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Environment,
Service environment, provider provider mood,
mood, and provider-customer and interaction
interaction
165
Kendra Fowler
Williamson College of Business Administration, Youngstown State University,
Youngstown, Ohio, USA, and
Eileen Bridges
Department of Marketing, Kent State University, Kent, Ohio, USA

Abstract
Purpose – The purpose of this paper is to improve understanding of the relationships between the
service environment, service provider mood, and provider-customer interaction. Specifically, mood is
evaluated as a potential moderator of the relationship between the service environment and
provider-customer interaction.
Design/methodology/approach – A multi-method data collection approach was utilized, including
observation and provider and customer surveys. Hypotheses are tested using regression, ANOVA,
and MANOVA.
Findings – Findings indicate that service provider evaluations of the physical environment improve
in the presence of an appropriate ambient scent. Behavioral responses are also enhanced: providers are
viewed as more courteous and customers more friendly. Perhaps the most interesting observation is
that provider mood moderates the relationship between the service environment and customer
perceptions of service provider behavior.
Research limitations/implications – The only environmental characteristic that was
manipulated was scent, and access was granted to only one store over the course of three
consecutive Saturdays. Consequently, validity is threatened by the potential for impact of factors other
than the manipulated characteristic.
Practical implications – Implications for managers include careful consideration of potential
changes to the ambient environment; if introduction of an appropriate scent can be undesirable, other
changes may also lead to unexpected results. Changes under consideration should be tested before
implementation.
Originality/value – This research extends service theory by examining the relationship between
providers and customers in an actual retail setting. Important theoretical contributions include:
demonstrating that service provider mood moderates the relationship between service environmental
characteristics and customer perceptions of provider behavior; and finding that positive changes to the
environment can amplify negative outcomes.
Keywords Atmospherics, Servicescape, Provider-customer interaction, Provider mood, Customers,
Store ambience
Paper type Research paper

Managing Service Quality

Vol. 22 No. 2, 2012
The authors express their appreciation to Nicole Catalano for research assistance, to Marco Wolf pp. 165-183
q Emerald Group Publishing Limited
for helpful comments and suggestions, to Travis Earley for access to the store, and to the 0960-4529
Association of Marketing Theory and Practice for the opportunity to present the work. DOI 10.1108/09604521211218972
MSQ 1. Introduction
The practical deployment of retail space has probably been studied, as long as there
22,2 have been retailers. In ancient Pompeii, for example, shops selling water utilized
identical floor space designs. In the early 1970s, marketers began to explore some more
subtle aspects of service environment design. In particular, Kotler (1973, p. 50) drew
attention to what he called “atmospherics,” or “the conscious designing of space to
166 create certain effects in buyers.” Since then, visual, aural, olfactory, and tactile
dimensions of service environments have been examined to assess their abilities to
capture consumer attention (Bellizzi et al., 1983), convey important information
(Baker et al., 2002; Chebat and Morrin, 2007), and arouse emotions (Bitner, 1992;
Ryu and Jang, 2008). Building upon this literature, the present study considers the
impact of environmental characteristics, not only on consumers, but also on service
providers and on the interactions between consumers and service providers. Further,
mood is also evaluated as a potential moderator of the relationship between the service
environment and provider-customer interaction.
The results suggest that service provider attitudes and behaviors are improved in
the presence of an ambient scent, but few direct differences for customers are observed.
The interaction between providers and customers is even more interesting. Service
provider mood is found to moderate the relationship between the characteristics of the
service environment and customer perceptions of provider behavior. The impact of the
environmental treatment is altered in the presence of negative employee moods,
leading to stronger negative customer impressions of poor service provider behavior.
Thus, the environmental treatment can have a dynamic impact on the customer
experience, depending on the service provider’s mood.
In summary, the present research extends the literature by examining how elements
of the servicescape impact the service provider and interactions between the service
provider and customer. Not only do we consider the influence of the service
environment on consumer and service provider attitudes and behaviors, the study also
takes into account the current mood state of the employee serving each customer.
Knowledge of current ambient conditions is complemented by collection of
observational data and by surveys of both service providers and customers. Before
describing the context and scope of the study, a brief overview of the servicescape
literature is provided, focusing on the impact of ambient conditions on individual
responses and behaviors. Specific hypotheses are developed, the context of the study is
presented, and results are explicated. Finally, theoretical and managerial implications
are explored and limitations of the study are discussed.

