Augmented reality advertisement: can it provide the adequate consumption values to affect intention and affective loyalty?

Purpose Despite the growing popularity of augmented reality (AR) advertisements, studies on AR advertisements are still in the nascent stage, and prior studies have mostly focussed on the Western markets. Prior researchers have highlighted the need to examine the impact of variables, like interactivity and store-like experience on choice behaviour. It is important for managers to examine customer choice behaviour since it can help in reducing uncertainty regarding product/service adoption. This study attempts at addressing this gap by examining the impact of certain consumption values on customer choice behaviour, mainly affective loyalty (AL) and intention. Design/methodology/approach The study has utilized a quantitative research approach through a questionnaire-based survey. Three hundred and two responses collected from Indian participants were used to assess the hypotheses. Partial-least-squares structural-equation-modelling (PLS-SEM) technique was utilized through a two-step approach: (1) measurement model assessment and (2) structural model assessment and hypotheses testing. Findings The study found that interactivity and emotional connect (EC) have a significant positive impact on both AL and intention. This suggests the need for managers to foster EC through interactive and immersive experiences which not only affects present purchase intentions but also can create long-term associations. Results also show that while store-like experience and social values affect AL, conditional values affected intention to use. Originality/value Research on AR advertising is still in its nascent stage. This study contributes to the literature on the theory of consumption values in the AR context. Moreover, this study also contributes to the lack of studies in the non-Western context by analysing Indian scenario. The study also highlighted the differential effects of different consumption values on loyalty and intention.