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This study aims to explore the impact of augmented reality (AR) technologies on consumer information processing and value perceptions in physical stores. Specifically, it investigates how the vividness, novelty and interactivity of AR shape utilitarian and hedonic value perceptions, and influence consumer purchase and continuance behaviour.

The study used the store intercept survey method at 15 retail outlets across four metro cities in India, representing nine prominent retail brands deploying AR technologies. The data collected (n = 650) were subjected to exploratory and confirmatory factor analysis.

Major findings confirm a significant effect of vividness, novelty and interactivity on utilitarian and hedonic value perceptions of in-store AR experiences of customers in physical stores. Hedonic value was found to affect continuance intention but not purchase intention, while utilitarian value was found to affect purchase intention but not continuance.

This study extends the stimulus–organism–response model’s application to AR in physical stores by integrating the impact of vividness, novelty and interaction on both utilitarian and hedonic values and revealing their significance in influencing purchase intentions and continuance.

Major findings advise retailers to increase AR experience adoption in stores and illustrate the process through which purchase and continuance intentions may be influenced.

This is one of the few studies that explore the impact of AR on consumer attitudes and intentions in physical stores. In addition, the study explores the effect of AR tools as a process that passes through value perceptions and then affects the consumer.