2. Conceptual development and hypotheses

2.1 Impact of service environments on providers and customers
Building upon the work of Kotler (1973), a number of researchers propose typologies
classifying the important dimensions of the service environment (e.g. Baker, 1987;
Turley and Milliman, 2000; Westbrook, 1981). One of the most widely accepted and
oft-cited works in this area is Bitner’s (1992) framework, which parses the physical
service environment, or “servicescape,” into three components:
(1) [n list]space/function;
(2) signs, symbols, and artifacts; and
(3) ambient conditions.
Bitner (1992) was one of the first to recognize that the physical environment of a service Environment,
can impact attitudes and behaviors not only of consumers, but also those of front-line
service providers. Since then, others have verified the effects of servicescapes on
provider mood,
consumer attitudes and behaviors (e.g. Baker et al., 1994; Gotlieb et al., 2004; and interaction
Pantouvakis, 2010; Wakefield and Blodgett, 1996; Wall and Berry, 2007;
Walter et al., 2010). In particular, Kim et al. (2009) observe that the service
environment influences customer satisfaction and Lin and Liang (2011) find that the 167
physical environment influences both customer emotion and satisfaction. Although not
as extensively examined, the impact of the service environment on employees has also
been substantiated in research, both in marketing (Parish et al., 2008) and in related
fields (Ilozor and Ilozor, 2006; Lin et al., 2008).
Rafaeli and Vilnai-Yavetz (2004) point out that objects present in a service
environment, regardless of whether they are categorized using Bitner’s (1992) or
another scheme, may contribute in multiple ways to resulting human emotions. They
use a qualitative methodology to evaluate one aspect of a physical environment, color,
and categorize its impact along three dimensions they identify as instrumentality,
aesthetics, and symbolism. Their findings suggest that emotional responses can occur
due to performance along one or more of these dimensions. Although Rafaeli and
Vilnai-Yavetz (2004) suggest that servicescapes should be examined from a holistic
perspective, other researchers have considered each of the three individual components
suggested by Bitner (1992) separately, an approach adopted in this study.
According to Bitner (1992, p. 66), space and function refer to “the ways in which
machinery, equipment, and furnishings are arranged. . . and the ability of the same
items to facilitate performance and the accomplishment of goals”. Impacts owing to
space and function have been studied predominantly from the perspective of the
employee. For example, research has shown that environmental functionality can
impact job satisfaction (Lin et al., 2008), emotion (Rafaeli and Vilnai-Yavetz, 2004), and
behavior, such as interpersonal interaction (Davis, 1984). The scarcity of research
investigating how space and function impact customers is substantiated in the review
of servicescape literature by Bhardwaj et al. (2008), who find a need for further research
on the impact of store layout on customer reactions. In a key exception, Bonnin (2002)
observes that customers are influenced by space and function, both in terms of their
behavior in the environment and their satisfaction with the experience.
Signs, symbols, and artifacts may offer explicit cues (e.g. exterior and interior
signage) or implicit cues (e.g. artwork, furnishings, floor coverings) that direct
consumers, communicate rules of behavior, or help to convey firm image (Bitner, 1992).
Such cues have been found to influence loyalty intentions (Harris and Ezeh, 2008),
perceived quality of the service provided (Arneill and Devlin, 2002), and may even be
used by ethnic customers trying to determine whether the business will welcome their
patronage (Rosenbaum, 2005).
Bitner (1992) describes ambient conditions as background characteristics
(e.g. lighting, temperature, cleanliness, music or noise, scent) that tend to impact
upon the subconscious. Thus, they may influence both customers and service
providers, as they are present in the shared environment. Several of these
characteristics have been empirically tested for their influence on consumers,
including lighting (Summers and Hebert, 2001; Vaccaro et al., 2008), cleanliness
(Barber and Scarcelli, 2010; Bitner, 1990; Wakefield and Blodgett, 1996), and ambient
scent (Spangenberg et al., 1996). When ambient conditions are within an acceptable
MSQ range, consumers may not even be aware of their existence in the environment. It is
only when the conditions are outside a zone of tolerance that individuals are likely to
22,2 notice (Baker, 1987). However, ambient condition manipulations may be effective even
when they go undetected (Russell and Snodgrass, 1987).
In summary, the servicescape as a whole, as well as individual components within
the servicescape, have been shown to impact both consumer and service provider
168 perceptions of and reactions to the servicescape. As this study was carried out in an
actual retail store, to best control for extraneous influences on providers and customers
and to maximize internal validity, only one environmental dimension (ambient scent)
was manipulated. Thus, the first set of hypotheses is consistent with extant literature
and provides a replication thereof:
H1a. A positive treatment in the ambient environment improves service provider
evaluations of the service environment.
H1b. A positive treatment in the ambient environment improves customer
evaluations of the service environment.
H1c. A positive treatment in the ambient environment improves customer
satisfaction with the service experience.

