Keywords

Store Atmospherics, Signage, Purchase Decision, Window Display, Retail Store Environment, Customer Perception.

Introduction

In modern retailing, visual merchandising plays a pivotal role in motivating a shopper to buy goods. This idea has always elicited the buying decision as an old retail strategy (Gopal, 2006). Retailers have slowly realized that focusing only on sales can't serve the purpose in the long run in this competitive retail world, but also improving customer satisfaction and providing a pleasant shopping experience. The store atmospherics plays a significant role in these efforts. (Iqbal et al., 2011). The shopper gets stimulation in the retail store in many ways, i.e., allocation of space, proper placement of products, and people management (Quartier et al., 2008). Visual merchandising is an effort to provide visual stimuli through adequate lighting in the space within the retail store. The classification of the area is into three main parts, namely; Aesthetic, functional, and atmospheric. Atmospheric cues include a retail store design environment and social factors (Baker, 1986). Shoppers are attracted by the various processed and developed stimuli, taking into account the customer about that store. Visual stimulation is considered to be an essential factor in building the customer's perception of the store. The shopper exposed to such stimuli feels a greater need to purchase the goods. (Rook and Hoch, 1985).

Visual Merchandising and Shopping Behavior

Visual merchandising consists mainly of designing store displays and sorting out components in a store to raise the enthusiasm and awareness of customers.

And also increase the number of walk-ins and improve the attractiveness of the products and enhance the store's brand image, with the ultimate goal of improvising daily sales. Visual merchandising can give an added advantage to the "feel-good factor" of a store and get a better consumer shopping experience. The buyers have to "warm-up" with a suitable atmosphere and merchandise presentations. (Diamond and Diamond, 2007).The elements of visual merchandising (VM) include store displays, store layout, store design, graphics, and additional store atmospherics such as interior color, lighting, etc. Those who should be integrated in a way that it grabs the attention of shoppers, but that is in harmony with the fundamental nature of the retail store (Levi and Weitz, 2009). The visual merchandising acts as a silent salesperson by presenting products with the right information to the shoppers (Diamond and Diamond, 2007). It also supports them to include the items shown to the shopping lists (Bhalla and Anuraag, 2010). Product Displays helps the buyers in saving time and favored to sellers by displaying stocks available in an easily accessible way, which makes the shopping activity easy and faster (Cant and Hefer, 2014).

While Retailers build up visual marketing stimuli for specific reasons, those shoppers who browsed to different displays of visual merchandising may respond differently at different times. Some of them are attentive to it. Some customers may ignore them. Shoppers process and filter the information in many ways and remember those elements which have top priority in their viewpoint (Blythe, 2008). Notably, the shoppers witnessed a store stimulus in a retail sales environment evaluate the consistency of the stimulus with their demands and shopping experiences (Cant et al., 2006), which means that they build up their attitude towards the retail store atmosphere.These opinions further help in motivating shopper's buying behavior (Evans et al., 2009). Visual merchandising is mainly store decoration in the most attractive way that stimulates purchase tendency and influences the consumer's perception towards the store.

Visual Merchandising and Store Sales

In the present retailing scenario, the role of the sales executive is getting changed slowly, they are becoming smarter these days with the right level of customer understanding. They are pretty sure when a customer needs their assistance and when they have to stand back and watch. Therefore, it is evident that visual marketing is one of the final stages of developing a store. The ambiance must be created in such a way that shoppers find it exciting and attractive to the store and reflect the principles reinforcing the store's image (Anon 2000). Focal points of visual merchandising are strategically positioned to let the customer walk in the store and were communicated about the advantages and characteristics of the goods together with the promotion in the store in vogue. With a catchy merchandise display, a passer-by will be converted into a browser and then a browser to a spender. Further, a big spender from a spender through cross-merchandising. (Gibson 2010) Below, Figure 1. explains how visual merchandising linked with store image and finally to perform sales.

(G. Surender 2001). In his article, "Visual merchandising– the synergy to show, tell and sell" made an interesting comment that, VM acts as a silent salesperson; it is an art and science of suggestive selling by visual displays. It is also a powerful communication tool within the store and drives the customer. It has two aspects, i.e., commercial and aesthetic. Mainly aesthetic is done within the store to grab the shopper's attention.

