Opportunities and challenges of implementing immersive commerce strategy in modern Indian retailing

Abstract

Immersive Commerce integrates advanced digital technologies such as Augmented Reality (AR),Virtual Reality (VR), 3D visualization, AI, and Metaverse elements to create interactive andexperiential shopping environments. In the Indian retail landscape, where digital adoption andconsumer expectations are rapidly evolving, immersive commerce presents a promising pathwayto enhance customer engagement and strengthen competitive positioning. However, despite itspotential, adoption remains limited due to financial, technological, infrastructural, and consumerreadiness challenges. This study examines the opportunities and challenges in implementingimmersive commerce within modern Indian retailing, focusing on retailers’ perceptions towardcustomer experience improvement, business performance, future innovation capability, andassociated risks. A descriptive research approach was adopted, and data was collected from 390retailers across Tier-1 and Tier-2 retail hubs using proportionate stratified sampling. Analyticaltools including Descriptive Statistics, Regression, ANOVA, Multi variance Analysis, FactorAnalysis, and Structural Equation Modeling (SEM) were applied. The findings indicate thatimmersive commerce significantly enhances experiential engagement, product presentation, andshort-term sales growth, demonstrating its strategic value in improving customer decision-making and in-store experience. Customer loyalty, however, is primarily influenced byengagement and system reliability rather than perceived value alone. Innovation capability andgrowth potential suggest that immersive commerce may shape long-term retail transformation.Conversely, high investment costs, lack of technical expertise, inadequate infrastructure, andlimited consumer familiarity act as major barriers. Operational risks, inclusivity concerns, anddata security issues further influence retailers’ implementation decisions. The study concludesthat immersive commerce can provide a competitive advantage in Indian retailing if adoptedgradually with improved infrastructure, staff training, customer awareness and technologicalsupport. The research provides insights for retailers, policymakers, and technology developers indesigning feasible, inclusive and sustainable immersive retail strategies.