BookPDF Available

Winning in Service Markets, Vol 8: Crafting the Service Environment


Abstract and Figures

Designing the service environment is an art that involves a lot of time and effort, and can be expensive to implement. Service environments relate to the style and appearance of the physical surroundings and other experiential elements encountered by customers at service delivery sites. Crafting the Service Environment focuses on the key dimensions of service environments in the servicescape model and not much on its other aspects. This book is the eighth book in the Winning in Service Markets series by services marketing expert Jochen Wirtz to cover the key aspects of services marketing and management based on sound academic evidence and knowledge.
Content may be subject to copyright.
Jochen Wirtz
the Service
Winning in Service Markets Series: Vol. 8
WS Professional
Y0010 sc
Designing the service environment is an art that involves a lot of time and effort,
and can be expensive to implement. Service environments relate to the style and
appearance of the physical surroundings and other experiential elements encountered
by customers at service delivery sites. Crafting the Service Environment focuses on
the key dimensions of service environments in the servicescape model and not much
on its other aspects. This book is the eighth book in the Winning in Service Markets
series by services marketing expert Jochen Wirtz to cover the key aspects of services
marketing and management based on sound academic evidence and knowledge.
Winning in Service Markets is a highly practical book. I love the comprehensive
coverage of services marketing and the rigor. Also, it is easy to read and full of
interesting, best practice examples.I recommend this book to everyone working in
a service organization.
Jan Swartz
President, Princess Cruises
Winning in Service Markets provides a set of useful frameworks and prescriptions
rooted in both practice and research. As such, it represents a refreshing alternative
to the prevailing literature available to managers who are looking for insights rooted
in sound theory.A must read for any practicing manager in the service economy.
Leonard A. Schlesinger
Baker Foundation Professor, Harvard Business School
Winning in Service Markets Series
Series Editor: Jochen Wirtz (National University of Singapore, Singapore)
The Winning in Service Markets Series covers the key aspects of services marketing
and management based on sound academic evidence and knowledge. The books in
this series is written by services marketing expert Jochen Wirtz, author of globally
leading textbook for Services Marketing. Each book in the series covers dierent
themes in the study of services marketing and management, is accessible, practical
and presented in an easy-to-read format for busy practitioners and eMBA students.
Managing People for Service Advantage
by Jochen Wirtz
Managing Customer Relationships and Building Loyalty
by Jochen Wirtz
Designing Complaint Handling and Service Recovery Strategies
by Jochen Wirtz
Service Quality and Productivity Management
by Jochen Wirtz
Building a World Class Service Organization
by Jochen Wirtz
Vol. 1 Understanding Service Consumers
by Jochen Wirtz
Vol. 2 Positioning Services in Competitive Markets
by Jochen Wirtz
Vol. 3 Developing Service Products and Brands
by Jochen Wirtz
Vol. 4 Pricing Services and Revenue Management
by Jochen Wirtz
Vol. 5 Service Marketing Communications
by Jochen Wirtz
Vol. 6 Designing Customer Service Processes
by Jochen Wirtz
Vol. 7 Balancing Capacity and Demand in Service Operations
by Jochen Wirtz
Vol. 8 Crafting the Service Environment
by Jochen Wirtz
*More information on this series can also be found at:
Karimah - Y0010 - Crafting the Service Environment.indd 1 14-07-17 10:49:05 AM
Jochen Wirtz
the Service
Winning in Service Markets Series: Vol. 8
WS Professional
Published by
WS Professional, an imprint of
World Scientic Publishing Co. Pte. Ltd.
5 Toh Tuck Link, Singapore 596224
USA oce: 27 Warren Street, Suite 401-402, Hackensack, NJ 07601
UK oce: 57 Shelton Street, Covent Garden, London WC2H 9HE
For orders of individual copies, course adoptions, and bulk purchases:
For orders of individual chapters and customized course packs:
For adaptations or translation rights and permissions to reprint;
Winning in Service Markets Series — Vol. 8
Copyright © 2018 by Jochen Wirtz
All rights reserved.
ISBN 9781944659325 (mobile book)
Desk Editor: Karimah Samsudin
Printed in Singapore
Karimah - Y0010 - Crafting the Service Environment.indd 2 14-07-17 10:49:05 AM
To my past and future EMBA and Executive Program participants.
I have been teaching EMBA and Executive Programs for over
20 years. is Winning in Service Markets Series is dedicated to you, the
participants from these programs. You brought so much knowledge and
experience to the classroom, and this series synthesizes this learning for future
EMBA candidates and managers who want to know how to bring their service
organizations to the next level.
e main objective of this series is to cover the key aspects of services
marketing and management, and that is based on sound academic
research. erefore, I used the globally leading text book I co-authored
with Professor Christopher Lovelock (Title: Services Marketing: People,
Technology, Strategy, 8th edition) as a base for this series, and adapted and
rewrote it for managers. is is a unique approach.
is series aims to aims to bridge the all-too-frequent gap between
cutting edge academic research and theory, and management practice.
at is, it provides a strongly managerial perspective, yet is rooted in solid
academic research, complemented by memorable frameworks.
In particular, creating and marketing value in today’s increasingly
service and knowledge-intensive economy requires an understanding of
the powerful design and packaging of intangible benets and products,
high-quality service operations and customer information management
processes, a pool of motivated and competent front-line employees,
building and maintaining a loyal and protable customer base, and
the development and implementation of a coherent service strategy to
transform these assets into improved business performance. is series
aims to provide the knowledge required to deliver these.
Winning in Service Markets comprises of the following volume:
Vol 1: Understanding Service Consumers
Vol 2: Positioning Services in Competitive Markets
Vol 3: Developing Service Products and Brands
Vol 4: Pricing Services and Revenue Management
Vol 5: Service Marketing Communications
Vol 6: Designing Customer Service Processes
Vol 7: Balancing Capacity and Demand in Service Operations
Vol 8: Craing the Service Environment
Vol 9: Managing People for Service Advantage
Vol 10: Managing Customer Relationships and Building Loyalty
Vol 11: Designing Complaint Handling and Service Recovery
Vol 12: Service Quality and Productivity Management
Vol 13: Building A World-Class Service Organization
Dedication 3
Preface 4
Introduction 7
Service Environments – An Important Element of 10
The Service Marketing Mix
What is the Purpose of Service Environments? 10
Shape Customer’s Service Experience and Behaviors
Signal Quality and Position, Differentiate and Strengthen the Brand
Core Component of The Value Proposition
Facilitate the Service Encounter and Enhance Productivity
The Theory Behind Consumer Responses to Service Environments 17
Feelings are a Key Driver of Customer Responses to Service
The Servicescape Model – An Integrative Framework
Dimensions of the Service Environment 23
The Effect of Ambient Condition
Spatial Layout and Functionality
Signs, Symbols and Artifacts
People are Part of the Service Environment too
Putting It All Together 36
Design with a Holistic View
Design from a Customer’s Perspective
Tools to Guide Servicescape Design
Conclusion 42
Summary 43
Endnotes 46
About the Author 52
Acknowledgments 53
Designing the service environment is an art that involves a lot of time
and eort, and can be expensive to implement. Service environments
relate to the style and appearance of the physical surroundings and other
experiential elements encountered by customers at service delivery
sites. Craing the Service Environment focuses on the key dimensions
of service environments in the servicescape model and not much on its
other aspects. is book is the eighth book in the Winning in Service
Markets series by services marketing expert Jochen Wirtz to cover the key
aspects of services marketing and management based on sound academic
evidence and knowledge.
Crafting The Service
Managers…need to develop a better understanding of the
interface between the resources they manipulate in atmospherics
and the experience they want to create for the customer.
Jean-Charles Chebat and Laurette Dubé
Professors of Marketing at HEC Montréal Business School
and McGill University, Montréal respectively
Restaurant design has become as compelling an element as menu,
food and wine…in determining a restaurant’s success.
Danny Meyer
New York City restaurateur and CEO
of Union Square Hospitality Group
10 · Winning in Service Markets
e physical service environment customers experience plays a key
role in shaping the service experience and enhancing (or undermining)
customer satisfaction, especially in high-contact, people-processing
services.1 Disney theme parks are oen cited as vivid examples of service
environments that make customers feel comfortable and highly satised,
and leave a long-lasting impression. In fact, organizations such as
hospitals, hotels, restaurants, and oces of professional service rms have
come to recognize that the service environment is an important element
of their services marketing mix and overall value proposition.
Designing the service environment is an art that involves a lot of time
and eort, and can be expensive to implement. Service environments,
also called servicescapes, relate to the style and appearance of the physical
surroundings and other experiential elements encountered by customers
at service delivery sites.2 Once designed and built, service environments
are not easy to change. e focus of this volume is on the key dimensions
of service environments in the servicescape model and not much on its
other aspects (Figure 1).
e reason why many service rms take so much trouble to shape the
environment in which their customers and service personnel will
interact will need to be examined. For many service rms, there are four
main purposes of servicescapes: (1) shape customers’ experiences and
behaviors; (2) signal quality and position, dierentiate and strengthen the
brand; (3) be a core component of the value proposition; and (4) facilitate
the service encounter and enhance both service quality and productivity.
Each of these four purposes are discussed in the following sections.
Shape Customers’ Service Experiences and Behaviors
For organizations that deliver high-contact services, the design of the
physical environment and the way in which tasks are performed by
customer–contact personnel play a vital role in shaping the nature
of customers’ experiences. Physical surroundings help to “engineer”
Crafting The Service Environment · 11
Design of Effective Services
Design with a holistic view
Design from the customers’ perspective
Use design tools (ranging from keen
observation and customer feedback to
photo audits and field experiments)
(e.g., beliefs,
Emotional (e.g.,
moods, attitudes)
(e.g., comfort,
Bitner’s Servicescape Model
Key Dimensions of Service
Ambient conditions (e.g., music,
scents, and colors)
Spatial layout and functionality
(e.g., floor plan, size and shape of
furnishing, counters, equipment)
Signs, symbols, and artifacts
Appearance of service employees
and other customers
Response Moderators
Employees (e.g., liking of
servicescape, personal tolerance for
stimulation through music, noise, and
Approach (e.g.,
explore, spend
time, spend
money in the
(e.g., leave the
between service
employees and
Main Purposes of Service
• Shape customers’ service
experience and behaviors
• Signal quality and position,
differentiate and strengthen the
• Core component of the value
• Facilitate the service encounter
and enhance productivity
Theories from Environmental
Psychology that Explain Consumer
Responses to Service Environments
The Mehrabian–Russell
Stimulus–Response Model
• Perceptions and interpretation
of servicescapes influences
how consumers feel
• These feelings then drive
consumer responses to those
Russell’s Model of Affect
• Customers’ feelings (or
emotions) can be modeled with
two dimensions: pleasure and
• Pleasure is subjective
• Arousal largely depends on
the information rate of an
• Pleasure and arousal interact
on response behaviors,
whereby arousal generally
amplifies the effects of
pleasure (or displeasure)
Figure 1: Organizational framework
12 · Winning in Service Markets
appropriate feelings and reactions in customers and employees, which
in turn can help to build loyalty to the rm.3 e environment and its
accompanying atmosphere can aect buyer behavior in important
ways, and this volume describes how the design elements of the service
environment can make customers feel excited or relaxed, help them nd
their way in complex servicescapes such as hospitals or airports, and
shape their quality perceptions and important outcomes such as buying
behavior, satisfaction and repeat purchase.
