Introduction

Avatars, as digital representations in a virtual world, have abilities to show a sense of

personality attitudes through their facial movements and gestures .Based on Moon's (2009)
findings, the successful immersive human-like abilities of avatars can increase the tendency
for human users to develop an emotional relationship with them. This kind of relationship can
induce the liking or trust feeling, or even can influence purchase behaviour Nowadays, in
order to gain profit from the customers, more and more virtual retail stores use avatars as
salespeople to provide the service just like in the real world .Since the salesperson is a crucial
part in the selling process and has significant impact on the relationship between company
and customer , investigating consumers' preferences and perceptions of avatar salespeople is
very practical and meaningful. Therefore the purpose of this assignment is to write a
litureture review and a conceptual framework from these objectives outlined as identifying
the factors having effect on online purchase intention, define avatars as a virtual characters
that can be used as company representatives, determine the influence of Avatars on consumer
behaviour and retailers and determine consumers perception of avatars as sales people based
on credibility and attractiveness. Furthermore, we need to find out how manipulation of the
human-avatar interaction impacts persuasion, brand attitude and intentions in e-retailing.

Objectives

To identify the factors having effect on online purchase intention.

To define avatars as a virtual characters that can be used as company representatives.

To determine the influence of Avatars on consumer behaviour and retailers

To determine consumers perception of avatars as sales people based on credibility

and attractiveness.

Literature review
Factors Having Effect On Online Purchase Intention
Trust is one of the important dimensions in most of the studies. Consumers trust in vendors
or websites, in other words consumers evaluations of website or vendor trustworthiness play
a crucial role to do online shopping. Lack of trust has a negative impact on online purchase
intention, so consumers do not prefer shopping online if they think that website or vendor is
not trustworthy (Ansary and Roushdy, 2013).On the other hand, Leerapong et al.(2013) do
not find a relationship between consumer trust attitude or trust propensity between their
online purchase intentions. Besides, Wu and Lee (2012) focus on a trust from
different perspective. They investigate blog trustworthiness instead of website or vendor. The
statethat bloggers have an impact on consumers purchase intention. However, they do not
find a significant impact of blog trustworthiness on online shopping intention.
Perceived risk is another factor investigated in most of the studies. Li et al. (2007) define
the perceived risk as a consumers perceptions of the uncertainty and adverse consequences
ofengaging in an activity. Perceived risk has negative impact on consumer intention
(Bianchi and Andrews, 2011). It implies that if consumers think that purchasing is so risky on
the Internet due to security or privacy issues, their online purchases also decrease. Wang et al.
(2010) explain personal innovativeness as the degree to which an individual is receptive to
new ideas. It is stated that personal innovativeness has a positive impact on online shopping
intention (Hsu and Bayarsaikhan, 2012).
However, Boyle and Rappel (2006) state that putting into practice of it, is more a difficult
issue because of the identification of consumers which is a very difficult problem practically.
Perceived self-efficacy is other dimension. According to Wang et al. (2010), self-efficacy is
a consumers self-assessment of his/her capabilities to shop online. If consumers selfassessments is high, their online purchases also increases (Bonera, 2011). Subjective norms
are the rules by which operates the subjective motivation of individuals to act consistently
with the views of the individuals peer and social group (Bonera, 2011). Most of studies find
that the views social groups or other individuals such as opinion leaders affect consumers
purchase intentions (Bonera, 2011).