2.2 Impact of service environments on provider-customer interaction

The servicescape can affect both consumers and service providers: this has been
demonstrated extensively from the viewpoint of the customer (see, e.g. Babin et al., 1999),
but far fewer studies approach the topic from the viewpoint of the service provider (a
key exception being Parish et al., 2008). The potential influence of the servicescape on
the interaction between the two groups is even less frequently studied (for an exception
see Namasivayam and Mattila, 2007), although its importance is substantiated in the
literature (see, e.g. Dabholkar et al., 1996; Merrilees et al., 2007; Yim et al., 2008).
Consequently, understanding how to improve the interaction between customers and
service providers represents an important gap in the servicescape literature. No
existing studies were found measuring the impact of the service environment on
interactions between front line service providers and customers in an actual retail
store. However, Pantouvakis (2010) confirms an important impact of the servicescape
on interactive service attributes in the transportation sector: higher quality provider
interaction is required to overcome decreases in customer satisfaction in poorly
designed servicescapes. In addition, Haelsig et al. (2007) find that personal interaction
is important to brand equity. Therefore, our second set of hypotheses extends the
literature by examining the entire scope of reaction to the servicescape, including
interactions between the customer and the service provider.
Because an individual’s response to a servicescape (particularly the emotional
component) is typically short-lived and also difficult to verbalize, its most salient
manifestation is likely to be revealed in consumer behavior (Donovan and Rossiter,
1982). This behavior may be characterized as approach or avoidance: approach
encompasses positive reactions to the environment, such as lingering, exploring, and
communicating, whereas avoidance includes negative behaviors such as leaving
quickly, unfocused attention, and lack of communication (Mehrabian and Russell, 1974).
Donovan and Rossiter (1982) suggest that shopper approach and avoidance behaviors
can be observed in the shopper’s apparent level of enjoyment, time spent in the store,
willingness to talk to sales personnel, tendency to spend more than originally intended, Environment,
and likelihood to return. Other researchers, building on Donovan and Rossiter’s (1982)
research, have followed in a similar vein and have included among retail approach
provider mood,
behaviors increased browsing and spending (Sweeney and Wyber, 2002), the number and interaction
of items touched and picked up (Summers and Hebert, 2001), time spent in store and
impulse buying (Li et al., 2009). Thus, their insight built a foundation for a substantial
variety of articles in retailing research. 169
From the viewpoint of the front-line provider, the servicescape can affect job stress
and satisfaction (cognitive and emotional reactions), leading to intentions to
recommend (or not recommend) the service to potential employees as well as to
consumers, outcomes that may also be characterized as either approach or avoidance
(Parish et al., 2008). Further, engagement in either approach or avoidance behaviors by
either the service provider or the customer may also influence perceptions of the
interaction between them. The second set of hypotheses examines these perceived
interactions:
H2a. A positive treatment in the ambient environment improves providers’
perceptions of interactions with customers.
H2b. A positive treatment in the ambient environment improves customer
perceptions of interactions with service providers.

2.3 Impact of service environments on perceptions of time

As mentioned above, Donovan and Rossiter (1982) suggest that one way shopper
approach and avoidance behaviors can be observed is in terms of time spent in the
store, with longer times indicating approach, and shorter times indicating avoidance.
Related to this, Spangenberg et al. (1996) hypothesize that the presence of pleasant
ambient scent increases both actual and perceived times spent in the store. However,
their data do not support this hypothesis: actual times were the same for both scented
and unscented conditions, and perceived times were significantly longer in the
unscented store. The authors attributed this unexpected result to an enhanced
subjective experience or “flow” created by the scented environment. Flow is typically
used to describe the behavior of Internet users and can be defined as a self-reinforcing
sequence of intrinsically enjoyable responses accompanied by a loss of
self-consciousness (Hoffman and Novak, 1996). However, contrary to the assertions
of Spangenberg et al. (1996), being in a state of flow is more commonly thought to lead
to time distortion, or incorrect perceptions of the passage of time, than to correct
perceptions (Novak et al., 2000) as observed. Thus, the explanation offered by
Spangenberg et al. (1996) is not entirely consistent with their findings.
Another researcher who looked at time distortion was Hornik (1992); he indicates
that positive moods result in underestimation of time spent, whereas negative moods
result in overestimation. This outcome is partially consistent with the findings of
Spangenberg et al. (1996), if unscented environments are correlated with more negative
moods. However, the impact of scented environments and/or mood remains
unexplained. The present study provides another look at this topic. First,
consumers’ actual and perceived shopping times are measured to improve
understanding of how conditions in the service environment might influence time
perceptions. Here, consideration is given to improving understanding of how
environmental conditions relate to the customer experience. Specifically, if ambient
MSQ scent increases the likelihood that customers experience “flow” or an enhanced
subjective experience, they might be expected to underestimate time spent. An
22,2 extension related to the second set of hypotheses addresses this issue:
H2c. A positive treatment in the ambient environment results in an
underestimation of time spent in the store.
170 2.4 Mood as a moderator
The strength and direction of the relationship between a perceived servicescape and an
individual response to it can be moderated by both personal and situational factors,
including traits such as desire for arousal or ability to screen environmental stimuli,
and transient states such as mood or time pressure (Bitner, 1992). According to Russell
and Snodgrass (1987), personality can also play an important role in an individual’s
reaction to an environment. Using their approach to personality, for example, an
outgoing person might enjoy eating at a crowded diner counter, in order to take
advantage of the ample opportunities to socialize, whereas a timid individual might
find a crowded diner counter over-stimulating or intimidating. Similar to personality,
mood is also thought to influence appraisals of a physical environment. Gifford (1980)
for example, finds that visitors in pleasant moods rate public building interiors more
positively than do those in less pleasant mood states.
Customer affective states have been shown to impact perceptions of services
(Moshe et al., 2009) and perceptions of servicescapes (Gifford, 1980). Building on these
findings, we suggest that front-line service provider perceptions of a servicescape and
the resultant attitudes and behaviors can also be expected to vary with individual
mood states (see, e.g. Hornik, 1992). Because service providers interact with many
customers in a given work day, their moods can be an important part of creating the
customer shopping experience. Therefore, service provider mood may impact the
relationship between the servicescape and customer outcomes. Our final set of
hypotheses addresses the impact of provider mood on the relationship between
features of the service environment and the resultant customer interaction:
H3a. The impact of the service environment on service provider attitude is
moderated by provider mood.
H3b. The impact of the service environment on customer perception of the
service provider is moderated by provider mood.
All of the hypotheses described in this section were tested in a field study utilizing
multiple data collection methods. The study is described thoroughly in the next
section.