Signal Quality, and Position, Dierentiate and Strengthen the Brand
Services are oen intangible and customers cannot assess their quality
well, so customers use the service environment as an important quality
proxy, and rms go to great lengths to signal quality and portray the
desired image.4 For example, the reception area of successful professional
service rms such as investment banks or management consulting rms,
where the decor and furnishings tend to be elegant and are designed to
Most people infer higher merchandise quality if the goods are
displayed in an environment with a prestigious image rather than in
one that feels cheap.5 Consider Figure 2, which shows the lobbies of two
hotels. ese are two dierent types of hotels catering to two very dierent
target segments. One caters to younger guests who love fun and have low
budgets, and the other caters to a more mature, auent and prestigious
clientele including business travelers. Each of these two servicescapes
clearly communicates and reinforces each hotel’s respective positioning
and sets service expectations as guests arrive.
Figure 2: Compare the two hotel lobbies; different types of hotels have very different
target segments.
Crafting The Service Environment · 13
Servicescapes oen play an important part in building a service
rms brand, such as the role outlet design played in building Starbucks’
brand! Likewise, Apple is famous for its sleek design, and their shops are
no exception. With their airy and minimalist interiors, white lighting,
silver steel, and beige timber, Apple Stores create a bright, open and
futuristic servicescape that provides a carefree and casual atmosphere.
Apple’s agship stores feature dramatic locations such as inside the
Louvre in Paris, or a 40-foot-high glass cylinder in Shanghai. Apple’s
retail operations are an important part of its business — it has 453 retail
stores in 16 countries; of its 43,000 employees in the US, 30,000 work at
Apple Stores, and its sales per square foot of $4,551 per annum in 2014
were the highest of any retailer in the US!6 e Apple Stores’ ability to
deliver a consistent, dierentiated, and high quality service experience
reinforces Apples brand image, and is consistent with the upmarket and
high quality positioning of its products.
Core Component of the Value Proposition
e servicescape can even be a core component of a rm’s value
proposition. Consider how eectively many amusement parks use the
servicescape concept to engineer their visitors’ service experiences as
Figure 3: In LEGOLAND®, the servicescape is part of the value proposition.
14 · Winning in Service Markets
they come to these parks to enjoy the environment and rides. e clean
environment of Disneyland or Denmarks LEGOLAND® (Figure 3), in
addition to employees in colorful costumes all contribute to the sense of
fun and excitement that visitors encounter upon arrival and throughout
their visit.
Resort hotels illustrate how servicescapes can become a core part
of the value proposition. Club Med’s villages, designed to create a totally
carefree atmosphere, may have provided the original inspiration for
getaway” holiday environments. However, new destination resorts are
not only far more luxurious than Club Med, but also draw inspiration
from theme parks to create fantasy environments both indoors and
outdoors. Perhaps the most extreme examples can be found in Las Vegas.
Facing competition from numerous casinos in other locations, Las Vegas
has repositioned itself away from being a purely adult destination, to a
somewhat more wholesome entertainment destination where families
too can have fun. e gambling is still there, but many of the large,
recently built hotels (or rebuilt) have been transformed by adding visually
attractive features, e.g., erupting “volcanoes, (Figure 4) mock sea battles,
striking reproductions of Paris, pyramids of Egypt, and Venice and its
Figure 4: At the Mirage Hotel and Casino in Las Vegas, an erupting volcano is part of
the servicescape.
Crafting The Service Environment · 15
Facilitate the Service Encounter and Enhance Productivity
Service environments are oen designed to facilitate the service encounter
and increase productivity. For example, childcare centers use toy outlines
on walls and oors to show where toys should be returned aer use. In
fast food restaurants and school cafeterias, strategically located tray-
return stands and notices on walls remind customers to return their trays.
As shown in the Bangalore Express Restaurant (Figure 5), environments
can be designed to optimize the use of expensive rental space. Finally,
Service Insights 1 shows how the design of hospitals helps patients recover
and employees perform better.
The Hospital Servicescape and
Its Effects on Patients and Employees7
ankfully, most of us do not have to stay in hospitals. If it should
happen, we hope our stay will allow us to recover in a suitable
environment. However, what is considered suitable in a hospital?
Figure 5: Bangalore Express City, a restaurant in the city of London, is designed to
optimize expensive rental space.
16 · Winning in Service Markets
Patients may contract
infections while in hospital,
feel stressed due to the contact
with many strangers, and yet
become bored without much
to do, dislike the food, or are
unable to rest well. All these
factors may delay a patient’s recovery. Medical workers usually work
under demanding conditions and may contract infectious diseases,
be stressed by the emotional labor of dealing with dicult patients,
or be at risk of injury when exposed to various types of medical
equipment. Research has shown that greater care in designing the
hospital servicescape reduces these risks and contributes to patient
well-being and recovery, as well as sta welfare and productivity.
e recommendations include:
Provide single-bed rooms. ese can lower the number of
infections caught in the hospital, improve rest and sleep quality
by lessening disturbance caused by other patients sharing
the room, increase patient privacy, facilitate social support by
families, and even improve communication between sta and
Reduce noise levels. is leads to decreased stress levels for sta,
and improved sleep for patients.
Provide distractions for patients, including areas of greenery and
nature for them to visit or see from their beds, personalized
televisions with headphones to avoid disturbing others, internet
access for tablets and smart phones, and perhaps a reading room
with a library with newspapers, magazines, and books. ese
can all aid to patient recovery.
Improve lighting, especially access to natural light. A lighted
environment increases cheerfulness in the building. Natural
lighting can lead to a reduced length of stay for patients. Hospital
sta can work better under proper lighting and make fewer
Crafting The Service Environment · 17
Improve ventilation and air ltration to reduce the transmission
of airborne viruses and improve the overall air quality in the
Develop user-friendly “waynding” systems. Hospitals are complex
buildings, and it can be frustrating for many rst-time and
infrequent visitors when they cannot nd their way around,
especially when rushing to see a hospitalized loved one.
Design the layout of patient care units and location of nurse
stations to reduce unnecessary walking within the building, and
the fatigue and time wastage it can cause. is way the quality
of patient care can be improved. Well-designed layouts also
enhance sta communication and activities.
A well-designed service environment makes customers feel good,
boosts their satisfaction and allows the rm to inuence their behavior
(e.g., adhering to the service script and prompting impulse purchases).
As service quality is oen dicult to assess, customers frequently use the
service environment as an important quality signal; therefore, the service
environment can play a major part in shaping customers’ perception of
a rms image and positioning, and can even be a core part of the rms
value proposition. Finally, a well-designed service environment will
enhance the productivity of the service operation.
It is evident why service rms take so much eort to design the service
environment, but why does the service environment has such important
eects on people and their behaviors? e eld of environmental
psychology studies how people respond to particular environments,
and its theories can be applied to better understand and manage how
customers behave in dierent service settings.
18 · Winning in Service Markets
Feelings Are a Key Driver of Customer Responses to Service
Two important models help to better understand consumer responses
to service environments. e rst, the Mehrabian–Russell Stimulus-
Response Model holds that our feelings are central to how we respond
to dierent elements in the environment. e second, Russell’s Model of
Aect, focuses on how we can better understand those feelings and their
implications on response behaviors.
e Mehrabian–Russell Stimulus-Response Model. Figure 6 displays a
simple yet fundamental model of how people respond to environments.
e model holds that the conscious and unconscious perception and
interpretation of the environment inuences how people feel in that
setting.8 Peoples feelings in turn drive their responses to that environment.
Feelings are central to the model, which posits that feelings, rather than
perceptions or thoughts, drive behavior. Similar environments can lead to
very dierent feelings and subsequent responses.
Figure 6: The Mehrabian–Russell Stimulus-Response Model: a model of
environmental responses.
Stimuli and Cognitive
Response Behavior:
Approach or Avoidance
(including Time and Money
Spent) and Cognitive
(including Perception of
Quality and Satisfaction)
Crafting The Service Environment · 19
For example, we may dislike being in a crowded department store
with lots of other customers, nd ourselves unable to get what we want
as quickly as we wish, and thus seek to avoid that environment. We do
not simply avoid an environment because of the presence of many people
around us; rather we are deterred by the unpleasant feelings of crowding,
people being in our way, lacking perceived control, and not being able to
get what we want at our pace. However, if we were not in a rush and felt
excited about being part of the crowd during seasonal festivities in the
very same environment, then we might derive feelings of pleasure and
excitement that would make us want to stay and enjoy the experience.
In environmental psychology research, the typical outcome variable
studied is the “approach” or “avoidance” of an environment. In services
marketing, there is a long list of additional outcomes that a rm might
want to manage, including how much time and money people spend, and
how satised they are with the service experience aer they have le the
rms premises.
Russell’s Model of Aect. Given that aect or feelings are central
to how people respond to an environment, Russell’s Model of Aect
(Figure 7) is widely used to understand those feelings better. It suggests
that emotional responses to environment can be described along two
main dimensions of pleasure and arousal.9 Pleasure is a direct, subjective
Figure 7: The Russell Model of Affect
20 · Winning in Service Markets
response to the environment, depending on how much an individual
likes or dislikes the environment. Arousal refers to how stimulated the
individual feels, ranging from deep sleep (lowest level of internal activity)
to highest levels of adrenaline in the bloodstream, for example, bungee-
jumping (highest level of internal activity). e arousal quality of an
environment is much less subjective than its pleasure quality. Arousal
quality depends largely on the information rate or load of an environment.
For example, environments are stimulating (i.e., have a high information
rate) when they are complex, include motion or change, and have novel
and surprising elements. A relaxing environment with a low information
rate has the opposite characteristics.
So how can feelings and emotions be explained by only two
dimensions? Russell separates the cognitive, or thinking, part of
emotions from these two underlying emotional dimensions. us, the
emotion of anger about a service failure is modeled as high arousal and
high displeasure. is positions itself in the distressing region in our
model, combined with a cognitive attribution process. When a customer
attributes a service failure to the rm — he thinks it is the rm’s fault this
happened, it was under their control, and they did not do much to prevent
it from happening — then this powerful cognitive attribution process
feeds directly into high arousal and displeasure. Similarly, most other
emotions can be dissected into their cognitive and aective components.
e strength of Russells Model of Aect is its simplicity as it allows
a direct assessment of how customers feel while they are in the service
environment. erefore, rms can set targets for the aective states they
want their customers to be in. For example, a roller coaster operator
wants its customers to feel excited (which is a relatively high arousal
environment combined with pleasure), a spa may want customers to feel
relaxed, a bank pleasant, and so on. How service environments can be
designed to deliver the types of service experiences desired by customers
will be discussed later in this volume.
Aective and Cognitive Processes. Aect can be caused by sensing,
perceptions, and other cognitive processes of any degree of complexity.
