Impact of Augmented Reality on Increasing Purchase Intention

among Bangladeshi Consumers in the Retail Industry with the

Mediating role of Brand Engagement

Project Report Submitted to the Department of Business Administration to Fulfil

the Degree of Bachelors of Business Administration

Course Title: Project

Course Code: BUS 498

Prepared for
Md. Anamul Hoque
Assistant Professor
Department of Business Administration
East West University

Prepared by
Nusrat Jahan Labonno
2018-3-14-010
Major in Finance & Marketing

15 September 2022
 Authorization Message
I hereby declare that I personally directed this research and that it was not previously submitted or
used. In addition to the uniqueness of the research itself, the entirety of the data used in this lookup
study was gathered only by me. Moreover, to reveal the information without any uncertainty, I
assure that all necessary citations have been made within this paper where prioritization has been
given to the work of others.

1
 Letter of Transmittal

Md. Anamul Hoque

Assistant Professor
Department of Business Administration
East West University
Aftabnagar, Dhaka-1212, Bangladesh

Subject: Submission of project report on “Impact of Augmented Reality on Increasing

Purchase Intention among Bangladeshi Consumers in the Retail Industry with the Mediating
role of Brand Engagement”
Dear Sir
It brings me great pleasure to be able to hand over the project titled "Impact of Augmented
Reality on Increasing Purchase Intention among Bangladeshi Consumers in the Retail
Industry, with Brand Engagement as a Mediating Factor." This report is the result of the
knowledge which has been acquired from the BBA program.
I sincerely hope that this report satisfies the project's objectives and requirements and is accepted
by you. I have endeavored to complete the report as concisely and comprehensively as appropriate
with the essential data and proposed solution.
Please feel free to ask any questions or seek clarifications you may have. I hope you'll appreciate
the hard work I've put in and pardon any mistakes. At every stage of my work on this report, I am
appreciative of your advice and helpful assistance. Thank you for your cooperation. Sincerely
yours,

_____________________
Nusrat Jahan Labonno
2018-3-14-010
Department of Business Administration
East West University
Date: 15 September 2022

2
 Acknowledgment
Firstly, I would like to thank Md. Anamul Hoque sir, our respected course instructor of my project
course, for giving me the opportunity to study and analyze such an amazing issue, as well as for
his supervision, constant direction, and essential advice whenever required. Without his directions
and assistance, this would have been nearly impossible to finish. Altogether, these things help us
attain the required research objective.

3
Tables of Content

Executive Summary ....................................................................................................................... 7

Chapter 1- Introduction ................................................................................................................ 8
1.1 Background of the study ........................................................................................................ 8
1.2 Research Question ............................................................................................................... 10
1.3 Research Objective .............................................................................................................. 10
1.4 Scope of the Study ............................................................................................................... 10
Chapter 2- Literature Review..................................................................................................... 11
2.1 Augmented reality in retail industry .................................................................................... 11
2.2 Theoretical Framework ........................................................................................................ 12
2.2.1 Telepresence .................................................................................................................. 13
2.2.2 Perceived ease of use..................................................................................................... 13
2.2.3 Hedonic value ................................................................................................................ 13
2.2.4 Relationship between Customer Brand Engagement and Purchase intention ............... 14
Chapter 3- Research Design ....................................................................................................... 15
3.1 Exploratory Research ........................................................................................................... 15
3.2 Descriptive Research............................................................................................................ 15
3.3 Data Collection .................................................................................................................... 16
3.4 Online Survey Method ......................................................................................................... 16
3.5 Data Analysis ....................................................................................................................... 16
Chapter 4- Result Analysis ......................................................................................................... 17
4.1 Demographic Analysis ......................................................................................................... 17
4.2 Psychographic Analysis ....................................................................................................... 18
4.3 Cross tabulation between Gender & Education group towards AR..................................... 19
4.4 Reliability Test ..................................................................................................................... 20
4.4.1 Telepresence .................................................................................................................. 20
4.4.2 Perceived ease of use..................................................................................................... 20
4.4.3 Hedonic Value ............................................................................................................... 21
4.4.4 Brand Engagement ........................................................................................................ 21
4.4.5 Purchase Intention ......................................................................................................... 21
4.5 Correlations .......................................................................................................................... 22
4.6 Regression Analysis ............................................................................................................. 23
4
 4.7 Hypothesis Testing............................................................................................................... 26
Chapter 5- Conclusion ................................................................................................................. 27
5.1 Discussion ............................................................................................................................ 28
5.2 Implications.......................................................................................................................... 29
5.3 Recommendations ................................................................................................................ 29
5.4 Limitation of the Study ........................................................................................................ 29
References..................................................................................................................................... 30
Appendix....................................................................................................................................... 31

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List of Figure
2.2 Theoretical Framework........................................................................................................ 12

List of Tables
2.1 Construct of Theoretical Framework................................................................................... 12
4.1 Demographic Analysis......................................................................................................... 17
4.2 Psychographic Analysis....................................................................................................... 18
4.3 Cross tabulation between Gender & Education group towards AR .................................... 19
4.4 Reliability Test..................................................................................................................... 20
4.4 Correlations ......................................................................................................................... 22
4.4 Regression Test.................................................................................................................... 23

6
 Executive Summary
Augmented reality (AR) enables the enhancement of the real world by the visualization of
computer-generated virtual data in real time (Furht, 2014). Because of this, marketers now have
alternatives that were previously unimaginable for reaching out to customers and connecting with
them. Users are presented with exciting new options to interact with a company's brand, service,
or product when a company has the ability to physically deliver things to customers.
These research paper examined the impact of augmented reality on increasing purchase intention
among Bangladeshi consumers in the retail industry with the mediating role of brand engagement.
To do this, the features of AR were used as independent variables and were tested to see how they
affected consumer engagement. The questionnaire was used to collect the first-hand information
for survey analysis total 202 people response was carried out. The opinions of respondents and the
analysis of secondary data have also been used to get better insights. The acquired data was
examined with the SPSS program to determine reliability, correlation and regression between the
variables. The study found that Telepresence, Perceive ease of use, Hedonic Value effects
consumer brand engagement which lead to impact purchase intent.

