The Impact of VR-based Service Innovation on Brand Equity

• Main Author: CHEUNG, Pan
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2024
• Subjects: VR technology; service innovation; corporate association; brand equity; purchase intention; Business Administration, Management, and Operations; Technology and Innovation
• Online Access: https://ink.library.smu.edu.sg/etd_coll/560; https://ink.library.smu.edu.sg/context/etd_coll/article/1558/viewcontent/GPBA_AY2018_DBA_Cheung_Pan.pdf
• Institution: Singapore Management University

The increasingly fierce competition in the service market have made service innovation a focal point of continuous attention and exploration in both academic and industry. The development of VR technology has provided new options for enterprises to innovate in services. However, employing VR technology for service innovation requires a certain level of cost investment and entails risks. Moreover, how using VR technology for service innovation will impact consumer cognition and behavior, and how this cognition will affect brand equity, remains unknown. These uncertainties hinder the application and development of VR technology in the service sector. Therefore, clearly understanding the benefits of VR-based service innovation is crucial. Against this background, this paper will analyze the effects brought by the use of VR technology in service innovation, providing guidance for enterprise service practices, with significant theoretical contributions and practical value. Specifically, this research focuses on the impact of the application of VR technology in service innovation on businesses and consumers. Based on the consumer-based brand equity model, associative network memory model, and stereotype content model, it constructs a research model with service innovation as the independent variable, corporate associations, and brand equity as mediating variables, and consumer purchase intention as the dependent variable. It also includes the personal characteristics of consumers - novelty seeking, as a moderating variable. Through a mixed-method approach combining field experiments and survey research, this research verifies the research model and hypotheses, obtaining the following conclusions: First, VR-based service innovation can impact corporate associations. specifically, it can significantly enhance corporate competence association. Second, VR-based service innovation enhances brand equity by enhancing corporate associations. That is, VR-based service innovation can improve corporate competence association, which further enhances brand equity. Third, corporate competence association and brand equity play a chain mediating role between VR-based service innovation and consumer purchase intention. Specifically, VR-based service innovation can enhance consumers' corporate competence association, which through enhancing the company's brand equity, positively impacts consumers' purchase intention. Fourth，novelty seeking moderates the relationship between service innovation and competence association such that higher novelty-seeking weakens the relationship. In summary, this research focuses on the application of VR technology in service innovation, proposes a theoretical model of VR-based service innovation, and verifies its positive effects, internal mechanisms, and differences in effects at different levels of novelty seeking characteristics. It has certain contributions to the research of VR technology, service innovation, corporate association, brand equity, and other fields, and provides enlightenment for enterprises to make better use of VR technology for service innovation to enhance their brand equity.