, 2010).


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Table 3.1 Advantages and disadvantages of qualitative and quantitative data collection (McGivern,

2009; Davies, 2010; Grix, 2010).

Table 3.1 above demonstrates the advantages and disadvantages for both qualitative and

quantitative data collection in relation to this study. Qualitative data collection is deemed to

be most appropriate in this instance with the study being interpretivist through its aim of

developing an understanding the social habits of consumers. That said it must be noted that

the in-depth nature of qualitative research will mean that a smaller sample size will be

chosen, with the findings being unlikely to be representative of the wider population.


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Table 3.2 Advantages and disadvantages of qualitative data collection methods (McGivern, 2009;

O’Gorman & MacIntosh. 2014).

In this instance in-depth interviewing has been chosen as the most appropriate collection

technique due to the subject being more personal to the individual negating the need for

debate and/or discussion (O’Gorman & MacIntosh, 2014). Observational data collection has

been eliminated due to it being a necessity for the observer to have knowledge of what

apps the participants are using as well as in-store actions, meaning that further questioning

would be required at an additional cost to time.

Interviews will be semi-structured to allow for easier analysis of themes and to ensure

relevance to the goals of the study which is an issue that may arise should the interview be

completely unstructured. The questions and path taken during the discussion could differ


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greatly between interviews could differ greatly which would make analysis more difficult for

the researcher (O’Gorman & MacIntosh, 2014). Semi-structured is also preferable to a

heavily structured interview technique as these may inhibit the uncovering of additional

information that the interviewer had not previously considered (McGivern, 2009). Whilst it

is acknowledged that there could be a degree of interviewer bias through prompting or

loaded questions, the use of semi-structured interviews should prevent this through having

a list of pre-determined questions which have been checked to ensure they are not biased.

3.4 Sample

To be in keeping with ethical guidelines whilst still allowing for depth of understanding

through research the target population will be Coventry University students, with a sample

size of eight participants being selected for data collection. These will be selected through

purposive sampling to allow for ease of access to participants whilst also providing a degree

of selectiveness in those interviewed (Davies, 2010).

3.5 Interview Design & Data Analysis

To follow the semi-structured nature of the interviews, questions will also be semi-

structured based around pre-determined key themes and will be adapted with follow-up

questions for each participant dependant on the answers given.

Due to the large amounts of descriptive data likely to be resultant of qualitative interviews,

the method of analysis most appropriate is thematic coding (O’Gorman & MacIntosh. 2014.

Despite indications of possible themes being indicated during the literature review it is of

vital importance to remain unbiased when analysing the data therefore initial themes will

be generated ‘posteriori’, beginning first with high-level coding before returning to analyse

in more detail with lower-level coding (O’Gorman & MacIntosh, 2014). This will ensure

consistency and reliability throughout the analysis, giving an overall narrative of the subject

and a comprehensive summary as a result.

3.6 Ethical Considerations

In order to ensure that data is collected ethically participants have been asked to read a

participant information form (see Appendix 7.2, disclosing the reasons for the research and


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any other questions they have regarding how their information. This is prior to filling out an

informed consent form to register their participation, where they are assured that

participation in voluntary and that they can opt out of the study at any time (see Appendix

7.3).

Data will be stored separately to the participant consent forms and pseudonym names will

also be used throughout to ensure anonymity and the data will be destroyed after use, and

will not be used for any other form of research.

3.7 Summary

In summary the decision has been made to conduct qualitative data collection through

semi-structured, in-depth interviews with eight participants from Coventry University. This

will prevent bias whilst having the maximum opportunity for ways in which consumers use

their smartphones in-store to enhance their customer experience.

The following chapter will discuss the findings of this data collection and relate this back to

the literature mentioned in section 2.0, with the hope of establishing links between existing

academia and the findings of this study to create the basis for theoretical conclusions.


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4.0 Data Analysis & Findings

From the eight in-depth interviews which have been conducted as the primary research for

this project, six key themes have been uncovered as being of particular relevance regarding

that which affects or is affected by a consumer’s in-store smartphone use. In order that

anonymity is retained for those who participated, pseudonym names will be used (see Table

4.1 below).

Table 4.1 Participant Pseudonym Names.