Keywords: Augmented reality, purchase intention, customer brand engagement,

Telepresence, Hedonic Value, Perceive Ease of use, retail shopping

Paper Type: Project Paper

7
 Chapter 1- Introduction
Augmented reality is the integration of digital objects into the physical world. Augmented reality
is the addition of digital elements to our physical surroundings, typically through a mobile phone,
tablet, or AR glasses. The retail industry uses augmented reality to enhance or augment the world
using digital technology. In recent years, augmented reality has become one of the most important
marketing tools for a variety of organizations, such as BMW and Topshop. The global market size
for augmented reality in retail was estimated at $2 billion in 2021 and is anticipated to reach $61.3
billion by 2031, expanding at a CAGR of 41.4% from 2022 to 2031(Allied Market Research). The
COVID-19 pandemic had a positive impact on the augmented reality in retail market, which
exhibited a positive growth rate during the period, due to the growing demand for augmented
reality solutions among retail enterprises to improve customer experiences. With augmented
reality, consumers can build a more intuitive and empathic connection with brands. Now,
marketers can communicate stories through immersive and 3D experiences, with the end user in
control of the narrative. Some early adopters in the retail sector have created augmented reality
(AR) technology aimed to enhance the shopping experience for consumers. The incorporation of
augmented reality into store catalog apps enables consumers to envision how various products
would appear in various contexts. When purchasing furniture, for instance, consumers point the
camera to the right room and the goods appears in the front. So how does augmented reality impact
can increase purchase intention in Bangladesh? Can integrating AR in Bangladeshi retail industry
make an impact?

1.1 Background of the study

 Evolving Technology always impact consumer behavior

The evolution of technology will always have an effect on consumer behavior. Smart mobile
phones, tablets, and wearables, which were once primarily used by the younger generation, are
now utilized by all segments of society due to rapid technological innovation and
improvement. Modern consumers have the potential to receive outstanding and efficient
services from businesses, in accordance with their expectations for more responsive and
equally effective services from companies. Changes in consumer behavior have a substantial
impact on organization strategy, requiring business owners to adopt and implement customer
experience management in their everyday operations. To improve customer experiences,
particularly in the retail environment, virtual and augmented reality are becoming increasingly
prevalent in the business sector. (Arman Hj. Ahmad, Ridzuan Masri 2020) (Kotler, Kartajaya
and Setiawan, 2017).

 Millennials are the core shoppers today

Millennials are the key shoppers of today, and they require services to be accessible whenever
and wherever they are. It is completely out of style to wait in long lines in order to take
advantage of a limited offer. Online booking is becoming increasingly popular among

8
 consumers. The use of augmented reality in retail gives customers a new perspective on the
online purchasing experience. Customers are given the opportunity to virtually try on items,
modify their purchases, and interact with the products in a more meaningful way so that they
can make rapid and informed purchasing decisions. Receiving total fulfillment from one's
purchases made online significantly boosts one's faith in a brand, providing merchants with an
immediate boost that enables them to accelerate sales! The more compelling the case becomes
for implementing AR in retail!

 Effective tool to enhance consumers engagement

When implemented correctly, augmented reality technology has the potential to greatly boost
consumer recognition of your brand and facilitate more productive engagement with users. AR
can provide consumers who prefer to shop online with a more satisfying shopping experience
by making it possible for them to form a mental image of the goods they are considering
purchasing.

 Try before you buy

Customers can now try on clothing or accessories virtually, because of augmented reality
technology, without physically going to a store. As augmented reality (AR) makes it easier for
buyers to see how things will look in their own environments, it represents a major shift in how
people conduct online product research, make comparisons, and ultimately make purchases.
Retailers like Warby Parker are taking advantage of augmented reality (AR) and the iPhone's
face mapping skills to let customers browse for glasses digitally, a trend that has been spurred
on by the current global epidemic of preventable blindness. Luxury businesses like Gucci have
been particularly interested in augmented reality because it allows them to connect with young
people on platforms like Snapchat. Users may see how an item will fit into their space with the
use of augmented reality. (Eero Martela, 2022)

 Powerful Retail Sales Channel

Websites and apps for e-commerce that incorporate augmented reality can be used on any
smartphone, giving customers a truly immersive experience with every product. By attracting
customers' attention during the crucial decision-making phase of the buying process,
businesses can increase the number of sales made from those customers. With augmented
reality, there are countless ways for consumers to engage with goods. Customers are no longer
restricted by a lack of available media when making purchasing decisions. Every single online
interaction can become a very effective sales channel with the help of AR. Get people's
attention when they're ready to buy. It converts visitors' web searches into effective marketing
tools.

9
1.2 Research Question
 RQ1 What is the impact of augmented reality on purchase intention with the mediating
role of brand engagement in the retail industry among Bangladeshi Consumer?
 RQ2 If this is the case, what could explain the potential increase in purchase intent when
using an augmented reality application?

1.3 Research Objective

General Objective
The broad objective of the study is to identify the impact of augmented reality on purchase
intention in the retail industry among Bangladeshi Consumer
Specific Objective
• To identify the role of consumer brand engagement
• To identify the variables that is directly or indirectly making an impact on the purchase
intention
• To identify the demographic and psychographic profile of the consumers.

