A Comparison of Shopping Experiences across Three Competing Digital Retailing Interfaces

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Abstract
Digital retailing has been promoted in one form or another by telecommunications service providers for more than two decades. It offers customers a shopping experience distinct from physical place-based retailing. However, little is known about the characteristics and payoffs from digital retailing or the degree to which it may substitute for physical stores and malls. This article investigates the characteristics of three commonly implemented digital retailing approaches–catalog search, bundling, and virtual reality storefront–and the suitability of each approach for electronic commerce. Publishers and vendors have claimed that the rich medium of virtual reality will lead to greater sales and profits in retailing, a view refuted by our research. Although qualitatively different from other approaches, virtual reality is not clearly superior in generating profits and sales revenues. The research finds no statistically significant difference in the money spent or the number of items purchased among the three approaches. The only significant difference is the time spent shopping, which tends to be longer for virtual reality storefronts. Virtual reality retailing requires a 50 percent increase in search time over a catalog search, and a 212 percent increase over time spent when retailers bundle products on screen. In contrast to claims of many software vendors and marketing consultants who have touted virtual reality storefronts and virtual reality technologies as vehicles for increasing sale revenues, the research finds that customers are not likely to spend more on merchandise just because it is presented via a virtual reality storefront interface.