A Study on Factors Influencing Consumer Engagement in Retail

Abstract

Consumer Engagement is a term defined in online marketing where the consumers interact with a website and are engaged to the contents of website and these websites market having a higher level of consumer engagement. The concept of consumer engagement has been extended in the study to the field of retail wherein consumer interacts with the retail stores and is engaged with the retail store. The study was conducted in six major cities of Rajasthan with the objective to find out the level of consumer engagement. A sample size of 360 respondents was covered under the study with a sample of 60 respondents from each city among SEC A and B classes. There were 13 factors identified as a result of elicitation studies that were found to impact consumer engagement and its four major dimensions of consumer involvement, interaction, intimacy and experience. A regression analysis was conducted to find out the impact of the 13 factors on consumer engagement and its four major dimensions. It was found out as a result of the study that the major factors that influence consumer engagement were Product Variety, Air-conditioning facilities, discounts, product displays and music played inside the retail stores.

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IJRIM Volume 6, Issue 2 ( February , 2016) (ISSN 2231-4334)
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A study on factors influencing Consumer Engagement in Retail
Himanshu Mahobia1,
Research Scholar,
Suresh Gyan Vihar University, Jaipur
Dr. Rakesh Kumar Dhar Dubey2,
Asst. Professor,
IMS Unison University, Dehradun
Dr. Trilok Kumar Jain3
Professor,
Suresh Gyan Vihar University, Jaipur
Abstract
Consumer Engagement is a term defined in online marketing where the consumers interact with a
website and are engaged to the contents of website and these websites market having a higher level
of consumer engagement. The concept of consumer engagement has been extended in the study to
the field of retail wherein consumer interacts with the retail stores and is engaged with the retail
store. The study was conducted in six major cities of Rajasthan with the objective to find out the
level of consumer engagement. A sample size of 360 respondents was covered under the study with
a sample of 60 respondents from each city among SEC A and B classes. There were 13 factors
identified as a result of elicitation studies that were found to impact consumer engagement and its
four major dimensions of consumer involvement, interaction, intimacy and experience. A
regression analysis was conducted to find out the impact of the 13 factors on consumer engagement
and its four major dimensions. It was found out as a result of the study that the major factors that
influence consumer engagement were Product Variety, Air-conditioning facilities, discounts,
product displays and music played inside the retail stores.
Introduction
Consumer Engagement has been used as a tool of promoting websites like yahoo, rediff etc. and in
simpler terms, it means that how much a consumer is involved in surfing at the same website. This
can be measured in terms of time spent by the consumer busy with that website. Various
definitions exist for consumer engagement. Some scholars even describe it in terms of consumer
participation in developing the policies and services for the organization. “Consumer engagement
is the process of involving consumers in the planning and development of policies and services.”
(Gregory, 2007). “Consumer Engagement is the turning on of a prospect to a brand idea that is
enhanced by the surrounding context” (Advertising Research Foundation, 2006). “Engagement is an
estimate of the degree and depth of visitor interaction on the site against a clearly defined set of
goals” (Eric Peterson). The evolution of the concept of Consumer Engagement is still in the stages of