1.4 Scope of the Study

The main focus of this project was the impact of augmented reality on purchase intention in the
retail industry with the mediating role of brand engagement. The important findings of this research
is the role of augmented reality in developing customer engagement in brands and their tendency
to make purchases. The purpose of this research is to determine how AR can influence consumers'
engagement toward a brand and, ultimately, their decision to make a purchase from that company.
The research focuses on a convenience sampling online survey procedure to examine the
hypotheses. This prospective study utilized moderated SPSS regression analysis to analyze
structural equation modeling paths. A total of 202 participants filled out the questionnaire.

10
 Chapter 2- Literature Review

2.1 Augmented reality in retail industry

The term "augmented reality," or "AR," refers to a view in real time of one's physical surroundings
that has been augmented by the addition of digital information that was generated virtually by a
computer (Furht, 2014). By using augmented reality (AR) apps on mobile devices, consumers can
see a digital good in a real-world setting, like digital furniture in a real-world room, or get a better
look at themselves with tools like virtual mirrors and virtual try-ons for things like cosmetics and
apparel. Augmented reality virtual mirrors provide a more interactive, real-time experience than
websites that allow users to upload their own images for virtual try-ons (Javornik, 2016).
The use of augmented reality (AR) in marketing and sales strategies is a rising trend. It enables
companies to provide consumers with innovative, mobile-friendly experiences. AR provides an
additional tool for increasing sales and brand value through mobile devices. Traditional web-based
internet retail has shortcomings in terms of product presentation, opportunity to try things or info
quantity. For instance, when evaluating large furniture and things that are expensive, consumers
mostly go for a visit in physical stores to have a more detailed understanding of the product in
order to reduce risk. It is expected that the prevalence of smartphones and the introduction of
intense technologies like as AR (augmented reality) will create new potential for enhancing the
multimodality, information density, and location independence of retail.
A number of the world's largest retailers, including IKEA, Walmart, and Amazon, have developed
their very own augmented reality (AR) applications as a compliment to their existing retail
operations. In addition, a few "hyper" AR wearables enhance the purchasing experience of
consumers with features such as hands-free operation, reduced response time, and rich
engagement. However, retailers and businesspeople may be unsure of augmented reality potential
in the future due to concerns about its effect on sales and customer adoption.. (Tobias Richter,
Kryštof Raška, 2017)

11
2.2 Theoretical Framework

Telepresence
H1

Perceive Ease of Customer Brand Purchase

Use Engagement Intention
H2
H4

Hedonic Value H3

Figure: Theoretical Framework

Category Source
Telepresence Tobias Richter and Kryštof Raška 2017

Perceive Ease of Use Wakim, Riad Samir Drak Al Sebai, Lara Miladinovic, Mira 2018

Hedonic Value Tobias Richter and Kryštof Raška 2017

Customer Brand Engagement Kashif Abrar, Vol.1, No.2 pp. 64-80, Aug 2018

Purchase Intention Kashif Abrar, Vol.1, No.2 pp. 64-80, Aug 2018

Figure: Constructs of Theoretical Framework

12
2.2.1 Telepresence
Telepresence is defined as “the experience of presence in an environment by means of a
communication medium” Telepresence described by Steuer (1992), is the perception that one is
physically present in a given area or place despite really being in a different one. While the latter
definition serves as the foundation for telepresence, which refers to the act of virtually being
present somewhere through the use of electronic methods of communication (Steuer, 1992)
According to research conducted by Fiore in 2005, the interactive visual technologies that create a
sense of telepresence have only a moderate impact on the cognitive responses of customers. Due
to the absence of any physical touch between product and user, the incorporation of the concept
"Telepresence" in the study framework is crucial. Therefore, it is essential to evaluate the store's
proficiency in providing the products to the customer by means of the augmented reality
technology.
The design and quality of an experience in augmented reality can provide telepresence and
duplicate a direct product experience, which influences a consumer's engagement and purchase
intention. In addition, past research in this area has demonstrated that Telepresence significantly
affects the attitudes and brand engagement (Fiore et al., 2005; Schwartz, 2011). That's why it's
assumed that Telepresence of the AR application has a positive effect on Customer brand
Engagement hence Hypothesis 1 is
 H1 Telepresence of the AR application has a positive effect on Customer brand Engagement

2.2.2 Perceived ease of use

Perceived ease of use is defined as “the degree to which a person believes that using a particular
system would be free of effort”. Perceived ease of use influence the establishment of attitudes
toward innovation adoption. This refers to the extent to which an individual believes that making
use of technological devices will be effortless (Davis et al., 1989). Therefore, it may be anticipated
that, to impact customers' cognitive responses and increase consumer engagement, the augmented
reality (AR) experience must be user-friendly and enhance the shopping experience through the
perceived usefulness and enjoyment (Kim & Forsythe, 2008). That's why it's assumed that
 H2 Perceived ease of use of the AR application has a positive effect on Customer brand
Engagement

2.2.3 Hedonic value

Hedonic value is the value a customer gets based on how much fun and playfulness they have with
the subject (Babin et al. 1994). Customers are more likely to make additional purchases of an item
if they have a positive impression of its hedonic worth, which is one of the qualities of AR (Huang
& Liao, 2017). During the buying process, consumers develop a sense of individual happiness and
pleasure because to this hedonistic value perception (Moon et al., 2017). A strong hedonic value
is often represented by fun, amusement, arousal, fantasy gratification, amusement, enjoyment,
and/or a good mood, therefore this serves as a primary incentive to engage in various purchase

13
activities. (e.g., Arnold & Reynolds, 2003; Babin et al., 1994). Researchers in the field of
augmented reality (AR), such as Hilken et al. (2017) and Yim et al. (2017), have shown that
consumers evaluate AR experiences not just on the basis of convincing or efficiency, but also on
hedonic basis. According to some study hedonic considerations have a significant role in keeping
customers engaged. High-involvement product categories like apparel and mobile phones are
particularly vulnerable to the impact of the hedonic value component (Wakim, Riad Samir, Drak
Al Sebai, Lara, Miladinovic, Mira, 2018). That's why it's assumed that Hedonic value of the AR
application has a positive effect on Customer brand Engagement hence Hypothesis 3 is
 H3 Hedonic value of the AR application has a positive effect on Customer brand
Engagement

