BLENDED SHOPPING

Interactivity and Individualization

Britta Fuchs, Thomas Ritz

Faculty of Electrical Engeneering and Information Technology, FH Aachen, Eupener Str. 70, 52070, Aachen, Germany

Bastian Halbach, Florian Hartl

Faculty of Electrical Engeneering and Information Technology, FH Aachen, Eupener Str. 70, 52070, Aachen, Germany

Keywords: eCommerce, Blended shopping, Mass customization, Web 2.0, Social networks.

Abstract: In this paper we describe in short the main characteristics of the separate sales channels traditional retail and

eCommerce with regards to the sales process of consumer goods. Afterwards we explain the integration of

both channels to blended shopping. The behaviour of consumers is influenced by technology driven trends

from which we identified the development of web 2.0 and social networks as relevant for blended shopping.

Additionally mass customization offers new possibilities to meet the increasing demand for individualized

goods close to mass product prizes. The combination of the discussed trends and developments is the basis

for a method to structure the development of blended shopping concepts for retailer. As examples two

prototypes developed according to results of this method are presented in this paper. The paper closes with a

future outlook.

1 INTRODUCTION

Consumer, trader and manufacturer had to adapt to

dramatic changes during the last years. ECommerce

is accepted next to traditional sales channels and

result – besides other technology-driven trends – in a

complex environment.

Web 2.0 with its architecture of participation and

social networks are used to produce and share user-

generated content. These trends influence the

shopping behaviour of consumers. New technologies

and approaches allow individualized mass

production (mass customization) with the integration

of customers into the configuration process as one

precondition. Configurators are already widespread

in the internet, but “the digital world” is no

integrated part of traditional commerce yet.

In this paper we seize these new trends and

present a method that enables retailers to blend

traditional commerce with web based content and

services in order to create fitting shopping

experiences or provide appropriate processes

(blended shopping). We give a look-out on further

possible developments integrating manufacturers

into the sales process for individualized goods.

2 STATE OF THE ART IN

RETAIL, ECOMMERCE AND

BLENDED SHOPPING

ECommerce is an established distribution channel

besides traditional retail. Often trade chains and

merchants run both channels in parallel with

separated processes (Fuchs and Ritz, 2009b), (Fuchs

and Ritz, 2009a). Following both sales channels with

their differences are described. The chapter closes

with explaining blended shopping as the

combination of both channels.

2.1 Traditional Retail

Some years ago traditional retail was the main sales

channel for consumer goods (Krafft and Mantrala,

2006). The core of traditional retail is the physical

presentation of goods in combination with advice

and instant availability of goods. Digital information

regarding customer and buying behaviour are often

not available, especially when the customers pays

cash. These characteristics result in specific

advantages and disadvantages which are presented

in detail in (Fuchs and Ritz, 2009a).

Fuchs B., Ritz T., Halbach B. and Hartl F..

BLENDED SHOPPING - Interactivity and Individualization.

DOI: 10.5220/0003516500470052

In Proceedings of the International Conference on e-Business (ICE-B-2011), pages 47-52

ISBN: 978-989-8425-70-6

 2011 SCITEPRESS (Science and Technology Publications, Lda.)

Nowadays traditional retailers face challenges

arising from increasing competition. Due to this

more and more trade chains and merchants offer

their goods as well via webshop (Krafft

and Mantrala, 2006). Configuration of individual

products in retail is done for custom-tailored

products like tailor-made suits. Then the customer

decides about the criteria (measures, texture, design,

etc.) with the help of a sales assistant. This service

requires no specific knowledge and ability of the

consumer and reduces the risk of receiving other

results than expected.

2.2 eCommerce

ECommerce applies the distance selling concept

which is already used by catalogue sellers, now

making use of the internet and latest technology to

present products and support the sales process. In

general this contains no physical contact between

product/merchant and customer (until fulfilment

phase). Because of price transparency easily

comparable products like books, DVD / CD / Video

and electrical equipment (Kroeber-Riel and

Weinberg, 2008) have the biggest share in

eCommerce. The buying decision is made on a more

rational way and is less emotionally influenced

(Mobile Fachgruppe im BVDE, 2008). A structured

presentation of advantages and disadvantages of

eCommerce is shown in (Fuchs and Ritz, 2009a).