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infancy and has not evolved even in the field of web-marketing. The term engagement is specifically
used for describing the effectiveness of the advertising campaign or media in terms of consumer
being busy in having an interaction for more duration of time with the advertisement or the
website. The terminology is also applicable in case of retail outlets where consumer interacts with
retail environment and there are various factors due to which he/she spends more time interacting
with the retailing environment.
Literature Review
Consumer Engagement is an evolutionary concept in Marketing and has been described by different
research scholars and bodies in different manner. Advertising Research Foundation has defined
Consumer Engagement as “the turning on of a prospect to a brand idea that is enhanced by the
surrounding context” (Advertising Research Foundation, 2010: n.d). This could be interpreted to
the level of consumer awareness. This is further justified with the view of the Chief Research
Officer of Advertising Research Foundation Joe Plummer who explained that “It is where the
consumers add their own associations, symbols and metaphors to ‘co-create’ meaning” (Michell,
2012: Jan. 30). This co-creation is related to consumer participation which is further justified by
Shiri D. Vivek who specifies that Consumer Engagement is “the intensity of consumer’s
participation and connection with organization’s offering and/or organized activities” (Vivek,
Beatty & Morgan 2012). For participation it is required that there is a consumer motivation to
participate in co-creation. This is further supported by the definition of Algesheimer, Dholakia &
Hermann (2005) who describe consumer engagement in a brand community as “consumer’s
intrinsic motivation to interact and cooperate with community members”. Therefore, consumer
engagement has an element that leads to intrinsic motivation for participation in a community. This
community could be a brand community or in case of retailers, a retail community. Vivek (2009)
has further specified the following dimensions of consumer engagement:
1. Awareness: Being conscious of and having knowledge of the focus of engagement
2. Enthusiasm: Strong excitement or zeal about the focus of engagement
3. Interaction: To share ideas, feelings or thoughts about the focus of engagement with others.
4. Activity: Actions focused on the programme or offering the person is engaged on
5. Extraordinary Experience: Sense of newness of perception and process.
Therefore, both the aspects of consumer awareness and participation are involved in the views of
Advertising Research Foundation’s consumer engagement dimensions.
Another research by People Metrics (2008) identifies the emotional and function dimensions of the
consumer engagement. The emotional dimensions of consumer engagement for a retail store
include authenticity of the retail store, attentiveness of consumers towards the retail store, engaged
employees within the retail store, reputation of the retail store, accountability of the retail store
towards the society and the consumers, retail stores being valued by the consumers (People
Metrics, 2008). The functional dimensions of consumer engagement include service delivery and
the service/product quality offered by the retail store (People Metrics, 2008). The consumer
engagement outcomes of study conducted by People Metrics (2008) reveal that the four major
outcomes or results of engagement include – Consumer Advocacy of the brand, customer retention,
extra efforts on the part of the consumers and passion towards the brand. Bowden (2009)
describes that customer engagement “is a psychological process that models the underlying

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mechanisms by which loyalty may be maintained for repeat purchase customers of a service
brand.”
Consumer engagement has been considered to be the process of involving consumers in the
planning and development of policies and services (Gregory, 2007). Further Forrester (2007) has
described that “Engagement theory comprises of four dimensions which include involvement,
Interaction, Intimacy and Influence” as in the text of Ahuja & Medury (2010: 23 March).
Involvement has been found to be a measurable aspect of the relationship between individual and
the brand (Haven, 2007: Aug. 8). “Engagement is an estimate of the degree and depth of visitor
interaction on the site against a clearly defined set of goals” (Peterson & Carrabis, 2008: Sept. 7).
Consumer interaction has been further identified to be associated with interaction as John
Livington, a senior partner at Mckinsey spoke in a presentation on consumer engagement at
Kellogg’s Marketing Leadership summit in November 2013 that consumer engagement is being
influenced by the interaction between consumer and the organization and therefore, Chief
Marketing Officers need to be replaced by Chief Engagement Officers (McKinsey & Co., 2013: n.d).
Creating a differentiated consumer experience in a physical retail store environment and
integration of this experience with the other channels through which consumer purchases leads to
enhanced consumer engagement (RIS, 2011).
Therefore, the following four major dimensions of
consumer engagement were identified as a result of literature review:
1) Consumer Involvement,
2) Consumer Interaction,
3) Consumer Intimacy and
4) Consumer Experience
Research Methodology
1) Type of Research Design: A descriptive research design was used to identify and relate the
factors influencing consumer engagement.
2) Methodology of Data Collection: Personal in-depth interviews of the respondents visiting any
retail outlet in the six urban cities of Rajasthan.
3) Universe: The entire population of the six major cities of Rajasthan – Jaipur, Jodhpur, Udaipur,
Bikaner, Kota and Ajmer will be considered as a sampling frame out of which sample was drawn.
4) Sample Size: A sample size of 360 respondents was gathered for the purpose of the research
study so that it is representative enough of the differing socio-economic classes residing in urban
areas. The reason for choosing the sample size is that for each homogeneous segment of population,
the sample size of 30 is enough to represent a normal distribution and therefore from each city for
each socio-economic class of the four socio-economic classes – SEC A 1, SEC A 2, SEC B1 and SEC B2
class being considered, this sample size sums up to 720 for the six cities which were equally
considered for the purpose of the study and a sample size of 60 respondents were considered from
each city for socio-economic classes A and B
Results and Discussion
Data Validity
Before analysis, it is important to test the data validity so that the results are not inconsistent with
the research to be conducted and the data is reliable. For this purpose, the data was tested for
validity using Cronbach alpha and the results were found to be as follows:
Table 1: Reliability Statistics

