Engaging Consumers With Virtual Reality: A Moderation Role of Product Types and Consumption Orientations

Abstract

Exploring virtual reality as an innovative marketing channel, this study investigates its impact on consumer engagement across the consumer journey, highlighting the influence of product types and consumption orientations. Despite the growing interest in and integration of virtual reality in retail, there is a lack of detailed understanding of how businesses can effectively deploy virtual reality to improve consumer interactions, particularly on online platforms. We adopted the Difference-in-Differences approach with the Propensity Score Matching technique to analyze clickstream data from approximately 3800 students, collected by the education company through quasi-experimental methods. We find that environment-replicating virtual reality significantly enhances engagement throughout the consumer journey, with increased visits, clicks, and conversions. Consistent with the Benefit Congruency Framework, this effect is more pronounced for hedonic products designed for pleasure and entertainment, demonstrating virtual reality's capacity to heighten experiential enjoyment. However, environment-replicating virtual reality's potential to offer immersive experiences can also introduce unintended inconvenience, particularly for consumers who are more focused on practical benefits. The integration of real-world elements may detract from the convenience of online environments. Therefore, our results provide managerial implications for virtual environment design and consumer targeting strategies to enhance consumer experience and engagement.