There has been a long held recognition that situational variables, including environments, can substantially explain and help the understanding of consumer behaviour (Belk 1975). Considerable empirical research has been undertaken in the past 30 years to verify Belk's assertions about effects of the environment on customers in retail and service settings. The resulting conclusions from this stream of research provide confirmation that the environment does influence the behaviour of customers through the impact it has on their emotional responses (c.f. Turley and Milliman 2000). However, the bulk of this work has focused on the effects of the physical attributes of the environment either as individual variables or combined to create an overall atmosphere. Few studies to date appear to have investigated the social aspects of the environment. Of these studies, most have investigated the negative aspects of a crowded environment, yet numerous examples can be found where high densities of other customers are seen as a positive attribute of the environment. Moreover, it appears that no study to date has investigated customer-to- customer emotional contagion. This lack of research is surprising given that many firms deliver services to customers in the presence of other customers, and in some settings such as hospitals, bus tours and other recreational services customers even co-produce the service with other customers. Hence, it is important to investigate the influence that the presence of other customers has in a social service setting.
The focus of this thesis is therefore to address this important gap by developing and testing a theoretical model which explains the influence of other customers, as an integral part of the service environment, on individual customers present. Hence, the key research question is:
What effect do other customers in a servicescape have on the individual customer within that environment?
A program of research involving four studies was undertaken to answer this question. Prior to any of the four studies being undertaken, the research commenced with a critical review of the literature. This literature review examined the relationships between Bitner's (1992) Servicescape Model and existing theories drawn from environmental psychology, social psychology and organisational behaviour, which explain the environmental and social influences on the individual. This process enabled a new conceptualisation of a service environment, where multiple customers are present, to be developed, called the Social-servicescape. The Social-servicescape acknowledges that many services are produced and consumed in the presence of others. It consists of three dimensions: contextual, physical and social, that relate to the customer's purchase occasion, the spatial density of customers, and the displayed emotions of other customers, respectively. The research program that followed consisted of three phases.
First, two exploratory qualitative studies were undertaken using unobtrusive observation in cafes and focus groups of customers in order to identify how and why customers are influenced by other customers in that environment. The results suggest that customers are influenced by other customers in the environment even when there is no direct interaction between these customers. The degree to which other customers in the environment induce affective and cognitive responses in the individual customers appears to depend upon three factors: 1) the occasion for which the customer purchases the service, 2) the spatial distance between customers and, 3) the moods and emotions of the other customers. Second, the findings of these first two studies enabled the conceptual model to be operationalised and research hypotheses developed. Third, the final two studies of this research program utalised 2 x 2 x 3 between subjects factorial design experiments to test the research hypotheses and quantify the relative strengths of the environmental dimensions on customer affect. However, unlike previous research that has emphasised the role of the physical attributes of the servicescape, the results shows that the contextual and social dimensions play a more important role in creating an affective response from the customer and subsequent repurchase intentions.
The results suggest that of the three environmental dimensions the social dimension (displayed emotions of the other customers) had the most significant effect on the individual customer's affective state, producing feelings of enjoyment, annoyance and surprise. The results clearly show that emotional contagion occurs when customers are exposed to the displayed emotions of other customers. However, further analysis demonstrated that while customer-to-customer emotional contagion occurred, the emotions felt by the recipient customers were not always the same as the emotions displayed by other customers. This variation between compatible emotional contagion and counter-contagion appears to be contextual and determined by the occasion for which the service was purchased. For example, customers exposed to positive emotions while experiencing a social or group purchase occasion felt an increase in enjoyment. While customers exposed to positive emotions while experiencing a private or personal purchase occasion felt an increase in annoyance. The cognitive response of the customer as a result of these environmentally induced affective responses were both positive and negative affect influenced their intentions to repurchase. Specifically enjoyment influenced positive repurchase intentions and annoyance influenced negative repurchase intentions. Interestingly, although customers' expectations were disconfirmed (they felt some surprise and a little embarrassed) by aspects of the environment, this had no influence on repurchase intentions.
The thesis provides important theoretical contributions to marketing knowledge by describing how a socially oriented service environment influences customer emotions and attitudes, as well as highlighting the significance of customer-to-customer emotional contagion within a service environment. Further, some useful contributions to managerial practice through suggestions for the design of both the spatial layout of the service environment and service offering, the use of customer compatibility as a method of segmentation, and improvements to staff training are provided.