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Table 2: Item-Total Statistics
Scale Mean if
Item Deleted
Scale Variance
if Item Deleted
Corrected Item-
Total
Correlation
Squared
Multiple
Correlation
Cronbach's
Alpha if Item
Deleted
Ratingvariety
77.50
112.085
-.211
.
.764
Employeebehavior
77.52
113.576
-.223
.
.777
Airconditioning
79.03
106.168
.053
.
.756
Productdisplay
78.02
103.576
.093
.
.758
Pricedisplay
78.23
88.453
.741
.
.702
Ambience
78.35
104.164
.313
.
.740
Discounts
77.92
109.739
-.081
.
.759
Music
79.25
87.106
.755
.
.699
Odor
79.03
82.914
.895
.
.684
Sittingandrelaxing
78.93
82.504
.822
.
.687
Signssymbols
78.27
88.470
.969
.
.694
Funandentertainmet
79.15
86.570
.862
.
.693
Creditanddebit
78.80
81.417
.736
.
.692
Engage1
77.83
110.955
-.158
.
.759
Engage2
77.08
104.993
.181
.
.745
Engage3
77.28
105.393
.260
.
.743
Engage4
77.55
101.709
.368
.
.736
Engage5
78.47
103.372
.302
.
.740
Engage6
77.68
106.762
.084
.
.750
Engage7
77.57
108.690
-.006
.
.752
Engage8
76.83
103.531
.403
.
.737
Engage9
78.00
96.102
.717
.
.718
Engage10
79.40
116.651
-.499
.
.773
Engage11
77.73
115.589
-.398
.
.772
Engage12
78.85
103.181
.433
.
.736
Engage13
77.80
123.451
-.685
.
.792
Since all the values are greater than 0.600 and are closer to 0.700, the data is considered to be
reliable.
Model Validity
Since there was a need to build a model based on regression analysis, it was important to test the
model validity. Therefore, on a pilot sample of 30 respondents, model validity was assessed as
follows:
Cronbach's
Alpha
Cronbach's
Alpha Based
on
Standardized
Items
N of Items
.748
.674
26

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Table 3: Model Fitting Information
Model
-2 Log
Likelihood
Chi-Square
df
Sig.
Intercept
Only
68.381
Final
.001
68.381
10
.001
Link function: Logit.
Since the pvalue < 0.05, the variables are completely explaining the consumer engagement and the
model is having a good fit to explain
Table 4: Goodness-of-Fit
Chi-Square
Df
Sig.
Pearson
.013
20
0.895
Deviance
.026
20
0.798
Link function: Logit.
The model becomes more valid as the significance value is >0.05.
These values show that the regression model is a good fit and the factors explain the impact of
independent variables on the dependent variable
Regression Analysis
Table 6 Model Summary
Model
R
R Square
Adjusted R
Square
Std. Error of
the Estimate
1
.876a
.767
.759
.13236
a. Predictors: (Constant), Creditanddebit, Airconditioning,
Discounts, Employeebehavior, Ambience, Productvariety,
Sittingandrelaxing, Productdisplay, Music, Pricedisplay,
Odor, Signssymbols
The model shows that there is a stronger relation between the factors and consumer engagement
as R square > 0.700 which means that the model is fitting.
Table 7: ANOVAa
Model
Sum of
Squares
Df
Mean Square
F
Sig.
1
Regression
20.027
12
1.669
95.268
.000b
Residual
6.079
347
.018
Total
26.106
359
a. Dependent Variable: EngageT
Table 5: Pseudo R-
Square
Cox and Snell
.898
Nagelkerke
.873
McFadden
.852
Link function: Logit.