Background of the Study

In India, the retail industry changing its shape from conventional retail stores to modern new format retail stores, for instance, hypermarkets, specialty stores, departmental stores, and supermarkets. It is one of the fastest developing segments that accomplish the second position in the customer market (Amit and Kameshvari, 2012). Nowadays, retailing offers a pleasant shopping experience through an attractive ambiance, a wide variety of product choices, and customers' perception analysis. Considerable salary growth, changing the way of life, and positive socioeconomics are the critical dimensions for the rapid growth of this segment.

The Apparel sector holds the primary (first) position in organized retail. In apparel retail, no significant research has done. The researcher has chosen to do his study in the branded apparel stores in Visakhapatnam. This research is to study the influence of visual merchandising on the purchase decision of branded apparel stores in light of the representativeness of the apparel division in organized retailing. The establishment of a retail market is an extent to a region's economic progress; in this way, the retail segment serves a substantial base to see the effect of regional wealth level.

As facing intense competition, the retail players must propel novelty and technical innovations in the retail stores intended to enhance the frequency of shopping. And time spent by the customers in terms of shopping trips as they are facing intense competition from both national and international retail giants (Michon et al., 2007). As research studies say that the shoppers who stay longer in the store are bound to spend, and they spend more than those customers who remain available for a lesser time in the store. (Lindeman, 2007), a viable retail store atmosphere can impact the customer's inclination towards spending (Soars, 2009) and retailers progressively recognize the positive effect of retail environment (visual merchandising components) on consumer purchase decision .The present study finds out the influence of visual merchandising elements on customer purchase decisions in selected branded apparel retail stores in Visakhapatnam.

Statement of the Problem

Retailing industry in India is majorly un-organized and less maintained when compared to the west. Organized retailing is said to evolve first in the west and then entered into India as a revolution. Consumers now have an abundance of options to purchase from ranging from small stores to big retail Malls, and the apparel sector is one among them. The apparel retail business is one of India's most critical sectors, as its income, investment, growth of trade, and employment creation is concerned. In light of McKinsey's report, "the apparel is the most beneficial sector of the Indian retail sector with an approximated margin of 35-50 percent. The store with a single brand garment retailer must convey the brand identity to differentiate from others. The store must speak about the overall image and the merchandise that it offers to its potential shoppers (Ailawadi and Keller 2004.) The retail components like store atmospherics, price variations, offers and promotions quality of service, and an attitude of salespeople, product assortment, and services derive the retailer's image. How organized branded apparel retail stores have been evolving and what factors contributing to such growth in India has the potential to survey. The store environment is a significant purchase initiating element since it has an impressive impact on the customer's perception of a store's overall image. And which is shaped based on a wide variety of the store's tangible attributes, such as store interior/exterior, Displays, and lighting, among others (Milliman, 1986; Baker et al., 1986 ;).

In this scenario, this research aims at studying the impact of visual merchandising elements on customer purchase decision, which have a direct bearing on sales. It will also help the retailers to develop a business model that comprises the best mixture of visual merchandising elements that enhance the store image and improve sales.

Research Questions

1. Whether the Visual merchandising components viz. Store displays (product display, mannequin display, product shelf position) Window displays, Store atmospherics (interior color and lighting), Signage, store layout, etc. affect a consumer purchase decision?
2. Which elements of Visual merchandising are dominant in influencing customer purchase decisions in branded apparel retailing?
3. What is the best business model that a retailer can adopt to attract a shopper by using the right mixture of visual merchandising elements?

Need for the Study

Branded apparel is known as shopping goods in marketing terms. These goods are usually purchased by looking into a large number of alternatives that are available in the market. These stores typically have an array of products with varied designs and prices suiting to various requirements of customers. These products have high net revenues additionally have fierce competition from different brands. The point of difference across brands is very negligible. Each manufacturer is trying to woo the customers by giving them lucrative value offerings. The growing population and per capita income indicate that apparels, which were once purchased occasionally, are bought frequently, which provides the retailers the opportunity to sell more. Retailer being the last connection in the channel assumes an essential part by making the product sell effectively. The store interior performs an imperative role in the selection of the store is the outcome of most of the research done by the earlier study. No research clarifies the effect of every component of the visual merchandising on shopper's purchase choice. Visual merchandising being a critical component in the Store environment and vital cost element in store outline components. The retailers need to recognize the right blend of Visual merchandising ingredients to plan conducive store atmosphere and appropriate budget allocation to attract the shoppers. In this situation, the current study focuses on the impact of visual merchandising on customer's purchase choices in selected branded apparel stores. The current trend includes an emphasis on the value of visual merchandising activities for consumers in the branded Apparel stores.