3. Methodology
To empirically test the influence of the servicescape on customers and front-line service
providers, as well as on interactions between them, a multi-method data collection
approach was utilized. The study, following a methodology similar to that of Lin and
Liang (2011), included an observational component and provider and customer
surveys. By including both observational and survey components, the methodology
allows for examination of hypotheses relating to time distortion and the impact of
service provider mood on the relationship between the service environment and
consumer/provider attitudes and behaviors in an actual retail environment. In addition,
an experimental design was used in order to test hypotheses relating to the impact of Environment,
the servicescape design on both consumer and service provider attitudes and
behaviors, as well as its impact on the interactions between consumers and service
provider mood,
providers. and interaction
The study took place over three consecutive Saturdays in early spring at a retail
store located in the Midwestern US. The first day served as a control condition, so the
store atmosphere was not manipulated. On the second and third Saturdays, treatments 171
were implemented – specifically, the ambient scent was manipulated using
commercial scent machines. The owner of the store was given a list of over one
hundred commercially available scents; from these, he selected scents of cedar and
fress-cut grass based on his perception of their appropriateness given the store’s
merchandise which could be described as typical of a local owned hardware store.
Appropriateness (or fit) has been shown to be an important determinant of the impact
of atmospheric variables (Chebat et al., 2001; Morrin and Chebat, 2005), making it
important to seek the advice of an experienced retail manager or shop owner. Our goal
was to test our hypotheses in an actual retail setting. The hardware store was an
appropriate choice; the type of merchandise sold was not a primary consideration in
the study. Because access to retail locations is difficult to obtain, hypotheses were not
tested in other store types, as noted in the limitations section.
Related to choice of scents used in the study, we note that although Spangenberg
et al. (1996) report no difference between various scents rated as neutral or pleasing in
their affective quality, other research suggests that specific scent characteristics may
be important determinants of effectiveness, depending on the goal. Given an objective
to improve quality perceptions and preferences of household products, Bone and
Jantrania (1992) achieve this goal experimentally, in conditions where the scent of the
product is appropriate given the product’s purpose. For instance, lemon scent is viewed
as consistent with household cleaner and coconut is a good fit with sunscreen. In a field
study, Spangenberg et al. (2006) also find positive impact resulting from an appropriate
aroma. An upscale clothing retail store was alternately scented to appeal to men one
week and women the next; results demonstrate that consumers evaluate a store and its
merchandise more favorably in scent conditions congruent with gender.
Behavioral intentions and actual behaviors (number of items purchased and dollar
volume of sales) are also positively influenced by a congruent scent. In a test of
scratch-and-sniff advertising stimuli, Ellen and Bone (1998) obtain significantly more
negative perceptions and lower purchase intentions for consumers viewing a floral
photo with an inconsistent scent (pine) compared to those with either an appropriate
scent (floral) or unscented conditions. Thus, these authors suggest that the violation of
expectations due to incongruency leads to the greatest negative impact on consumer
attitudes. We did not want to drive a negative impact owing to the store environment,
so we requested scents that would be viewed as appropriate given the store’s target
market and merchandise.
Cedar scent was used on the second Saturday, and fresh-cut-grass on the third. Two
scent machines, each measuring only 900 by 900 (23 by 23 cm), were positioned
inconspicuously in the two middle aisles of the store atop the merchandise shelving
after the close of the store the evening before usage. This placement maximized the
effectiveness of the scent machines by taking advantage of the airflow provided by the
store’s ventilation system, and kept the machines out of the general sight lines of both
the service providers and shoppers. The presence of the ambient scent and functioning
MSQ of the machines were monitored periodically by the researchers. This monitoring was
22,2 accomplished under the guise of evaluating the general condition of the store and
was carried out during periodic walkthroughs of the servicescape.
The sample frame consisted of all shoppers exiting the store; front-line service
providers working on each of the three observation days were also asked to complete
surveys. Data were collected using a combination of observation, self-report
172 questionnaires, and scanner files. Using a structured observation sheet, researchers
recorded the time that each shopper entered the store. As each shopper exited, the time