The analysis of the primary data which has been collected has provided key themes which

can be critiqued against existing literature to either support or contradict that which has

previously been discussed – three of which are antecedents of the customer experience

concept, and one of which is an outcome:

Saving time

Saving money

Goal achievement

Loyalty


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This data analysis will discuss these four themes in more detail in order to draw logical

conclusions as to the result of this study.

4.1 Saving Time

Zayn echoes the large majority of participants when he says that “all of the information that

you could ever want about a product, you can find at the convenience of your phone”, with

interviewees as Rachel expanding on this with comments such as “it’s a lot more convenient

for me to have [loyalty cards] on my phone as everything is in one place”.

Convenience is a strong theme found throughout all participants interviewed regarding their

decision to use a smartphone as part of their in-store experience with all interview

participants making clear reference to the antecedent as well as citing ‘ease of use’. From

reviewing the literature there was specific mention of the importance of convenience and

ease of use in creating a positive customer experience (Klaus & Maklan, 2012) and the role

that technology is expected to play in the fulfilment of positive customer experience (Baker

et al., 2002; Verhoef et al., 2009; Sathish & Venkatesakumar, 2013).

Data which has been collected shows that the term ‘convenience’ with regards to

smartphone usage in retail stores is determined more so by the availability and accessibility

of information as opposed to the convenience of the actual retail store which is the main

point mentioned in existing literature thus far (Verhoef et al., 2009). This is a discovery

which adds to the existing base of literature, further proving the scope and depth to which

convenience is a factor in creating a positive in-store experience for consumers. It also

reaffirms the strong link between convenience and ease of use as antecedents of customer

experience, as one was rarely mentioned without the other both in existing academia

(Meuter et al., 2000; Verhoef et al., 2009; Klaus & Maklan, 2012; Sathish & Venkatesakumar,

2013) and in the primary research collected for this study.

The core rationale when discussing the importance of convenience for consumers when

using a smartphone in store has been established through the interview process as being

because it saves the consumer time when completing their goals (see section 4.3). This

assists in marrying the customer experience focused literature and literature from other


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research areas as technology has been noted to be of particular use to the consumer when

it aids in saving time (Meuter et al., 2000). Researching products has high prevalence as

being an activity which participants undertake when using their smartphone in a retail

environment.

Whereas the majority of those interviewed had the mentality of “if it makes my life easier I

will [try it]” when deciding to use mobile applications and websites through their phone,

Annie disagreed with this sentiment as she had fears over the security of mobile

applications in particular and would rather wait to find information or purchase products

from her laptop at home rather than use her smartphone. When asked about why she felt

this way about mobile applications Annie said that: “I feel like they have ulterior motives and

just want my information and bank details so that they can scam me or sell my information”.

Whilst the majority of participants did not mention that they felt the security of their

smartphone was an issue for them this factor must be taken into consideration for brands as

it is likely that others will have similar feelings, although this cannot be proven due to the

small sample size of this study. It must also be noted that security and privacy is not

something which has been taken into consideration in the vast majority of customer

experience and technology literature which has been analysed in Section 2.0, with few

making any real reference to it (Klaus & Maklan, 2012; Richard & Meuli, 2013).

Existing literature discussed the necessity for product comparison for consumers as well as

the consumer’s need for accessible product/service reviews (Verhoef et al., 2009; Klaus &

Maklan, 2012) which does still fit with all interviewees despite some being more willing to

share information than others to gain access to this. Interviewees who did use their

smartphone to access information did so because they “always have their phones with

them” and because it “makes accessing information a lot quicker and easier” which allowed

them to save time during the decision-making and purchasing process.

Where interviewees were facilitated by the brand in their search for information via a

branded app or similar, it was shown that the brand was more positively received by the

consumer and brand-consumer relationships were also improved (see Section 4.4 for more

on relationships and loyalty). In this instance, Mark used an app created by his preferred

video game retailer to read reviews on games he was contemplating on purchasing whilst he


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was in the store, and had more positive perceptions as a result of increased availability of

information.

4.2 Saving Money

Much like saving time, saving money is also of importance to users when giving reasons why

they may use smartphones in retail stores, with consumers utilising the ability to compare

prices on their smartphone as a way of saving time AND money. “I guess it is financially

driven because you want to make sure that you get value for money but if you’re on a

budget then you also don’t want to spend too much” as quoted from Carrie is a common

sentiment among those interviewed with the online retailer, Amazon, being the most

commonly used tool for comparison via smartphone having being mentioned almost

unanimously by interviewees. That said, browsing through specific competitor retailers’

websites has also been revealed from the interviews of Mark and Saffron as being a

common activity in price comparison.