2.2.4 Relationship between Customer Brand Engagement and Purchase intention

Customer engagement is an essential marketing tactic construct since it has been found to be
positively related to other crucial marketing concepts such as commitment (Chan and Li, 2010).
It's possible that consumers have an optimistic perspective on a certain brand. Customers who feel
a strong emotional attachment to a brand are more likely to make repeat purchases from that
company. (Writz et al., 2013). As a result of fiercer competition, and ever-evolving consumer
expectations, brand engagement has become a vital focus for today's most successful businesses
(Todor, 2014).
The term "purchase intention" is used to describe a person's attitude, which leads to a certain
behavior. Additionally, it has a favorable or negative influence on their decision to purchase a
service or a product). It is often measured by marketing managers and used as one of the factors
they consider when making decisions about new and existing products and services. There is a link
between purchase intentions and future sales (Zarantonello & Schmitt, 2010). Additionally,
purchase intentions are used in some instances in order to calculate consumer demand for new
products by means of idea and product testing. (Allameh et al., 2015).
When customers use AR, they are much more likely to engage with a company and make a
purchase. Some research has found that augmented reality applications and devices have a
significant influence on consumers' propensity to make a purchase; however, the strength of the
correlation between AR and consumer spending is tempered by consumers' commitment to a
particular brand (Kashif Abrar, 2018). That's why it's assumed customer brand engagement has a
direct impact on product purchase intention hence Hypothesis 4 is
 H4 Customer brand engagement has a direct impact on product purchase intention

14
 Chapter 3- Research Design

3.1 Exploratory Research

Exploratory research can also be called "formulative" research. Exploratory research designs are
used to do two things: (1) generate a working hypothesis from an operational standpoint, and (2)
formulate an issue for more targeted research.

 Focus group discussion: I will conduct focus group discussions with groups of 7 people to
learn about their perception about retail shopping with augmented reality. The individuals
will be East West University students.

 Secondary data analysis: I have already studied several journals on the subject I have
choose for this research. In this proposal, six of them are reviewed in depth, including their
findings, limitations, and future research objectives.
• Daniyal Ahmed Fazal , Haris Shoukat and Osama Mughees “Impact of Virtual Reality
on Customer Purchase Intention - A study on Pakistan’s Fashion Industry.” July 2022
• Kashif Abrar “Impact of Augmented Reality on Consumer Purchase Intention with the
Mediating role of Customer Brand Engagement: Moderating role of Interactivity in
Online Shopping” Vol.1, No.2 pp. 64-80, Aug 2018
• Tobias Richter and Kryštof Raška “Influence of Augmented Reality on Purchase
Intention” May 2016
• Syed Hasnain Alam Kazmi, Rizwan Raheem Ahmed, Kamran Ahmed Soomro,
Alharthi Rami Hashem E, Hameed Akhtar and Vishnu Parmar “Role of Augmented
Reality in Changing Consumer Behavior and Decision Making: Case of Pakistan” Dec
2021
• Wakim, Riad Samir, Drak Al Sebai, Lara, Miladinovic, Mira “The Impact of Augmented
Reality on Product Purchase Intention in the Swedish Eyewear Industry” May 2018
• Shirin Gatter, Verena Hüttl‐Maack, Philipp A. Rauschnabel “Can augmented reality
satisfy consumers' need for touch?” March 2021

3.2 Descriptive Research

The objective of descriptive research is to provide a comprehensive and systematic description of
a group, context, or phenomenon as the subject of the investigation. It can provide answers to the
questions of what, where, when, and how to be asked.
To quantify the impact of Augmented Reality on increasing purchase intention among Bangladeshi
consumers in the retail industry I will employ the questionnaire method. I will also investigate the
target audience's demographic and psychographic profile.

15
3.3 Data Collection
I will be collecting both primary and secondary data:

 Primary Data: A questionnaire will be used to get first-hand information from 202
respondents, allowing us to draw conclusions on my research problem after evaluating the
data.
 Secondary Data: I have gathered secondary data from the journals that I have added in the
above citations.

The survey of augmented

reality in retail industry
have both users and
Sample Selection Criteria nonusers in order to better
Respondents understand their attitudes,
perceptions, and concerns.
The target audience will
primarily be the younger
generation.
Area Dhaka City
Time August 2022
Sample Size 202
Scaling Technique Likert scale

3.4 Online Survey Method

I will employ an online google survey. There will be total 25 questionnaires. I will share the google
survey link to the respondents. The respondents will click on the link open the form and fill it up.
After filling up the demographic and psychographic question there will be a link which will direct
them to amazon website from there, they can download the app. In this app by using amazon lens
respondents can actually select a product and see it in their personal place. Also YouTube video
link is also attached so that respondents can clearly understand the AR process. After using the
app and seeing the video they will fill up the Likert scale questions.

3.5 Data Analysis

I will do conclusive research, which means that we will use statistical tools to look at the
information from the surveys and come to a firm conclusion. Once I am done collecting the data,
I will use the SPSS software to look at it and decide how reliable it is. I will also use it to figure
out the regression between the dependent variable and independent variable separately. To come
to a conclusion about the research problem, I will also test theories.

16
 Chapter 4- Result Analysis
Primary data collected via survey has been analyzed and the results presented in the chapter. Using
the SPSS statistical Software, we did a thorough examination of the collected data. The following
analysis includes the results of my survey and, more importantly, reliability and regression testing.
Age ranges, socioeconomic status, levels of education, purchasing frequency, and other
demographics have all been analyzed in depth.