Distribution of web-enabled mobile devices

contributes to the establishment of mCommerce

(Dholakia et al., 2006). This offers new possibilities

for blended shopping concepts. Until now obstacles

regarding usability (e.g. difficult navigation with

mobile devices in web shops designed for a screen

size of a stationary monitor) often cause a lack in

acceptance.

The trend of individualized mass products (mass

customization) (Piller and Tseng, 2010) leads to a

wide variety of configurators available in the

internet. Those configurators are used to define

specifications for individualized goods without

assistance of a sales person. Complex

interdependencies between components or

characteristics as well as specific data formats often

make the handling difficult for consumers,

especially when they are not computer-savvy. In

general online configuration is to be done without

having a product at hand and without personal

support which requires the ability to think abstractly.

2.3 Blended Shopping

When comparing advantages and disadvantages of

traditional retail and eCommerce it becomes

obvious that – depended from the situation and

requirements – the disadvantages of one sales

channel may be compensated by the other one.

Selecting processes of both channels for one

purchase could be an advantage for the customer

(e.g. selecting a pair of ski in the branch and let it be

delivered at home by eCommerce, because the

customer don’t like to carry them when continuing

shopping that day). But this is not supported by the

merchants yet (Fuchs and Ritz, 2009a).

Blended shopping is defined as “execution of the

transaction phases (information, mediation,

negotiation, contracting, fulfillment and after-sales)

involving both, real sales and presentation

mechanisms as well as network based sales

functionality” (Fuchs and Ritz, 2009a). Precondition

of blended shopping is that merchants run both

channels: eCommerce as well as a branch network.

This combination is already quite established (Krafft

and Mantrala, 2006). Usually eCommerce is

organized as separated unit with separated processes.

Each unit fears that the other may jeopardize the

own turnover.

The idea of blended shopping seizes the so

called multi-channel behaviour of customers which

is already object of investigation. Multi-channel

behaviour describes how consumers make use of

different distribution channels for one purchase. In a

study the authors (van Baal and Hudetz, 2008) found

out that customers make use of advantages of both

sales channels depending on their needs and

attitudes, e.g. ¼ of purchases in 2008 were prepared

by using the respectively other channel. It has

become a common practice to touch and test the

product in a branch and order it by eCommerce,

because lower prices are expected. Often this applies

but eCommerce is associated with other

disadvantages. Blended shopping enables merchants

to offer services and information best fitting to the

consumer’s situation. This could lead to higher

customer satisfaction. In the end the merchant who

offered information and advice aims to clinch the

deal instead of loosing it to eCommerce competition.

When taking the individualization trend into

account, blending eCommerce and traditional retail

processes involves production and logistic processes

as well. For the consumer it would create added

value if the interface for all processes connected

with individualized products is one contact person:

the merchant. In two field studies (Fuchs and Ritz,

2009a);(Fuchs and Ritz, 2009b) it was proved that

blended shopping concepts are scarcely applied in

Germany yet.

ICE-B 2011 - International Conference on e-Business

3 WEB 2.0

The situation in retail is affected by trends emerging

from the widespread availability of internet (ARD-

/ZDF-Medienkommission, 2009). Web 2.0 and

based on this the development of social networks

influence the shopping behaviour of consumers.

The term web 2.0 was coined in 2004 (O'Reilly,

2005) as further development of the internet after

analyzing the results of the dot com bubble burst.

According to O'Reilly web 2.0 can be described by a

set of principles and attributes. One of the core

principles of web 2.0 is the architecture of

participation instead of passive consumption of

content. The penetration of broadband connection at

decreasing cost was an important precondition for

user participation (Horrigan, 2006) and participation

is the basis for social networks. The idea of social

networks is not new but the actually widespread

distribution was enabled by web 2.0.

Bigger parts of services allocated to web 2.0 can

be described as social software. They all have

centralizing human social behaviour in common

(Coates, 2005). Social networks as subarea of social

software provide mainly organization and

maintenance of contact networks. As one success

factor of social networks object-centred sociality

(Engström, 2005) emphasizes the necessity to share

common objects. Additionally different

functionalities may be important for the user, e.g.

identity or conversation (Webb, 2004). Testimonials

and user-generated content result from the activity in

social networks and influence the purchase decisions

of consumer. Those newer trends of influencing

consumption decisions need to be integrated into

blended commerce concepts

4 INTERACTIVE CONCEPTS

The trends described in the chapter before make

clear that merchants and consumers operate in a

complex context. Because of available information

and communication technologies as well as social

networks consumers are very well informed about

products and offers. But they have to structure the

information themselves. And information from the

internet is still separated from the retailer’s branch.

