Less stress, fewer delays: The role of sophisticated AI in mitigating decision fatigue and purchase postponement in luxury retail

Abstract

Purchase postponement is a critical issue for luxury retailers, as consumers often browse or try luxury goods but ultimately delay or abandon purchases. This study explores how retail technologies can address this problem. While sophisticated AI offers diversified recommendations and hyper-personalized options, it can overwhelm consumers, increasing their decision fatigue and purchase postponement. However, it also has the potential to facilitate consumers' decision-making. Building on the stressor-strain-outcome framework, this study examines whether luxury consumers’ experiences with different levels of AI sophistication (high vs. low) show varying levels of purchase postponement (Study 1) and further explores the underlying mechanisms by which sophisticated AI mitigates decision fatigue and purchase postponement (Study 2). Results from two online experiments indicate that luxury consumers who interacted with highly sophisticated AI exhibited lower levels of purchase postponement, even among those with higher goal orientations. This is because luxury consumers perceive sophisticated AI as having more mind-like qualities (agency and experience), enhancing their perceived trust and empathy, which helps alleviate decision fatigue and purchase postponement, especially when service embarrassment is low. This paper makes a significant contribution to the body of knowledge in AI services, retailing, and luxury consumer research, and provides practical insights for luxury retailers with strategies to prevent and mitigate consumer decision fatigue and purchase postponement.