was again recorded; so the actual duration of the visit is known. In addition, all
shoppers were asked to participate in a short self-administered questionnaire utilizing
items similar to those used by Spangenberg et al. (1996). The survey asked shoppers to
estimate (without looking at a watch) how much time they had spent in the store; they
also evaluated the store’s merchandise, service providers, and atmosphere using
five-point semantic differential response options. Shoppers indicated overall
satisfaction and intention to re-patronize the store, again using five-point semantic
differential response options. A final section of the survey asked shoppers to provide
information about their purchases and demographic characteristics. (A list of survey
items used is included in the Appendix.) Incentives, in the form of snacks and store
coupons redeemable the following month, were used to encourage response.
Over the course of the study 1,058 shoppers were tracked, of which 251 (24 percent)
completed the survey. Approximately the same number of shoppers were tracked
across all three observation days; 339 shoppers were tracked in the control condition,
364 and 355 in the experimental conditions. On average, 12 shoppers were in the store
in any given 15 minute block; ANOVA results suggest there were no significant
differences across the three observation days (F ¼ 0.08, p ¼ 0.92). Participation in the
self-administered survey was lowest in the control condition with 66 (19 percent)
shoppers completing the survey. In the experimental conditions 98 (27 percent) and
87 (25 percent) completed the survey. Scanner data were used to link observational and
survey results. By comparing the time recorded on the observation sheet with the time
stamp on the sales record, each survey response could be matched to a sales record.
The sales record also indicated which service provider rang up the purchase, allowing
the employee survey responses to be matched with appropriate customer survey data.
Front-line service providers participated in the study by completing
self-administered questionnaires at the beginning and end of each shift, in a manner
similar to that utilized by Stilley et al. (2010). The pre-shift survey measured service
provider mood, whereas the post-shift survey asked them to evaluate store working
conditions, courtesy of the shoppers, and their own behavior during the shift. Provider
mood was evaluated using an established mood scale, consisting of 20 items reflecting
both positive and negative affect, developed by Watson et al. (1988). The mood scale
and all other survey items utilized five-point semantic differential response options.
Over the course of the research study, 13 sets of surveys (both pre-shift and post-shift)
were collected; five during the control condition and four during each day of the
experimental condition. However, one employee did not complete the post-shift survey
on the second observation day; two of the employees participated on all three days,
three participated on two of the three days, and one employee participated only once
during the course of the study. Neither the service providers nor the customers were
informed of either the scent or the research objectives guiding the study.
4. Data analysis and results Environment,
In analyzing the data, potential differences between the impact of cedar scent and provider mood,
fresh-cut grass scent were considered. The two scents were found not to have a
significantly different impact. Therefore, the scent cells were combined and the study and interaction
considers the overall influence of an appropriate environmental scent.
The first set of hypotheses relate to the impact of ambient scent on perceptions of
the service environment, from the viewpoints of the provider and the customer. To test 173
H1a, which relates to service provider evaluations of the servicescape, the five items
measuring providers’ perceptions of the service environment (gathered from the
employee post-shift survey) were subjected to principal components analysis to reduce
the responses to a single dimension explaining 73 percent of the variance (Green, 1978).
Thus, a single factor score (representing perception of the service environment) was
obtained for each service provider response. (See Table I for factor loadings.)
Regression analysis relating the presence of an appropriate ambient scent to
provider perceptions of the servicescape reveals that these perceptions are
significantly increased by introduction of a scent (F ¼ 53.906, p , 0.001) and
therefore, we accept H1a, which states that a positive treatment in the ambient
environment improves service provider evaluations of the environment. (Single-tailed
tests were used in this instance and wherever testing effects for which directions were
hypothesized.)
H1b concerns the impact of ambient scent on customer evaluations of the service
environment and satisfaction with the shopping experience. To measure the impact of
scent on customer evaluation of the service environment, eight survey items measuring
customer perceptions of the service environment were subjected to principal
components analysis, and a three-factor solution explaining 80 percent of the variance
was retained. (See Table II for factor loadings.)