However, the more complex a cognitive process becomes, the more
powerful its potential impact on aect is. For example, a customer’s
disappointment with service level and food quality in a restaurant (a
complex cognitive process, in which perceived quality is compared to
Crafting The Service Environment · 21
previously held service expectations) cannot be compensated by a simple
cognitive process such as subconscious perception of pleasant background
music. Yet, this does not mean that simple cognitive processes, such as
subconscious perception of scents or music, are unimportant. In practice,
the large majority of people’s service encounters are routine, with little
high-level cognitive processing. We tend to function on “autopilot
and follow our service scripts when doing routine transactions such as
using a bus or subway, or entering a fast food restaurant or bank. Most
of the time, it is the simple cognitive processes that determine how
people feel in the service setting. ese include the conscious and even
subconscious perceptions of space, colors, scents, and so on. However,
should higher levels of cognitive processes be triggered — for instance,
through something surprising in the service environment — then it is the
interpretation of this surprise that determines peoples feelings.10
Behavioral Consequences of Aect. At the most basic level, pleasant
environments result in “approach” behaviors and unpleasant ones result
in “avoidance” behaviors. Arousal acts as an amplier of the basic eect of
pleasure on behavior. If the environment is pleasant, increasing arousal can
generate excitement, leading to a stronger positive response. Conversely,
if a service environment is inherently unpleasant, increased arousal levels
would move customers into the “distressed” region. For example, loud
and fast-paced music would increase the stress levels of shoppers trying
to make their way through crowded aisles on a pre-Christmas Friday
evening. In such situations, retailers should try to lower the information
load of the environment.
Finally, customers have strong aective expectations of some
services. ink of experiences such as a romantic candlelight dinner in a
restaurant, a relaxing spa visit, or an exciting time at the stadium. When
customers have strong aective expectations, it is important that the
environment be designed to match those expectations.11
e Servicescape Model — An Integrative Framework
Building on the basic models in environmental psychology, Mary Jo
Bitner developed a comprehensive model named the “servicescape”.12
Figure 8 shows the main dimensions identied in service environments:
(1) ambient conditions, (2) space/functionality, and (3) signs, symbols,
and artifacts. As individuals tend to perceive these dimensions holistically,
22 · Winning in Service Markets
Figure 8: The servicescape model
Source: Reprinted with permission from Journal of Marketing, published by the American Marketing Association, Mary Jo Bitner, Servicescapes: The Impact of Physical
Surroundings on Customers and Employees, 56 (April).
Ambient Conditions
• Temperature
• Air quality
• Noise
• Music
• Odor
• etc.
• Layout
• Equipment
• Furnishings
• etc.
Signs, Symbols, and
• Signage
• Personal artifacts
• Style of decor
• etc.
Internal Responses
• Exploration
• Affiliation
• Stay longer
• Commitment
• Carry outplan
(opposites of
Social Interactions
Between and
Among Customers
and Employees
• Attraction
• Stay/explore
• Spend money
• Return
• Carry out plan
(opposites of
• Beliefs
• Categorization
• Symbolic
• Mood
• Attitude
• Pain
• Comfort
• Movement
• Physical fit
• Beliefs
• Categorization
• Symbolic
• Mood
• Attitude
• Pain
• Comfort
• Movement
• Physical fit
Crafting The Service Environment · 23
the key to eective design is how well each individual dimension ts
together with everything else.
Bitner’s model shows that there are customer and employee-
response moderators. is means that the same service environment can
have dierent eects on dierent customers, depending on who they are
and what they like — aer all, beauty lies in the eyes of the beholder, and
is subjective. For example, rap music or an opera may be sheer pleasure to
some customer segments, but torture to others.
An important contribution of Bitner’s model is the inclusion of
employee responses to the service environment. Aer all, employees
spend much more time there than customers, and it is important that
designers are aware of how a particular environment enhances (or at
least, does not reduce) the productivity of the frontline personnel and the
quality of service they deliver.13
Internal customer and employee responses can be grouped into
cognitive responses (e.g., quality perceptions and beliefs), emotional
responses (e.g., feelings and moods), and physiological responses (e.g.,
pain and comfort). ese internal responses lead to overt behavioral
responses such as avoiding a crowded supermarket, or responding
positively to a relaxing environment by staying longer and spending
extra money on impulse purchases. It is important to understand that the
behavioral responses of customers and employees must be shaped in ways
that aid the production and purchase of high quality services. Consider
how the outcomes of service transactions may dier in situations where
both customers and frontline sta feel stressed rather than relaxed and
Service environments are complex and have many design elements.
Ta bl e 1 gives an overview of the design elements that might be encountered
in a retail outlet. is section will focus on the main dimensions of the
service environment in the servicescape model, namely the ambient
conditions, space and functionality, signs, symbols, and artifacts.14
24 · Winning in Service Markets
e Eect of Ambient Conditions
Ambient conditions refer to characteristics of the environment that
pertain to our ve senses. Even when they are not noted consciously,
they may still aect a persons emotional well-being, perceptions, and
even attitudes and behaviors. ey are composed of literally hundreds of
Table 1: Design Elements of A Retail Store Environment
Dimensions Design Elements
Exterior facilities • Architectural style
• Size of building
• Color of building
• Exterior walls and exterior signs
• Store front
• Marquee
• Lawns and gardens
• Window displays
• Entrances
• Visibility
• Uniqueness
• Surrounding stores
• Surrounding areas
• Congestion
• Parking and accessibility
General interior • Flooring and carpeting
• Color schemes
• Lighting
• Scents
• Odors (e.g., tobacco smoke)
• Sounds and music
• Fixtures
• Wall composition
• Wall textures (paint, wallpaper)
• Ceiling composition
• Temperature
• Cleanliness
• Width of aisles
• Dressing facilities
• Vertical transportation
• Dead areas
• Merchandise layout and displays
• Price levels and displays
• Cash register placement
• Technology, modernization
Store layout Allocation of floor space for selling,
merchandise, personnel, and
• Placement of merchandise
• Grouping of merchandise
• Workstation placement
• Placement of equipment
• Placement of cash register
• Waiting areas
• Traffic flow
• Waiting queues
• Furniture
• Dead areas
• Department locations
• Arrangements within
Interior displays • Point-of-purchase displays
• Posters, signs, and cards
• Pictures and artwork
Wall decorations
• Theme setting
• Ensemble
• Racks and cases
• Product display
• Price display
• Cut cases and dump bins
• Mobiles
Social dimensions • Personnel characteristics
• Employee uniforms
• Crowding
• Customer characteristics
• Privacy
• Self-service
Source: Adapted from: Barry Berman and Joel R. Evans, Retail Management — A Strategic Approach, 8th edition, Upper Saddle
River, NJL Prentice Hall, 2001, p. 604; L.W. Turley and Ronald E. Milliman (2000), “Atmospheric Effects on Shopping Behavior: A
Review of the Experimental Literature,Journal of Business Research, Vol. 49, pp. 193–211.
Crafting The Service Environment · 25
design elements and details that must work together if they are to create
the desired service environment.15 e resulting atmosphere creates
a mood that is perceived and interpreted by the customer. Ambient
conditions are perceived both separately and holistically, and include
music, sounds and noise, scents and smells, color schemes and lighting,
and temperature and air movement. Clever design of these conditions can
elicit desired behavioral responses among consumers. ese important
ambient dimensions are discussed next, beginning with music.
Music can have powerful eects on perceptions and behaviors in
service settings, even if played at barely audible volumes. e various
structural characteristics of music such as tempo, volume, and harmony are
perceived holistically, and their eect on internal and behavioral responses
is moderated by respondent characteristics (e.g., younger people tend to
like dierent music and therefore respond dierently from older people
to the same piece of music).16 Numerous research studies have found that
fast tempo and high volume music increases arousal levels, which can
then lead to customers increasing the pace of various behaviors.17 People
tend to adjust their pace, either voluntarily or involuntarily, to match the
tempo of music. is means that restaurants can speed up table turnover
by increasing the tempo and volume of the music and serve more diners
during the course of the busy lunch hour, or slow diners down with
slow beat music and soer volume to keep evening diners longer in the
restaurant, and increase beverage revenues. A restaurant study conducted
over eight weeks showed that the customers who dined in a slow-music
environment spent longer in the restaurant than the individuals in a fast-
music condition. As a result, beverage revenue increased substantially
when slow-beat music was played.18
Likewise, studies have shown that shoppers walked less rapidly and
increased their level of impulse purchases when slow music was played.
Playing familiar music in a store was shown to stimulate shoppers, thereby
reduce their browsing time, whereas playing unfamiliar music induced
shoppers to spend more time there.19 In situations that require waiting
for service, eective use of music may shorten the perceived waiting
time and increase customer satisfaction. Relaxing music proved eective
in lowering stress levels in a hospital’s surgery waiting room. Pleasant
music has even been shown to enhance customers’ perceptions of service
26 · Winning in Service Markets
Providing the right mix of music to restaurants, retail stores, and even
call centers has become an industry in its own right. Mood Media, the
market leader in this space, provides music to over 300,000 commercial
locations in the US. It tailors its playlists to outlets such as Christian
bookstores, black barbershops, and bilingual malls where Anglo and
Hispanic customers mingle, and uses “day parting” to target music to
their clients’ segments such as daytime mothers or aer-school teens.21
It is not surprising to know that music can also be used to deter the
wrong type of customer. Many service environments, including subway
systems, supermarkets, and other publicly accessible locations, attract
individuals who are not bona de customers. Some are jaycustomers
whose behavior causes problems for management and target customers
alike. In the United Kingdom, an increasingly popular strategy for driving
such individuals away is to play classical music, which is apparently
unpleasant to vandals’ and loiterers’ ears. Co-op, a UK grocery chain,
has been experimenting with playing music outside its outlets to stop
teenagers from hanging around and intimidating customers. Its sta are
equipped with a remote control and, as reported by Steve Broughton of
Co-op, “can turn the music on if there’s a situation developing and they
need to disperse people”.22
e London Underground (subway) system has probably made
the most extensive use of classical music as a deterrent. irty stations
pump out Mozart and Haydn to discourage loitering and vandalism.
A London Underground spokesperson reports that the most eective
deterrents are anything written by Mozart or those sung by Pavarotti.
According to Adrian North, a psychologist researching the link between
music and behavior at Leicester University, unfamiliarity is a key factor
in driving people away. When the target individuals are unused to strings
and woodwind, Mozart will do. However, for the more musically literate
loiterer, an atonal barrage is likely to work better. For instance, North
tormented Leicester’s students in the union bar who tended to linger long
beyond closing time with what he describes as “computer-game music. It
cleared the place!23
Scent is the next important ambient dimension. Ambient scent or
smell pervading an environment may or may not be consciously perceived
by customers and is not related to any particular product. e presence
of scent can have a strong impact on mood, feelings, and evaluations,
Crafting The Service Environment · 27
and even purchase intentions and in-store behaviors.24 We experience
the power of smell when we are hungry and get a whi of freshly baked
croissants long before we pass a local bakery. is smell makes us aware of
our hunger and points us to the solution (i.e., walk into the bakery and get
some food). Other examples include the smell of freshly baked cookies on
Main Street in Disney’s Magic Kingdom to relax customers and provide
a feeling of warmth, or the smell of potpourri in Victoria’s Secret stores
creating the ambiance of a lingerie closet.
