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STUDY OF STORE ATMOSPHERICS IN DEPARTMENT

STORES AND ITS EFFECT ON BUYING BEHAVIOR OF


CUSTOMERS

Research Project Report

Submitted to the Punjab Agricultural University


in partial fulfillment of the requirement
for the degree of

MASTER OF BUSINESS ADMINISTRATION


In

MARKETING MANAGEMENT
(Minor Subject: Economics)

By

Navdeep Singh Sekhon


(L-2013-BS-31-MBA)

School of Business Studies


College of Basic Sciences and Humanities
©PUNJAB AGRICULTURAL UNIVERSITY
LUDHIANA-141004

2015
CERTIFICATE – I

This is to certify that the research project entitled “Study of Store Atmospherics in Department Stores
and its Effect on Buying Behavior of Customers” submitted for the degree of Master of Business
Administration in the subject of Marketing Management (Minor Subject: Economics) of Punjab
Agricultural University, Ludhiana is a bonafide research work carried out by Navdeep Singh Sekhon (L-
2013-BS-31-MBA) under my supervision and that no part of this research project has been submitted for
any other degree.

The assistance and help received during the course of investigation have been fully
acknowledged.

_________________________________
Dr. (Mrs.) Gagandeep Banga
Major Advisor
Associate Professor,
School of Business Studies,
College of Basic Sciences and Humanities,
Punjab Agricultural University,
Ludhiana - 141004
CERTIFICATE – II

This is to certify that the research project entitled “Study of Store Atmospherics in Department Stores
and its Effect on Buying Behavior of Customers” submitted by Navdeep Singh Sekhon (L-2013-BS-
31-MBA) to the Punjab Agricultural University, Ludhiana, in partial fulfillment of the requirements for
the degree of Master of Business Administration, in the subject of Marketing Management (Minor
Subject: Economics) has been approved by the external examiner along with the internal examiner after
an oral examination on the same.

_____________________ ______________________

Internal Examiner External Examiner

____________________________

(Dr. Sandeep Kapur)

Director
School of Business Studies
ACKNOWLEDGEMENT

First of all, I am indebted to the Almighty by whose kindness; I have been able to achieve a huge
goal of my life.

I express my sincere thanks to my Major Advisor, Dr. (Mrs.) Gagandeep Banga, Associate
Professor, School Of Business Studies, for her dexterous guidance, inspiration, sustained encouragement,
keen interest and precious time given to me during the course of research project and in successful
completion of the manuscript. I consider myself fortunate to have an opportunity to work with her.

I owe my thanks to Dr. Babita Kumar, Associate Professor, School Of Business Studies, for her
valuable guidance throughout my research work. I would also like to thank Dr. Parminder Kaur,
Associate Professor of Agricultural Economics, Department of Economics and Sociology for her valuable
suggestions during the preparation of this manuscript. I owe special thanks to Dr. Ramandeep Singh,
Nominee of the Dean, PGS.

I express my deep appreciation to Dr. Sandeep Kapur, Director, School Of Business Studies for
his sagacious guidance. I express my sincere thanks to all other faculty members of School Of Business
Studies for providing necessary facilities during the tenure of my studies.

I express my thanks to all my friends Amrinder, Satbir and Lakshdeep who were there for me
whenever I needed them and also for their valuable support. Finally, I would like to thank my family
members, for always being there on my side.

Place: Ludhiana __________________

Dated: (Navdeep Singh Sekhon)


Title of the Project Report : Study of Store Atmospherics in
Department Stores and Its Effect on
Behavior of Customers

Name of the Student : Navdeep Singh Sekhon

Admission No. : L-2013-BS-31-MBA

Major Subject : Marketing Management

Minor Subject : Economics

Name and Designation of : Dr. (Mrs.) Gagandeep Banga


Major Advisor Associate Professor
School of Business Studies

Degree to Be Awarded : M.B.A


Year of the Award of Degree : 2015

Total Pages in the Project Report : 51 + Annexure + VITA

Name of University : Punjab Agricultural University,


Ludhiana-141004, Punjab, India

ABSTRACT

The present research was conducted to study the store atmospherics in department stores and its
effect on buying behavior of customers. The study was conducted by selecting 10 stores which qualify the
definition of Department stores, from Ludhiana city and by selecting 15 customers from each store on
basis of systematic random sampling. Thus, a total sample size of 150 customers was selected. Primary
data was collected with the help of structured and non-disguised questionnaires and observation chart.
Two separate questionnaires were prepared. For the first objective, data was collected from the store
managers and by observation chart. For the second objective, data was collected from the customers. The
study showed that store atmospherics components are one of the most important tools to attract customers
and increase sale. The store atmospheric components are exterior, general interior, store layout and
interior display. The most effective store atmospheric components are store interior display and exterior
of the department store. The customers feel that store atmospherics increase their comfort level and makes
them store loyal.

Key words: Store Atmospherics, Department Stores, Store Strategies, Shopping Behaviour.

_______________________ _______________________

Signature of Major Advisor Signature of the Student


CONTENTS

____________________________________________________________________________________

CHAPTER TOPIC PAGE NO.

I INTRODUCTION 1-8

II REVIEW OF LITERATURE 9-14

III RESEARCH METHODOLOGY 15-18

IV RESULTS AND DISCUSSION 19-44

V SUMMARY 45-50

REFERENCES 51-53

ANNEXURE I

ANNEXURE II

ANNEXURE III

VITA

____________________________________________________________________________________
CHAPTER-I

INTRODUCTION

Retailing includes the business activities involved in selling of goods and services to consumers
for their personal, family, or household use through multiple channels of distribution to earn a profit.
There are many kinds of retail outlets including grocery stores, department, specialty, convenient stores,
fast-food outlets, etc. In retailing businessman buys goods in large quantities from a manufacturer or a
wholesaler and then sells these products and services to consumers fulfilling their personal or family
needs. Retaining is the last stage in a channel of distribution. The retailer is the last but most important
link that connects the manufacturer with the consumer. Retailing in India is one of the pillars of its
economy and one of top five retail markets in the world by economic value. The retail industry in India
accounts for 14 to 15 percent of its GDP and employs about 40 million Indians. The Indian retail market
is estimated to be US$ 500 billion and one of the top five retail markets in the world by economic value.
The share of retail trade in the country’s gross domestic product (GDP) was between 8-10 percent in
2007. India is one of the fastest growing retail markets in the world. India’s retail market has been ranked
20th position among the top 30 developing countries identified by management consulting firm AT
Kearney in its 2014 Global Retail Development Index (GRDI). The size of retailing industry is increasing
rapidly, with more than five lakhs retail outlets globally. Due to the rise in the disposable income there
has been increase in consumer spending resulting in the growth of retail industry in the country. The most
important factors like changing age profile, increasing consumerism, the availability of cheap credit and
changing attitude of the Indians have led to increase of consumers spending in emerging economies. The

In order to appeal to all classes of the society, retail stores would have to identify with different
lifestyles. The attractiveness of the other stores actually appeals to the existing affluent class as well as
those who aspire for to be part of this class. Hence, one can assume that the retailing revolution is
emerging along the lines of the economic evolution of the society. In order to cater to the increasing
complexity in the market place the Indian retailer will need to know exciting time of growth in the retail
sector (Khare, 2011).

