Face meets machine: How price promotions shape consumer preference for virtual assistants (VAs) vs. human in luxury retail

Abstract

Advances in artificial intelligence encourage luxury firms to consider virtual assistants (VAs) as frontline service providers. It is thus important to understand whether consumers are willing to accept VAs as service providers in luxury retail. Drawing on face theory, this study examines consumer preferences for VAs versus human salespeople under price promotion versus full-price conditions. We also test the mediating effect of face consciousness and the moderating role of concern for face. Across three studies and an additional robustness check, we find that consumers prefer VAs under price discount conditions but prefer human salespeople in full-price luxury consumption. This phenomenon is explained by face consciousness. When purchasing full-price luxury products, consumers perceive more face gain if a salesperson provides service. In contrast, when price discounts are offered, consumers perceive less face loss if a VA provides service. Our result also indicates that differences in the stable individual trait of concern for face strengthen these effects, which further supports that face consciousness is an important mechanism in luxury consumption. Our findings offer insights for luxury firms to deploy and design VAs to meet consumers’ needs for signaling social status by purchasing luxury products.