Item Factor loading

Comfortable 0.96
Attractive 0.95
Interesting 0.95 Table I.
Motivating 0.93 Factor analysis of
Easy to move around in 0.22 employee service
Variance extracted 0.73 environment perceptions

Item Store Merchandise Employees

Interest of the store 0.94

Comfort of the store 0.94
Store attractiveness 0.93
Merchandise quality 0.84
Merchandise prices 0.84
Merchandise selection 0.81 Table II.
Knowledge of employee 0.85 Factor analysis of
Courtesy of clerk 0.81 customer service
Variance extracted 0.80 environment perceptions
MSQ The first factor represents interest, comfort, and attractiveness of the store
environment, the second factor includes perceptions of quality, price, and selection
22,2 of merchandise, and the third factor deals with knowledge and courtesy of the service
providers. MANOVA analysis examining the relationships between use of scent and
each of the three customer perception factor scores failed to achieve significance
(Wilks’ Lambda ¼ 0.992, F ¼ 0.670, p ¼ 0.57), indicating that scent does not influence
174 consumer perceptions of the store environment. ANOVA analysis revealed that the
presence of scent also failed to significantly influence customers’ level of satisfaction
with the shopping experience (F ¼ 0.005, p ¼ 0.94). Therefore, H1b and H1c are not
supported; the presence of ambient scent does not affect either customer perceptions of
the service environment or satisfaction with the shopping experience. Although most
of the previous literature suggests that scent should impact customer perceptions, the
present findings are consistent with Ellen and Bone’s (1998) observation that the
impact of scent is noticeable in customer outcomes only when the scent is incongruent
with other elements of the marketing mix. Therefore, given the store owner’s choice of
an appropriate scent, it is not surprising that its impact on consumer perceptions was
negligible.
The second set of hypotheses relates to the impact of ambient scent on approach
and avoidance behaviors exhibited by service providers and customers. First, the
impact of service environment on service providers’ job-related behaviors is
considered, including interactions with customers. MANOVA analyses reveal that
scent has a significant positive impact on provider self-reported behavior
(Wilks’ Lambda ¼ 0.778, F ¼ 17.05, p , 0.05). Specifically, self-reports of courtesy
(F ¼ 6.129, p ¼ 0.01) and politeness (F ¼ 30.083, p , 0.001) were improved in scented
conditions. Reported friendliness moved in the expected direction, but did not reach
significance (F ¼ 2.354, p ¼ 0.06). Therefore, we accept H2a, in that employees
perceive their politeness and courtesy to be improved when scent is present.
To test H2b, which concerns the impact of service environment on customers’
approach and avoidance behaviors, service provider assessments of customers’
behavior are considered. The presence of an ambient scent does have a significant
impact on service provider perceptions of customer behavior (Wilks’ Lambda ¼ 0.855,
F ¼ 10.158, p , 0.001). Although perceptions of customer courtesy (F ¼ 0.266,
p ¼ 0.30) and politeness (F ¼ 1.434, p ¼ 0.12) did not improve significantly,
perceptions of customer friendliness are significantly greater (F ¼ 25.259, p , 0.001)
with scent than without it. Therefore, we have partial support for H2b, because in the
presence of scent, customers are reportedly friendlier to service providers.
Evidence of the impact of ambient scent on customer behaviors is further
demonstrated by time distortion effects reported when scent is present, but not in the
control condition. Interestingly, the effect is in a direction opposite of that predicted in
H2c. In the treatment conditions, customers estimate they spent an average of
8.22 minutes in the store, whereas the actual average time spent was 7.44 minutes
(t ¼ 2.080, p , 0.05); thus, we cannot accept H2c because they significantly
overestimate time spent. In the control condition, the amount of time spent in the
store was 9.11 minutes and customer estimates of time spent are accurate at
9.74 minutes (t ¼ 0.917, p ¼ 0.36).
The third set of hypotheses tests for a moderating impact of provider mood on the
relationship between the service environment and service provider attitude. To utilize
the mood data, the relevant survey items were separated into those measuring positive
and those measuring negative affect, and the results summed for each set of items Environment,
separately, as recommended by the scale developers (Watson et al., 1988). This permits provider mood,
positive and negative affective states to be considered as two separate dimensions. No
moderating relationship is found for the positive affect scale; therefore, it is not used in and interaction
further analysis.
To test H3a, which hypothesizes a moderating effect of mood on the relationship
between presence of a scent and service provider behavior, provider self-reported 175
behaviors are subjected to principal component analysis in order to reduce the items to
a single dimension (Green, 1978). This single dimension accounts for 74 percent of the
variance in the original items. (See Table III for factor loadings.)
The moderating effect of levels of negative provider moods on the relationship
between scent and employee self-reports was examined using ANOVA. The results
(see Table IV) indicate that negative affect does act as a moderator of the relationship
between scent and employee self-perceptions of behavior; the interaction term is
significant (F ¼ 27.152, p , 0.001). Therefore, we accept H3a, because the impact of
the service environment on service provider attitude is moderated by provider mood.
H3b proposes that the relationship between the service environment and customer
perceptions of service provider behavior is moderated by provider mood. To test this
hypothesis, ANOVA is again used. Results (see Table IV) indicate that negative
provider affect is a significant moderator of the relationship between the service
environment and customer perceptions of service provider behavior, as the interaction
term is significant (F ¼ 3.389, p , 0.05). Therefore, we accept H3b because the impact
of the service environment on customer perception of the service provider is found to
be moderated by provider mood.
To improve understanding of these moderated relationships, the negative
affect score is subjected to a median split, and mean scores are plotted to provide

Item Factor loadings

Courtesy 0.95 Table III.