Customers increasingly expect higher quality and services and some customization. In response
entrepreneurial retailers are building entertainment into stores. They are marketing an ‘experience’ rather
than a product assortment. Subsequently, store- based small retailers are succumbing to the growing
power of giant retailers (Kotler, 2002).

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1.1 Overview of retailing in India

The Indian retail sector is highly fragmented with about 15 million retailers. Out of the large
number of total retail outlets in the country, majority of them relate to the food items. Since 1990s, big
industrial houses like Rahejas, Piramals, Tatas, etc have started entering the retail industry. Besides,
several Indian and foreign companies have been franchising for establishing exclusive outlets for their
brands, both within the country and overseas. The retail market is expected to reach a whooping Rs. 47
lakh crore by 2016-17, as it expands at a compounded annual growth rate of 15 per cent, accordingy to
the ‘Yes Bank - Assocham’ study.
The retail market, (including organised and unorganised retail), was at Rs. 23 lakh crore in 2011-
12. According to the study, organised retail, that comprised just seven per cent of the overall retail market
in 2011-12, is expected to grow at a CAGR of 24 per cent and attain 10.2 per cent share of the total retail
sector by 2016-17.
The retail industry in India accounts for 14 to 15 percent of its GDP and employs about 40
million Indians. The Indian retail market is estimated to be US$ 500 billion and one of the top five retail
markets in the world by economic value. The share of retail trade in the country’s gross domestic product
(GDP) was between 8-10 percent in 2007. On 7 December 2012, the Federal Government of India
allowed 51% FDI in multi-brand retail in India. The Indian Retail sector has come off age and has gone
through major transformation over the last decade with a noticeable shift towards organised retailing. A T
Kearney, a US Based global management consulting firm has ranked India as the fourth most attractive
nation for retail investment among 30 flourishing markets. In the past few years, Indian Retail sector has
seen tremendous growth in the organised segment. Major domestic players have stepped into the retail
arena with long term, ambitious plans to expand their business across verticals, cities and formats.
Companies like Tata, Reliance, Adani Enterprise and Bharti have been investing considerably in
the booming Indian Retail market. Along with these giant retailers, a number of transnational brands have
also entered into the market to set up retail chains in close association with bigger Indian companies.

High consumer spending over the years by the young population (more than 31% of the country
is below 14 years) and sharp rise in disposable income are driving the Indian organised retail sector’s
growth. Even Tier I & Tier II cities and towns are witnessing a major shift in consumer preferences and
lifestyles, the result of which, they have emerged as attractive markets for retailers to expand their
presence.
The Indian retail sector is highly fragmented and the unorganized sector has around 13 million
retail outlets that account for around 95-96% of the total Indian retail industry. However, going forward,

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the organized sector’s growth potential is expected to increase due to globalization, high economic
growth, and improved lifestyle.

The 'Retailers Association of India (RAI)' is the voice of Indian organised and modern retailers
putting forward their demands. Launched by the key retailers of the country, its founder membership
comprises the leading retailers like Aditya Birla Retail Limited, Bharat Petroleum Corporation Ltd;
Damas Goldfields Jewellery Pvt. Ltd, etc.

1.2 Retail Formats


Store type has been defined based on the benefit that the shoppers would draw from the
store. It can also be taken as the positioning/image platform used by the store. According to them,
customers see a store as a collection of characteristics and benefits sought. The model is designed to
predict a customer’s evaluation of a store based on store’s performance on several attributes, and the
attributes’ importance the customer. There are following types of store based retail formats :
1.1.1 Department Store
A department store is a large shop stocking many varieties of goods in different departments.
Department stores today have sections that sells the following clothing, furniture, home appliances, toys,
cosmetics, gardening, toiletries, sporting goods, do it yourself, paint, and hardware and additionally select
other lines of products such as food, books, jewelry, electronics, stationery, photographic equipment,
baby products, and products for pets. These stores have generally 120,000 to 300,000 square feet of
selling space. Department stores offer many customer services, such as knowledgeable and helpful sales
clerks, delivery and wrapping services, liberal return policies and store credit cards. Examples of
department stores are Lifestyle, Westend etc. Some are part of a retail chain of many stores, while others
may be independent retailers.
1.1.2 Discount Store

A discount store is a shop that sells goods at less than the normal retail price. A department
store which offers its items at a lower price than many other retail stores is a discount store. Discount
stores are often able to drop their prices due to efficient distribution. Discount stores are those stores that
sell merchandise, especially consumer goods, at a discount from the manufacturer's suggested retail price.
They are also called as discounter and discount house. They usually have many name-brand products and
offer a wide price range of the items. e.g.: The world famous stores of Wal-Mart, Big Bazaar, Kmart etc.
are basically discount stores.

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1.1.3 Supermarket
A supermarket is a large self-service shop selling foods and household goods. The supermarket
typically comprises meat, fresh produce, dairy, and baked goods aisles, along with shelf space reserved
for canned and packaged goods as well as for various non-food items such as kitchenware, household
cleaners, pharmacy products and pet supplies. Easyday, Metro, More, etc are some examples of
supermarkets.
1.1.4 Warehouse stores
A retail format which sells limited stock in bulk at a discounted rate is called as warehouse store.
Warehouse stores do not bother much about the interiors of the store and the products are not properly
displayed. A warehouse store or warehouse supermarket is a food and grocery retailer that operates stores
geared toward offering deeper discounted prices than a traditional supermarket. These stores offer a no-
frills experience and warehouse shelving stocked well with merchandise intended to move at higher
volumes. Factory outlets are kind of warehouse stores.
1.1.5 Mom and Pop stores (Kirana stores)
Mom and Pop stores are the small stores run by individuals in the nearby locality to cater to daily
needs of the consumers staying in the vicinity. They offer selected items and are not at all organized. The
size of the store would not be very big and depends on the land available to the owner. They wouldn’t
offer high-end products. Bread, Stationery, Toys, Cigarettes, Cereals, Pulses, Medicines etc are some of
the merchandizes of these stores.
1.1.6 Specialty stores
As the name suggests, Specialty store would specialize in a particular product and would not sell
anything else apart from the specific range. Specialty stores sell only selective items of one particular
brand to the consumers and primarily focus on high customer satisfaction. For example you will find only
Nike merchandise at Nike store and nothing else, thus making it a speciality store. You can never find
Adidas shoes at a Nike outlet.
1.1.7 Shopping Malls
A shopping mall is a large retail complex containing a variety of stores and often restaurants and
other business establishments housed in a series of connected or adjacent buildings or in a single large
building. Food courts, Department stores, movie theatres, play courts are some of the components of a
shopping mall. MBD, Westend, etc are the examples of shopping malls.
1.3 Store Atmospherics