Olfaction researcher Alan R. Hirsch, managing director of the
Smell & Taste Treatment and Research Foundation based in Chicago,
is convinced that at some point in the future we will understand scents
so well that we will be able to use them to manage people’s behaviors.25
Service marketers are interested in how to make you hungry and thirsty
in the restaurant, relax you in a dentist’s waiting room, and energize you
to work out harder in a gym. In aromatherapy, it is generally accepted
that scents have special characteristics and can be used to solicit certain
emotional, physiological, and behavioral responses. Table 2 shows the
Table 2: Aromatherapy: The Effects of Selected Fragrances on People
Fragrance Aroma Type Aromatherapy
Effect on People
Eucalyptus Camphoraceous Toning, stimulating Deodorant,
Stimulating and
Lavender Herbaceous Calming, balancing,
Relaxing and
Lemon Citrus Energizing,
Soothing energy
Black pepper Spicy Balancing,
Balancing people’s
Sources:, accessed 25 April 2016; Dana Butcher, “Aromatherapy — Its Past & Future.Drug
and Cosmetic Industry, 16, no. 3 (1998): 22–24; Shirley Price and Len Price (2011), Aromatherapy for Health Professionals, 4th
ed.; Mattila, A. S., & Wirtz, J. (2001). Congruency of scent and music as a driver of in-store evaluations and behavior. Journal of
Retailing, 77, pp. 273–289.
28 · Winning in Service Markets
generally assumed eects of specic scents on people. In service settings,
research has shown that scents can have signicant impact on customers
perceptions, attitudes, and behaviors. For example:
• Gamblers plunked 45% more quarters into slot machines when a Las
Vegas casino was scented with a pleasant articial smell. When the
intensity of the scent was increased, spending jumped by 53%.26
• People were more willing to buy Nike sneakers and pay more for
them — an average of $10.33 more per pair — when they tried on
the shoes in a oral-scented room. e same eect was found even
when the scent was so faint that people could not detect it, i.e., the
scent was perceived unconsciously.27
Service rms have recognized the power of scent and increasingly
made it a part of their brand experience. For example, Westin Hotels uses a
white tea fragrance throughout its lobbies, and Sheraton scents its lobbies
with a combination of g, clove and jasmine. As a response to the trend of
scenting servicescapes, professional service rms have entered the scent
marketing space. For example, Ambius, a Rentokil Initial company, oers
scent-related services such as “sensory branding”, “ambient scenting” and
odor remediation” for retail, hospitality, healthcare, nancial, and other
services. Firms can outsource their servicescape scenting to Ambius,
which oers one-stop solutions ranging from consulting, designing
exclusive signature scents for a service rm, to managing the ongoing
scenting of all the outlets of a chain.28 Clients of Mood Media, a leading
provider of music, scents, and signage for commercial establishments,
can choose their ideal ambient scent from a library of 1,500 scents!29
Although there is an overwhelming evidence for the potentially
powerful eects scent can have on customers’ experiences and behaviors,
it has to be implemented with caution. e ambient scent has to t the
service context and the target audience (very much as discussed for
music). Furthermore, a recent study suggests that simple scents whereby
the researchers used a simple orange scent in a retail environment can
have an excellent impact on sales per customer, whereas more complex
scents such as basil-orange with green tea used as a complex scent in this
study, did not do better than unscented environments. In this study, both
scents were perceived as equally pleasant, but the simple scent helped in
consumer decision making (consumers spent less time deciding which
Crafting The Service Environment · 29
items to buy), whereas the complex scent did not (consumers spent
as much time deciding as in the no scent condition). e researchers
concluded that complex scents cannot be uently processed by consumers
and require too much cognitive eort, which subsequently has a negative
eect on consumer decision making and perceptions.30
While these ndings are derived only from a few research projects,
they suggest that managers need to carefully match their scents to their
context, and probably should favor simpler rather than more complex
scents. In any case, using eld experiments, monitoring sales, and shopper
behaviors and perceptions would be an excellent way to optimize the
ambient scent in any particular servicescape.
In addition to music and scent, researchers have found that colors
have a strong impact on people’s feelings.31 Color is “stimulating, calming,
expressive, disturbing, impressionable, cultural, exuberant, symbolic. It
pervades every aspect of our lives, embellishes the ordinary, and gives
beauty and drama to everyday objects.32
e de facto system used in psychological research is the Munsell
System, which denes colors in the three dimensions of hue, value, and
chroma.33 Hue is the pigment of the color (i.e., the name of the color: red,
orange, yellow, green, blue, or violet). Value is the degree of lightness or
Table 3: Common Associations and Human Responses to Colors
Color Degree of
Warmth Nature Symbol Common Association and Human
Responses to Color
Red Warm Earth High energy and passion; can excite and
stimulate emotions, expressions, and warmth
Orange Warmest Sunset Emotions, expressions, and warmth
Yellow Warm Sun Optimism, clarity, intellect, and mood
Green Cool Growth, grass, and
Nurturing, healing, and unconditional love
Blue Coolest Sky and ocean Relaxation, serenity, and loyalty
Indigo Cool Sunset Meditation and spirituality
Violet Cool Violet flower Spirituality, reduces stress, can create an inner
feeling of calm
Sources: Sara O. Marberry and Laurie Zagon, The Power of Color—Creating Healthy Interior Spaces. New York: John Wiley, 1995, p.
18; Sarah Lynch, Bold Colors for Modern Rooms: Bright Ideas for People Who Love Color. Gloucester, MA: Rockport Publishers, 2001,
pp. 24–29
30 · Winning in Service Markets
darkness of the color, relative to a scale that extends from pure black to pure
white. Chroma refers to hue intensity, saturation, or brilliance; high chroma
colors have a high intensity of pigmentation in them and are perceived as
rich and vivid, whereas low chroma colors are perceived as dull.
Hues are classied into warm colors (red, orange and yellow hues)
and cold colors (blue and green), with orange (a mix of red and yellow)
being the warmest, and blue being the coldest of the colors. ese colors
can be used to manage the warmth of an environment. For example, if a
violet is too warm, you can cool it o by reducing the amount of red. Or
if a red is too cool, warm it up by adding a shot of orange.34 Warm colors
are associated with elated mood states and arousal, but also heightened
anxiety, whereas cool colors reduce arousal levels and can elicit emotions
such as peacefulness, calmness, love, and happiness.35 Table 3 summarizes
common associations and responses to colors.
Research in a service environment context has shown that despite
diering color preferences, people are generally drawn to warm color
environments. Warm colors encourage fast decision making and are
best suited for low-involvement service purchase decisions or impulse
buying. Cool colors are favored when consumers need time to make high-
involvement purchase decisions.36
An early example of using color schemes to enhance the service
experience was the HealthPark Medical Center in Fort Meyers, Florida,
which combined full-spectrum color in its lobby with unusual lighting to
achieve a dreamlike setting. e lobby walls were washed with rainbow
colors by using an arrangement of high intensity blue, green, violet, red,
orange, and yellow lamps. Craig Roeder, the lighting designer for the
hospital, explained, “It’s a hospital. People walk into it worried and sick. I
tried to design an entrance space that provides them with light and energy
— to ‘beam them up’ a little bit before they get to the patient rooms.37
A recent example of eective color and lighting are the new cabin
designs in the Boeing 787 Dreamliner and Airbus A350 and models. In
the past, cabin lights were either on or o, but with the new light-emitting
diode (LED) technology a wide range of lighting palette is available.
Designers start to experiment to illuminate the cabin in all kinds of
hues, and ask questions such as: “Does a pinkish-purple glow soothe and
calm passengers when boarding better than an amber warmth?” or “Can
lighting be used to prevent jet lag as much as possible?” e Finnair A350
Crafting The Service Environment · 31
cabin has two dozen light settings aligned with the dierent stages of a
long-haul ight such as featuring a 20-minute ‘sunset’. It also aligns colors
with the destination by featuring warmer, amber colors when ying into
Asia, and cooler ‘Nordic blue’ hues when arriving in Finland. Similarly,
Virgin Atlantic has a few main settings on its 787 ights, including rose-
champagne for boarding, purple-pink for drinks, amber for dinner, a
silver glow for overnight sleep, and a waking color. According to Nik
Lusardi, the design manager at Virgin Atlantic: “We’ve always wanted to
create a dierent kind of atmosphere aboard our aircra, and light plays
exactly into our hands. …You can get people energized or you can relax
people very, very quickly”.38
Although we have an understanding of the general eects of colors,
their use in any specic context needs to be approached with caution.
For example, a transportation company in Israel decided to paint its
buses green as part of an environmentalism public relations campaign.
Reactions to this seemingly simple act from multiple groups of people
were unexpectedly negative. Some customers found the green color as
hampering service performance because the green buses blended in
with the environment and were more dicult to see; some felt that the
green was aesthetically unappealing and inappropriate as it represented
undesirable notions such as terrorism or opposing sports teams.39
Spatial Layout and Functionality
In addition to ambient conditions, spatial layout and functionality
are other key dimensions of the service environment. As a service
environment generally has to fulll specic purposes and customer needs,
spatial layout and functionality are particularly important.
Spatial layout refers to the oor plan, size and shape of furnishings,
counters, and potential machinery and equipment, and the ways in which
they are arranged. Functionality refers to the ability of those items to
facilitate the performance of service transactions. Both dimensions aect
the user-friendliness and the ability of the facility to service customers
well. Tables that are too close in a café, counters in a bank that lack privacy,
uncomfortable chairs in a lecture theatre, and lack of parking space can
all leave negative impressions on customers, aect the service experience
and buying behavior, and consequently, the business performance of the
service facility.
32 · Winning in Service Markets
Signs, Symbols, and Artifacts
Many things in the service environment act as explicit or implicit signals
to communicate the rm’s image, help customers nd their way (e.g.,
to certain service counters, departments, or the exit), and to convey
the service script (e.g., for a queuing system). In particular, rst time
customers will automatically try to draw meaning from the environment
to guide them through the service processes.40
Examples of explicit signals include signs, which can be used
(1) as labels (e.g., to indicate the name of the department or counter),
(2) for giving directions (e.g., to certain service counters, entrance, exit,
way to lis and toilets), (3) for communicating the service script (e.g.,
take a queue number and wait for it to be called, or clear the tray aer
your meal), and (4) for reminders about behavioral rules (e.g., switch
o or turn your mobile devices to silent mode during a performance, or
smoking/non-smoking areas). Signs are oen used to teach behavioral
rules in service settings. Singapore, which strictly enforces rules in many
service settings, especially in public buildings and on public transport,
is sometimes ironically referred to as a ‘ne’ city (Figure 9). Contrast
these signs to the more creative and perhaps equally eective signed
used by Singapore’s Changi Airport at the entrance of its buttery garden
(Figure 10). Some signs are quite interesting and may be obvious, but
other signs need the person to think a little before understanding the
meaning (Table 4).
e challenge for servicescape designers is to use signs, symbols,
and artifacts to guide customers clearly through the process of service
delivery, and to teach the service script in as intuitive a manner as
possible. is task assumes particular importance in situations in which
there is a high proportion of new or infrequent customers (e.g., airports
and hospitals), and/or a high degree of self-service with no or only a few
service employees available to guide customers through the process (e.g.,
a self-service bank branch).