4.1 Demographic Analysis

Demographic Analysis

Category Frequency Percentage

Male 105 52%
Gender
Female 97 48%

18-25 77 38.1%
25-35 66 32.7%
Age 35-45 42 20.8%
45-55 16 7.9%
55 and above 1 0.5%

SSC/ O levels 88 1%
HSC/A-levels 70 4%
Education Undergraduate 34 43.6%
Graduate 8 34.4%
MBA/Masters 2 16.8%

Student 92 45.5%
Businessman 56 18.3%
Occupation
Service Holder 37 27.7%
Home Maker 17 8%

Less or equal 25,000 79 15.8%

25,001- 55,000 47 23.3%
Income 55,001-75,000 32 39.1%
75,000- 100000 30 14.9%
Above 100,000 14 6.9%

17
Interpretations: The sample size of the survey is about 202. From the demographic profile it can
be interpret that there are more male (52%) participate then female (48%). In case of age groups,
most of the participants belongs to the age group of 18-25 and 25-35. In terms of occupation
category, majority of them were students (45.5%). From the education category majority of the
respondents were in their undergraduate (43.6%) or Graduate (34.4%). In case of average
monthly income, majority had an income of 55,001-75,000 takas (39.1%).

4.2 Psychographic Analysis

Psychographic Analysis

Category Frequency Percentage

Yes 162 80.2%

Have you ever heard of AR/VR
Technology?
No 40 19.8%

Yes 61 30.2%
Have you ever used AR/VR
Technology while shopping?
No 141 69.8%

19.80%
Have you ever heard of AR/VR Technology?
80.20%

no

Have you ever used AR/VR Technology while 69.80% yes

shopping? 30.20%

0.00% 20.00% 40.00% 60.00% 80.00% 100.00%

Interpretations: From the above chart it can be interpret that majority of the people are familiar
with AR/VR Technology which is about 80.20%. On the other hand only 30.20% have used
AR/VR Technology while shopping.

18
4.3 Cross tabulation between Gender & Education group towards AR
Gender & Age Group * Familiarity with AR/VR Technology Cross tabulation

 Have you ever heard of AR/VR Technology?

Gender Yes No
Male 91 14
Female 71 26
Total 162 40

Education Yes No
Undergraduate 67 21
Graduate 61 9
Masters/ MBA 30 4
HSC/ A- level 3 5
SSC/ O level 1 1
Total 162 40

Interpretation: From the cross tabulation it can be analyze that the male are more familiar with
AR/VR Technology than the female. The percentage of male agreeing to the statement of having
familiar of AR/VR Technology is more than the female. In terms of education it can be analyzed
that educated people like undergraduate or graduates are more likely to be heard of AR/VR
technology then those who are less educate.

19
4.4 Reliability Test
Reliability Test is data analysis procedure in SPSS Cronbach Alpha is a reliability test that is run
in SPSS to find out how reliable the measuring tool is (Questionnaires)
 The standard value for Cronbach's alpha is 0.7 or higher which indicate acceptable
internal consistency.

4.4.1 Telepresence
Telepresence is the first scale to be studied in the framework, here the total number of items is 4.
The average reliability of telepresence is 0.802 which is more than 0.7. As the value is higher than
the standard value so it can be said telepresence is considered as high in terms of internal
consistency.

Reliability Statistics

Cronbach's
Alpha Based on
Cronbach's Standardized
Alpha Items N of Items
.797 .802 4

4.4.2 Perceived ease of use

Perceived ease of use is another scale to be studied in the framework, again the total number of
items is 4. The average reliability of perceived ease of use is 0.838 which is more than 0.7. This is
highest Cronbach’s Alpha among all other factors. As the value is higher than the standard value
so it can be said perceived ease of use is considered as high in terms of internal consistency

Reliability Statistics

Cronbach's
Alpha Based on
Cronbach's Standardized
Alpha Items N of Items
.837 .838 4

20
4.4.3 Hedonic Value
Hedonic Value is third scale to be studied in the framework, the total number of items is 4. The
average reliability of hedonic Value is 0.821 which is more than 0.7. As the value is higher than
the standard value, hence internal consistency is also there in hedonic value.

Reliability Statistics

Cronbach's
Alpha Based on
Cronbach's Standardized
Alpha Items N of Items
.818 .821 4

4.4.4 Brand Engagement

Brand engagement is another factor, which is conducted on 3 number of items. The average
reliability of brand engagement is 0.756 which is more than 0.7. Though the Cronbach’s Alpha
value is lower compared to other scale. However, the value is still higher than the standard hence,
there is internal consistency present in the brand engagement.

Reliability Statistics

Cronbach's
Alpha Based on
Cronbach's Standardized
Alpha Items N of Items
.751 .756 3

4.4.5 Purchase Intention

Purchase Intention is another factor, which is conducted on 3 number of items. The average
reliability of purchase intention is 0.742 which is more than 0.7. The Cronbach’s Alpha value of
this factor is lower compared to other scale. However, the value is higher than the standard hence,
there is internal consistency present in the purchase intention.

Reliability Statistics

Cronbach's
Alpha Based on
Cronbach's Standardized
Alpha Items N of Items
.744 .742 3

21
4.5 Correlations
The correlation coefficient is a statistical tool that can be used to find out what kind of linear
relationship there is between two variables and how strong it is. In terms of correlation analysis, it
can be analyzed that telepresence, perceive ease of use and hedonic value are positively,
moderately strong and significantly correlated with brand engagement (p-value< 0.05). In the
same way the inter relation between brand engagement and purchase intention is moderate,
positive and significant (p-value< 0.05; r= 0.691).