In retail industry high level of competition exists. Fast response and ability in understanding
customers’ behavior influences the success of retail business. Retail business must focus on its customer

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preferences and factors influencing a customer’s purchase decision. Store atmospherics form the overall
context within which shoppers make decisions of store selection and patronage. Retailers must realize the
importance of atmospherics and systematically try to implement them that will attract their target
customers. There are components governing both store exterior and interior, which includes color co-
ordination, lighting design and the application of design principles. The retail environment is changing
more than ever before. It is characterized by intensifying competition and more sophisticated and more
demanding customers who have greater expectations related to their consumption experiences. A retail
store experience involves more than a non retail services experience in terms of customers negotiating their
way through store, finding the merchandising they want, interacting with several store personnel along the
way, and returning merchandise, all of which influence evaluations of service quality (Dabholkar et al.,
1996).
Most recent classification of the store atmospherics was created by Berman and Evans (Berman
and Evans 2007). They suggested that store atmospherics variables are divided into four different
categories:

1. External variables (for example exterior display windows, color of building, location, etc.)
2. General interior variables (for example color schemes, lighting, music, scents, etc.)
3. Store layout variables ( for example space design and allocation, traffic flow pattern)
4. Interior display variables ( for example point of purchase displays, price displays)

It was noted by some researchers that a fifth element, human variables (for example employee
characteristics, uniforms and privacy), is missing from the Berman and Evans classification.

I) External Variables

These variables communicate to customer who retailer is and what they stand for. Exterior draws
attention and provides first impression to customers about the store. Interesting windows displays, an
impressive building and inviting entrances all these entice customer to enter store. A style of shop sign or
name board even forms an input for customers. Retailers are aware of today about powerful impact of them
on its store image and should be planned accordingly. Some retailers use frontage to showcase campaigns
or use heritage buildings for a look of store. Theme for exterior depends on target to serve and merchandise
mix to be offered. Elements of exterior design of store are storefront, store entrance and walkways, display
windows, exterior building height and parking facility.

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II) General Interior Variables
Numerous elements affect customer’s perception when they are inside the store and retailers
should plan accordingly to gain maximum. Aesthetics form integral part of interior design. General interior
variables consist of flooring and carpeting, color schemes, lighting, music, scents, width of aisles, wall
composition, paint and wallpaper, cleanliness. Consumers then form positive perceptions of the store,
which also increases time spent in store and leads to a higher chance that a purchase will be made. The
music would also have to suit the store environment. People shop longer and spend more if aisles are wide
and uncrowded. Dressing facility can be elaborate, plain or non-existent. Polite, well groomed,
knowledgeable personnel generate a positive atmosphere. Graphics and signage are meant for informing
customers about products, special offers, and prices. Last but not least cleanliness should be maintained in
the store to create positive environment. No matter how impressive the exterior and interior, an unkempt
store will be perceived poorly.
III) Store Layout Variables

Integral to interior store design is layout. The manner in which merchandise or products arranged
in store. It affects movement of customers in store. Ideal layout provides a balance between merchandise
displayed and productivity. To facilitate movement and flow of customers in entire store areas are
demarcated prime selling, impulse merchandise areas and seasonal merchandise areas. Entrance as
“decomposition zone' is transition to new environment. Entry zone should be used for deep discount
merchandise or flowers, seasonal like umbrellas, artificial flowers etc. The layout design allows complete
presentation of merchandise to customers and encourages moving complete store to tap unplanned
purchase. So many keep separate entry and exit. Straight (grid) and curving (free flow) are layout patterns.
Factors considered in locating various departments are amount of traffic generated by that department, an
analysis of footfalls in department, sales potential and basket analysis of customer likely to buy. Customer
feels familiar, comfortable when products presented in same manner across locations of chain of stores. It
helps in brand building, loyalty and trust.

IV) Interior Display Variables

These variables are helpful in orderly, systematic, logical and intelligent way of putting stock on
the floor. They involve planning for store windows, floor displays, signs, space designs, fixtures and
hardware, props and mannequins. Retailing becoming complex creating right atmosphere and presenting
merchandise in right way becomes necessity. Good understanding of products and customer is vital for
visual merchandising means a selling space that is neat, easy to see, follow and shop. It enables customers
to buy quickly, efficiently and comfortably. Each point-of-purchase (PoP) display provides shoppers with

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information, adds to store atmosphere and serves a substantial promotional role. PoP performs multiple
functions at the retail outlet. These can be classified in two broad categories inducing sales and achieving
other communication objectives. In recent times there is an increase in the usage of PoP in retailing. It can
be attributed to many reasons such as changing shopping habits, too much media with too many messages,
too many products, lack of trained retail sales personnel, growth of target marketing and cost effectiveness.
There are several types of displays such as ensemble display, rack display, case display, cut display,
dumpbin, mobile display and electronic display. Most retailers use a combination of them. The primary
purpose of displays is to achieve additional contact with the customer. This is meant to provoke a buying
impulse in the customer. In other words, displays aim at influencing customer’s impulse buying. Hence,
the presentation format of the PoP influences the shopping behavior of customers.

1.4 Effect of Store Atmospherics on Shopping Behavior

Retail atmospherics planning is complex task. The fundamental objective is to maximize sales with
customer satisfaction and minimize overall costs. Many factors affect the store atmospherics planning like
the arrival pattern of customer, building design, desired service level, merchandise-mix, adjacency
requirements and many more. Store atmospherics can affect consumer’s perceptions of a retail
environment and thus there is a likelihood of approaching or avoiding the product or store. Creating
superior customer experience seems to be one of the central objectives in today’s retail environments.
Customer experience encompasses the total experience including the search, purchase, consumption and
after-sales phases of the experiences. All these are closely related to store atmospherics planning and have
significant impact on the customer experience of a retail firm. Store atmospherics could affect shoppers’
behaviors in several ways. Certain response of human being to environment may be conditioned or hard-
wired in the human brain. Store atmospherics also influences various stages of shoppers’ cognitive process
inside a store, including attention, perception, categorization and information processing. For example, it
has been shown that perceived waiting time varies with the valence of music and consumers’
categorization of a restaurant as a fast food outlet depends largely on the external appearance of the store
(Hui and Chebat 1997; Bitner and Barnes 1992).