Our research focuses on exploring how

information of third parties (social networks as well

as manufacturer) can be integrated within traditional

retail stores in a structured way. Consumers make

use of web 2.0 and social networks at home, we

search for ways to embed these sources into the sales

process at the POS. Usage of web-based platforms

and contents presume access to the internet. This can

be realized either by stationary terminals within the

shop or by consumers’ mobile web-enabled devices.

Both possibilities differ in strategic impacts like e.g.

investments in infrastructure and require different

frameworks e.g. for appropriate presentation of

content related to environmental, situational and

device-dependent circumstances.

In the upcoming chapter we present an approach

to select information services. Prototypes developed

based on results of this evaluation method will be

presented afterwards.

5 EVALUATION METHOD

Nowadays merchants have a lot of possibilities to

strengthen their position in competition with product

information systems. A product information system

provides public accessible information related to one

or more products. For merchants it is often difficult

to decide if an investment is reasonable, how the

solution should look like and what information from

what source should be embedded. To support the

decision process, we developed a method to evaluate

the given situation, to derive requirements regarding

the product information system and to support the

development of possible approaches.

This method allows structured guidance but

demands individual assessment of each situation.

The result of one session cannot be deemed as

standard solution. We identified three core factors

which we apply with differentiated characteristics:

- Customer

- Product

- Shopping experience

The factors customer and product are closely

connected, e.g. the product type has influence on the

information demand of the customer. Nieschlag

(Nieschlag et al., 2002) applies involvement to

distinguish products on the basis of the consumer’s

motivation to select and handle product-related

information. Obviously products with high

involvement like cars and vacation trips need

another kind of product information system at the

POS than low involvement products like cleaner or

flour (Kuß and Tomczak, 2007).

Besides the product and the involvement of the

customer, the character of the shopping experience

which should be created by the product information

system is emphasized in this method. Shopping

experience (Weinberg, 1992) is understood as a

BLENDED SHOPPING - Interactivity and Individualization

subjectively sensed contribution to the consumer’s

quality of life generated by a product, service, sales

conversation or anything related to the product

presentation. Based upon the mentioned factors we

developed a method that enables merchants to

evaluate product information system requirements in

a given framework (product, situation) and supports

the development of realization approaches (e.g.

mobile or terminal solution, shape, necessary

features,…). Two prototypes created based upon

results of the applied method are presented in the

upcoming chapter.

6 PROTOTYPES OF PRODUCT

INFORMATION SYSTEMS

As mentioned, web-based content can be integrated

in branches either by terminals or by consumers’

mobile devices. Following in subsection 6.1 and 6.2

prototypes for both scenarios are presented which

have been developed upon results of the method

presented in chapter 5. While the ski-example

mentioned in chapter 2.3 visualizes a process link-up

at a late point of the shopping process (fulfilment)

we aim to address with both prototypes blended

shopping at a very early stage (information,

mediation). In subsection 6.3 both concepts are

compared regarding advantages and disadvantages

for merchants and consumers.

6.1 Sensor-based Sales Terminal

Information terminals in shops are no new idea. One

well known example is the barcode scanner in super

markets where the customer can check the price of a

product. Since a few years merchants try to develop

new concepts of offering digital information on

demand, e.g. drug stores connecting product and

information systems with health guidance (DM

Drogeriemarkt).

At the moment service terminals often present

available product information from manufacturer but

do not respond to the specific needs and do not

interact with the customer like an “advisor”.

Furthermore they do not take advantage from the

fact that the customer has a product at hand to test

and touch and to explore configuration possibilities.

A possible solution for that was designed in an

interaction sensor-supported information prototype

shown in figure 1. A range of physical products (like

cameras) are arranged on a rack that is linked to an

interaction terminal by RFID. When a consumer

picks up a product, the system starts to interact. It

identifies the product removed from the rack and

gives advice what should be tested (e.g. “give the

sports modus of this camera a try by focussing a

moving person. Check the result on the screen.”).

