IMPLEMENTATION OF AUGMENTED REALITY (AR) ON INDONESIAN BEAUTY INDUSTRY: ITS IMPACT ON BRAND ENGAGEMENT, SATISFACTION WITH CUSTOMER EXPERIENCE, AND BRAND USAGE INTENTION

• Main Author: Mei Kristi Sinabutar, Kiko
• Format: Final Project
• Language: Indonesia
• Online Access: https://digilib.itb.ac.id/gdl/view/64481
• Institution: Institut Teknologi Bandung

Augmented reality utilization in Indonesia is still in its infancy so customers are not able to experience shopping with the help of AR. The Indonesian beauty industry growth is currently appealing whilst it is also placed as the main sector that contributes to national exports (Kemenperin, 2018). AR could be the answer to the Ministry of Industry’s suggestion to use digital transformation as a marketing strategy to boost the growth of the Indonesian beauty industry. This research aims to determine AR attributes (interactivity, vividness, and novelty) that influence the AR acceptance (perceived ease of use, perceived usefulness, and enjoyment) in the Indonesian beauty industry and how it shaped the customer perception as well as its impact on brand engagement, satisfaction with experience, and brand usage intention. Through an experiment of three AR platforms (website, e-commerce, and social media) on 413 customers, the research also aims to discover which platform that gives the best customer experience. The experiment result is obtained by utilizing an online questionnaire and further be analyzed using PLS-SEM while the platform comparison is done by deploying Kruskal-Wallis H. Structured interviews are also conducted to make sure the variables are worth studying. The findings indicate that almost all attributes of augmented reality influence indicators of technology acceptance but vividness is found not influencing perceived ease of use. The findings also demonstrate that all indicators of technology acceptance except perceived ease of use will influence brand engagement. Furthermore, brand engagement is shown to influence satisfaction with experience and brand usage intention. The platform comparison reveals that e-commerce gives the best customer experience. The findings generate recommendations for marketers in the Indonesian beauty industry and future research. Marketers should pay attention to increase the performance of interactivity and vividness in the AR platform and choose the AR platform which Indonesian customers consider familiar. While future research is suggested to examine the influence of customer perception on other indicators of technology acceptance and explore the impact of familiarity with users' intention in using AR technology also to reassess the impact of vividness to perceived ease of use and the impact of perceived ease of use to brand engagement.