It has been found that a high level of brand awareness need not always translate into sales. Store
atmospherics play an important role in such situation. Store atmospherics helps in attracting customers to
the department store. Presentation format of the store atmospherics is key determinant of influencing
shopping behavior. Store atmospherics are more effective in influencing shopping behavior when used
with impulsively bought products. At the retail outlet, store atmospherics actually provides the marketer
the last opportunity to communicate with the shoppers before a purchase is made. This communication at

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the shop can play several roles. These include informing, reminding, encouraging, creating excitement and
building store image. A high proportion of all purchases in department store and other retail outlets are
unplanned and many product choices are made while the customer is in the store. Store atmospherics plays
a major role in influencing such unplanned purchases. Store atmospherics also induces the shoppers to stay
at the retail outlet for a longer duration leading to increases spending.

Store atmospherics has to work in environment in which many other stimuli are fighting for
customers’ attention. Customers’ shopping behavior cannot be fully understood outside context in which it
occurs-neither customers nor brands exist in isolation. A shopper goes through a process of “See-Touch-
Sense-Select” in order to buy a product. The degree to which the customer follows the whole or part of this
process varies with brand, product category and other elements of the marketing mix.

1.5 Need For The Study


Store atmospherics are becoming one of the most important aspects of advertising and promotion
because of their efficiency in targeting the customers in the actual buying environment and increasing
competition among retail outlets. It is important to study the shopping behavior of customers in the
department stores i.e. frequency of visit, timing of visit, and amount of money spent, with whom they visit
etc. Although a lot of research has been done on at store atmospherics and its affect on customer buying
behavior but little work has been done on store atmospherics in department stores and its affect on
customer buying behavior in Indian context. Therefore, the present study will be undertaken with the
following specific objectives:

1) To study the elements of store atmospherics of selected department stores.

2) To study the effect of store atmospherics on shopping behavior of customers.

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Chapter-II

REVIEW OF LITERATURE

This chapter provides both the theoretical framework and the discussion of empirical literature for
the study. The aim of this study is to study the elements of store atmospherics of selected department
stores and the effect of store atmospherics on shopping behavior of customers. To give a positive
direction to this study some relevant and significant research studies of the past have been taken from
various articles, journals, books and magazines.

Park and Iyer (1989) considered the effects of two global situational factors-store knowledge and
time available for shopping-on differences between purchase intentions and outcomes and on the amount
in-store purchase volume deliberation. They conducted a field experiment to explore the effects of these
two situational factors on consumers' grocery shopping behavior. The results indicated that these two
factors had an impact on such shopping behaviors as failure to make the intended purchases, unplanned
buying, brand and product class switching, and purchase volume deliberation. The findings also
suggested that the information processing activities that mediate these relationships differ across shopping
conditions.

Donovan (1994) measured emotions during the shopping experience rather than before or after,
and recorded the effects on actual shopping behavior. Arousal was found to vary in its effects. The effects
of the emotional factors of pleasure and arousal were added to cognitive factors such as variety and
quality of merchandise, price specializing and value for money. The practical significance for retailers is
that emotional responses induced by the store environment can affect the time and money that consumers
spend in the store.

Spies (1997) studied the effects of store characteristics on customers' mood, on their satisfaction,
and on their purchasing behavior. Two stores differing with regard to their atmosphere, i.e. their
condition, information rate and layout, were selected. Satisfaction with the store was greater in the
pleasant store. This was due to a direct effect of store atmosphere as well as to an indirect effect mediated
by customers' mood. Customers in the pleasant store spontaneously spent more money on articles they
simply liked.

Sharma and Stafford (2000) examined an unexplored but potentially important area: the influence
of store atmospherics on the level of persuasion induced by retail salespeople. The results of the research
suggested that store ambience and design positively affect customers' persuasion as well as customers'
positive perceptions of salespeople. Their research also suggested that in “prestige ambience” stores, a

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reduction in the number of retail salespeople does not significantly affect customers' buying intentions. In
contrast, in “discount ambience” stores, an increase in the number of retail salespeople dramatically
enhances customers' buying intentions.

Turley and Milliman (2000) focused on the research conducted over the years on the effects of
facility-based environmental cues, or “atmospherics”, on buyer behavior. They reviewed the pertinent
literature by constructing a comprehensive table of the empirical studies in this area that focused on the
various findings associated with these investigations. The summary table indicated that atmospheric
variables influence a wide variety of consumer evaluations and behaviors. The article concluded by
identifying gaps in the literature and suggesting potential future topics for atmospheric related research.

Yalch (2000) extended research linking shopping behavior to environmental factors through
changes in emotional states. Analyses revealed that individuals reported themselves as shopping longer
when exposed to familiar music but actually shopped longer when exposed to unfamiliar music. Shorter
actual shopping times in the familiar music condition were related to increased arousal. Longer perceived
shopping times in the familiar music condition appear related to unmeasured cognitive factors. Although
emotional states affected product evaluations, these effects were not directly related to the music
manipulations.

Lam (2001) reviewed previous studies about the store environmental effects on shopping
behaviors with an aim of identifying issues for future research. A conceptual framework which integrates
various environmental effects was first constructed.These propositions concern the multiple effects of
individual environmental elements/factors, congruence among these elements/factors, congruence
between these elements/factors and a store’s merchandise, the moderating role of consumer
characteristics, and the lagged effects of store environment.

Mattila and Wirtz (2001) analyzed effect of variations in scent and music in stores on consumer
buying behaviors. Research showed when ambient scent and music are congruent with each other in terms
of their arousing qualities, consumers rate the environment significantly more positive, exhibit higher
levels of approach and impulse buying behaviors, and experience enhanced satisfaction than when these
environmental cues were at odds with each other.

Summers and Hebert (2001) studied the influence of display lighting, a component of store
atmospherics, on consumer approach–avoidance behavior. Experiment was conducted by installing
supplemental lighting on merchandise displays in two retail stores to test for effects on consumer
behaviors. Data collected was analyzed using correlations, Analysis of Variance, and Bonferroni paired

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comparisons. The result showed that Supplemental lighting treatments had a positive effect on consumer
behavior. Interactions between lighting and display were found to be statistically significant. These
findings could be used by retailers in developing in-store lighting as part of a store's atmospherics to aid
in attracting and retaining consumer patronage.

Grossbart and Hampton (2002) examined that atmospheric responsiveness is the tendency to base
patronage decisions on stores' physical design and condition and alter shopping behavior because of
crowding. They also examined the relation between responsiveness and environmental dispositions. Their
findings suggested atmospheric responsiveness is related to dispositions reflecting customers' openness to
environmental experience, stimulation, and distraction, urban and pastoral preferences, and adaptiveness
to physical circumstances.

Michon and Chebat (2005) investigated the moderating effects of ambient odors on shoppers’
emotions, perceptions of the retail environment, and perceptions of product quality under various levels of
retail density. The pleasing ambient scents are hypothesized to positively moderate shoppers’ perceptions
of their environment. Ambient odors positively influence shoppers’ perceptions only under the medium
retail density condition. Incongruity theory informed the interaction effect between the two atmospheric
variables. A moderate incongruitylevel is more likely to trigger a favorable evaluation of the situation (the
shopping experience), object (the products sold), or the person (the salesclerks).