Objectives of the Study

1. To understand the influence of visual merchandising elements like Store displays, (product display, mannequin, product shelf position) Window display, Store atmospherics (interior color, lighting), Signage, store layout, etc. on customer’s purchase decision.
2. To develop a model comprising of the most effective mixture of visual merchandising elements to help the retailer in designing the store interior.

Research Scope

The scope of this study focus on various elements of visual merchandising and their possible impact on branded apparel consumers’ purchase decision. VM techniques may vary from store to store because the degrees of differentiation in price, offers, display, and the way the store being maintained and these are the significant factors that grab the customer’s attention, and the same can stimulate repetitive purchases. Moreover, creatively arranged visual displays in a store, positive influence the buying decisions of the customers. Apparels are is one of the prominent lifestyle products that will be sold throughout the year, irrespective of the season, appropriate garment merchandise will be sold on a continuous basis, the demand for the apparels is comparatively high than the other goods, As many garment exclusive stores are mushrooming in India especially after Globalization, It is essential to study at what extent the VM techniques influencing customer’s purchase decision of branded apparel customers.

Research Methodology

The ultimate purpose of this research is to know the impact of visual merchandising (VM) on the purchase decision of branded apparel customers in the city of Visakhapatnam. The sample was selected based on the stratified random sampling method. For the collection of primary data, the survey method is used. The compilation of responses made through a systematically designed questionnaire, it is of closed-ended type questionnaire, and the same distributed to buyers in the selected branded apparel stores. The data collection is from the final questionnaire that contains various elements of visual merchandising like Store displays (product display, mannequin, product shelf position) Window display, store atmospherics (interior color and lighting), signage, and store layout. Hypothesis tested and developed business model with SEM (Structural Equation Modelling) with the right mixture of visual merchandising elements.

Review of Literature

The quality of the atmospheric elements of stores in the retail environment is considered part of visual marketing (Kotler, 1974). Donovan and Rossiter (1982) expanded the concept of the store's atmosphere by classifying the store's physical variables, such as store design, architectural design, wall color, and social factors, such as interaction taking place and people's behavior. In general, Visual Merchandising has a variety of factors such as the combination of colors, the lighting, merchandise presentation, store design and layout of the store, mannequins, furniture, fixtures, and other props) All these factors play an essential role in creating a favorable buying environment (Law, et al. 2012). Qualitative research reveals that these strong visual marketing helps men’s fashion retailers create a strong brand identity through cultural memes (Matthews et al. 2013). Juliana et al. (2017) The authors stated that visual merchandising is vital in sales maximization, the improvement of the brand image, the update in brand positioning, and the positive influence at the time of purchase. Visual merchandising is a process that organizes the goods that the customer wants in the right place, at the right time, to influence the consumer's clothing purchases (Mehta and Chugan 2013).Maier (2009) underlines how visual merchandising is typically connected with the business strategy of a retailer. It is said that a decent visual merchandising plan will push any retailer to effectively and quickly build up a sharp brand image with its target segment. The study proved that Visual merchandising techniques would have great assistance in building a boutique successfully. That further leads to a repeated purchase. Kaur A. (2013), in her study, it was revealed that Visual merchandising has a positive relationship with shopper's impulse purchase behavior. The environment must be such as to serve as a catalyst for the return of the customers to the store. The customer's evaluation must be carried out continuously to incorporate all the changes that the target market wants to see for their favorite store (Stanley, 2010).Jigna N. Ahir, Vishal J. Mali (2013) also focused on how Visual merchandising would be a focal point for a strategic marketing plan. He added how a convenient right store environment tempts the shopper to check the product thoroughly and can him/her to buy it Mohd (2013) is opined that Visual merchandising is developing more fabulously and led to a retail boom, especially after globalization; it is not merely bothered about finishing a store wonderfully but also making the customers remember the brands at the time of purchase.