Customers become disoriented when they cannot derive clear
signals from a servicescape, leading to anxiety and uncertainty about
how to proceed and how to obtain the desired service. Customers can
easily feel lost in a confusing environment and experience anger and
frustration as a result. ink about the last time you were in a hurry and
Crafting The Service Environment · 33
Figure 9: Singapore is a ‘fine’ city. Figure 10: Changi Airport uses a creative sign
to manage visitor behavior in its butterfly
Table 4: Benefits Well-Designed Signage for Customers and Service Organizations.
Potential Benefits of Well-developed Signage
For Customers
Be informed, up-to-date, oriented,
free to move about, guided along
prepared paths, emotionally
Creates familiarity with the
Helps to participate with greater
ease in the service process
Increases confidence and
reassurance while following
signage; provides higher levels
of perceived control during the
service encounter
Reduces tension, confusion, feeling
lost, wrong turns and requests for
Reduces time to reach the desired
goal as efficiently as possible
For the Service
Direct, inform, and manage the flow
and the behavior of customers
Improve the quality of service
provided and increase customer
Reduce information-giving by
frontline employees
Help frontline employees to work
with fewer interruptions
Attract and excite curiosity, help to
strengthen the corporate image
Differentiate the firm from the
Adapted from: Angelo Bonfani (2013), “Towards an Approach to Signage Management Quality (SMQ)”, Journal of Services
Marketing, Vol. 27, No. 4, pp. 312-321.
34 · Winning in Service Markets
tried to nd your way through an unfamiliar hospital, shopping center,
or a large government oce where the signs and other directional cues
were not intuitive to you. At many service facilities, customers’ rst point
of contact is likely to be the car park. As emphasized in Service Insights 4,
the principles of eective environment design apply even in such a very
mundane environment.
Guidelines for Parking Design41
Car parks play an important role at many service facilities. Eective
use of signs, symbols, and artifacts in a parking lot or garage helps
customers nd their way, manages their behavior, and portrays a
positive image for the sponsoring organization.
Friendly warnings — all warning signs should communicate a
customer benet. For instance, “Fire lane — for everyone’s safety
we ask you not to park in the re lane.
Safety lighting — good lighting that penetrates all areas makes
life easier for customers and enhances safety. Firms may want to
draw attention to this feature with notices stating that “Parking
lots have been specially lit for your safety.
Help customers remember where they le their vehicle — forgetting
where one le the family car in a large parking structure can be
a nightmare. Many car parks have adopted color-coded oors
to help customers remember which level they parked on. In
addition, many car parks also mark sections with special symbols,
such as dierent kinds of animals. is helps customers to not
only remember the level, but also the section where the car is
parked. Bostons Logan Airport goes two steps further. Each level
has been assigned a theme associated with Massachusetts, such
as Paul Revere’s Ride, Cape Cod, or the Boston Marathon. An
image is attached to each theme — a male gure on horseback,
a lighthouse, or a female runner. While waiting for the elevator,
travelers hear music that is tied to the theme for that level; in
the case of the Boston Marathon oor, it is the theme song from
Crafting The Service Environment · 35
Chariots of Fire, an Oscar-winning movie about an Olympic
run ner.
Maternity parking — disabled-friendly spaces are oen required
by law with special stickers displayed on the vehicle. A few
thoughtful organizations have special expectant mother parking
spaces, painted with a blue/pink stork. is strategy demonstrates
a sense of caring and understanding of customer needs.
Fresh paint — curbs, cross walks, and lot lines should be
repainted regularly before any cracking, peeling, or disrepair
become evident. Pro-active and frequent repainting give positive
cleanliness cues and projects a positive image.
People are Part of the Service Environment Too
e appearance and behavior of both service personnel and customers can
strengthen or weaken the impression created by a service environment,
and some academics argue that these social dimensions should be
explicitly considered when assessing the quality of servicescapes.42
Dennis Nickson and his colleagues use the term “aesthetic labor” to
capture the importance of the physical image of service personnel who
serve customers directly.43 Employees at Disney theme parks are called
Figure 11: Distinctive servicescapes — from table settings, furniture and room
design to other customers present in the servicescape — create different customer
expectations of these two restaurants.
36 · Winning in Service Markets
cast members. Whether the sta are acting as Cinderella, one of the seven
dwarfs, or as the park cleaner, or the person managing Buzz Lightyear’s
Tomorrowland booth, all of these cast members must dress up and look
the part. Once dressed up, they must “perform” for the guests.
Likewise, marketing communications may seek to attract customers
who will not only appreciate the ambience created by the service provider
but will actively enhance it by their own appearance and behavior. In
hospitality and retail settings, newcomers oen survey the array of existing
customers before deciding whether to patronize the establishment.
Consider Figure 11 which shows the interior of two restaurants. Imagine
entering each of these two dining rooms. How does each restaurant
position itself within the restaurant industry? What sort of dining
experience can you expect, and what are the clues you use to make your
judgments? In particular, what assumptions do you make from looking at
the customers who are already seated in each restaurant?
Although individuals oen perceive particular aspects or individual
design features of an environment, it is the total conguration of all those
design features that determines consumer responses. at is, consumers
perceive service environments holistically.
Design with a Holistic View
Whether a dark, glossy, wooden oor is the perfect ooring depends on
everything else in that service environment, including the type, color
scheme and materials of the furniture, the lighting, the promotional
materials, the overall brand perception and positioning of the rm.
Servicescapes have to be seen holistically, which means no dimension of
the design can be optimized in isolation, because everything depends on
everything else.
As the design of the environment needs to be planned as a whole,
it is more like an art. erefore, professional designers tend to focus on
specic types of servicescapes. For example, a handful of famous interior
designers do no other projects but create hotel lobbies around the world.
Crafting The Service Environment · 37
Similarly, there are design experts who focus exclusively on restaurants,
bars, clubs, cafes and bistros, or retail outlets, or healthcare facilities and
so forth.44
Design from a Customer’s Perspective
Many service environments are built with an emphasis on aesthetic values,
and designers sometimes forget the most important factor to consider
when designing service environments — the customers who will be using
them. Ron Kaufman, founder of Up Your Service! College, experienced
the following design aws in two new high-prole service environments:
A new Sheraton Hotel just had opened in Jordan without clear
signage that would guide guests from the ballrooms to the
restrooms. e signs that did exist were etched in muted gold
on dark marble pillars. More ‘obvious’ signs were apparently
inappropriate amidst such elegant décor. Very swish, very chic, but
who were they designing it for?
At a new airport lounge in a major Asian city, a partition of
colorful glass hung from the ceiling. My luggage lightly brushed
against it as I walked inside. e entire partition shook and several
panels came undone. A sta member hurried over and began
carefully reassembling the panels. (ank goodness nothing broke.)
I apologized profusely. ‘Don’t worry,’ she replied, ‘is happens all
the time.’ An airport lounge is a heavy trac area. People are always
moving in and out. Kaufman keeps asking “What were the interior
designers thinking? Who were they designing it for?”
“I am regularly amazed,” declared Kaufman, “by brand
new facilities that are obviously ‘user unfriendly’!” He draws the
following key learning point: “It’s easy to get caught up in designing
new things that are ‘cool’, ‘elegant’ or ‘hot. But if you don’t keep
your customer in mind throughout, you could end up with an
investment that’s not.45
Along a similar vein, Alain d’Astous explored environmental aspects
that irritate shoppers. His ndings highlighted the following problems:
38 · Winning in Service Markets
1. Ambient conditions (ordered by level of irritation):
• Store is not clean
• Too hot inside the store or the shopping center
• Music inside the store is too loud
• Bad smells in the store
2. Environmental design variables:
• No mirror in the dressing room
• Unable to nd what one needs
• Directions within the store are inadequate
• Arrangement of store items has been changed in a way that
confuses customers
• Store is too small
• Losing one’s way in a large shopping center46
To design servicescapes from the customer’s perspective, managers
have to understand how their customers use it. An in-depth study in the
context of a highly functional and utilitarian service, a public transport
systems, showed that consumers use servicescapes in three main ways,
namely47: (1) identifying the resources in the environment and trying
to understand the objects and persons in the service environment
as resources and how they can be used (e.g., searching for a bus stop,
timetable, map, or bus; approaching sta or other customers); (2) sense-
making, which is the process of giving meaning to and comprehending
the resources previously identied (e.g., trying to understand maps and
timetables); and (3) using the resources to attain their consumption goals
(e.g., nding ones way in the subway system). e implications of these
ndings are clear: servicescapes should be designed to support customers
to attain their consumption goals by making the designs intuitive (i.e.,
easy to sense), meaningful (i.e., easy to understand), and easy to use.48
For hedonic services, customers use the service environment for
additional objectives; they want to experience what they came for when
they entered the servicescape (e.g., have fun, relax, or socialize). In this
context, contrasting Kaufman’s experiences and d’Astou’s ndings with
the Disney example in Service Insights 5 leads to interesting conclusions.
Crafting The Service Environment · 39
Design of Disney’s Magic Kingdom
Walt Disney was one of the undisputed champions of designing
service environments. His tradition of amazingly careful and
detailed planning has become one of his company’s hallmarks, and
is visible everywhere in its theme parks. For example, Main Street is
angled to make it seem longer upon entry into the Magic Kingdom
than it actually is. With a myriad of facilities and attractions
strategically located at each side of the street, this makes people
look forward to the relatively long journey to the Castle. However,
looking down the slope from the Castle back towards the entrance
makes Main Street appear shorter than it really is, relieving
exhaustion and rejuvenating guests. It encourages strolling, which
minimizes the number of people who take the buses and so
eliminates the threatening problem of trac congestion.
Meandering sidewalks with multiple attractions keep guests
feeling entertained by both the planned activities and also by
watching other guests; trash bins are aplenty and always in sight to
convey the message that littering is prohibited; and the repainting
of facilities is a routine procedure that signals a high level of
maintenance and cleanliness;
Disney’s servicescape design and upkeep help to script
customer experiences, and create pleasure and satisfaction for
guests, not only in its theme parks but also in its cruise ships and
Source: Lewis P. Carbone and Stephen H. Haeckel, “Engineering Customer Experiences,” Marketing Management 3, no.
3 (Winter 1994): 10-11; Kathy Merlock Jackson, Walt Disney, A Bio-Bibliography. (Westport, Greenwood Press, 1993),
pp. 36-39, Andrew Lainsbury, Once Upon An American Dream: The Story of Euro Disneyland (Lawrence, Kan, University
Press of Kansas, 2000), pp. 64-72. See also: Disney Institute, Be Our Guest: Perfecting the Art of Customer Service. Disney
Enterprises (2011).
Tools to Guide Servicescape Design
Among the tools a manager uses to determine how customers use the
servicescape, and which of its aspects irritate them and which they like
40 · Winning in Service Markets
Table 5: A Visit to The Movies: The Service Environment as Perceived by The Customer.