Avatars Definition
The word avatar was originally derived from Sanskir etymology; it was used to describe a
deity that had taken physical form on earth (Holzwarth et al., 2011).However the original
meaning has evolved to present an entirely different meaning in present day grammar. Nah et
al (2011) define the avatars as digital representations of the user and simulated bodies that
can move in the 3D virtual worlds. Another interpretation of avatars is Barnes and Mattsons
(2008, p. 196-197), who argue: Avatar are graphical representations of characters - typically
people - and are used in various applications including chat, instant messaging, blogs, games
and virtual communities.
Ives and Junglas (2008, p. 152) write: An avatar is a graphic identity that a virtual world
user chooses to represent him- or her in this environment. Sometimes, an avatar is created as
a representation of a human being but can also take on the form and appearance of fantasylike creatures. Hence, avatars provide a visual representation of the users real,
representative identity, and appearance that help them to socialize insides the 3D virtual
world.
Furthermore Holzwarth et al. (2006) define an avatar as virtual characters that can be used
as company representatives in an online store. Therefore avatars are virtual characters that
can be used as company representatives. Avatars can serve as identification figures, as
personal shopping assistants, as Web site guides, or as conversation partners. In these roles,
avatars have the potential to fulfil the consumers desire for a more interpersonal shopping
experience.
Thus, an electronic shopping agent may be able to ease a consumers navigation of a Web site
or provide personalized information, but an avatar can personify the interaction and make the
shopping experience more interpersonal.
Avatars influence on consumers and online retailers
With the presence of an avatar, Holzwarth et al. (2006) demonstrated that online retailers
increased consumers positive attitude toward the products being offered, purchase intention,
and overall satisfaction toward the shopping experience. Additionally, they found that
attractiveness of the avatars physical appearance had a positive effect on consumers
perceptions of credibility and likability.

Avatar interactions can induce feelings of trust or liking within users and even influence
purchase decisions (Wood et al., 2005). Also in Holzwarth et al.'s research (2006), avatars can
enhance the positive online shopping experience, and they suggested that using an avatar
sales person may lead to higher level of customer satisfaction, a more likeable or trust feeling
for the products and retailer, and even create greater purchase intention. Through this method,
the retailers can fulfill consumers' strong thirst for personal social interaction in the shopping
experience (Swaminathan et al., 2011).
Therefore In recent years, many online retail companies create virtual salesperson to increase
the pleasure and convenient shopping experience for their consumers. It helps to provide
related product information, suitable guidance with a search function and personalize
recommendation to enhance the purchase decision-making (Komiak et al., 2005). When
people perceive the human-avatar interaction providing an attractive interpersonal
communication, they are likely to satisfy and continue a relationship (Keeling et al., 2009).
Avatars as salespeople
According to (Crosby et al., 2010) Salespeople are an important component in the retail mix
by providing services and assistance to consumers, such as making recommendations or
answering product related questions These services are an essential marketing tool for
retailers that are used to separate and differentiate themselves from competitors. Salespeople
interact directly with consumers, build higher levels of consumer trust, and generate higher
profits for retailers (2013).
While the online shopping environment has become an increasingly important economic and
marketing channel for retailers, online retailers have been unable, until only recently, to take
advantage of the value added from the use of salespeople. As compared to the traditional
store channel, the online channel has few opportunities to interact with consumers. The
missing element for the online channel is the representation of a brand salesperson. Without a
frontline employee to interact and offer assistance to customers, online retailers potentially
miss an opportunity to build trust and develop relationships. (Williams and Spiro, 2011).
Consequently, consumers tend to suffer uncertainty expectations and perceive online
shopping as carrying greater risks in terms of lack of secure transactions and loss of privacy.
An avatar may be beneficial to online retailers and consumers by taking the role of an online
salesperson, which can provide consumers with social interactions from a company

representative, increase trust, and enhance consumer-retailer relationships (Holzwarth et al.,

2006).