Pillai (2011) the study suggested that the right use of visual merchandising is a useful tool to convert potential customers into current customers, Eroglu (2003) Retail stores make efforts to create value through different visual merchandising tools and marketing strategies. These tools include the concept of "Atmospherics" and the creation of "atmospheric cues" along with the product. Young et al. (2007) opined that some parts of visual merchandising are inconsistent with purchaser desires and are unfavorable to store the image. Saini, C., R.F Gupta, Khurana I.(2015) The study found that visual merchandising practices positively influence the customer's buying behavior and lead to immediate purchase. Park et al., (2015), argued that the proper use of visual marketing makes the retail brand different from competing brands, establishes brand preference among consumers. Pillai et al. (2011) found in their research that attractive storefronts, well-designed store layout influence consumers, and engaging visual marketing and those businesses can turn potential visitors into real buyers.

Kaur, A. (2013) The study recognized that there are three primary components of visual marketing, in particular, the window displays, innovative product assortments cleanliness of the store. Bastow- Shoop et al. (1991) stated that visual merchandising is an essential factor that retailers often neglect in their store's success or failure. Makhal, A.B (2015) found that there is a significant association between visual merchandising elements and the type of shopper. Bashar and Irshad (2012), in their study, revealed that window display and floor merchandising have a positive correlation with impulse buying behavior, and overall Visual merchandising has a significant impact on consumer buying behavior.

Identification of Research Gap

The researcher has reviewed various research articles, including Indian and International research journals and other publications, which have discussed the attributes of retail stores and their impact on consumer behavior, primarily related visual merchandising dimension. After a thorough review of collected research articles, the researcher has decided to study the Influence of Visual merchandising on the purchase decision of branded apparel customers. It is found that hardly a few studies have been undertaken in this research area with branded apparel categories. Secondly, in many pieces of research, it was found that very few variables have been considered for their study, and many variables at one have not been studied. Each year many researchers have been undertaken to work on the above initiatives, which in turn cleared the path for further study and a more comprehensive and specific solution to address the fundamental role of visual merchandising in influencing the customers for positive store behavior that further improves sale. After thorough literature review, the researcher has found that the Indian retail industry, especially the lifestyle stores like in Apparel retail stores, has very little research on visual merchandising.

Hypothesis for the Study

Based on the reviewed extant literature, the researcher hypothesized the following:

Hypothesis Development

Hypothesis. 1

H0.A0: There is no influence of visual merchandising techniques on customer’s purchase decision.
To test the statistical significance of the above null hypothesis 1, it is extended to each element of visual merchandising

H0.A1: There is no influence of Store displays on customer’s purchase decision
H0.A2: There is no influence of window display on customer’s purchase decision
H0.A3: There is no influence of Store atmospherics on customer’s purchase decision
H0.A4: There is no influence of Signage on Customer’s purchase decision
H0.A5: There is no influence on store lay-out on customer’s purchase decision

Research Design

In general, the research design is the overall strategy of the researcher to answer questions about the study. The aim of the study is to investigate the various elements of visual merchandising and how it affects customers in branded apparel stores in Visakhapatnam, Andhra Pradesh. This research explores the essential aspects of visual goods that can influence consumers ' buying decisions. The study aimed to produce key experimental factors which contribute to the success of consumer behaviour. The study is a descriptive study using descriptive design. The study design involves sampling design, analytical design, statistics and organizational design, described briefly in Table 1 below.

Table 1  Research Design Elements
S.No	Elements of research design	Type of design used in the research undertaken
(a)	Sampling design	Five stores and 500 respondents from these stores are selected using a stratified random sampling method.
(b)	Observational Design	The data is collected from sample respondents while they visit stores for purchasing apparel.
(c)	Statistical design	For testing hypothesis and to develop model comprising best VM Mixture further structural equation modelling (SEM), is used.
(d)	Operational Design	The sample stores are visited at different times, and the pretested questionnaire is given to the respondents, and the filled-in questionnaires are retrieved on the spot. SEM is used to a tabulation of the data and drawing necessary inferences, and the outcomes are analysed.