Correlations

Perceived_ease Purchase_
Brand_
Telepresence _of_Use Hedonic_Value Engagement Intention
** ** **
Mean_Telepresence Pearson Correlation
1 .625 .596 .649 .516**

.000 .000 .000 .000

Sig. (2-tailed)
N 202 202 202 202 202

.625** 1 .666** .659** .607**

Mean_Perceived_ease_o Pearson Correlation
f_Use .000 .000 .000 .000
Sig. (2-tailed)
N 202 202 202 202 202

.596** .666** 1 .744** .585**

Mean_Hedonic_Value Pearson Correlation
.000 .000 .000 .000
Sig. (2-tailed)
N 202 202 202 202 202

Mean_Brand_Engageme Pearson Correlation

.649** .659** .744** 1 .691**

nt .000 .000 .000 .000

Sig. (2-tailed)
N 202 202 202 202 202

.516** .607** .585** .691** 1

Mean_Purchase_Intentio Pearson Correlation
n .000 .000 .000 .000
Sig. (2-tailed)
N 202 202 202 202 202
**. Correlation is significant at the 0.01 level (2-tailed).

22
4.6 Regression Analysis
The method of regression is applied in the process of determining the extent of the connection that
exists between a dependent variable and an independent variable. Predicting the value of a
dependent variable given the values of one or more independent variables is simplified by this
method.

 By selecting Brand Engagement as dependable variable and the other constructs

(Telepresence, Perceive Ease of use & Hedonic Value) as independent variables in the
graphical model, I have conducted the regression analysis.

Model Summary

Model R R Square Adjusted R Square Std. Error of the Estimate

1 .798a .636 .631 .386

a. Predictors: (Constant), Mean_Hedonic_Value, Mean_Telepresence, Mean_Perceived_ease_of_Use

Interpretation: According to the model summary, the R square is 0.636, indicating that 63.6% of
the dependent variable (Brand Engagement) can be explained by the variation in the independent
variables. And the adjusted R square value is quite close to R square's value (0.631). That means
that there were very few errors in the data. So, it can be said that the regression model is in a great
position.

ANOVAa

Model Sum of Squares df Mean Square F Sig.

1 Regression 51.549 3 17.183 115.345 .000b

Residual 29.496 198 .149

Total 81.046 201

a. Dependent Variable: Mean_Brand_Engagement

b. Predictors: (Constant), Mean_Hedonic_Value, Mean_Telepresence, Mean_Perceived_ease_of_Use

The significance of the ANOVA (.000) demonstrates that the independent variables are excellent
predictors of the dependent variable (Brand Engagement). Now that the model's significance has
been established. We must assess the coefficients and significance levels to determine if all of the
constructs are significant and to develop a regression equation.

23
 Coefficientsa

Standardized
Unstandardized Coefficients Coefficients
Model B Std. Error Beta t Sig.
1 (Constant) .353 .203 1.738 .084
Telepresence .240 .055 .251 4.350 .000
Perceived_ease_of_Use .185 .060 .190 3.060 .003
Hedonic_Value .475 .061 .468 7.743 .000

a. Dependent Variable: Mean_Brand_Engagement

Interpretation: Telepresence, Perceive Ease of use & Hedonic Value have significance level
below 0.05. So, three of them are proper predictors of the dependent variable.

 By selecting Purchase Intention as dependable variable and the other Brand Engagement
as independent variables in the graphical model, I have conducted the regression analysis.

Model Summary

Model R R Square Adjusted R Square Std. Error of the Estimate

1 .691a .477 .474 .413

a. Predictors: (Constant), Mean_Brand_Engagement

Interpretation: According to the model summary, the R square is 0.477, indicating that 47.7% of
the dependent variable (Purchase Intention) can be explained by the variation in the independent
variables. And the adjusted R square value is quite close to R square's value (0.474). That means
that there were very few errors in the data. So, it can be said that the regression model is in a great
position.

24
 ANOVAa

Model Sum of Squares df Mean Square F Sig.

1 Regression 31.099 1 31.099 182.291 .000b
Residual 34.120 200 .171
Total 65.218 201

a. Dependent Variable: Mean_Purchase_Intention

b. Predictors: (Constant), Mean_Brand_Engagement

The significance of the ANOVA (.000) demonstrates that the independent variables are excellent
predictors of the dependent variable (Purchase Intention). Now that the model's significance has
been established. We must assess the coefficients and significance levels to determine if all of the
constructs are significant and to develop a regression equation.

Coefficientsa

Standardized
Unstandardized Coefficients Coefficients
Model B Std. Error Beta t Sig.
1 (Constant) 1.645 .189 8.685 .000

Brand_Engagement .619 .046 .691 13.502 .000

a. Dependent Variable: Mean_Purchase_Intention

Interpretation: Brand Engagement have significance level below 0.05. So, it is a proper predictors
of the dependent variable (purchase intention).

25
4.7 Hypothesis Testing
Overall, 4 hypotheses have been proposed in the research, and these hypotheses are separately
analyzed using statistical tools. Almost all hypotheses have been observed to be statistically
significant, and the relationships between dependent and independent variables are clearly
specified.

 H1 Telepresence of the AR application has a positive effect on Customer brand Engagement

The significance level from the regression analysis was (0.000) which is less than .05. This
Hypothesis needs to be accepted. Also, the value of the beta coefficient indicates that is 0.251
which implies that Telepresence had a positive effect on Brand Engagement, and could
explain 25.1% of the variations of brand engagement. According to the Raed Salah Algharabat
study, using 3D product presentation technology in retailing there have been significant
impact of telepresence on increasing user engagement, which in turn affects cocreation value
and purchase intention. (Raed Salah Algharabat, January 2018)

 H2 Perceived ease of use of the AR application has a positive effect on Customer brand
Engagement.

The significance level from the regression analysis was (0.003) which is less than .05. This
Hypothesis needs to be accepted. Also, the value of the beta coefficient indicates that is 0.190
which implies that Perceive Ease of Use had a positive effect on Brand Engagement, and
could explain 19% of the variations of brand engagement. Previous studies proved that to
effect customers' cognitive responses and improve consumer engagement, augmented reality
(AR) must be user-friendly and enhance the purchasing experience through perceived ease of
use (Kim & Forsythe, 2008).

