How do Customers Alter Their Basket Composition When They Perceive the Retail Store to Be Crowded? An Empirical Study

Using data from a large-scale field study, we show that (perceptions of) crowding change(s) the composition of a consumer's shopping basket. Specifically, as shoppers experience more crowding, their shopping basket contains (a) relatively more affect-rich (“hedonic”) products, and (b) relatively more national brands. We offer a plausible dual-process explanation for this phenomenon: Crowding induced distraction limits cognitive capacity, increasing the relative impact of affective responses in purchase decisions. As we are the first to show that level of crowding relates to what shoppers buy (at both product and brand level), the implications of these effects for retailers are discussed

Retail service innovations and their impact on retailer shareholder value:evidence from an event study

To survive in the competitive retail landscape, retailers launch service innovations designed to grant additional value to consumers. This study investigates whether and in which circumstances retail service innovations create shareholder value, using stock returns to capture investors' point of view. An event study is used to analyze a broad, varied set of 350 service innovation announcements by publicly listed retailers. The study shows that the customer value benefit(s) aimed for by the retail service innovation (i.e., its level of convenience and engagement) has an impact on shareholder value. Moreover, this impact is contingent upon the stage of the consumer purchase process that the innovation targets, and upon the hedonic or utilitarian nature of the products offered by the retailer that initiates the innovation. The impact on retailer shareholder value is more positive for service innovations high on convenience that speed up and simplify the shopping process, when implemented at the purchase stage or by retailers offering utilitarian products. Service innovations high on engagement that focus more on non-transactional initiatives instead fare well in the post-purchase stage