Virtual Promises, Tangible Failures: Understanding Augmented Reality Service Failures in Online Retail

Abstract

This study evaluates the impact of augmented reality (AR) on consumer expectations and responses to service failures in online retail. AR enables virtual product trials, significantly raising consumer expectations. However, when AR falls short, it triggers the 'AR Confidence Paradox,' where the mismatch between expected and actual service outcomes shifts typical attribution patterns seen in online retail from internal (self-blame) to external (retailer blame). To investigate how AR-induced failures influence consumer responses, our research employs a multi-method approach that includes sentiment analysis and quantitative experiments, with a total of 1,082 participants. Our results show that consumers using AR have significantly higher outcome expectations and when disappointed, attribute more responsibility to the retailer. We also find that preemptive recovery strategies effectively reduce negative impacts and enhance revisit intentions. Our findings contribute to literature on consumer expectations, responsibility attribution, and technology-induced service failures, offering practical strategies for improving AR implementations in e-commerce.