Analysis and Discussion

Structural Equation Model

Structural Equation Modelling (SEM) is a multivariate technique that estimates a series of interrelated dependency relationships simultaneously. The term Structural Equation Modelling expresses that the causal processes in the study represented by a set of structural equations (i.e., regression) and that these can be modelled graphically to allow a more precise conceptualization of the study. The hypothetical model can be statistically tested in simultaneous analysis of the whole system of variables to determine how much it is consistent with the data. If the goodness-of-fit is adequate, the model supports the plausibility of the postulated relations between the variables.

In the present study, the relationship of different visual merchandising elements like store displays (product display, mannequin display, product shelf position), window display, Store Atmospherics (interior color, lighting), Signage, and Store Layout elements on customer purchase decision was explored. This element constitutes visual merchandising elements. The model of visual merchandising elements causal relationships were developed through SEM with AMOS.

Development of Visual Merchandising Factors Using Structural Equation Modelling: Final Model Fit

The modeling of structural equation allows the relative strength of relationships between variables to be examined. We first conduct a confirmatory factor analysis (CFA) in this research to ensure that all indicator variables that are used to measure the building are reliable and valid. Second, we postulate and check the important factors between each structure and each variable indicator. Following the confirmatory factor analysis, the following Figure 2 shows an overview of the SEM results. The model was constructed with the other factors and latent variables.

Figure 3: Standardized Estimates: Modified Structural Equation Model for Visual Merchandising Elements (Store Displays, Window Display, Store Atmospherics, Signage, and Store Layout)

The below Table 2 shows that other indicating variables have a positive significance on each construct. These indicators extracted from the Confirmatory Factor Analysis for the construction of the SEM model. These extracted factors have a significant impact on visual merchandising than the remaining variable.

Table 2 Sem Model Results
Construct	Indicator	Standard Loading(ß)	S.E.	C.R.(t)	Probability
Store Displays	Pro_4	0.461	0.05	70.094	Significant
	Man_11	0.305	0.04	78.883	Significant
	Man_12	0.254	0.04	79.941	Significant
	Pshelf_15	0.546	0.04	113.13	Significant
	Pshelf_19	0.678	0.05	72.662	Significant
Window Display	win_22	0.895	0.05	70.597	Significant
	win_27	0.848	0.05	81.267	Significant
	win_28	0.494	0.04	87.424	Significant
	win_29	0.584	0.04	89.538	Significant
Store Atmospherics	light_37	0.225	0.05	77.739	Significant
	light_42	0.255	0.04	97.813	Significant
	light_43	0.307	0.05	85.054	Significant
Signage	sign_50	0.777	0.05	75.775	Significant
	sign_51	0.758	0.04	78.219	Significant
	sign_53	0.531	0.05	66.835	Significant
	sign_54	0.539	0.05	71.326	Significant
Store Layout	store_55	0.002	0.05	65.366	Significant
	store_56	0.093	0.05	65.714	Significant
	store_57	0.005	0.05	53.142	Significant
	store_58	0.712	0.03	130.99	Significant
	store_59	0.628	0.04	84.077	Significant
	store_60	0.458	0.04	93.903	Significant

After taking into consideration of the above results, the model can be depicted as shown in the below Figure 4.

SEM Model Discussion

From the above figure, it can be observed that convenience with a beta value of 0.895 has the maximum influence on customer purchase decision .i.e. Window display. This result highlights the importance of Window display. It is the effective way through which the retailer can communicate the central theme of the store, also inform the customer about the type of merchandise that the retailer sells in the store and attracts the customer into the store. The next element with a beta score of 0.777 is Signage, which is the second-highest influencer on the customer's purchase decision in branded apparel stores. Signage includes all promotional signs, clearance/discount sales signs, and directional signboards, which will inform and direct the customers within the store. Coming to the third most influencer on customer's purchase decision is Store–layout with a beta score of 0.712, It is evident that appropriate store-layout makes the shopping more convenient and easy. The fourth highest influencer on customer's purchase decision is Product –shelf position with a beta score of 0.678, this infers that, if the merchandise display is at eye- level and easily accessible to the customer, He/she will touch and feel the fabric that enhances the tendency of buying. Product displays stand at fifth position with a beta score 0.461; It is an indication that attractive merchandise display on the floor provokes positive shopping behavior. It is followed by lighting with a beta score of 0.307, and mannequin with a beta score of 0.305 comes as the lowest influencer compared to the rest. Because as many branded apparel stores provide appropriate lighting and mannequins are the primary display mechanism in apparel stores. It is not surprising. However, if we compare the influence of visual merchandising on purchase decisions in a different retail format store, the result could be different.