Politeness 0.66 Factor analysis of service
Friendliness 0.62 provider self-reported
Variance extracted 0.74 behaviors

Source of variation SS df Mean square F p-value *

H3a: Provider self-reported behavior

Scent 27.148 1 27.148 36.228 ,0.001
Negative affect 6.279 1 6.279 8.379 ,0.010
Scent £ negative affect 20.347 1 20.347 27.152 ,0.001
H3b: Customer perceptions of provider behavior
Scent 5.992 1 5.992 6.321 ,0.010
Negative affect 9.972 1 9.972 10.520 ,0.010
Scent £ negative affect 3.212 1 3.212 3.389 ,0.050 Table IV.
ANOVA analyses for
Note: p-value given is for a single tailed test, consistent with hypotheses H3a and H3b
MSQ a visual assessment of the moderating effects of mood (see Figures 1 and 2).
22,2 Negative affect includes a variety of aversive mood states: low negative affect can be
described as a state of calmness (Watson et al., 1988). The scale developers’
terminology for the scale end-points is adopted here; the term “aversive” is used
to describe the upper portion of the negative affect range, and the term “calm” is used to
describe the lower portion of the negative affect range.
176

Figure 1.
Impact of mood on
scent £ provider
self-reported behavior
relationship

Figure 2.
Impact of mood on
scent £ customer
perceptions of provider
behavior
As can be seen in the figures, when service providers are calm (having low negative Environment,
affect), scent has no impact on self-reported evaluations of behavior. However, when
service providers exhibit high negative affect, the presence of scent significantly
provider mood,
improves self-perceptions of behavior (see Figure 1). Considered from the consumers’ and interaction
perspective, when providers are calm (having low negative affect) scent has no impact
on the perception of provider behavior (see Figure 2). However, consumer perceptions
of provider behavior are significantly more negative when providers are suffering from 177
high negative affect and the environment is scented. These findings suggest that the
impact of scent can only be negative, as scent tends to inflate providers’ self-reports of
behavior but leads to decreases in consumer perceptions of that same behavior. Thus,
service provider mood acts as a moderator of the relationship between the service
environment and evaluations of provider behavior, both from the provider and
employee perspectives, providing strong support for H3a and H3b.
In summary, results suggest in support of H1a and H2a that a positive treatment in
the ambient environment improves service providers’ evaluations of the service
environment as well as their perceptions of interactions with customers. However,
results generally did not support a corresponding improvement in customer
evaluations, satisfaction, or perceptions of interactions; H1b and H1c were rejected
and H2b was only partially supported. Further, in opposition of H2c, we found that a
positive treatment in the ambient environment results in an overestimation of time
spent in the store, rather than an underestimation, as hypothesized. Finally, H3a and
H3b were both supported. Results suggest the impact of the service environment on
service provider attitude and customer perceptions of the service provider are both
moderated by provider mood.

5. Discussion and conclusions

5.1 Research goals and theoretical contributions
The primary goal of this research was to improve understanding of the service
environment’s impact on interactions between service providers and customers;
ambient scent was manipulated to examine the impact of environmental change.
Attention was also given to the initial mood state of the service providers. Based on
prior literature, hypotheses relate to attitudes and behaviors of service providers and
customers in a retail environment. The study also explores how these relationships
might be moderated by the service provider’s mood state on a given day. Several
significant results are observed, some of which are consistent with previous findings
and others of which are somewhat surprising.
The outcomes of testing the first hypothesis indicate that use of positive
atmospherics (specifically ambient scent) leads to better employee attitudes in the
service environment. A similar hypothesis for customers considers satisfaction as well
as other attitudes, but no significant relationships are observed. In retrospect, this
seemingly unexpected result should not have been surprising, because it is consistent
with the findings of Ellen and Bone (1998), who suggest that customer attitude is
significantly impacted only in the presence of an incongruent scent. The present study
did not test a scent that was a mismatch to the store environment.
Regarding customer and service provider behaviors, the use of an ambient scent in
the service environment leads to more provider courtesy and politeness, and greater
friendliness on the part of customers. In addition, scent appears to have an effect on time
perception, although not in the direction predicted. Customers overestimate the amount
MSQ of time spent in the store when it was scented, whereas they did not experience time
distortion when the store was unscented. This topic is addressed in greater detail below.
22,2 Perhaps the most interesting finding is that service provider mood acts as a
moderator of the relationship between servicescape characteristics and individual
attitudes and behaviors. However, this is true only for negative mood states. In
particular, when a service provider is in an unpleasant mood, customer perceptions of
178 provider behavior are more negative in the presence of scent, although service
providers perceive their own behavior as improved. Perhaps customer expectations are
elevated by the presence of an ambient scent; then when confronted with a service
provider’s negative attitude, they perceive a breakdown in service delivery, as the
service provided does not match the heightened expectations. There is no
counterbalancing impact of positive moods.