Melara and Arangarasan (2007) developed a new research methodology that allows the objective
measurement of the cognitive and psychophysical reactions of individual consumers to structural changes
in realistic store settings. This research examined the effects of different store layout on impulsivity in
making purchases (response bias). Study demonstrated that the actual habits of the shoppers correspond
with their self-assessed motivations, reflecting either a lax or strict criterion in purchase decisions.
Moreover, they found that hedonic shoppers are less accurate overall in properly locating targeted items,
due to the reported differences in shopping approaches.

Yingjiao (2007) studied the impact of store environments on the impulse buying behaviors of
adult Generation Y consumers. Generation Y is emerging as an enormous force in the U.S. marketplace,
with its growing spending power and its members’ unique spending patterns. Results showed that store
environments have a significant influence on these consumers’ emotional states, including pleasure and
arousal, which in turn influence consumers’ impulse buying behaviors in the store. The study also
indicated that the relationship between store environment and adult Generation Y consumers’ emotional
states is moderated by personal factors such as arousability and by situational factors such as time
pressure.

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Park and Farr (2008) examined, through cross-cultural comparison, the effect of the color quality
of light in a retail environment on consumers' emotional states, behavioral intentions, and perceptions.
The results of this study indicate that consumers are aroused and pleased by certain lighting effects and
that cultural differences influence perceptions as well as the behavioral intentions of “approach-avoid” in
a retail environment.

Smith and Chebat (2008) explored how the shopping mall environment influences the shopping
experience and approach behavior of female fashion shoppers. They found out a favorable perception of
the mall atmosphere elicits a positive perception of the merchandise offering and triggers hedonic
shopping experiences. The effect of the mall environment, mediated by product perception, significantly
impacts the shopping objectives of middle‐of‐the‐road female fashion shoppers. Mall atmospherics has no
or little effect on the utilitarian value of low‐ or high‐fashion oriented shoppers.

Baumstarck and Park (2010) examined the effects of dressing room lighting direction on states of
arousal and pleasure, and on shopper self-evaluation and dressing room assessment. The study indicated
that dressing room lighting direction has a specifically strong effect on facial shadowing and perceived
roominess, for which frontal lighting is superior. Designers may consider using frontal lighting instead of
overhead lighting unless they can use both to achieve the most universally acceptable shopper experience.

Demoulin (2011) evaluated the effect of music congruency with the whole atmosphere in a store.
His study demonstrated that music congruency leads to low arousal, which creates high pleasure. Pleasure
induced by music congruency increases customers’ evaluation of environment quality and service quality,
which positively affects the customers’ return intention.

Lunardo and Mbengue (2011) examined the atmosphere of a retail store is a powerful marketing
tool for influencing consumer behavior to the benefit of the retailer. They explored the case where
consumers perceived the store environment as a manipulative tool in use by the retailer. Their study
hypothesized that incongruent store environments urge consumers to make inferences of manipulative
intent (IMI) from the retailers, and that those inferences negatively influence consumer's perception of the
retailers' integrity, and attitudes toward the atmosphere and the retailers. Empirical results from the study
confirmed the hypothesis.

Banat and Wandebori (2012) measured the store design and store atmosphere effect towards
customer sales per visit. This paper proposes that store design and store atmosphere has a significant
effect on the shopping experience which can increase the amount of merchandise that customer purchase.
Fixture and display product arrangement, layout, space, signage, window display and entrances, dressing

12
rooms, lighting, atmosphere, music, and scent plays important role in influencing customers shopping
behavior.

Joshi and Kulkarni (2012) identified the factors which the customers perceive as important
elements of the retail stores atmospherics. The twenty elements of store atmospherics were regrouped into
five factors viz. Impressive store interiors and exteriors, Store Personnel and fellow shoppers, Comfort,
Beauty & Aesthetics, Display and creative arrangement of products on shelves & Attractive displays and
behavior of the store personnel. Study brings out the facts that impressive displays, ability to move freely
in the store, quality of the fellow shoppers and well behaved and humble employees significantly
contribute in enhancing the store atmospherics and gives excellent shopping experience to the customers
translating into more sales and footfalls.

Seock and Lee (2013) identified the important visual merchandising factors and examine the
relationships of those factors with store images and shopper behaviors in the context of home furnishings
retail setting. Factor analysis was employed to identify dimensions of the importance of visual
merchandising and correlation analyses were implemented to examine the relationships among the
variables in this study. Based on the findings of the study, discussions and implications were provided.

Farias and Aguiar (2014) examined that the components of a store atmosphere that can be
manipulated to generate answers on individuals are related to sensory factors. Experiential marketing that
enhances the sensory aspects of consumption helps in understanding the impact of retail environment on
consumer behavior. Their main objective was to propose a conceptual framework for an extraordinary
customer experience. They provided some research propositions aiming to develop the knowledge in this
field. They concluded that it is imperative for retailers today to take in account customers’ holistic
experience as a relevant tool to manage the retail operation in a scenario of global competition.

Sabrina (2014) focused on the influence of different atmosphere factors of a store, on consumer
behavior. At the end of her investigation, she confirmed the impact of factors of environment exercise on
the behavioral and emotional answers of the subject during his visit on the store. Besides, the influence of
the emotional states, felt inside the store, on the actions undertaken by the customers was also verified.
She used a convenience sampling thus reducing the external validity of the study. The research fits into an
exploratory initiative which it would be advisable to complete by the realization of additional researches
concerning other stores and ambient

Singh and Katiyar (2014) conducted research to argue that store image, as it has been previously
developed by marketing academics, is a necessary but insufficient to understand store performance and

13
consumer behavior and to discuss the enhanced conceptual and operational benefits of store equity as
compared with store image. To accomplish this research, the conceptualization and operationalization of
customer-based store equity by explicitly comparing the concept of store atmospherics and store layout
and discussed the implications for marketing practitioners by identifying the considerations for building
and managing customer-based store equity.

Foster and McLelland (2015) study indicated that many retailers still do not actively differentiate
their retail environment from competitors. They considered an alternative approach, where a brand
dictated “theme” is used to guide the manipulation of the atmospheric elements. This allowed retail
brands to break free from standard design to create a more interactive, immersive, and authentic
environment. Outcomes included increases in shopping enjoyment, positive brand attitudes, and brand
loyalty. T-tests were utilized to compare the two approaches within both the apparel and restaurant
industries.

Even though there is a growing literature associated with store atmospherics and its affect on
customer buying behavior but little work has been done on store atmospherics in department stores and its
affect on customer buying behavior in Indian context. The present research is an attempt to fill the gap.