These sentiments follow that of Verhoef et al.,(2009) who state the importance of price in a

consumer’s experience evaluation, with positive in-store experience being achieved through

technology’s facilitation in reducing risk by allowing the consumer to find the best price and

by a consumers results focus of purchasing a product deemed value for money (Klaus &

Maklan, 2012).

Application-based loyalty cards and other branded applications which convey offers are also

mentioned significantly across the interviews, with all interviewees being of a similar mind-

set to Rachel in that they enjoy using them to save money in an easier, more convenient

way: “I like the incentives that [branded apps] offer me because it adds a little extra value

and excitement when buying things in-store”. Mark adds to this in that “you accumulate

points and points mean money so you can use the points to get money off a game” while

Rebecca mentions that one of the reasons that she enjoys using loyalty cards and other

branded apps because it “gamifies it slightly”.

This price sensitivity of consumers was discussed in the literature review as not having an

impact on a customer’s decision to engage in a loyalty scheme (Garcia-Gomez, 2012),

however the finding s of this study shows price sensitivity to be of significant importance in


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a consumer’s decision to use loyalty card applications of their smartphone, with Rob saying

that “it’s nice to know that when you shop you can get some vouchers for a free meal out of

something” and many noting that personalised offers in particular are significantly more

likely to create a positive experience when in-store. This type of customer satisfaction is a

typical outcome of Klaus & Maklan’s (2012) customer experience model, with it also proving

that a positive customer experience can be facilitated by technology when the consumer is

able to access promotional offers and loyalty schemes with more ease (Meuter et al., 2000;

Verhoef et al., 2009; Klaus & Maklan, 2012).

There is some minor resistance to the use of application-based loyalty cards, with Carrie

saying that she “prefers the physical vouchers and cards as they fell more real”, saying that if

her phone or internet connection is slow it can be easier to use physical vouchers as

opposed to virtual, and Rachel saying that the way in which Boots let customers add virtual

vouchers to a physical card via an app scares her as she is worried that “I’ll go to buy a load

of stuff because I’ve attached a money saving offer virtually to my [physical] card, and then

when I have paid I’ll realise that it won’t have worked so I’ll end up spending more than I

wanted to”. This demonstrates that whilst price sensitivity is a reason for the use of

smartphones in retail environments, there is also the need for consumer reassurance which

retailers need to consider as despite advancements in technology consumers are still wary

of new methods of brand interaction if they could lose money as a result, which also follows

that which has been discussed in the reviewing of existing literature (Verhoef et al., 2009;

Klaus & Maklan, 2012).

4.3 Goal Achievement

Goal achievement is something which is mentioned throughout customer experience

literature as well as other conjoining areas of literature for this study (Meuter et al., 2000;

Verhoef et al., 2009; Klaus & Maklan, 2012). In all of the scenarios mentioned by the

interview participants, the intention/goal for purchase was already present upon entering

the store and using their smartphone, although it must be noted that some goals weren’t

necessarily a high priority.

Rob mentions an occasion where he has used his smartphone to purchase online whilst in a


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store – something which has also been done by other interview participants: “I was in Zara

and wanted to purchase a jacket but they didn’t have in my size so I took a photo of the

serial number of the jacket and bought it online instead”. This is a typical scenario where

consumers would opt to use a smartphone in store and demonstrated how technology

assists in goal achievement leading to a more positive experience, and is one which Rachel

and Zayn have also done whilst they’ve been shopping: “If I want something but the shop

doesn’t have it in stock I can just buy it on my phone whilst I’m in the shop before I forget so

I’ve still achieved what I set out to” (Rachel). Klaus & Maklan (2012) in particular noted that

the fulfilment of a goal will always take precedence when a consumer evaluates their

shopping experience, making it one of the most important antecedents. In addition a cross

over between goal achievement and saving time can also be seen through the ways in which

consumers are using their smartphones in store, as most are using their phones to purchase

immediately to save them having to wait until a later time or date. This correlates with that

which was discussed in Section 2.0 as technology has been able to assist those interviewed

in achieving their goals quickly and simply, which also satisfying consumers’ needs for more

innovative products and services in-store (Meuter et al.,2000; Verhoef et al., 2009; Pantano,

2014).

