2.1. Customer Buying Cycle
The customer buying cycle originates from the customer resource cycle. It models the connection between customers and suppliers in a cycle of phases: stimulation phase, inspirational phase, purchasing phase and after sales phase (Blecker, Friedrich, Kaluza, Abdelkafi, & Kreutler, 2005). Thus, as Tourism Australia (2013) state, the customer buying cycle shows the process a customer is going through when buying a product. First, in the stimulation phase, also often called problem recognition or contact phase, the first contact with the customer is established and the initial interest is evoked. Further, within this phase, the customer’s need for products or services is stimulated (Meier & Stormer, 2009). Hence, within this phase it is important for companies to create an emotional connection with the customer, showing how the customer will feel when consuming the product, reasoned by Tourism Australia (2013). In the second phase, the customer’s advisory is important. The customer collects information about products and services offered (Meier & Stormer, 2009). Moreover, the customer evaluates and compares different offers and decides what he/she wants to buy. Thus, as mentioned by Meier & Stormer (2009), the information search and decision-making process take place within the inspirational phase of the customer buying cycle. In line with this, it is important for companies to provide good and detailed information about the product or service offered and to demonstrate value against major competitors (Tourism Australia, 2013). If there is not enough information about the product available, the customer cannot make a rational decision. In the purchasing phase, the customer makes an order and in the last phase, the after sales phase, the customer uses the product or service bought (Meier & Stormer, 2009).
Due to the nature of this research project, it is not possible to investigate the influence of VR on the whole customer buying cycle. Thus, VR’s influence will be investigated in greater detail only on two stages within this process, the information search process and the decision-making process within the inspirational phase.
By using VR in their marketing strategies, destinations have great influence on the information search process of potential or repeating tourists. Nowadays, people live in a world of variety and are forced to choose between different careers, places to live or holiday destinations. Park and Jang (2013) find out, that there is a choice and information overload in the tourism industry. As touristic products are mostly intangible, there is a larger variety of tourism than retail products. Therefore, it is important for destinations to differentiate their products and giving accurate information to customers.
Buhalis (1998) argues that by using VR, destinations offer tourists to access accurate and reliable information in a fraction of cost, time and effort compared to traditional promotional material. In addition, Fritz et al. (2005) indicate, that new technologies and VR in particular, have changed the information search process into a faster and more interactive one. Furthermore, VR reduces elements of uncertainty and the intangible nature of tourism products in a better way, as it supplies tourists with plentiful information, compared to traditional promotional material (Cheong, 1995; Hyun & O’Keefe, 2012). Moreover, according to Cheong (1995) and Hyun & O’Keefe (2012) customers can be supplied with extensive information and would be able to create realistic expectations of the destination that eventually will be visited.
Thus, compared to traditional promotional materials, VR provides consumers with high media richness, interactivity and telepresence what, as a consequence, enhances consumer learning (Suh & Lee, 2005). High media richness refers to depth and breadth of information (Steuer, 1992), where the first concept includes the quality of information, meanwhile the second one the stimulation of multiple senses such as vision or hearing. Interactivity, on the other side, involves consumers in the computer-mediated environment and make them active as soon as the consumer can adjust the information according to their needs and their individual interests (Suh & Lee, 2005). Finally, telepresence indicates the sense of “being there”. According to Zhao (2003), the technologies that can reach the “there” have two main roles: Firstly, to provide a communication channel that allows the flow of information to and from the remote place and secondly to provide an interface that permits users to send and receive information through that channel. In such a way, VR gives the opportunity to explore different places even if the client is far away. Furthermore, VR technologies permit to enhance the consumers’ learning process (Suh & Lee, 2005; Zarzuela, Pernas, Calzón, Ortega, & Rodríguez, 2013).With regard to this, Suh & Lee (2005) state that consumer learning involves three main dimensions: cognitive, affective and conative learning. The cognitive dimension allows consumers to explore realistic product images from different angles and distances. Moreover, interactivity also enhances the comprehension of information. Next, the perception of affective and conative dimensions creates positive, neutral, or negative attitudes and purchase intentions towards products.
Furthermore, the studies of the aforementioned scholars demonstrate a superior effectiveness of the VR peculiarities such as media richness, interactivity and telepresence on product knowledge, product attitude and purchase decisions. Moreover, VR may be used to manipulate and control consumers` beliefs and opinions for the company or destination advantage. Overall, as information is the lifeblood of the tourism industry (Poon, 1993), due to the intangible nature of the products in combination with high prices, destinations should further effectively use new information technologies and VR in particular to facilitate tourism and improve service quality and contribute to customers` satisfaction, as argued by Buhalis (1998). VR not only improves the information search process, but also influences the decision-making processes. To further narrow down the influences of VR on tourists, the next section will focus on the decision-making process.