Steps in the Service
Design of the Service Environment
Exceeds Expectations Fails Expectations
Locate a parking lot Ample room in a bright place
near the entrance, with a security
officer protecting your valuables
Insufficient parking spaces, so
patrons have to park in another
Queue up to obtain
Strategic placement of mirrors,
posters of upcoming movies,
and entertainment news to ease
perception of long wait, if any;
movies and time slots easily
seen; ticket availability clearly
A long queue and having to wait
for a long while; difficult to see
quickly what movies are being
shown at what time slots and
whether tickets are still available
Check tickets to enter
the theater
A very well-maintained lobby with
clear directions to the theater and
posters of the movie to enhance
patrons’ experience
A dirty lobby with rubbish
strewn, and unclear or
misleading directions to the
movie theater
Go to the restroom
before the movie
Sparkling clean, spacious,
brightly lit, dry floors, well-
stocked, nice décor, clear mirrors
wiped regularly
Dirty, with an unbearable
odor; broken toilets; no hand
towels, soap, or toilet paper;
overcrowded; dusty and dirty
Enter the theater and
locate your seat
Spotless theater; well designed
with no bad seats; sufficient
lighting to locate your seat;
spacious, comfortable chairs,
with drink and popcorn holders
on each seat; and a suitable
Rubbish on the floor, broken
seats, sticky floor, gloomy and
insufficient lighting, burned-out
exit signs
Watch the movie Excellent sound system and
film quality, nice audience,
an enjoyable and memorable
entertainment experience overall
Substandard sound and movie
equipment, uncooperative
audience that talks and
smokes because of lack of “No
Smoking” and other signs; a
disturbing and unenjoyable
entertainment experience
Leave the theater and
return to the car
Friendly service staff greet
patrons as they leave; an easy
exit through brightly lit and safe
parking area, back to the car with
the help of clear lot signs
A difficult trip, as patrons
squeeze through a narrow exit,
unable to find the car because of
no or insufficient lighting
Source: Adapted from Albrecht, S. (1996). “See Things from the Customer’s Point of View — How to Use the ‘Cycles of Service’ to
Understand What the Customer Goes Through to Do Business with You.World’s Executive Digest, December, pp. 53–58.
Crafting The Service Environment · 41
For a manager to determine how customers use the servicescape, and
which of its aspects irritate them and which do they like, following are the
tools that can be used:
• Keen observation of customers’ behavior and responses to the service
environment by management, supervisors, branch managers, and
frontline sta.
• Feedback and ideas from frontline sta and customers using a variety of
research tools such as scanning social media, using suggestion boxes,
focus groups and surveys. e latter are oen called environmental
surveys if the focus is on the design of the service environment.49
Photo audit is a method of asking customers (or mystery shoppers)
to take photographs of their service experience. ese photographs
can be used later as a basis for further interviews of their experience,
or included as part of a survey about the service experience.50
• Field experiments can be used to manipulate specic dimensions
in an environment to observe the eects. For instance, researchers
can experiment with various types of music and scents, and then
measure the time and money customers spend in the environment.
Laboratory experiments using pictures or videos, or other ways to
simulate real-world service environments (such as virtual tours via
computers) can be eectively used to examine the impact of changes
in design elements that cannot be easily manipulated in a eld
experiment, for examples testing of dierent color schemes, spatial
layouts, or styles of furnishing.
• Blueprinting or owcharting (as described in Volume 6) can be
extended to include the physical evidence in the environment.
Design elements and tangible cues can be documented as the
customer moves through each step of the service delivery process.
Photos can supplement the map to make it more vivid.
Table 5 shows an examination of a customers visit to a movie theater,
identifying how dierent environmental elements at each step exceeded
or failed to meet expectations. e service process was divided into steps,
decisions, duties, and activities, all designed to take the customer through
the entire service encounter. e more a service company can observe,
understand, and experience from the customer’s point of view, the better
42 · Winning in Service Markets
equipped it will be to realize errors in the design of its environment and
to further improve what is already functioning well.
e service environment plays a major role in shaping customers’
perception of a rm’s image and positioning. As service quality oen is
dicult to assess, customers frequently use the service environment as
an important quality signal. A well-designed service environment makes
customers feel good and boosts their satisfaction, and allows the rm to
inuence their behavior (e.g., adhering to the service script and impulse
purchasing) while enhancing the productivity of the service operation.
1. Four Core Purpose of Service Environments
Shaping customers’ experiences and behaviors
Important in determining customer perceptions of the rm, and its
image and positioning. Customers oen use the service environment
as an important quality signal
Can be a core part of the value proposition (e.g., as for theme parks
and resort hotels)
Facilitating the service encounter and enhance productivity
2. Understanding the Eects of Service Environments
Environmental psychology provides the theoretical underpinning for
understanding the eects of service environments on customers and
service employees. ere are two key models:
e Mehrabian-Russell Stimulus-Response model holds that
environments inuence peoples’ aective state (or emotions and
feelings), which in turn drives their behavior.
• Russell’s Model of Aect holds that aect can be modeled with the
two interacting dimensions of pleasure and arousal, which together
determine whether people approach, spend time and money in an
environment, or whether they avoid it.
3. e Servicescape Model
e servicescape model, which builds on the above theories, represents
an integrative framework that explains how customers and service sta
respond to key environmental dimensions.
4. ree Dimensions of Service Environments
e servicescape model emphasizes three dimensions of the service
Ambient conditions (including music, scents, and colors)
Spatial layout and functionality
Signs, symbols, and artifacts
44 · Winning in Service Markets
5. Ambient Conditions
Ambient conditions refer to those characteristics of the environment that
pertain to our ve senses. Even when not consciously perceived, they still
can aect peoples internal and behavioral responses. Important ambient
dimensions include:
• Music — Its tempo, volume, harmony, and familiarity shape behavior
by aecting emotions and moods. People tend to adjust their pace to
match the tempo of the music.
• Scent — Ambient scent can stir powerful emotions and relax or
stimulate customers.
• C olor — Colors can have strong eects on peoples feelings with warm
(e.g., a mix of red and orange) and cold colors (e.g., blue) having
dierent impacts. Warm colors are associated with elated mood
states, while cold colors are linked to peacefulness and happiness.
6. Spatial Layout and Functionality
Eective spatial layout and functionality are important for eciency of
the service operation and enhancement of its user-friendliness.
• Spatial layout refers to the oor plan, size and shape of furnishing,
counters, potential machinery and equipment, and the ways in
which they are arranged.
• Functionality refers to the ability of those items to facilitate service
7. Signs, Symbols, and Artifacts
Signs, symbols, and artifacts help customers to draw meaning from the
environment and guide them through the service process. ey can be
used to:
Label facilities, counters, or departments.
Show directions (e.g., to entrance, exit, elevator, toilet).
Communicate the service script (e.g., take a number and watch it to
be called).
• Reinforce behavioral rules (e.g., “please turn your cell phones to
Crafting The Service Environment · 45
8. Reinforcing the Positioning of the Firm
e appearance and behavior of service employees and other customers
in a servicescape can be part of the value proposition and can reinforce
(or detract from) the positioning of the rm.
9. Service Environments are Perceived Holistically
No individual aspect can be optimized without considering everything
else holistically, making designing service environments an art rather
than a science.
• Because of this challenge, professional designers tend to specialize
on specic types of environments, such as hotel lobbies, clubs,
healthcare facilities, and so on.
Beyond aesthetic considerations, the best service environments
should be designed with the customer’s perspective in mind, guiding
them smoothly through the service process.
Tools that can be used to design and improve servicescapes include
careful observation, feedback from employees and customers, photo
audits, eld experiments, and blueprinting
1 See also Hooper and Coughlan (2013) who show that the quality of a service
environment should be modeled as a separate construct which precedes overall
service quality perceptions; Daire Hooper and Joseph Coughlan (2013), e
Servicescape as an Antecedent to Service Quality and Behavioral Intentions,
Journal of Services Marketing, Vol. 27, No. 4, pp. 271–280.
2 e term servicescape was coined by Mary Jo Bitner in her paper “Servicescapes:
e Impact of Physical Surroundings on Customers and Employees,Journal of
Marketing, 56, 1992: 57–71.
3 Madeleine E. Pullman and Michael A. Gross, “Ability of Experience Design Elements
to Elicit Emotions and Loyalty Behaviors,Decision Sciences, Vol. 35, No. 1, (2004):
A recent study in a retail context has shown that retail shops were remodeled,
sales increased and continued to outperform shops there were not remodeled.
Interestingly, customers acquired in the remodeled shops had a higher spent than
customers acquired before the remodeling, and had overall more positive attitudes
towards the retailer. See: Tracy S. Dagger and Peter J. Danaher (2014), “Comparing
the Eect of Store Remodeling on New and Existing Customers, Journal of
Marketing, Vol. 78, No. 3, pp. 62–80.
4 Anja Reimer and Richard Kuehn, “e Impact of Servicescape on Quality
Perception,European Journal of Marketing, 39, 7/8, 2005: 785–808.
5 Julie Baker, Dhruv Grewal, and A. Parasuraman, “e Inuence of Store
Environment on Quality Inferences and Store Image,Journal of the Academy of
Marketing Science, Vol. 22, No. 4 (1994): 328–339.
6 Barbara au, “Apple And e Other Most Successful Retailers By Sales Per Square
F o o t ”, Forbes, 20 May 2014,
accessed on 25 April 2016; Yukari Iwatani Kane and Ian Sherr, “Secrets from Apple’s
Genius Bar: Full Loyalty, No Negativity”, e Wall Street Journal, 12 June 2011,,
accessed on 25 April 2016;, accessed on
25 April 2016.
7 Ulrich, R., Quan, X., Zimring, C., Joseph, A., & Choudhary, R. (2004). e role of the
physical environment in the hospital of the 21st century: A once-in-a-lifetime opportunity.
Report to the center for health design for the Designing the 21st Century Hospital
Project, funded by the Robert Wood Johnson Foundation. (September).
For a review of the literature on hospital design eects on patients, see: Karin
Dijkstra, Marcel Pieterse, and Ad Pruyn, “Physical Environmental Stimuli at Turn
Healthcare Facilities into Healing Environments rough Psychologically Mediated
Eects: Systematic Review,Journal of Advanced Nursing, Vol. 56, No. 2 (2006): 166–
Endnotes · 47
181. See also the painstaking eort the Mayo Clinic extends to lowering noise levels
in their hospitals: Leonard L. Berry and Kent D. Seltman, Management Lessons from
Mayo Clinic: Inside One of the World’s Most Admired Service Organization. McGraw-
Hill (2008): 171–172. For a study on the eects of servicescape design in a hospital
setting on service workers’ job stress and job satisfaction, and subsequently, their
commitment to the rm, see: Janet Turner Parish, Leonard L. Berry, and Shun
Yin Lam, “e Eect of the Servicescape on Service Workers,Journal of Service
Research, Vol. 10, No. 3 (2008): 220–238.
8 Robert J. Donovan and John R. Rossiter, “Store Atmosphere: An Environmental
Psychology Approach,Journal of Retailing, 58, No. 1, 1982: 34–57.
9 James A. Russell, “A Circumplex Model of Aect,Journal of Personality and Social
Psychology, 39, No. 6, 1980: 1161–1178.
10 Jochen Wirtz and John E.G. Bateson, “Consumer Satisfaction with Services:
Integrating the Environmental Perspective in Services Marketing into the Traditional
Disconrmation Paradigm,Journal of Business Research, 44, No. 1, (1999): 55–66.
11 Jochen Wirtz, Anna S. Mattila, and Rachel L.P. Tan, “e Moderating Role of
Target-Arousal on the Impact of Aect on Satisfaction — An Examination in the
Context of Service Experiences,Journal of Retailing, 76, No. 3 (2000): 347–365;
Jochen Wirtz, Anna S. Mattila and Rachel L. P. Tan, “e Role of Desired Arousal
in Inuencing Consumers’ Satisfaction Evaluations and In-Store Behaviours,
International Journal of Service Industry Management, Vol. 18, No. 2, (2007): 6–24.
