Sustainable Effects of Technological Innovation on Business Models : A Case Study on AR in the Grocery Industry

Abstract: In the growing digitalization of the grocery industry, it is necessary for traditional grocery retailers to adapt their business models to the new digital era. Augmented reality (AR) and other digital tools have proven to have the ability to transform the grocery business, and it is crucial for traditional grocers to act in order to remain competitive. AR technology has been used in a number of different retail industries, such as the clothing industry and the furniture industry. The purpose of this paper is to investigate how the implementation of AR can affectthe business model of a traditional grocery retailer. A case study has been conducted with a food company in Sweden, at the request of our commissioner working in the field of digitalization of different industries. Furthermore, the Triple Layered Business Model Canvas, has been used as a tool to identify the current business model, and to give suggestions on how the future business model can look like, after an implementation of AR. The results show a change on the canvas of the three different sustainability factors, but also an identification of the different challenges a grocery retailer can face. The results show an increased collaboration with external partners and the implementation of new activities for the case company. Furthermore, the study emphasizes the impact on distribution and suppliers, as well as the social consequences. Preparation for the technology is further presented in the study.  The study contributes to increased knowledge of business model change in the grocery industry. Previous research on the impact of AR on the grocery industry has been confirmed, and this paper contributes new research investigating the impact of technological innovations on the business model of traditional grocery retailers. This study also adds knowledge on theuse of the Triple Layered Business Model Canvas as an analytical tool for sustainability and business model change.