As well as literal purchases through their phones whilst in-store, participants also spoke of

their search for information whilst in-store always being congruent to them achieving the

goals which they had set out to: “I use my phone for specific goals like googling the answer

to a question or to visit a website that I needed at that time” (Rob). These are usually spur-

of-the-moment and are used to help the consumer make a decision there and then, saving

them time as well as fulfilling a pre-determined goal.

4.4 Loyalty

Many of the comments mentioned by those interviewed show that an integrated, cross-

platform consumer experience has a strong likelihood of creating positive perceptions and

loyalty towards the brand involved: “I would definitely become more loyal to a brand if my

smartphone was a lot more integrated and interactive for me during my [in-store] buying

process” (Saffron) with Zayn adding to this: “being able to use my phone in-store positively


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reflects on my perception because I’m able to do more and it leaves me more engaged”.

Price sensitivity is also less of an issue for consumers if there is better integration of their

smartphone in a retail environment with Rachel saying that “I would much rather go to a

store that offers me a more integrated experience that is a little different to the norm, even

if it costs me a little more”. This is a typical view of the vast majority who were interviewed,

with Carrie also admitting that “I’m more likely to buy from them because their app is good”.

Price sensitivity reduction is something which has not been mentioned explicitly in existing

customer experience literature, however the effect of promotional offers, loyalty

programmes and price has – all of which have been shown to factor into a positive customer

experience (Verhoef et al., 2009). Whilst Verhoef et al., (2009) do not discuss the outcomes

of customer experience, there are others who have established loyalty as being an outcome

(Klaus & Maklan, 2012; Bagdare & Jain, 2013), meaning that the primary research of this

study provides a link which conjoins both pricing factors as an antecedent to customer

experience together with loyalty as an outcome.

Access to reviews and other comparison for information is something which the reviewed

literature established as being linked to the creation of a positive customer experience –

something which Klaus & Maklan (2012) have gone further in saying is linked to loyalty,

although the primary data which has been collected does not explicitly say this. It was

discovered however that consumers must already have at least a mild preference for the

brand in order for a branded retail app to be downloaded, with Saffron noting that “I don’t

really feel that invested with some brands to have their loyalty cards on my phone” and Rob

stating that “I wouldn’t get an app for a place that I didn’t like”. This is something which has

not previously been discussed in any pre-existing literature available therefore filling a gap

regarding ways in which consumers may or may not use their phone to enhance their

experience. For occasions when those interviewed were in a shop that they do not already

have a preference for, it was seen that participants were more likely to browse competitor

websites for further information or for price comparisons instead as opposed for interacting

with the retailer brand.

As much as it has been discussed in the analysis of primary research that the use of

smartphones in-store can positively enhance a consumer’s loyalty to the retailer brand, it is


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also important to note that a negative mobile application or mobile website experience of a

brand can also damage a consumer’s loyalty to retailer.

Carrie is one of the participants who speak of this saying: “Their site is impossible to

navigate on my phone. […] it makes me consider whether or not I actually want another

contract with them when this one ends because they’re not making any effort for their

customers” and Rachel also notes that “if [an app] has caused me hassle or if I run into

difficulties I would have just given in and not bothered buying from them”. Service interface

is spoken about in the literature as having an impact on customer experience (Verhoef et

al., 2009), and by linking this to the primary research it can be seen that the service

interface of mobile applications and website access on smartphones can also impact on a

consumers decision to purchase products and services through the retailer, ultimately

impacting on their overall brand experience.


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5.0 Conclusions

The initial basis for this research was to discover ways in which consumers use smartphone

devices in bricks and mortar retail environments, and whether this impacts on their overall

experience whilst in the store. There is a plethora of customer experience literature already

published regarding more generalised customer experience literature (Parasuraman et

al.,1985; Gentile et al., 2007; Meyer & Schwager, 2007; Verhoef et al.,2009; Klaus & Maklan,

2012; Bagdare & Jain, 2013; Sathish & Venkatesakumar, 2013). There is however a distinct

lack of customer experience literature relating directly to ways in which technology impacts

this experience. This then meant that it was necessary to extend review of literature to

include other research approaches to retail-based technology.