As per the result obtained from the above Table 2 SEM model, It can be observed that the standard β coefficients for store display elements of product display, mannequin display, product –shelf position are 0.461, 0.305, 0.254,0.546 and 0.678 respectively, window display has the standard β coefficient values 0.895, 0.848, 0.494, 0.584. When it comes to Store atmospherics, the significant element is lighting and has the standard β coefficient values of 0.225, 0.255, and 0.307. The other important component is Signage and has the standard β coefficient values 0.777, 0.758, 0.531, and 0.539. The last component that has taken for the study is Store –layout; the corresponding standard β coefficient values are 0.002, 0.093, 0.005, 0.712, 0.628, and 0.458. So from the obtained standard β coefficients for all the dimensions of Visual merchandising, it is evident that all of them are significantly influencing the customer's purchase decision in branded apparel stores.

The present study verifies that there is a significant connection between purchasing behaviour and visual merchandising practices. The model is found to be fit, which reveals that the purchase decision of the branded apparel customers is being influenced by visual merchandising elements like window display, signage, store –layout, Product shelf –position, product display, lighting and mannequin with highest standard β coefficients0.895, 0.777, 0.712, 0.678, 0.461, 0.307 and 0.305 respectively.

Conclusion

The modern retail is bringing about a slow but steady change in the shopping behavior of the Indian consumer. As organized retail grows and the number of global retail players increases in India, the pressure on bottom lines and throughputs in stores increasing the role of visual merchandisers would become more and more crucial. Higher conversions would be the critical business accountability for all visual merchandising elements. Visual merchandising would have to find its path of growth in these evolving markets. The purpose is to increase footfalls and, thereby, sales through improved layout and presentation and visual appeal. Stores are increasingly focusing on impulse purchase and ease of navigation for customers while working on the visual merchandising aspect. Window display itself has become a science, with much thought going into what kind of mannequins to use and where to place them.

VM educates the customers, creates desire, and finally augments the selling process. Hence, this study primarily helps to identify the various elements of visual merchandising elements like Store displays (product display, mannequin display, product shelf –position), window display, Store atmospherics (interior color, lighting, music), Signage and Store-Layout, etc. and its influence on customer's purchase decision in the branded apparel stores.

This study concludes that visual merchandising influences the purchase decision of shoppers. The VM elements like Window display, store displays, store atmospherics, signage, and store–layout plays an important role in attracting the consumers into the store. To conclude the research, it is found that Null Hypotheses H0A1, H0A2, H0A3, H0A4, and H0A5, were rejected. This infers that Visual merchandising is not only an art of grabbing the customers' attention but also provoke their purchase decision. Store managers need to accelerate sales activity within the store by focussing on VM techniques. Retailers should use visual merchandising strategies to communicate with customers and invite them into stores.

Scope for further Research

A Research study using a larger and more representative sample covering various cities would be useful to verify the regional differences in customer's purchase decisions further. From this research study, it is raveled that there is a significant impact of visual merchandising on customers' purchase decisions, but there is a lot more scope to research VM as a retail strategic tool in the retailer's perspective. As E-retailing is booming up in India, customers are slowly habituating to buy their preferred goods online. Research can be conducted in the future on the efficiency and effectiveness of VM online – retailing, which will help online retailers.

The present study is confined to only the influence of VM on customer's purchase decisions, but it has not thrown adequate light on finding innovative ways to increase sales through VM. More research studies on Visual Merchandising have to be conducted on every specific retail segment to help the retailers to make appropriate decisions related to retail strategies for the smooth functioning of retail operations, which further enhances the overall efficiency of the firm and leads to profit maximization.

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