 H3 Hedonic value of the AR application has a positive effect on Customer brand Engagement

The significance level from the regression analysis was (0.000) which is less than .05. This
Hypothesis needs to be accepted. Also, the value of the beta coefficient indicates that is 0.468
which implies that Hedonic Value had a positive effect on Brand Engagement, and could
explain 46.8% of the variations of brand engagement. The hedonic value leads to the
development of long-lasting relationships hence increase engagement among target
consumers (Carpenter, 200)

H4 Customer brand engagement has a direct impact on product purchase intention

The significance level from the regression analysis was (0.000) which is less than .05. This
Hypothesis needs to be accepted. Also, the value of the beta coefficient indicates that is 0.691
which implies that Customer brand engagement had a direct impact on purchase intention,
and could explain 69.1% of the variations of purchase intention. According to some study
augmented reality can increase consumer brand engagement as well as buying intention by
providing product reviews, measurements, benefits, uses. (Kashif Abrar, 2018).

26
 Chapter 5- Conclusion

Our research aimed to determine whether or not an experience with an augmented reality shopping
application can influence the customer's desire to make a purchase, and if so, how. In order to
accomplish the goal that has been outlined, a list of research questions has been compiled, and
these questions must now be answered.

 RQ1 What is the impact of augmented reality on purchase intention with the mediating
role of brand engagement in the retail industry among Bangladeshi Consumer?

Our research showed a more positive effect on purchase intention of customers within the
sample group after experiencing the AR application. Because of this, the findings imply
that an interesting augmented reality application does might genuinely affect the users'
purchase intention and possibly convert them into buying customers.

 RQ2 If this is the case, what could explain the potential increase in purchase intent when
using an augmented reality application?

As a result of our research, we can make justifications for the variables that may have
contributed to the increase in intent to buy. The customer brand engagement as a mediator
of the augmented reality has a direct impact on consumers' propensity to make a purchase.
As a result of the hedonistic nature of the AR experience, consumers are getting fun
experience. Consistent with the literature, it has been found that a more thorough
understanding of a product can increase the likelihood that a consumer will go on to make
a purchase; the 3D augmentation offers a more immersive experience than more
conventional online product pages. The idea that the sense of telepresence brought on by
AR is a major factor in the intent to buy is products. The ease of use in a straightforward
application, however, might enhance the AR experience and contribute to stronger buy
intentions.

27
5.1 Discussion
This is an era of constant progress and developing technologies (Sven Reek, 2017). Augmented
Reality (AR) is emerging as a next-generation technology that may take over traditional markets.
AR has emerged as a notion because it has the potential to replace reality. Existing studies and our
research concur that millennials are more tech-savvy and adaptable to accept this transformation.
Recent global events show that technology was the only remedy when the world went locked
down. E-commerce boomed and consumers preferred less personal contact with the outside world.

According to the findings of our research, the target demographic is responsive to the integration
of augmented reality in the retail industry in Bangladesh, and they are also willing to make the
necessary adaptations. Its evidence that affluent shoppers are also familiar with the concepts and
processes by which augmented reality stores run. The respondents had an understanding, and the
consistency of the data is evidence that the target population of this concept understands the
functionality of Telepresence, Perceive Ease of Use, Hedonic Value, and Brand Engagement all
which may eventually lead them to the development of an Intention to Purchase the product/brand

This study also analyzed how augmented reality can increase purchase intention through a
mediator called Brand Engagement. In order to do this, the current study used consumer brand
engagement to determine if it affects the relationship between augmented reality and purchase
intent of consumers. Based on results, it's clear that augmented reality can have an impact on how
engaged consumers are with a brand and how likely they are to buy something from that brand.
This is because customers can learn more about a product that the brand offers, including reviews,
product view, advantages, uses. Brand Engagement makes it easier for customers to experience,
but due to lack of implementation of AR applications in Bangladesh customers don't know how
AR will help them when they go for retail shopping. So Bangladeshi retail industry should use AR
to increase sales.

According to the results of my research, the Bangladeshi retail sector is ready for the introduction
of augmented reality. The respondents' comprehension and the reliability of the data provide
evidence that the concept's intended audience understands the effects of Telepresence, Perceive
ease of use, Hedonic Value and Brand Engagement all of which may contribute to the formation
of purchase intent.

The idea of virtual reality and augmented reality is spreading and widely discussed in developed
countries. As a result, emerging markets need to move as fast as developing ones in adopting these
innovations. Since technology is now integral to every industry, marketers need to be opportunists
to create and exploit emerging trends before their direct and indirect rivals.

28
5.2 Implications
The result study proved that augmented reality can increase customers' propensity to make retail
purchases. Several studies (Kang & Young, 2014; Poushneh, Vasquez-Parraga, & Arturo, 2017),
among others, have addressed the need of developers maintaining and enhancing the quality of AR
technology to give users the best possible experience. As a result, they will be more likely to
continue using the firm's website or mobile app over time, and the company will have an advantage
over its competitors that will last. Poushneh and Vasquez-Parraga (2017) emphasis the significance
of presenting a high level of engagement, and telepresence to create consumer pleasure, which in
turn increases sales. Based on the results of this study, developers and managers in the retail sector,
should strive to provide high-quality interactivity (Telepresence) and accurate information of
products in order to influence the purchasing decisions of millennials.

To make the customer experience more persuasive and appeal to a specific demographic
(millennials), developers should keep in mind the importance of hedonic values. Accordingly,
developers should make AR apps that are simple to use because they are believed to have a good
effect on the likelihood that millennials (Generation Y) in Bangladesh, and particularly students
who are part of Generation Y, will actually buy a product. Finally, the aforementioned
characteristics have the potential to give retail business a distinct competitive advantage if they are
adopted and put into practice. Given the strong spending power of today's millennials (Straus et al.,
2006), it's no surprise that the retail market is expanding at a rapid rate (Sperduto, 2017). That's
why it's so important for retail stores to have a competitive edge.