14
Chapter-III

RESEARCH METHODOLOGY

This chapter describes the sampling plan, data collection, statistical procedures used to analyze
the data and finally the limitations of the study. In order to satisfy the first objective data was be collected
from the store managers with the help of questionnaire and observation chart. Another questionnaire was
prepared to satisfy the second objective and data will be collected from customers. The research
methodology adopted for the present investigation is described under the following headings for the sake
of convenience.

3.1 Research design

3.2 Population

3.3 Sample design

3.4 Method of data collection

3.5 Data analysis

3.6 Limitations of the study

3.1 Research design

A research design was formulated which guided the collection and analysis of data. A descriptive
research design was followed and survey was done with the help of a structured non-disguised
questionnaires and a observation chart.

3.2 Population

The population for the first objective consisted of all the Department stores in Ludhiana city like
Easyday, Lifestyle, Reliance market etc. A department store is large retail unit with an extensive
assortment of goods and services that is organized into separate departments for purposes of buying
promotion, customer service and control (Berman and Evans 2007).. For the second objective, the
population comprised of the customers of the selected Department stores in Ludhiana.

3.3 Sample Design

A sample of ten stores which qualified the definition of department store was selected for study.
Efforts were made to select each department store from a different company/corporate. The Department
stores selected for the study were Lifestyle, Westside, Easyday, Reliance Fresh, More, Vishal Mega Mart,
Best Price, Big Bazar, Shoppers’ Stop and Globus. The managers/owners of the selected stores were

15
contacted and interviewed. For the second objective, 15 respondents were selected from each store on
basis of systematic random sampling. Thus, a total of 150 respondents were selected for the study

3.4 Method of Data Collection

Primary data was collected with the help of structured and non-disguised questionnaires. In order
to satisfy both the objectives, two separate questionnaires were prepared. For the first objective, the data
was collected with the help of structured non-disguised questionnaire from the managers/owners of the
selected Department stores. Questions were asked relating to the various components of store
atmospherics in their Department store. An observation chart was also prepared to collect first hand
information of store atmospherics from the store. A separate questionnaire was prepared for the second
objective and 15 customers from each store were contacted, thus a total sample size of 150 customers was
contacted for the study. Data was collected from the customers with the help of a structured non-disguised
questionnaire. Questions were asked related to their awareness of store atmospherics, factors influencing
the choice of Department stores, factors influencing the purchase decision, frequency of purchase,
benefits of store atmospherics to consumers etc.

3.5 Data Analysis

After collection of data, master tables were constructed and analysis of the collected data was
done with the help of statistical techniques like percentage, mean scores, test of significance. The
respondents were asked to rank their degree of agreement, scores were assigned from 1 to 5 for the degree
of agreement (1 for strongly disagree, 2 for disagree, 3 for neutral, 4 for agree and 5 for strongly agree).
On the basis of frequency of ranks for each factor weighted average value for each factor was calculated.
Each factor was given rank on the basis of weighted average value. Similarly a mean score for questions
asked on a 5 point scale was calculated.

 Mean
 Standard deviation
 Test of significance for single mean

The formulae used were

Mean =  Sn*Fn / N

N= Sample size
Sn= Score
Fn= Frequency

16
Standard deviation is calculated as follow:

1
S = √𝑁−1 ∑𝑁
𝑖=1(𝑋𝑖 − 𝑋)
2

Where

S is sample standard deviation

N is number of observations

Xi is particular observation

X is mean of sample

Test of significance for single mean:

t-test is used to test whether the mean value of sample is significantly different from the assumed
mean i.e. the midpoint of the scale. T-test value was calculated by following formula:

𝑋−𝜇
t-test value = 𝑠 /√ 𝑛

Where,

X= the mean of sample

s= Sample standard deviation calculated for the sample

n= the sample size

= assumed mean

t-test was applied to find if there is any significant difference between actual mean and assumed mean.
Calculated value of t is compared with table value. Assumed mean was the midpoint of the rating scale.
Calculated value of t is greater than the table value then it indicates that there is significant difference in
the actual mean and the assumed mean or vice-a-versa.

3.6 Limitations of the study

Any study based on consumer survey through a pre-designed questionnaire and observation chart
suffers from the basic limitation of the possibility of difference between what is recorded and what is the
truth no matter how carefully the questionnaire and observation chart has been designed and field

17
investigation has been conducted. This is because the consumers may not deliberately report their true
preferences and even if they want to do so, there are bound to be differences owing to problems in filters
of communication process. The error has been tried to be minimized by conducting interviews personally
yet there is no fool proof way of obviating the possibility of error creeping in.

In addition there are limitations regarding scope of validity of conclusions as follows:

1. The study relates to Ludhiana. Thus, although there is a possibility of applicability of the
conclusions about consumer behavior for other areas no such general applicability beyond
Ludhiana is claimed.
2. The sample size taken on basis of systematic random sampling might have affected the results of
the study. The objectives and conclusions are only suggestive and not conclusive.
3. Some biasness might have crept in the responses or some information could have been concealed
due to the human nature.
4. Best efforts were made to incorporate all important variables in the study. Yet the chances of
some variables not appearing in the study are not ruled put.
5. Information provided on income was not fully accurate due to unavoidable biases.
6. There were some problems in getting the information from the respondents as they were
interviewed in a very short time and few of them were quite busy to give proper thought to the
questions.
7. The study being based on data available from personal opinions of the respondents may, suffer
from the personal bias up to some extent.

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Chapter-IV

RESULTS AND DISCUSSION

This chapter contains the results obtained from the analysis of primary data collected from the
respondents in order to achieve the set objectives. The results are discussed under the following sub
heads:

 Store atmospherics strategies followed by the Department stores


 Various store atmospherics strategies of Department stores as observed
 Effect of store atmospherics on shopping behavior of customers

4.1 Store atmospherics strategies followed by the department stores

This section analyses the data collected from the owner/ senior managers of the department stores
relating to store atmospherics strategies followed by them. Data related to various parameters like
frequency of change of store atmospherics, store atmospherics decisions in department stores, criteria
used to display products in the department stores, contribution of store atmospherics towards store
ambience and customer convenience and effectiveness of stores atmospherics.

4.1.1 Effectiveness of components of store atmospherics in the Department stores

The respondents were asked to rank effectiveness of store atmospherics components according to
their importance in the Department stores from 1 to 4 where 1 means most important and 4 means least
important.

Table 1: Effectiveness of components of store atmospherics in the Department stores in order of


importance

Components Rank
Interior display 1
Store layout 2
Exterior 3
General interior 4

Table 1 shows the ranks of all the components of store atmospherics on basis of their mean score.
Higher the mean score, higher is the rank. Interior display with rank 1 is given more importance in the

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department stores while Store layout gets rank 2 according to its importance. Exterior and general interior
components of store atmospherics with ranks 3 and 4 respectively get importance.