12 Mary Jo Bitner, “Servicescapes: e Impact of Physical Surroundings on Customers
and Employees,Journal of Marketing, 56, (April 1992): 57–71.
13 When servicescapes are designed or redesigned, it is important to use cross-
functional teams as there are signicant perception gaps between managers and
fontline employees, and the latter’s perspective is important for servicescapes to
facilitate productive and eective service delivery, see: Herman Kok, Mark Moback
and Onno Omta (2015), “Facility Design Consequences of Dierent Employees’
Quality Perceptions, e Service Industries Journal, Vol. 35, No. 3, pp. 152–178.
14 For a comprehensive review of experimental studies on the atmospheric eects
refer to: L.W. Turley and Ronald E. Milliman, “Atmospheric Eects on Shopping
Behavior: A Review of the Experimental Literature,Journal of Business Research,
49, 2000: 193–211.
15 Patrick M. Dunne, Robert F. Lusch and David A. Grith, Retailing, 8th ed., Orlando,
FL: Hartcourt, 2013.
16 Steve Oakes, “e Inuence of the Musicscape Within Service Environments,
Journal of Services Marketing, 14, No. 7, 2000: 539–556.
17 Morris B. Holbrook and Punam Anand, “Eects of Tempo and Situational Arousal
on the Listener’s Perceptual and Aective Responses to Music,Psychology of Music,
48 · Winning in Service Markets
18, 1990: 150–162; and S.J. Rohner and R. Miller, “Degrees of Familiar and Aective
Music and eir Eects on State Anxiety”, Journal of Music erapy, 17, No. 1 (1980):
18 Laurette Dubé and Sylvie Morin, “Background Music Pleasure and Store Evaluation
Intensity Eects and Psychological Mechanisms,Journal of Business Research, 54
(2001): 107–113.
19 Clare Caldwell and Sally A. Hibbert, “e Inuence of Music Tempo and Musical
Preference on Restaurant Patrons’ Behavior,Psychology and Marketing, 19, No. 11
(2002): 895–917.
20 For a review of the eects of music on various aspects of consumer responses and
evaluations, see: Steve Oakes and Adrian C. North, “Reviewing Congruity Eects
in the Service Environment Musicscape,International Journal of Service Industry
Management, Vol. 19, No. 1 (2008): 63–82.
21 See for in-store music solutions provided by Mood Media,
and e Economist, “Christmas Music: Dreaming of a Hip-Hop Christmas”, 14
December 2013, p. 36.
22 e Economist , “Classical Music and Social Control: Twilight of the Yobs,” 8 January 2005,
p. 48.
23 Ibid.
24 Eric R. Spangenberg, Ayn E. Crowley, and Pamela W. Henderson, “Improving the
Store Environment: Do Olfactory Cues Aect Evaluations and Behaviors?” Journal
of Marketing, 60, April 1996: 67–80; Paula Fitzerald Bone and Pam Scholder Ellen,
“Scents in the Marketplace: Explaining a Fraction of Olfaction,Journal of Retailing,
75, No. 2, 1999: 243–262; Jeremy Caplan, “Sense and Sensibility,Time, 168, No. 16
(2006): 66, 67.
25 Alan R. Hirsch, “Dr. Hirsch’s Guide to Scentsational Weight Loss,” UK: Harper
Collins, January 1997, pp. 12–15., accessed on 25
April 2016.
26 Alan R. Hirsch, “Eects of Ambient Odors on Slot Machine Usage in a Las Vegas
Casino,Psychology and Marketing, 12, No. 7, 1995: 585–594.
27 Alan R. Hirsch and S.E. Gay, “Eect on Ambient Olfactory Stimuli on the Evaluation
of a Common Consumer Product,Chemical Senses, 16, 1991: 535.
28 See Ambius’ website for details of its scent marketing, ambient scenting and sensory
branding services at:;
accessed at 24 April 2016.
29 e Economist , “Christmas Music: Dreaming of a Hip-Hop Christmas, 14 December
2013, p. 36.
Endnotes · 49
30 Andreas Herrmann, Manja Zidansek, David E. Sprott, and Eric R. Spangenberg
(2013), “e Power of Simplicity: Processing Fluency and the Eects of Olfactory
Cues on Retail Sales”, Journal of Retailing, Vol. 89, No. 1, pp. 30–43.
31 Ayn E. Crowley, “e Two-Dimensional Impact of Color on Shopping,Marketing
Letters, 4, No. 1, 1993: 59–69; Gerald J. Gorn, Amitava Chattopadhyay, Jaideep
Sengupta, and Shashank Tripathi, “Waiting for the Web: How Screen Color Aects
Time Perception,Journal of Marketing Research, XLI, May 2004: 215–225; Iris
Vilnai-Yavetz and Anat Rafaeli (2006), “Aesthetics and Professionalism of Virtual
Servicescapes,” Journal of Service Research, Vol. 8, No. 3, pp. 245–259.
32 Linda Holtzschuhe, Understanding Color — An Introduction for Designers, New
Jersey: John Wiley, 3rd ed., 2006, p. 51.
33 Albert Henry Munsell, A Munsell Color Product. New York: Kollmorgen Corporation,
34 Linda Holtzschuhe, Understanding Color — An Introduction for Designers, New
Jersey: John Wiley, 3rd ed., 2006.
35 Heinrich Zollinger, Color: A Multidisciplinary Approach. Zurich: Verlag Helvetica
Chimica Acta (VHCA) Weinheim, Wiley-VCH, 1999, pp. 71–79.
36 Joseph A. Bellizzi, Ayn E. Crowley, and Ronald W. Hasty, “e Eects of Color in
Store Design,Journal of Retailing, 59, No. 1. 1983: 21–45.
37 Sara O. Marberry and Laurie Zagon, e Power of Color — Creating Healthy Interior
Spaces. New York: John Wiley & Sons, 1995, p. 38.
38 Justin Bachman (2015): “Airlines Add Mood Lighting to Chill Passengers Out:
New Boeing and Airbus Models Oer Cabin Designers Splashy Ways to Engage
Passengers with Light”, Bloomberg Business,
articles/2015-04-22/airlines-add-mood-lighting-to-chill-passengers-out, accessed
24 April 2016.
39 Anat Rafaeli and Iris Vilnai-Yavetz, “Discerning organizational boundaries through
physical artifacts,” in Managing boundaries in organizations: Multiple perspectives,
eds. N. Paulsen and T. Hernes, UK: Basingstoke, Hampshire, Macmillan, 2003;
Anat Rafaeli and Iris Vilnai-Yavetz, “Emotion as a Connection of Physical Artifacts
and Organizations,Organization Science, Vol. 15, No. 6 (2004): 671–686; and Anat
Rafaeli and Iris Vilnai-Yavetz, “Managing Organizational Artifacts to Avoid Artifact
Myopia,” in A. Rafaeli and M. Pratt (Eds.), Artifacts and Organization: Beyond Mere
Symbolism, (Mahwah, NJ: Lawrence Erlbaum Associates Inc., 2005, pp. 9–21.
40 For an excellent review of the quality of signage management, see: Angelo Bonfani
(2013), “Towards an Approach to Signage Management Quality (SMQ)”, Journal of
Services Marketing, Vol. 27, No. 4, pp. 312–321.
50 · Winning in Service Markets
41 Lewis P. Carbone and Stephen H. Haeckel, “Engineering Customer Experiences,
Marketing Management, 3, No. 3, Winter 1994: 9–18; Lewis P. Carbone, Stephen H.
Haeckel and Leonard L. Berry, “How to Lead the Customer Experience,Marketing
Management, 12, No. 1, Jan/Feb 2003:18; Leonard L. Berry and Lewis P. Carbone,
“Build Loyalty rough Experience Management,Quality Progress, 40, No. 9
(September 2007): 26–32.
42 Roscoe Hightower, Jr. and Mohammad Shariat (2009), “Servicescape’s Hierarchical
Factor Structure Model, Global Review of Business and Economic Research, Vol. 5,
No. 2, pp. 375–398; Roscoe Hightower, Jr. (2010), “Commentary on Conceptualizing
the Servicescape Construct in ‘A Study of the Service Encounter in Eight Countries’”,
Marketing Management Journal, (Spring), Vol. 20, No. 1, pp. 75–86.
43 Dennis Nickson, Chris Warhurst, and Eli Dutton, “e Importance of Attitude and
Appearance in the Service Encounter in Retail and Hospitality,Managing Service
Qu ality, 2, 2005, pp. 195–208.
44 Christine M. Piotrowski, Designing Commercial Interiors (New York: John Wiley &
Sons, Inc., 2007); Martin M. Pegler, Cafes & Bistros. (New York: Retail Reporting
Corporation, 1998); Paco Asensio, Bars & Restaurants. (New York: HarperCollins
International, 2002); Bethan Ryder, Bar and Club Design, (London: Laurence King
Publishing, 2002).
45 Ron Kaufman, “Service Power: Who Were ey Designing it For?” Newsletter, May
2001, http://Ron
46 Alan d’Astous, “Irritating Aspects of the Shopping Environment,Journal of Business
Research, 49, (2000): 149–156. See also: K. Douglas Homan, Scott W. Kelly and
Beth C. Chung, “A CIT Investigation of Servicscape Failures and Associated
Recovery Strategies,Journal of Services Marketing, Vol. 17, No. 4, (2003): 322–40.
47 Jörg Pareigis, Per Echeverri and Bo Edvardsson (2012), “Exploring Internal
Mechanisms Forming Customer Servicescape Experiences”, Journal of Service
Management, Vol. 23, No. 5, pp. 677–695.
48 Interestingly, visual complexity in environments hinders shoppers’ information
processing and thereby reduces their satisfaction. is nding is especially
applicable in utilitarian service contexts and also suggest that it is better for service
organizations to reduce complexity in servicescape design and make it easy for
customers to sense and process a servicescape. is nding is well-aligned with
the study by Jörg Pareigis, Per Echeverri and Bo Edvardsson (2012); see: Ulrich R.
Orth, Frauke Heinrich and Keven Malkewitz (2012), “Servicescape Interior Design
and Consumer Personality Impressions, Journal of Services Marketing, Vol. 26, No.
3, pp. 194–203; Ulrich R. Orth and Jochen Wirtz (2014), “Consumer Processing
of Interior Service Environments”, Journal of Service Research, Vol. 17, No. 3,
pp. 296–309.
Endnotes · 51
49 Audit tools and checklists can be used to determine environmental dimensions that
are important to customers; for example, see the auditing tool provided in: Mark S.
Rosenbaum and Corolyn Massiah (2013), “e Challenge of Managing a Service
Context”, in: Serving Customers: Global Services Marketing Perspectives, by Raymond
P. Fisk, Rebekah Russell-Bennett, and Lloyd C. Harris (eds.), Tilde University Press,
Melbourne, Australia, pp. 287–310.
50 Madeleine E. Pullman and Stephani K.A. Robson, “Visual Methods: Using
Photographs to Capture Customers’ Experience with Design,Cornell Hotel and
Restaurant Administration Quarterly, 48, No. 2, (2007): 121–144.