5.3 Recommendations
Engagement with a brand improves the customer's experience, but because of a lack of
implementation, people do not know how the AR will help them when they shop for retail products.
Since this is the case augmented reality technology should be implemented in Bangladesh retails
sector. With the support of IT experts, marketers can create a plan to make AR technology work
for their business. In the realm of retail, this yields the highest possible quality for the customer.
In addition, this needed to be adopted in other sectors.

5.4 Limitation of the Study

 A questionnaire was used to test the framework that was used in this study. A few of the
respondents may have given biased reviews (Tax et al., 1998). As a result, more surveys
should be done to get rid of unfairness.
 The study is only focused on the impact of augmented reality in retail industry. It did not
explore the other kind of industry neither it is focused on a specific product.
 The sample size for these research are from the urban areas mostly from Dhaka city. Rural
area sample has not been covered in the study. So the impact on that sample size is missing
from the analysis.
 The respondents of this study are mostly educated and working class people. Also a huge
number of respondents is from East West University.

29
 References

 Abrar, K. (2018). Impact of Augmented Reality on Consumer Purchase Intention with the
Mediating role of Customer Brand Engagement: Moderating role ofInteractivity in Online
Shopping. Bahria University Journal of Management & Technology, 64-80.
 Daniyal Ahmed Fazal, H. S. (July 2020). Impact of Virtual Reality on Customer Purchase
Intention - A study on Pakistan’s Fashion Industry.
 Hyejune Park, S. K. (2020). Do augmented and virtual reality technologies increase
purchase intention?: The role of .
 Marc Riar, J. J. (2021). The Use of Augmented Reality in Retail: A Review of Literature.
Proceedings of the 54th Hawaii International Conference on System Sciences, 638-647.
 Raajpoo, N. A. (2019). Impact of Customer Engagement, Brand Attitude and Brand
Experience on Branded Apps Recommendation and Re-use Intentions.

 Raška, T. R. (May 2017). Influence of Augmented Reality on Purchase Intention.

 Shirin Gatter, V. H.‐M. (2021). Can augmented reality satisfy consumers' need for touch?
 Syed Hasnain Alam Kazmi, R. R. (2021). Role of Augmented Reality in Changing
Consumer Behavior and Decision Making: Case of Pakistan.
 Wakim, R. S. (May 2018). The Impact of Augmented Reality on Product Purchase
Intention in the Swedish Eyewear Industry.
 THE INFLUENCE OF AUGMENTED REALITY ON RETAIL PRICING. (2017). Issues
In Information Systems. Published. [Link]

 Riar, M., Xi, N., Korbel, J. J., Zarnekow, R., & Hamari, J. (2022). Using augmented reality
for shopping: a framework for AR induced consumer behavior, literature review and future
agenda. Internet Research. Published. [Link]

 Algharabat, R. S. (2018). The Role of Telepresence and User Engagement in Co-Creation

Value and Purchase Intention: Online Retail Context. Journal of Internet Commerce, 17(1),
1–25. [Link]

30
 Appendix

Questionnaires

I am a students of East West University and as a part of the BBA program, I am doing the course
Research project. The topic of this survey is “Impact of augmented reality on increasing brand
engagement and purchase intention among Bangladeshi consumers in the retail industry.” I
am going to take your suggestions and opinions. I ensure that the data will only be used for
academic purpose.

1. Age
a) 18-25 b) 25-35 c) 35-45
d) 45-55 e) 55 and above

2. Gender
a) Male b) Female

3. Education
a) Masters/MBA b) Graduate c) Undergraduate
d) HSC/A-level e) SSC/O-level
f) Others (Please specify) ............

4. Your occupation-
a) Student b) Businessman c) Service holder
d) Homemaker e) Others (Please specify) .............

5. Average family income (BDT)

a) Less or equal 25,000 b) 25,001- 55,000 c) 55,001-75,000
d) 75,000- 100000 e) Above 100,000

6. Have you ever heard of AR/VR Technology?

a) Yes b)No

7. Have you ever used AR/VR Technology while shopping?

a) Yes b)No

31
Go through this website [Link] and share your valuable
thought about shopping with augmented reality

Please put your level of agreement with the following statement in the 4 point Likert Scale and put
a tick (🗸) mark on your respective answer

Construct Statement Strongly Agree Strongly Disagree

Agree Disagree
8. Augmented reality allows
me to interact with the
product as I would in the
store
9. It created a shopping
experience similar to the
Telepresence
one I would experience in
stores
10. I felt connected and
emotionally attached to the
product I will buy

11. It will give me sensory

information (taste, smell,
sight, hear, touch) about
the product as I would
experience in the store
12. Augmented reality does
not require a lot of mental
Perceived ease of effort
use
13. It is clear and
understandable
14. It is easy to learn

15. AR website or app allows

me to shop the way I want

16. Shopping with augmented

reality would be exciting

32
17. Shopping with augmented
reality would involve me
in the shopping process

18. Shopping with augmented

Hedonic value
reality would make me
feel good

19. AR website or app

motivates me to buy

20. Using the brand's AR

feature on the brand's app
stimulates my interest in
the brand
Customer brand
21. I feel positive about the use
Engagement
of AR feature while
shopping
22. I will spend a lot of time
using the AR feature on
the brand's app compared
to other brands
23. Well known retail brands
(e.g. IKEA, Amazon,
Walmart, etc.) on AR
stores can raise my
purchase intention

24. AR feature will be helpful

Purchase Intention aiding me to make
purchase decision

25. AR features will increase

my intention to purchase
retail items.

Google Form [Link]

33
Survey Result

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