4.1.2 Decision making regarding of store atmospherics components

The managers were asked that who decide on type of store atmospherics components to be used for
the department stores. The decision about various components of store atmospherics to be used for the
department store was taken by the company in all the 10 stores, which were selected.

4.1.3 Frequency of change of store atmospherics in the department store

The managers were asked that how often they change the store atmospherics in the department
store.

Table 2 Distribution of respondents according to frequency of change of store atmospherics in


department store

Time Period Frequency(N=10) Percentage (%)


< 1 month 0 0
1-4 months 0 0
4-6 months 4 40
>6 months 6 60
Total 10 100

Table 2 shows that store atmospherics were changed in 4 stores (40%) in 4-6 months and in case of
other 6 stores (60%) after 6 months as per the new promotional schemes and advertisement which were
offered from time to time.

4.1.4 Reasons for change in store atmospherics

The managers were asked whether they make changes in store atmospherics of the department
stores according to season, special event or festival.
Table 3 Distribution of respondents according to reasons for change in store atmospherics
Store atmospheric changes No. of respondents(N=10) Percentage (%)
Changing season 2 20
Special event 3 30
Festival 5 50

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The results presented in Table 3 shows that only 5 stores (50%) make changes in store
atmospherics according to festival while 3 stores (30%) made changes in store atmospherics on account
of special event and rest of 2 stores (20%) made changes with change in season.

4.1.5 Criteria for display of products

The managers were asked on what criteria they display the products in the department store.

Table 4 Distribution of respondents according to criteria for display of products

Criteria for display of product Frequency (N=10) Percentage (%)


On category basis 4 40
On the basis of sale of the product 2 20
To promote any brand 2 20
Any other 2 20
No criteria 0 0
Total 10 100

Table 4 shows that 4 stores displayed their products on category basis. 2 stores displayed products
on basis of the sale of the product, 2 stores to promote any brand and rest 2 stores displayed products on
any other criteria. This shows that most of department stores display product on category basis for
customer convenience.

4.1.6 Effect of store atmospherics towards store ambience and customer convenience

The managers were asked to rate five statements related to contribution of store atmospherics
towards store ambience and customer convenience on 1-5 scale where 1 mean strongly disagree with
statement and 5 means strongly agree with the statement.

Table 5 Effect of store atmospherics towards store ambience and customer convenience
(N=10)
Statements Mean Score t-value

Helps in building store image 4.31 8.51*


It creates curiosity and excitement among customers 4.30 6.09*
Helps in creating atmosphere for better shopping experience 4.20 6.00*

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Adds to beautification of store 3.50 2.20NS
Encourages to buy a particular product or a brand 3.20 1.00NS
*Significant at 5% level of confidence ttable (df=9) = 2.26 =3 NS: Non significant
Table 5 shows that, according to response given by managers inorder to find out the contribution
of store atmospherics towards store ambience and customer convenience, statement “Helps in building
store image” with a mean score of 4.31 was found to be most effective, followed by statements
“It creates curiosity and excitement among customers” with mean score 4.3 and “Helps in
creating atmosphere for better shopping experience” with mean score of 4.2. With mean score of
3.2 statement “Encourages to buy a particular product or a brand” is found to be least effective.
Further t-test at 5% level of significance shows that all the statements regarding the contribution
of store atmospherics towards store ambience and customer convenience were found to be significant for
all the statements except the “Adds to beautification of store” and “Encourages to buy a particular
product or a brand”.

4.1.7 Effectiveness of store atmospherics in increasing sales


The respondents were asked to rate the various attributes, which they think contribute towards
increasing the sales of a store. For this likert scale was used to measure the effectiveness of store
atmospherics in making the sale and respondents were asked to rate attributes on scale from 1 to5. The
following table will give the mean scores and t values
Table 6 Effectiveness of store atmospherics in increasing sales
(N=10)
Statements Mean
t-value
Score
Helps in increasing the footfall rate 4.60 7.23*
Helps to promote sales 4.50 6.43*
Effective in selling products even when customers are not
4.40 6.34*
interested in buying
Store atmospherics are effective in helping to make unplanned sale 4.10 3.97*
Good way to sell low image products 3.90 5.01*
*Significant at 5% level of confidence ttable (df = 9) = 2.26 =3
Table 6 shows that, according to response given by managers inorder to find out the effectiveness
of store atmospherics in making sales, statement “Helps in increasing the footfall rate” with a mean

22
score of 4.6 was found to be most effective, followed by statements “Helps to promote sales”
with mean score of 4.5, “Effective in selling products even when customers are not interested in
buying” with the mean score 4.4. With a mean score of 3.9 statement “Good way to sell low
image products” is found to be least effective.
All the statements are significant at 5% level of significance; therefore all attributes
contribute towards increasing the sales of a store.

4.2 Various store atmospherics components of Department stores as observed

An observation chart was prepared to observe and record the store atmospherics being used in
selected department stores. Store interior and exterior were also taken into consideration as these
contributed to the effect of store atmospherics display thus making the atmosphere lively for shopping.
Various types of store atmospheric components being used in the stores were recorded. Analysis of the
observations made in different stores is given below.
4.2.1 Exterior of store
The components of exterior of the store were studied as follow:
I) Types of store front of the department stores
A storefront is the total physical exterior of the store itself. Various alternatives can be used for
planning of storefront. It should attract attention of passing by customers in unfamiliar business
environment.
Table 7 Types of store front of the department stores

Types of store front Observation (N=10) Percentage (%)


Modular structure 8 80
Unique building 2 20
Recessed storefront 0 0
Prefabricated 0 0
Total 10 100

Table 7 shows that 8 stores (80%) used modular structure and 2 stores (20%) have unique
building design to attract the customers.
II) Marquee used in department stores
Marquee is a sign used to display the store name. It can be painted or a neon light, printed or
script and alone or mixed with slogan and other information. To be effective, the marquee should stand
out and attract attention.

23
a) Visibility of Marquee
Observation regarding the visibility of marquee was made as given in table 9.
Table 8 Visibility of Marquee
Visibility of Marquee Observation (N=10) Percentage (%)
Good 7 70
Bad 3 30
Total 10 100

It was found out that 70% of the stores were having marquee of good visibility and other 30% had
poor visibility.

b) Colour of marquee
Observation was made regarding the type of colour used to make marquee.
Table 9 Colours used for marquee by department stores

Colour of marquee Observation (N=10) Percentage (%)


Bright 8 80
Black and white 2 20
Dull 0 0
Total 10 100

According to the observation made it was found that 8 stores used bright colour marquees, while
other 2 were using black and white colours.

III) Entrance of department stores


Store entrance always is attractive as it adds to the beautification of the store and attracts the
customers. The entrance doorway can be revolving, electric, regular or push/pull. The type of entrance are
given in Table 11
Table 10 Type of entrance of department stores
Type of entrance Observation (N=10) Percentage (%)
Electric 2 20
Push pull 7 70
Climate controlled 1 10
Revolving 0 0
Total 10 100

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Table 10 shows that 7 stores were having push pull entrance and other 2 were having electric.
One of them has climate controlled entrance.