The project was able to meet the objectives of this study which were:

To critically analyse existing literature surrounding customer experience and

technology in retail.

To investigate the reasons for the use of smartphones in physical retail

environments.

To explore how retailers can adapt their in-store marketing strategies to include the

use of smartphones in order to improve the experience of their consumers.

The first was achieved through the analysis of existing research such as general customer

experience literature, how technology is currently used within retail environments, and

current uses for smartphones which has been documented so far.

The second and third were achieved through conducting primary research via in-depth face-

to-face interviews to deduce the ways and reasons for consumers making the decision to

use their smartphones in-store, with participant recommendations being combined with

suggestions from literature to create managerial recommendations.

As a result of the research which has been conducted during this study, three key areas have

been established as being key determinants as to reasons for smartphone use in-store:

saving time, saving money, and goal achievement. The study has shown that these three

themes are intrinsically inter-linked with each other, with goal achievement and saving time


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being particularly entwined with one-and-other as consumers become more time-poor. The

antecedents established correlate well with existing customer experience literature

(Verhoef et al., 2009; Klaus & Maklan, 2012; Bagdare & Jain, 2013; Sathish &

Venkatesakumar, 2013) and has allowed for the literature to be expanded upon, confirming

that smartphone technology is a facilitator for influencing a consumer’s perception of

experience. It is, however, vital to note that a positive smartphone experience is not enough

to fulfil consumer requirements for in-store experience alone, with it instead needing to be

integrated seamlessly as part of the overall experience to add value for the consumer – an

idea also discussed by Verhoef et al. (2009).

The primary research has also allowed for a link between consumer loyalty and the use of

technology as part of customer experience to be established – something which although

insinuated, has not been explicitly linked in previous literature. Analysis of primary data

uncovered that a pre-existing preference was required for branded apps to be used within

retail environments, with consumers being more likely to browse competitor websites for

price comparisons and information in stores which they have no pre-existing preference for.

This is where customer experience literature has been expanded upon into the specifics of

technology use in-store, as it has created conditions for loyalty and possible implications for

how this can be managed.

Diagram 5.1 Antecedents and outcomes of a technology-enabled in-store customer experience.

Figure 5.1 above presents the findings of this study as a conceptual model which clearly

shows the ways in which the three key themes of ‘saving time’, ‘saving money’ and ‘goal


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achievement’ antecedes customer experience, as well as demonstrating the link between

technology’s facilitation of customer loyalty as part of a multi-platform experience.

5.1 Managerial Implications

One of the key areas for managerial attention is the necessity of a mobile application or

mobile-optimised website which is easy to use for a consumer both within a retail store and

elsewhere. Negative brand perceptions such as laziness were cited by consumers who did

not bother to meet the minimum expectations regarding the usability of mobile user

interfaces, with loyalty being affected where they were unable to complete their goals with

relative ease.

An integrated and interactive smartphone experience was also established as being an

enticing pull for consumers, with personalised, hyper-local offers being mentioned as

appealing for consumers in order for them to save time and money when shopping in bricks

and mortar shopping environment.

5.2 Limitations

The most significant limitation in this instance is the scale of the study as only eight

participants were interviewed for the study which, as mentioned in Section 3, means that

the results are unable to be generalised to the wider population. Further to this, the use of

university students and purposive sampling also means that a representative sample of the

population is unlikely to have been obtained.

In order to improve the validity of finding in the future, a greater sample size should be

used, with specific qualifying questioned being asked to the participant beforehand in order

to assess suitability for the study.

5.3 Recommendations for Future Research

Generically speaking, the use of technology in physical retail environments is still difficult to

come by in existing literature, meaning there is a further requirement for research into the

use of mobile device use in-store and how this effects customer experience, as they

become ever-increasingly integrated into the daily lives of consumers. Whilst this set of

research has begun to uncover the ways in which smartphones contribute to overall


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customer experience in store, the specific uses of branded mobile applications in particular

could benefit from additional research to further uncover consumer usage and preferences.

It would also be beneficial for managers to understand more about how smartphone use in

physical retail environments fits into a multi-channel strategy, as this was often touched on

by interview participants however looking into this in more detail would have made this

specific study too broad. Since the price sensitivity of consumers has been shown to be

reduced when consumers feel that they are getting a more integrated, interactive

experience in-store, it would be advantageous for further research to be carried out

regarding the technological factors which consumers would find enjoyable as part of an

integrated in-store experience to allow for greater potential for loyalty and follow-through

to purchase.