5.2 Limitations and future research directions

Of course, there are limitations to the present research. The only characteristic of the
service environment that was manipulated was scent, so it is not known whether
similar results would be obtained when manipulating other environmental
characteristics. Further, access was granted to only one store over the course of
three consecutive Saturdays, so the possibility exists that factors other than the
manipulated scent may have impacted the dependent variables in the study. Future
research should test for similar relationships in controlled laboratory settings and/or in
other service venues, and might also examine negative scents as well as other
environmental characteristics. Additionally, it is possible that scent may operate
differently in other types of stores. Because this research was conducted in a single
store, differences due to store type could not be investigated. Therefore, additional
research is needed to determine if the influence of scent is stable across store types.
Given the unexpected outcome of testing H2c, some further investigation of the
topic of time perception was undertaken. The goal was to better understand why, in the
scented condition, shoppers would significantly overestimate the amount of time spent
in the store. Smith and Sivakumar (2004) provide one possible explanation. They
suggest that shoppers engaged in impulse buying are more likely to underestimate
time spent, because impulsive behavior moderates the relationship between flow and
shopping. (In fact, at least one study finds no direct relationship between flow and
reported purchasing; see Bridges and Florsheim, 2008.) Thus, shoppers who do not
behave impulsively, especially those who cannot even find what they do wish to buy,
are less likely to be in flow and may be more likely to overestimate time spent.
To test for an interaction between potential flow due to scent and impulse
purchasing, ANOVA analysis was run. The results indicate a significant interaction
between scent and impulse buying (F ¼ 4.028, p , 0.05). To clarify the interaction
between scent and impulse purchasing, a profile plot was created comparing the
overestimation of time spent in the store between those shoppers who were shopping
on impulse and those who were not (see Figure 3). As the plot indicates, shoppers not
engaged in impulse buying correctly estimate the amount of time spent in the store, in
both the scented and unscented conditions. Impulse shoppers also correctly estimate
the amount of time spent in the store in the unscented condition. However, in the
scented condition, impulse shoppers significantly overestimate the amount of time
spent shopping. Although it is consistent with our overall findings, this result seems
surprising, because the combination of scent and impulse purchasing was anticipated
 Environment,
provider mood,
and interaction

179

Figure 3.
Impact of impulse
shopping on scent x time
overestimation
relationship

to result in a significant underestimation of time spent in the store. Further research

should clarify under what conditions positive or negative time distortion occurs, and
should also improve understanding of the mechanism by which it occurs.

5.3 Managerial implications

Our results suggest that the presence of an appropriate ambient scent in a retail
environment positively impacts service provider attitudes and behavior, but does not
greatly impact consumer attitudes. This finding supports Ellen and Bone’s (1998)
contention that incongruent or mismatched atmospherics may be more effective than
congruent ones at influencing consumer attitudes. It is important to keep in mind,
however, that the impact of incongruent scents may not be in a direction desired by the
retailer. Store management should not take lightly the responsibility of selecting
environmental extras such as scent. Rather, the decision to scent the store environment
should come from an experienced manager familiar with the store, its merchandise, and
its clientele. Alternatively, customers may be asked to assist in the selection of an
appropriate scent.
A second important implication for managers concerns how ambient conditions
might interact with other factors of relevance in the service encounter. For example,
our study investigates the potential interaction between employee mood and ambient
conditions. We find that when employees suffering from negative mood states are
staffing the store, the presence of an ambient scent artificially elevates the service
providers’ perception of their own behavior while simultaneously degrading the
consumers’ perceptions of the same behavior. Therefore, we caution that use of scent
may be inadvisable in certain circumstances.
MSQ Practitioners may be well advised to make efforts to improve service provider
moods (possibly through improved facilities, financial rewards, or even perks like free
22,2 coffee and donuts) before investing in environmental extras, such as scent. By reducing
negative moods, unintended interactions with the improved servicescape may be
avoided. Additionally, care should be taken to recruit and retain service providers with
positive outlooks. In this regard, personality tests used by human resource
180 professionals could prove valuable. Above all, the careful monitoring of social
interactions between the customer and service provider should be maintained, because
these types of interactions have been shown to be a key driver of the customer
experience (Walter et al., 2010).
Finally, this study has important implications for managers trying to decide on
tactics in the marketing mix. We find that the addition of an appropriate ambient scent
generally improves attitudes among service providers, while doing little in the way of
influencing customer attitudes. Thus, environmental conditions may not always have
equal impact on customers and service providers. Before embarking on efforts to
improve service environments, retailers may want to carefully consider the target of
their effort and test pilot any modifications to determine if the change influences the
correct audience. These suggestions, used in tandem with an ambient scent should
produce positive responses in both employee and customer attitudes and behaviors
and allow the positive effects of scent to shine through.

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Appendix. Customer self-administered survey items

Without looking at your watch, how long did you spend shopping in [store] today?
Shoppers were asked to evaluate the store environment, merchandise, and employees using
the following items. Five point response options were utilized for each question (end points given):
.
Satisfaction: completely satisfied – completely dissatisfied.
.
Merchandise selection: better than expected – worse than expected.
.
Merchandise quality: better than expected – worse than expected.
.
Merchandise prices: better than expected – worse than expected.
.
Courtesy of clerk at register: better than expected – worse than expected.
.
Knowledge of employee: better than expected – worse than expected.
.
Store environment: unattractive – attractive.
.
Store environment: uncomfortable – comfortable.
.
Store environment: uninteresting – interesting.

When I was in [store] today I felt inspired to start a new project. Completely agree – completely
disagree.In the future if you wish to purchase the same type of merchandise you purchased
today, how likely would you be to visit this [store]? Very likely – very unlikelyWould you say
that you bought less than what you intended to buy, just what you intended to buy, or more than
what you intended to buy?

Corresponding author
Kendra Fowler can be contacted at: kfowler01@ysu.edu

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