Exploring the impact of metaverse adoption on sustainability outcomes in retail organizations: A dynamic capabilities view perspective

The metaverse presents an opportunity for retailers' sustainability in how its value can be created with efficient resources, inclusivity, and less waste. Nevertheless, the relationship between metaverse adoption and sustainability outcomes is not sufficiently explored in the literature. Building on the Dynamic Capability View (DCV) and employing a two-study mixed method approach, it is examined how metaverse adoption affects the economic, environmental, and social aspects of sustainability performance, emphasizing the role of technology infrastructure. A qualitative study (Study 1) based on interviews' thematic analysis revealed that metaverse-enabled dynamic capabilities of collaboration, business process optimization, realignment with stakeholders' empowerment, and pro-environmental practices are key mediators in this relationship, whereas technological infrastructure shapes these dynamic capabilities. A quantitative approach (Study 2) using PLS-SEM provided empirical support for Study 1. The findings suggest that collaboration enhances social and environmental sustainability; business process optimization enhances economic sustainability; stakeholder empowerment enhances economic, social, and environmental sustainability; and pro-environment practices enhance economic and environmental sustainability. Furthermore, technology infrastructure strongly moderates the relationship between metaverse adoption and dynamic capabilities, including collaboration, stakeholder empowerment, and pro-environmental practices. Finally the study yields a strategic roadmap for the retail sector to harmonize innovation with long-term sustainability objectives. • Discusses the relationships between metaverse adoption and sustainability outcomes. • Emphasises on the role of technology infrastructure in shaping dynamic capabilities. • Pro-environment and stakeholder empowerment practices enhance sustainability.