Historically, a major drawback to online shopping was that consumers did not interact
directly with the myriad of company representatives in the brick-and-mortar store space.
Lipshitz and Strauss (2005) suggest that lack of social interaction does not provide consumers
with complete information, which leads to perceptions of increased risk and uncertainty when
making purchasing decisions online. However, with the successful adoption of Web 2.0 and
open graph capabilities, companies were able to interact more directly with consumers online
and in essence increase socialization.
According to social presence theory, individuals may experience varying levels of social
interaction through the human-computer interface (Wang and Fodness, 2010). Short et al.
(2012) refer to social presence as an individuals perception that communication media has
humanistic characteristics, such that individuals perceive the media as interacting directly
with a human. Depending on the interactive qualities of the web site, social presence may be
viewed as having a high or low level of presence (Gefen and Straub, 2011). One plausible
solution to increase social presence online may be with the use of avatars as salespeople.
Wang and Fodness (2010) discovered that web sites that utilized avatars increased consumer
perceptions of socialness. Additionally, Gefen and Straub (2011) found there is a positive
association between an individuals perceptions of social presence, trust, and web site loyalty
for online retailers utilizing avatars.
Avatars have the ability to possess characteristics such as hair color, voice and language,
much like real human characteristics and individuals often perceive avatars as possessing
human traits. Social response theory postulates that individuals will respond to computers or
machine as if the computer were another human (Reeves and Nass, 2012). Individuals will
reflexively interact and communicate with the machine in a social manner; even though they
comprehend it is not a human (Moon, 2000).
Additionally, individuals will perceive the computer as being more human-like when the
interaction is considered to be similar to human-to-human interaction (Nass and Steur, 1993).
By creating a human-like avatar with the role of a salesperson, individuals may respond to an
avatar as if they are responding to a real salesperson offline, enhancing the online shopping
experience, and overall perception of the web site (Wang et al., 2007). In the eyes of
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consumers, the avatar may be seen as a real salesperson with whom they could interact, much
like they would a real salesperson in a brick-and-mortar store.

CONCEPTUAL FRAMEWORK

Almost all websites include some form of help system but most consumers fear and hate the
help menu, simply because in most times when they are using help menu it always come out
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with no results. Spool (2010) concurs that users mostly prefer trial and error, they then only
use help systems only when stuck, and often bail out without obtaining the information.
Grayling (2011) prescribes characteristics of a well-designed help system, including being
obvious to invoke, easily available and non-intrusive.
At first sight, avatars would appear to fulfil the first two criteria admirably, assuming that
they are available by default or by a single click. As for non-intrusive, that clearly depends on
specific characteristics, but their abilities to simulate social interaction may well compensate
for a degree of intrusion. Online retailing websites in particular need to provide more than
merely information through their help systems.
Many users are discouraged from online shopping by the lack of social interaction and
pleasurable experiences (Holzwarth et al. 2006). It is unsurprising that some shoppers are
seeking hedonic as well as utilitarian benefits from their online experiences (Mathwick et al.
2011), as in other forms of shopping. Burgoon et al. (2000) illustrate that, by increasing the
anthropomorphic features of an interface, people feel more understood, as well as deriving
more utility from the website.
Lee and Nass (2009) states that if artificial representations possess properties such as
language and personality, automatic social responses tend to succeed in users. Avatars
therefore offer the potential for greater information and entertainment value, thus greater
satisfaction with online shopping experiences (Redmond 2008). They have also been found to
contribute to consumers feelings of telepresence, i.e., the feeling of being present in a remote
environment, potentially an interpersonal buying situation in a retail store (Qui and Benbasat
2008).
Consequently, the interactive and social credentials of avatars appear promising; the
literature on salespersons offline suggests strong associations between these characteristics,
customer satisfaction and sales. Journal of Marketing Management, Volume 24 Salesperson
and avatar roles Practitioners and researchers agree that the salesperson role should go far
beyond just clinching transactions. Bettancourt and Brown (2009) highlight the importance of
creating an image for the company, as well as selling goods and services.
Many retailers train their staff to greet or at least acknowledge customers as they enter a
department (Sparks 2012), even in stores using primarily self-service. They are well aware
that warmth, during what may be regarded by some as non-productive retail encounters, can
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be essential in producing a favourable service encounter (Lemmink and Mattsson , 2007).