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7.0 Appendices

7.1 Ethics


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7.2 Participant Information Leaflet Participant Information Sheet

Study title:

How retailers can use smartphones to enhance customer experience in-store.

What is the purpose of this study?

To investigate the ways in which millenials use their smartphones in physical retail stores, allowing

for recommendations to be made regarding how retailers can incorporate the devices to enhance

customer experience.

Why have I been approached?

For the purpose of this study I need to recruit those studying at Coventry University who own a

smartphone.

Do I have to take part?

No. Participation is entirely voluntary. You can withdraw from the study at any point during the

study and at any point up to 2nd February 2015. To withdraw, please contact me by email stating you

wish to withdraw from the study. If you decide to withdraw you will have no further involvement in

the study. All data is anonymous and you will not be identifiable in any way. There are no

consequences for withdrawing from the study.

What will happen to me if I take part?

You will be asked to complete one, 1:1, in-depth interview which will be held on the university

campus, and will last for approximately 45 minutes.

What are the possible disadvantages and risks of taking part?

It is considered that there are no disadvantages or risks in participating in this study. It is a simple,

casual interview process where questions will be asked relevant to your smartphone usage in

general and specific to when you are in a retail environment.

What if something goes wrong?

If the session has to be cancelled I will attempt to inform you as soon as possible………. If you change

your mind about taking part in the study you can withdraw at any point during the sessions and at

any time up to 2nd February 2015 (see ‘Do I have to take part?’ above).

Will my taking part in this study be kept confidential?

Yes. Only I will have access to the raw data. All the consent forms will be stored in a separate, locked

location from the raw data itself. You will NOT be identifiable from the questionnaires or any data

subsets. All questionnaires will be destroyed by 30th April 2015. Consent forms will be destroyed

according to University regulations.


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What will happen to the results of the research study?

The results will be written up and presented as part of my undergraduate dissertation.

Who is organising funding of this research?

No funding is associated with this research.

Who has reviewed this study?

The questionnaire has been reviewed by members of the ORB - Marketing and Advertising

Department.

Contact for Further Information

Rhiannon Owen, Project Investigator [email protected] OR for independent contact and information: Ellie Hickman, Research Supervisor [email protected]


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7.3 Informed Consent Form

Informed Consent Form Study title:

How retailers can use smartphones to enhance customer experience in-store.

What is the purpose of this study?

To investigate the ways in which millenials use their smartphones in physical retail stores, allowing

for recommendations to be made regarding how retailers can incorporate the devices to enhance

customer experience.

Please tick 1. I confirm that I have read and understood the participant information sheet for the above study and have had the opportunity to ask questions.

2. I understand that my participation is voluntary and that I am free to withdraw at anytime without giving a reason.

3. I understand that all the information I provide will be treated in confidence.

4. I understand that I also have the right to change my mind about participating in the study for a short period after the study has concluded (until 2nd February 2015).

5. I agree to complete a 1:1, in-depth interview as part of the research project.

6. I agree to take part in the research project

Name of participant: .......................................................................................

Signature of participant: .................................................................................

Date: ................................................................................................................

Name of Researcher: Rhiannon Owen

Signature of researcher: ...................................................................................


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Date: ..................................................................................................................


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7.4 Health & Safety Assessment

STUDENT RESEARCH PROJECT RISK

ASSESSMENT

Person(s) undertaking project: Rhiannon Owen

Project supervisor: Ellie Hickman

Brief outline of project:

Outline the types of activities

that will take place or items

fabricated i.e. face to face

interviews, public surveys,

water sampling, machining

vehicle parts, brazing etc.

To investigate the ways in which millenials use their smartphones

in physical retail stores, allowing for recommendations to be

made regarding how retailers can incorporate the devices to

enhance customer experience.

This will be achieved via 1:1, in-depth, face-to-face interviews.

Dates of study (from – to) October 2014 - 28th April 2015.

Location(s) of activity:

Country and specific area.

Coventry University.

Will the project involve laboratory work?

If yes, you will be required to complete separate risk assessment(s) prior to

carrying out any laboratory work.

No

Will the project involve workshop work?

If yes, you will be required to complete an induction and may carry out a separate

risk assessment(s) prior to carrying out any workshop work.