Additionally web based information like

testimonials from social networks is embedded. The

concept aims to generate shopping experience in

order to establish an emotional commitment of the

consumer.

Figure 1: Interaction sensor-supported information

prototype.

An illustration of the concept is given in figure 2.

Figure 2: Interaction sensor-based sales Terminal.

First tests with possible users proved acceptance

and appeal of the prototype.

But merchants are still not prepared to support

price transparency. In future possibilities to offer

individualized accessories or components (e.g.

camera bags with an individualized surface) can be

embedded. The configuration process would take

ICE-B 2011 - International Conference on e-Business

into account that the consumer has the camera at

hand. Organizing production, distribution and

settlement can be integrated into the system.

6.2 Mobile Solution

Widespread availability of web-enabled devices like

e.g. smartphones is a precondition for using mobile

applications such as presented in this subsection. It

can be assumed that already a relevant rate of

consumers make use of mobile internet and in future

the rate will increase (Tudor and Pettey, 2010).

When developing solutions for mobile devices

special basic conditions have to be respected as

changing light, disconnection time, limited screen

size, different kinds of devices and so on. This

illustrates the necessity of analyzing the given or

targeted situation as described in section 5.

In the example shown in figure 3 an iPhone

application was developed which enables the

consumer to receive web based information like

testimonials and prices in the shop during testing the

product. This app could be offered by a merchant to

structure information. Reference to linked products

or accessories are possible.

Figure 3: iPhone application for web 2.0 in the shop

(Fuchs and Ritz, 2009a).

An illustration of the concept is given in figure 4.

This application was tested with possible users and

proved acceptance. Nevertheless merchants have

strong concerns regarding price transparency

supported by this prototype.

Following advantages and disadvantages of the

described prototypes are compared.

Figure 4: Concept web 2.0 in the shop.

6.3 Comparison of Concepts

In this chapter the presented examples for stationary

and mobile web-based sales support are compared

regarding their advantages and disadvantages for

merchants and consumers. Following table 1 showes

advantages and disadvantages connected with the

use of mobile or stationary solutions.

Table 1: Advantages and Disadvantages of concepts.

Advantage Disadvantage

Terminal

Merchant Standardized

screen

definition and

presentation

possible

Costly

infrastructure

Customer No own device

needed;

emotional

shopping

experience

possible

Unknown system

and structure;

system may be

occupied

Mobile

Merchant No costly

infrastructure

needed

No influence on

content delivered;

content structure

needed for mobile

devices

Customer Independent

from foreign

device;

no private data

exchange if not

desired

Limited screen

size reduces

shopping

experience

The stationary prototype supports the sales

process with advice and additional information to

explain more complex products and puts the

customer into the position to retrieve all information

BLENDED SHOPPING - Interactivity and Individualization

he or she needs to take a buying decision. It offers a

special shopping experience by taking advantage

from having the product at hand. Furthermore this

prototype could be extended by supporting mass

customization approaches (individualized

accessories). The disadvantages of this stationary

system are the costly infrastructure and the

development of advisory structure and content.

The presented mobile solution provides

information needed within a shopping situation. The

approach is more rational and it does not support an

emotional shopping experience. The customer

receives information mainly independent from the

merchant. This allows only little space for cross

selling impulses or any other form of advice. The

merchant’s efforts are reduced to provide needed

information in an appropriate format for mobile

devices. In conclusion both prototypes address

different shopping situations and depend highly on

the product and the target group. We emphasize that

both prototypes were developed on the outcomes of

the evaluation method in two different scenarios.

When merchants are interested in blended shopping

concepts the first step is to evaluate the given or

aimed situation.

7 FUTURE PROSPECTS

In this paper we presented the necessary theoretic

background to describe the idea of blended

shopping. Our evaluation method for blended

shopping solutions was described. With the help of

prototypes we proved the useful utilization of

concepts. We emphasize that this method do not

include a cost-benefit analysis. Since developing a

product information system requires investment,

new concepts need to be developed to analyze the

cost benefit relation with regards to customer

satisfaction and loyalty.

Within this paper we focus on blended shopping

concepts for consumer mass products. In future we

address the development of mass customization

approaches within blended shopping concepts.

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