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b. Predictors: (Constant), Creditanddebit, Airconditioning, Discounts,
Employeebehavior, Ambience, Productvariety, Sittingandrelaxing, Productdisplay,
Music, Pricedisplay, Odor, Signssymbols
Table 8 Regression Coefficientsa
Model
Unstandardized Coefficients
Standardized
Coefficients
T
Sig.
B
Std. Error
Beta
1
(Constant)
2.927
1.062
2.756
.006
Productvariety
-.116
.024
-.362
-4.878
.000
Employeebehavior
.029
.096
.142
.303
.762
Airconditioning
-.005
.008
-.024
-.600
.007
Productdisplay
.087
.026
.501
3.299
.001
Pricedisplay
-.026
.096
-.128
-.268
.789
Ambience
-.020
.077
-.050
-.257
.798
Discounts
.057
.034
.192
1.679
.046
Music
-.371
.116
-1.934
-3.206
.001
Odor
.164
.133
.885
1.226
.221
Sittingandrelaxing
-.013
.200
-.079
-.066
.947
Signssymbols
.344
.426
1.356
.807
.420
Creditanddebit
-.045
.029
-.305
-1.538
.125
a. Dependent Variable: EngageT
Table 9 Excluded Variablesa
Model
Beta In
T
Sig.
Partial
Correlation
Collinearity
Statistics
Tolerance
1
Funandentertainmet
.b
.
.
.
.000
a. Dependent Variable: EngageT
b. Predictors in the Model: (Constant), Creditanddebit, Airconditioning, Discounts, Employeebehavior,
Ambience, Productvariety, Sittingandrelaxing, Productdisplay, Music, Pricedisplay, Odor, Signssymbols
Therefore, the analysis for urban areas show that there is a stronger need for the retailers to focus
on the following factors in urban areas of Rajasthan as for the other factors alternate hypothesis is
rejected as the pvalue > 0.05:
1) Product Variety
2) Air-conditioning facilities
3) Product Displays
4) Discounts
5) Music played inside retail store
MODEL OF CONSUMER ENGAGEMENT
STIMULATING FACTORS

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Retail High Priority Stimulants
Discounts
Product Display
Product Variety
Air-conditioning facilities
Music played inside retail store
OS
CONSUMER ENGAGEMENT
CONSUMER
INVOLVE MENT
CONSUMER
INTERACTION
CONSUMER
INTIMACY
CONSUMER
EXPERIENCE
- Product
Displays
- Price
Displays
- Ambience
- Discount
- Music
- Odor
- Credit/Debit
cards
- Product
Variety
- Product
Displays
- Ambience
- Discount
- Credit/Debit
cards
- Product
Variety
- Product
Displays
- Price
Displays
- Discount
- Music
- Product
Variety
- Product
Displays
- Price
Displays
- Ambience
- Discount
- Music
- Odor
- Sitting and
relaxing
facilities
- Signs& smb.
- Credit/Debit
cards
COMMON FACTORS: PRODUCT DISPLAYS AND DISCOUNTS

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Conclusion
Consumer Engagement in retail stores is relevant for the retail stores that serve not only as the
place where buyers are interacting with different brands and making purchases but also as a
medium where various advertisers can advertise their brands. Therefore, the retail stores
providing higher levels of engagement can market themselves to be used as media of advertising.
This will induce higher impulse buying also within the retail stores. The researcher has identified
the factors that can serve as tools of engaging consumers inside the retail stores. The factors were
analysed using regression analysis and the results depict that the factors the consumer engagement
within retail stores in Rajasthan are Discounts, Product Display, Product Variety, Air-conditioning
facilities and music played inside the retail store. These factors are most important specifically in
the major cities of Rajasthan as the consumers in Rajasthan are highly price sensitive and want a
good relaxed ambience for a retail store to engage them. But there is a difference in terms of
different factors influencing each of these dimensions wherein more number of factors were found
to influence consumer experience as compared to influence on all other dimensions – consumer
involvement, interaction and intimacy. The major factors that were found to influence consumer
involvement include Product Displays, Price Displays, Ambience, Discount, Music, Odor,
Credit/Debit cards. The factors that were found to influence consumer interaction include Product
Variety, Product Displays, Ambience, Discount and Credit/Debit cards. The major factors that were
found to influence consumer intimacy are Product Variety, Product Displays, Price Displays,
Discounts and Music. The major factors that were found to influence consumer experience include
Product Variety, Product Displays, Price Displays, Ambience, Discounts, Music, Odor, Sitting and
relaxing facilities inside the retail stores and Signs & symbols. The common factors that were found
to influence all the four major dimensions of consumer engagement are Product Displays and
Discounts which means that the consumers in Rajasthan are highly price sensitive and are enticed
by the packaging displays of the products inside the retail stores. Besides this, there were common
factors in the form of Ambience and Music which were common in the three different dimensions
out of the four dimensions which means that the consumers in Rajasthan are also concerned with
physical environment of the retail store and their engagement is not limited to the price sensitivity.
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