No


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45

Will the project involve travel? (If yes, complete this section as fully as possible.

The form may require review prior to travel to add

missing details)

No

Contact details at

destination(s):

Contact details of next of kin

in case of emergency:

Rhiannon Owen

Mobile: 07940229163

David Owen (father): 07930134957

Approximate dates of travel:

Your supervisor must have

details of travel plans once

confirmed.

N/A.

Arrangements to maintain

contact with the University:

Emergency contact

information:

School/Faculty contact (Daytime): 02476 887688

24hr University contact (Protection Service): 02476 888 555

Local healthcare/emergency services: 024 7696 4000

Has suitable travel insurance has been obtained? (Please attach a copy of

certificate)

N/A.

If EU travel, has EH1C card been obtained? N/A.

Has advice/vaccinations from GP been sought (where appropriate)? N/A.

Are medical kits required (i.e. in countries with poor healthcare facilities)? N/A.

Are there any warnings issued by the FCO* against travel to the area? N/A.

Have you registered with the FCO* service LOCATE? (British nationals only) N/A

*FCO = http://www.fco.gov.uk/en/travel-and-living-abroad/travel-advice-by-country/

http://www.fco.gov.uk/en/travel-and-living-abroad/travel-advice-by-country/


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PLEASE USE THE HAZARD CHECKLIST AS A GUIDE WHEN COMPLETING THIS

SECTION.

Hazard Precautions to be used

Work factors:

E.g.: dealing with the public,

interviewing on sensitive issues,

lone working, driving, working

on boats, laboratory work;

biological, chemical hazards etc

N/A.

Site specific factors (in the field):

E.g.: remote area, construction

site, local endemic diseases,

political unrest, terrorism risk etc

If travel abroad see FCO* website

– list any risks greater than there

would be for the UK

N/A.

Environmental factors (in the

field):

E.g.: extremes of temperature,

altitude, weather conditions, tidal

conditions, cliffs, bogs, caves,

mountains etc

N/A

Equipment:

E.g.: operation of machinery, use

of specialist equipment, manual

handling/transportation,

compressed gases, etc

N/A.


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Other:

Detail any special arrangements

required, i.e. permissions

required, accommodation, travel,

catering etc

N/A.

This assessment must be reviewed before any significant project changes are made.

Assessment carried out by:

Signature: Rhiannon Owen

Position: Project Manager & Student

Date: 17/12/2014

Authorisation to proceed:

Signature:

Position:

Date:


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7.5 Interview Questions

Interview Questions

Have you ever shopped using a smartphone? o Who with? o What did you buy?

Describe to me how you tend to use your smartphone during your day-to-day life. o What would you say are the most common reasons (outside of calls and

texts?) that you have for using your smartphone?

Have you ever used your smartphone in a store?

What would you say is your most common reason for using your smartphone in a store?

Can you think of a time when you have used your smartphone in a store to assist in your shopping experience?

o What did you use it for? o What did you hope to achieve by using your smartphone? o Can you talk me through the different stages of the way in which you used

your smartphone on this occasion? (e.g. used an app, went onto a website, took a photo, scanned a code etc).

o What was the outcome? Did you achieve what you set out to? o Were you satisfied with your experience? How did it make you feel towards

the brand?

If/when you have used your smartphone in store, did you use any branded apps for the store you were in? This could be a barcode scanner, a loyalty card app etc.

o How did you find the experience? o Did it do what you expected it to? Was it a satisfactory experience? o Did it enhance your customer experience whilst you were in the store? o Were you satisfied with this experience? How did it make you feel towards

the brand?

If/when you have used your smartphone in store; did you go on the retailer’s website?

o What did you hope to achieve by doing this? o What was the outcome? Did you achieve what you set out to? o How did this affect your experience in the store? o Were you satisfied with the experience? How did this make you feel towards

the brand? o Was it the same experience as in the store?

Has there been an occasion where a brand has prompted you to use your smartphone in their store? Describe this occasion to me.

o Did you engage with this? What made you decide to/not to engage? o How did this make you feel towards the brand? o How did this alter your experience within the store? Was it more

positive/negative? o Are there any other occasions where you have been prompted to use a

smartphone in-store by a retailer?


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Are there any other occasions where you have used your smartphone in a retail environment that you would like to talk about?

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