2.3. Decision-Making Process
As previously mentioned, VR has a huge influence on the information search process. Additionally, it also has a huge influence on the decision-making process of tourists. The decision making process of tourists is generally very complex, as it includes several sub-decisions (Smallman & Moore, 2010). Such sub-decisions range from the choice of destination to the decision of what to do at the destination, discussed by Smallman & Moore (2010). Additionally, decision-making in tourism usually needs a high involvement because of the high risk which is perceived by the customers (Sirakaya & Woodside, 2005). They are confronted with higher risk due to relatively high costs and the intangible nature of tourism products (Sirakaya & Woodside, 2005). Furthermore, decision-making is a rational process, which means that a potential tourist reviews the costs and benefits of his/her actions before purchasing, therefore, good and clear information are needed, as indicated by Sirakaya & Woodside (2005).
Overall, as mentioned by Neuhofer et al. (2012), tourists seek for inspiration and want to explore new things. Thus, by using VR in its marketing, destinations have the unique chance to position themselves and to attract potential tourists (Neuhofer et al., 2012). According to Cheong (1995) and Chiou et al. (2008), by using VR as a marketing tool, destinations can increase their appeal to future tourists. Specifically, VR gives destinations a powerful instrument to enhance tourism through better promotion and information supply (Cheong, 1995; Chiou et al., 2008).
If VR is used as a marketing tool, destinations first need to create a 360° video of its attractions and facilities. This 360° video can then be provided – by using special headsets– to tourists at fairs, travel agencies or even at home. Watching the video, tourists can move their head and explore and experience the destination from each angle (Charara, 2016). This enables potential tourists to see, hear and even feel how it would be to visit the particular destination (Bruce, 2016). Fundamentally, as stated by Bruce (2016), Cheong (1995) and Neuhofer et al. (2012), destinations give future tourists a free trial to experience facilities and attractions of a destination before the tourists make their final travel decision. Therefore, tourists have the opportunity to experience the atmosphere of a destination and explore the destination in deeper depth, according to Bruce (2016), Cheong (1995) and Chiou et al. (2008). Due to this, several authors argue that tourists are in a better position to decide whether they want to travel or not and are able to form realistic expectations of their future visit (Cheong, 1999 in Huang, Backman, & Backman, 2010; Williams & Hobson, 1995; Zarzuela, Pernas, Calzón, Ortega, & Rodríguez, 2013). Cheong (1995) indicate that the fundamental significance of using VR in marketing is, that it brings possible experiences to future tourists and that the virtual experience of a destination will further increase the actual desire to visit that place.
Overall, Govers, Go, & Kumar (2007) reason that VR has such a huge influence on the decision-making process as it provides tangible images and experiences of the destination and its facilities. Therefore, VR minimises the risk which is perceived by tourists and provides a more reliable basis to do a rational decision. In addition, Buhalis (2000), Govers et al. (2007) and Nicoletta & Servidio (2012) mention that based on these seen images, tourists can create their own mental constructions about facilities and attributes in the destination – the destination image –, and can develop a set of realistic expectations. This destination image and developed expectations have a crucial impact on the intention and motivation to visit the particular destination, reasoned by Buhalis (2000), Govers et al. (2007) and Nicoletta & Servidio (2012). Therefore, VR should be used to influence the destination image as perceived by future tourists and to improve its quality as claimed by Buhalis (2000), Govers et al. (2007), Hyun & O’Keefe (2012), Nicoletta & Servidio (2012), Williams & Hobson (1995) and Zarzuela et al. (2013).
Furthermore, VR has a great influence on the decision-making process as it touches and can create intended emotions. According to Achar, So, Agrawal, & Duhachek (2016), emotions are very important for influencing the decision-making process of tourists. VR is able to trigger emotions by stimulating users’ senses. VR creates an illusion that one immerses himself/herself and believes in it, thus, when experiencing VR, users are able to interact within the experience. An example of such interaction would be moving, jumping, watching or hearing. By stimulating these senses, a complete immersion can be obtained, as indicated by Gutiérrez, Vexo, & Thalmann (2008). This creates a colossal opportunity for the whole travel industry, especially for tourist destinations. Therefore, destinations are able to visualise impressive landscapes and fascinating activities that visitor could potentially experience when visiting the destination (Cheong, 1995).
Diemer, Alpers, Peperskorn, Shiban, & Mühlberger (2015), Felnhofer et al. (2015) and Osti & Pechlaner (2001) mention, that VR gives destinations a unique opportunity to transmit intended emotions to potential tourists in a more effective way compared to traditional promotional material. Additionally, according to Cuperus, Laken, van den Hout, & Engelhard (2016) and Serrano, Baños, & Botella (2016), VR is more powerful in inducing strong emotions as it creates a feeling of presence, that is traveling virtually to the shown place. Thus, by influencing and stimulating intended emotions through VR, destinations have a great opportunity to influence the decision-making process of potential tourists and to enhance tourism.