Jochen Wirtz is Professor of Marketing and Vice Dean,
Graduate Studies, at the National University of Singapore
(NUS), and an international fellow of the Service Research
Center at Karlstad University, Sweden. Furthermore, he is the
founding director of the dual degree UCLA–NUS Executive
MBA Program (ranked globally #6 in the Financial Times
2016 EMBA rankings) and international fellow of the Service
Research Center at Karlstad University, Sweden, and Academic Scholar at the
Cornell Institute for Healthy Futures (CIHF) at Cornell University, USA. Dr.
Wirtz holds a PhD in services marketing from the London Business School and
has worked in the eld of services for over 25 years.
Professor Wirtz’s research focuses on service marketing and has been
published in over 200 academic articles, book chapters and industry reports. He
is an author or co-author of more than 10 books, including Services Marketing —
People, Technology, Strategy (8th edition) (World Scientic, 2016), co-authored with
Professor Lovelock, which has become one of the world’s leading services marketing
text book that has been translated and adapted for more than 26 countries and
regions, and with sales of some 800,000 copies.
In recognition of his excellence in teaching and research, Professor Wirtz has
received more than 40 awards, including the prestigious Academy of Marketing
Science (AMS) 2012 Outstanding Marketing Teacher Award (the highest
recognition of teaching excellence of AMS globally), and the top university-level
Outstanding Educator Award at NUS. He was also the winner of the inaugural
Outstanding Service Researcher Award 2010, and the Best Practical Implications
Award 2009, both by Emerald Group Publications.
Professor Wirtz was a banker and took the banking exam at Chamber of
Commerce and Industry in Munich. He has since been an active management
consultant, working with international consulting rms including Accenture,
Arthur D. Little and KPMG, and major service rms in the areas of strategy,
business development and customer feedback systems. He has also been involved
in several start-ups including in Accellion (, Angeloop
(, TranscribeMe (, and Up! Your
Service (
Originally from Germany, Professor Wirtz spent seven years in London
before moving to Asia. Today, he shuttles between Asia, the US and Europe. For
further information, see
First, I would like to thank my mentor, friend and co-author Professor
Christopher Lovelock. Since rst meeting in 1992, he has become a dear friend
who has had signicant inuence on my thinking and development. We have
worked together on a variety of projects, including cases, articles, conference
papers, and several books. Winning in Service Markets is, in fact, derived from
our best-selling textbook, Services Marketing: People, Technology, Strategy, 8th
edition. I am eternally grateful to Christopher for his friendship and support.
Although it’s impossible to mention everyone who has contributed in some
way to this book through their research, their contributions and discussions
at the many academic conferences where we have met, as collaborators on
various research projects, and as friends who have always been ready to
discuss, criticize, and provide feedback and suggestions. I particularly want to
express my appreciation to the following: Tor Andreassen, Norwegian School
of Management; John Bateson of Cass Business School; Leonard Berry of
Texas A&M University; David Bowen of underbird Graduate School of
Management; Richard Chase of the University of Southern California; Jayanta
Chatterjee of Indian Institute of Technology at Kanpur, India; James Heskett,
Earl Sasser and Leonard Schlesinger, all of Harvard Business School; Bo
Edvardsson of University of Karlstad; Pierre Eiglier of Université d’Aix-Marseille
III; Michael Ehret of Nottingham Trent University; Raymond Fisk of the Texas
State University; Christian Grönroos of the Swedish School of Economics in
Finland; Miguel Angelo Hemzo, Universidade de São Paulo, Brazil; Irene Ng of
University of Warwick; Jay Kandampully of Ohio State University; Ron Kaufman
of UP! Your Service; Sheryl Kimes of Cornell University; Tim Keiningham of
Rockbridge Associate; Jos Lemmink of Maastricht University; Xiongwen Lu of
Fudan University, China; Paul Maglio of University of California, Merced, USA;
Anna Mattila of Pennsylvania State University; Ulrich Orth of Kiel University;
Chiara Orsingher of University of Bologna; A. “Parsu” Parasuraman of University
of Miami; Paul Patterson of the University of New South Wales, Australia; Anat
Rafaeli of Technion-Israeli Institute of Technology, Roland Rust of the University
of Maryland; Benjamin Schneider formerly of the University of Maryland; Jim
Spohrer of IBM; Javier Reynoso of Tec de Monterrey, Mexico; Christopher Tang
of UCLA; Rodoula Tsiotsou of University of Macedonia; and Valarie Zeithaml of
the University of North Carolina.
Finally, Id like to thank you, the reader of this book, for your interest in
this exciting and fast-evolving eld of services management and marketing. If
you have any feedback, please contact me via www. I’d love to
hear from you!
Suitable for:
Polytechnic Students
Undergraduate Students
Services Marketing is available for various audiences:
Services Marketing Series
The content in terms of core theory, models and frameworks is largely the same
across these publications. However, they are presented and designed to fit their
particular target audiences.
Services Marketing is available in some 26 languages and adaptations for key
markets around the world.
Essentials of
Services Marketing
Winning in Service Markets:
Success Through People,
Technology Strategy
Services Marketing:
People, Technology, Strategy
Suitable for:
Advanced Undergraduate Students
Master’s-Level/MBA Students
Suitable for:
Executive Program/EMBA Participants
Practitioners/Senior Management
Available in the following formats:
• Paperback
• E-book
Available in the following formats:
• Hardcover
• Paperback
• E-book
Bundle of Paperback & E-book
Rental 6 months
Available in the following formats:
• Hardcover
• Paperback
• E-book
Bundle of Paperback & E-book
Winning in Service Markets Series
Key chapters of Winning in Service
Markets are available as stand-alone
publications in e-book and paperback:
Vol. 1: Understanding Service
Vol. 2: Positioning Services in
Competitive Markets
Vol. 3: Developing Service Products
& Brands
Vol. 4: Pricing Services & Revenue
Vol. 5: Service Marketing
Vol. 6: Designing Customer Service
Vol. 7: Balancing Demand & Capacity
in Service Operations
Vol. 8: Crafting the Service
Vol. 9: Managing People for Service
Vol. 10: Managing Customer
Relationships & Building
Vol. 11: Designing Complaint Handling
& Service Recovery
Vol. 12: Service Quality & Productivity
Vol. 13: Building a World Class
Service Organization
(Assessment Tool)
For orders of individual copies, course adoptions, bulk purchases:
For orders for individual chapters, customized course packs:
For adaptions or translation rights, permissions to reprint:
For further information see:
For questions regarding contents: Jochen Wirtz,
Published by Pearson Education
SM8_Endlims_10042015_maha.indd 784 11/3/16 9:09 am
Click book covers for links to Amazon:
Professor Jochen Wirtz
Click below to follow his research & publications
ResearchGate has not been able to resolve any citations for this publication.
Full-text available
Customers always have an experience when they interact with a firm. The question for managers is whether the firm is prepared to systematically manage the customers' experience or simply hope for the best. The customers' overall experience - influenced by sensory and emotional clues - evokes a value perception that determines brand preference. Through experience management principles, a firm can design a composite of clues that resonate with customers and earn their loyalty.
Full-text available
The popular press has recently reported that managers of retail and service outlets are diffusing scents into their stores to create more positive environments and develop a competitive advantage. These efforts are occurring despite there being no scholarly research supporting the use of scent in store environments. The authors present a review of theoretically relevant work from environmental psychology and olfaction research and a study examining the effects of ambient scent in a simulated retail environment. In the reported study, the authors find a difference between evaluations of and behaviors in a scented store environment and those in an unscented store environment. Their findings provide guidelines for managers of retail and service outlets concerning the benefits of scenting store environments.
Full-text available
Executive summary When it comes to repeat business, some managers are clueless. Customers always get more than they bargain for, because a product or service always comes with an experience. By "experience," we mean the "takeaway" impression formed by people's encounters with products, services, and businesses—a perception produced when humans consolidate sensory information. We constantly filter a barrage of clues, organizing them into a set of impressions—some of them rational, some emotional. These impressions can be very subtle-even subliminal-or extremely obvious. They may occur by happenstance or by purposeful design. They may exist as isolated episodes or as managed suites. Collectively, they become an experience. Experience clues may be either performance—or context-based. Performance clues relate to the function of the product or service e.g., the bank did or did not dispense the right amount of cash or the razor did or did not give a close, smooth shave. But over and above the performance of the service, context clues are telegraphed by the appearance of the ATM (or the demeanor of the teller); by the decor, smell, cleanliness, and privacy of the location; by the legibility of the print on the receipt; and by a host of other signals. Similarly, the clues generated by the way the razor shaves are complemented by clues sent out by its look, smell, feel, and sound as well as from the people and things in the environment when a customer inquires about, buys, pays for, uses, and maintains it. Unmanaged, these clues may cancel each other out and leave no net impression on the customer, or worse, induce a strong net negative perception.
A typology of service organizations is presented and a conceptual framework is advanced for exploring the impact of physical surroundings on the behaviors of both customers and employees. The ability of the physical surroundings to facilitate achievement of organizational as well as marketing goals is explored. Literature from diverse disciplines provides theoretical grounding for the framework, which serves as a base for focused propositions. By examining the multiple strategic roles that physical surroundings can exert in service organizations, the author highlights key managerial and research implications.
The popular press has recently reported that managers of retail and service outlets are diffusing scents into their stores to create more positive environments and develop a competitive advantage. These efforts are occurring despite there being no scholarly research supporting the use of scent in store environments. The authors present a review of theoretically relevant work from environmental psychology and olfaction research and a study examining the effects of ambient scent in a simulated retail environment. In the reported study, the authors find a difference between evaluations of and behaviors in a scented store environment and those in an unscented store environment. Their findings provide guidelines for managers of retail and service outlets concerning the benefits of scenting store environments.
The popular and business press is enamored with the idea that the sense of smell can have strong effects on consumer responses to retail environments. The claims that odors have strong persuasive powers tantalize retailers looking for the competitive edge. Herein, we review the current paradigm of retailing-relevant olfaction research and find that "conventional wisdom" does not allow researchers or retailers to reliably predict olfaction effects. We suggest accessibility and availability theories as a way of explaining the current empirical research and as a method by which we can increase the reliability of capturing olfactory effects. We conclude by identifying fruitful areas of research in this interesting stimuli-that which we smell.
Traditional guest feedback methods such as surveys or mystery shopping are not ideal for collecting information about customers' reactions to a hotel's physical design. Because design is a visual medium, survey questions may not capture the whole of a guest's reaction to the design. By the same token, the reaction of mystery shoppers to design is not necessarily representative of all guests. Instead, a photography-based approach allows guests to show managers and researchers what they consider to be the hotel's design highlights and failures. A pilot study indicated that guests took notice of design elements that signified that the hotel was being considerate of their needs, as well as providing a functional, high-quality environment.
Although ambient scents within retail stores have been shown to influence shoppers, real-world demonstrations of scent effects are infrequent and existing theoretical explanation for observed effects is limited. The current research addresses these open questions through the theoretical lens of processing fluency. In support of a processing fluency explanation, results across four studies show the complexity of a scent to impact consumer responses to olfactory cues. A simple (i.e., more easily processed) scent led to increased ease of cognitive processing and increased actual spending, whereas a more complex scent had no such effect. Implications for theory and retail practice are provided.