2.1 Metaverse and the virtual environment
Current global trend towards digital visualisation technologies has drawn the attention towards the idea of the ‘metaverse’ – a 3D virtual world that unbound the real and virtual boundaries with VR and AR technologies [6, 8]. Since Mark Zuckerberg’s press release to rename Facebook to Meta and the company’s vision that entails technological innovations for social networking in virtual space, there was a substantial boost in the metaverse searches in Google and YouTube [9].
The metaverse concept was derived from the words “meta” that means transcend or beyond, and “universe” [10]. The word metaverse was first composed by a fictional-novel writer, Neal Stephenson in Snow Crash, 1992. The metaverse was depicted by the author to be an infinite virtual world that imitates the real world where individuals could interact with each other using digital avatars [11]. Currently, the concept and understanding of metaverse been strengthened through various visualisation technologies, the expansive social media influence on consumers and the rapid development of virtual and digital business transactions [12]. Within the metaverse, users and business owners are promised with new experience in the virtual world for communication, entertainment, and business.
The duality of the real and virtual world or digital twins that allow realistic virtual representation of the natural and built environment would revolutionize the way we connect, socializes, and conduct businesses through VR technology [13]. In addition, VR allows for the immersion between the physical and virtual environment through simulation that imitates the real world [14]. In recent years, the VR technology market has expanded tremendously with an expected value of $6 billion in 2020 [3]. Studies have shown the vast potential of VR for application in various fields and industries including architecture, engineering and construction (AEC) [15], consumer products [16, 17] and psychology [18].
VR would allow for research in consumer behaviour for marketing in the metaverse platforms as it simulates the real world. There are several studies that prove the advantage of VR in marketing. Research has found that stores that applies VR technology could enhance shopping efficiency and generates positive customer behaviour [2]. On the other hand, in the real estate market, VR was found to be convenient for buyers and realtors to experience houses in different geographical locations [19].
Despite the extensive research in VR, this study found that most research focused mainly on the VR equipment. With the growth of VR users, the direction of current research trend towards the metaverse, and the rapidly evolving digital age that takes control of every aspect of human life, this study emphasizes on the need for understanding how the VR impacted human emotion and behaviour. This proposition is in line with [20] who argue that the study on human aspects and behaviour in the virtual world seems to be overlooked.
The metaverse concept has driven companies to radically reinvent new business model that aim to deliver their businesses digitally through simulated environment such as VR [21]. Business transactions in the metaverse would significantly extend the scope and extent of economic activities to reach out to more customers from different geographical locations. As VR became an integral part of the IR 4.0 and the metaverse vision, this study calls to enhance the real estate sector towards new business models by taking advantage of VR as the digital visualization tools for more efficient operations, better customer engagement as well as elevating potential homebuyers’ experience with the built environment. The long term goal for this study is to develop a more personalized services or customer interface in VR using the metaverse platforms such as Meta, by taking into account the use of big data technologies and a highly customized services that could influence consumers’ behaviour [22]. Leading real estate companies need reinvent their business model to apply latest innovations in virtual marketing. With that, effective strategies to integrate these technologies into their business could be implemented efficiently to garner the potentials of the virtual world, especially to catch up with the metaverse trend.
Thus, the study presented in this paper is the first step towards achieving the seamless and coherent approach to the virtual environment for a better human-machine interaction, particularly for the real estate sector. It is paramount to investigate factors that are influential in marketing using VR. Accordingly, this research believes that it is pertinent to compare and analyse user interactions between the two different environment – real and virtual, to recommend future trend in consumer behaviour within the metaverse.
2.3 Virtual commerce for residential real estate
Virtual commerce can be defined as the activities involving commerce held in the virtual world [23]. Virtual commerce is one of the most important potentials of the metaverse that would allow for business activities and transactions to be held with no limitations of the physical boundaries. The integration of VR as an immersive technology infrastructure to evoke the sense of presence in the virtual environment is vital in virtual business and marketing [23]. This study argues that in order for virtual commerce to be realized effectively, it is vital to evaluate how consumer behaviour is influenced by the virtual environment.
In marketing research, various studies were done regarding the effect of environment on consumer behaviour. Most research focused on how purchase decisions are motivated by the consumers’ emotions [23]. For example in a restaurant setting, restaurant environment with aesthetic simulations influences the customers’ behaviour [24]. In addition, research has found that immersive virtual store impacted consumers’ perceptions and buying behaviour [25]. In a home-buying context, the environment of the house that influences emotion also plays a crucial role in influencing purchase decision. Studies shown that the perceptions of family life portrayed by the house environment have strong relationship with emotions, which influences purchase decision [26]. In addition, [27] demonstrates that homebuyers’ emotions were dominated and significantly affected by the visual evaluation of the house’s environment. Furthermore, research also shown that visual representations of houses for sale are capable of generating desired consumer behaviour [28].
However, this paper found a gap in the literature concerning virtual marketing for the homebuying context. Although [29] proved that immersive VR could evoke a higher sense of presence and detailed spatial recognition as housing pre-occupancy evaluation tool, the practicability of VR as a marketing medium for real estate to influence emotion and consumer behaviour is paid very little attention. This is important in order to take advantage of the metaverse platforms and virtual commerce using advanced digital visualisation technologies.
Based on the different theoretical perspectives in consumer behaviour, this paper examine how purchase intention was influenced by emotions. This paper specifically applies the stimulus-organism-response (S-O-R) framework as the theoretical foundation in this study because this framework has been widely used as the theoretical foundation in consumer behaviour studies [30]. Henceforth, the authors aim to extend this theory to understand the impact of virtual environment on consumer behaviour, which has not been extensively done in prior research in the literature.
2.4 Stimulus-Organism-Response (S-O-R) Model
The S-O-R model [31] originates from the field of environmental psychology that suggests the environment is the stimuli (S) that influence individual’s emotional states (O), which then influences their behavioural response (R). It has been extensively applied in various marketing research to study the influence of the environment on consumer behaviour, including research related to digital marketing using VR [32, 33]. In what follows, this study proposed research hypotheses based on the theory and findings in prior literature.
Research framework and hypotheses development
Atmosphere refers to the environmental features that is apprehended through human senses, which can be tangible and intangible aspects [34]. Various research have proven the use of atmosphere as part of the marketing tool in businesses to influence consumers’ emotion such as pleasure, arousal and satisfaction, including consumer behaviour such as purchase intention [7, 17, 36].
Satisfaction can be defined as a state evoked from individual’s cognitive evaluation. In this paper, the authors posits that the atmosphere in the virtual environment could influence potential homebuyers’ satisfaction, which in turn influences their purchase intention. In addition, perceived enjoyment is defined in this research as the extent to which the virtual environment in VR is perceived to be enjoyable [37], which in turns would stimulate positive behavioural response. Perceived enjoyment was proven in prior research to be a significant determinant of consumer behaviour to influence purchase intention [38, 39]. Thus, the following hypotheses are proposed and illustrated in Fig. 1:
H1: Atmospheric positively effect satisfaction.
H2: Atmospheric positively effect perceived enjoyment.
H3: Satisfaction positively effect purchase intention.
H4: Perceived enjoyment positively effect purchase intention.