Mittal and Lassar (2011) concur that staff who send out warmth offer customers a more
personally rewarding shopping experience. Baron et al. (2007) further note that social
interchange is a key element in the remembered role of a retail store. Gremler and Gwinner
(2000) identify the importance of customer-employee rapport in creating customer
satisfaction.
The social benefits of the customer-salesperson interaction are also widely recognised in the
context of relationship marketing (Hennig-Thurau et al., 2002). Repeat customer-employee
interactions are not however based solely on trust and friendship; salesperson work and help
in realising customer goals are also significant (Beatty et al. 1996). Based on content analysis
of salesperson job descriptions, Kim and Stoel (2005) identify twelve customer service roles
that need to be reproduced in online retailing. Semeraro et al. (2003) propose that an avatar
could reflect these roles by instructing customers in the use of a website, pointing out offers,
helping to find products, guiding customers through the purchase process and suggesting
products based on customer requirements or past purchase history.
Thus, it is constructive to gauge customer views on the usefulness of possible avatar roles.
Providing those functions most wanted by customers will enhance user experiences, focus
development efforts and minimise costs for online retailers. Segmentation by service. Bateson
(2005) found very different levels of preference for personal service and self-service in
offline service environments. Many customers prefer the non-personal service options, even
if they do not save time, money or effort, in part to maintain a greater degree of control.
Similarly, customers vary in their desire to maintain salesperson-customer relationships,
creating opportunities to segment on the basis of these social needs (Reynolds and Beatty
2009). Whether such relational benefits remain relevant online is questioned by Yen and
Gwinner (2003), yet a lack of rapport and continuing interactions with service employees
may, for some, undermine attachment and loyalty (Gutek et al. 2008).
The evidence from offline suggests likely opportunities for online retailers to gain advantage
through segmentation in the use of avatars, fulfilling various functional and (para) social
roles. Some of potential problems factors that has an effect, in the development and use of
avatars, which could contribute to the rejection of some or all of their potential roles by a
segment of internet shoppers:

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 increased time and cognitive demands of the customer (Cassell et al., 2000)
Heightened and inappropriate expectancies for the system (Cassell et al. 2009);
Choosing an appropriate image for the context (Wood et al. 2005; Luo et al. 2006);
Providing appropriate interaction content and interaction style for the context that also
addresses cultural and personality differences (Isbister and Nass 2000);
Failure to deliver user benefits beyond novelty value (Witkowski et al. 2003).
Therefore due to these factors that can affect consumers purchase intention or has an effect on
consumers we suggest that there will be some internet customers for whom the advantages of
an avatar will outweigh the disadvantages and vice versa. The challenge is to identify which
groups of customers derive most benefit and what roles are sought from avatars.
The available evidence also suggests the likelihood that customers will differ in the type of
help that they will require from avatars. Hence: Distinct clusters of online buyers exist,
significantly different in the extent and types of help required from avatars. One of the
opportunities afforded by having an online assistant on an internet shopping site is that of
giving the customer choices, e.g., whether or not to use the assistant, and what sort of
assistant to select, in terms of appearance and nature of the interaction. It is important to
understand more about the preferences of different customer segments for online assistants,
including gender, age groups and levels of online shopping experience.

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Conclusion
As central findings of this assignment, we can summarize that avatars can take the position of
a trust intermediary in online shopping. They positively influence the trust of a consumer
toward the supplier and consequently present themselves as effective instruments for the
establishment of trust in the distribution channel of the Internet. As management implications
for suppliers in online shopping, we can generally recommend using avatars as virtual
shopping consultants on the Internet. By this action, one can expect a considerable increase in
the trust shown by a consumer and in other consumer dispositions that are decisive for a
purchase. Because the possibility to choose between different avatars additionally strengthens
all of the variables relevant to consumer behavior, we can further recommend to likewise
offer a variety of virtual characters to assist in the buying process. With this variety, the
supplier satisfies the consumers need for an interaction partner that is similar to oneself and
thus creates extra emotional value. This, again, has a positive effect on trust and other latent
constructs of buying behavior and leads finally to an increase in volume of online sales.

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