An empirical investigation of customer characteristics on retail format selection – a mediating role of store image

Abstract

Purpose Food and grocery, which accounts for around 60% of the overall retail market in India, is the most promising area for launching a retail firm. The objective of this research paper is to conduct a thorough investigation of the impact of customers’ geographic, demographic and psychographic characteristics on the selection of retail store format choice behavior in the quickly growing Indian food and grocery retail industry, also to analyze the mediating role of store image on the store choice behavior. Design/methodology/approach A descriptive research design is used to collect data using the survey method and a structured questionnaire. The data collected from more than 400 food and grocery retail customers from neighborhood Kirana stores, supermarkets and hypermarkets in Karnataka, India, would be analyzed using both descriptive (mean and standard deviation) and Structural equation modeling (SEM) techniques. SEM techniques are used for validation of the model with independent constructs namely Demographics factors, Socio-Economic factors, Geographic factors, Lifestyle and Shopping Motives, a Mediating variable Store Image, and a dependent variable Store choice behavior. Partial least squares structural equation modeling (PLS-SEM) is used to examine the suggested theoretical framework. Findings The model is tested to reveal the impact of shoppers’ age, gender, occupation, education, monthly household income, family size, and distance traveled to the store, which all play a role in their retail format choice. Also, the socio economic and life style factors of shoppers influence their purchasing decisions as well; store image partially mediates between customer characteristics and store choice behavior. Implications The study has practical implications for food and grocery retailer in understanding customer behavior in the context of changing customer demographic and psychographic features in the Indian retailing sector. The findings aid retail merchants, allowing them to develop more successful retail marketing strategies and gain a competitive advantage. Originality This study could serve as a springboard for future research in this field. Retail marketers will benefit from the findings in terms of format creation and reorientation of marketing strategies in the shortest time.