IV) Width of walkways in the department stores


Walkways are ways through which customers walk into stores. They should have sufficient width
to accommodate large number of customers into store. Following table shows width of walkways in
different department stores.
Table 11 Width of walkways in the department stores
Width of walkways Observation (N=10) Percentage (%)
Wide 7 70
Narrow 3 30
Total 10 100

Table 11 shows that 7 of department stores have wide width to accommodate large number of
customers while 3 stores have narrow width walkways.

V) Display windows in Department stores.


Display window is a window in shop displaying items for sale. It serves two main purposes: first
to identify the store and its offering and second to induce the people to enter. Observation was made to
see the number of stores using display windows and the size of display windows used in those stores. Size
of display window can be large, medium or small.
Table 12 Presence of display windows in the department store
Display window Observation (N=10) Percentage (%)
Yes 4 60
No 6 40
Total 10 100

Table 12 shows that only 4 stores had display windows, while other 6 were not having. Size of
display windows of these stores was medium.

VI) Exterior building height of the department stores


Exterior building height represents the size of the department store is. It can be disguised or non-
disguised. Table 13 shows height of different department stores.

25
Table 13 Exterior building height of the department stores
Exterior building height Observation (N=10) Percentage (%)
Disguised 5 50
Non-disguised 5 50
Total 10 100

Table 13 shows half of the department stores had disguised exterior height and other half had
non-disguised height.

VII) Availability of parking facility


Observation was made where the customers can park their vehicles while visiting to department
store. Observations were made regarding parking facility availability and its type of which can be free,
paid or both of them.
Table 14 Parking facility of department stores
Availability
Parking facility availability Observation (N=10) Percentage (%)
Yes 10 100
No 0 0
Total 10 100
Type of parking facility
Free 2 20
Paid 2 20
Both 6 60
Total 10 100

Table 14 shows that all the ten stores have parking facility. Out of them 2 had free and other 2
had paid parking facility. Rest of 6 had both type of parking facility availability.

4.2.2 General interior of the store


The components of general interior of the store were studied as follow:

I) Type and colour of flooring used in department store


Observation was made regarding type of flooring used in department stores. Colour of flooring
was also observed. All of the department stores used cemented flooring of a single colour.

26
II) Colour of walls of department store
Observation was made regarding colour of walls of department store. Following table shows
different colour of walls of the department study.
Table 15 Colour of walls of department store
Exterior building height Observation (N=10) Percentage (%)
Bright and vibrant color pattern 4 40
Plain white balls 6 60
Total 10 100

According to observation made 4 department stores had bright and vibrant colour pattern on walls
and rest 6 stores had plain white walls.

III) Presence of distinctive smell in the store


Scent can be very effective in increasing pleasure and positive perception of store. It can be
attributed to the scent emitted by the store that it attracts customer to step into the store, or to think about a
purchase. Table 18 shows whether department stores had distinctive smell or not.
Table 16 Presence of distinctive smell in the store
Distinctive store smell presence Observation (N=10) Percentage (%)
No 3 30
Yes 7 70
Total 10 100

Table 16 shows that 7 department stores (70%) had distinctive store smell and rest 3 (30%) do
not have distinctive store smell.

IV) Lighting used in the department store


Different types of lighting are used in stores to suit their image. Lighting can be direct or indirect,
white or colors, constant or flashing. Lighting can be per theme for favorable impression of merchandise.
Following table shows observations made about type of lighting used in the stores.
Table 17 Type of lighting in the department store
Type of lighting Observation (N=10) Percentage (%)
Direct 7 70
White 9 90
Constant 7 70
*Multiple responses

27
Table 17 shows 70% department stores used direct and constant lighting and 90% of stores used
white lighting. Observation shows that great importance is given to lighting in the store.

V) Width of aisles in the department stores


Observation was made regarding the width of aisles in the department stores.
Table 18 Width of aisles
Width of aisles Observation (N=10) Percentage (%)
Wide and uncrowded 9 90
Narrow and crowded 1 10
Total 10 100

Table 18 shows that 9 stores had wide and uncrowded aisles and one store had narrow and
crowded aisles.

VI) Existence of dressing rooms in the department stores


Dressing rooms are the places where people can try new clothes from the stores and later on buy
them. These dressing rooms can be plain or elaborate and in some stores dressing rooms may not exist.
Table 19 shows presence of dressing rooms and their types in the department stores.
Table 19 Type of dressing rooms
Type of dressing room Observation (N=10) Percentage (%)
Elaborate 2 20
Plain 5 50
Non-existent 3 30
Total 10 100

Table 19 shows that 5 stores had pain dressing rooms and 3 stores had elaborate dressing rooms.
In 3 stores department dressing rooms were absent.

VII) Levels of department stores


Observation regarding the levels of department stores was made as given in Table 20.
Table 20 Levels of department stores
Levels Observation (N=10) Percentage (%)
Single 6 60
Multilevel 4 40
Total 10 100

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Table 20 shows that 6 stores had single level where as rest of 4 stores had multilevel. Multilevel
stores used elevator, escalator or stairs for movement of customers to different levels of the store.

4.2.3 Store Layout


The components of store layout of the store were studied as follow:
I) Space allocation in the department store
Space allocation means how space in the store is allocated to various sections like selling space,
merchandise space, personnel space and customer space. Observation made about space allocation in the
department store is given in the Table 21.
Table 21 Space allocation in the department store
Type of space allocated Observation (N=10) Percentage (%)
Selling space 10 100
Merchandise space 10 100
Personnel space 8 80
Customer space 1 10
*Multiple responses
Table 21 shows that 100% of stores allocated both selling and merchandise space where as only
80% of stores allocated personnel space and only 10% of stores allocated customer space.

II) Traffic flow pattern in the department stores


Observation made about type of traffic flow pattern in the department stores is given in the
following table.
Table 22 Type of traffic flow pattern in the department stores
Type of traffic flow pattern Observation (N=10) Percentage (%)
Straight 2 20
Curving 8 80
Total 10 100

Table 22 shows that 8 department stores had curving traffic flow while only 2 stores had straight
traffic flow.

4.2.4 Interior displays


The components of interior displays of the store were studied as follow:

29
I) Price displays in department stores
These are tags, banners, stickers, sign cards or some displays showing the price of the
merchandise. According to the observation made it was found that all the 10 stores used price displays.

II) Cash register counters in department stores


These are counters where payment is made against the products which are purchased from the
store.
a) Number of cash register counters
Observation was made for the number of cash register counter a particular store was having. It
was found out that all the 10 department stores had more than 2 cash register counters.
b) Placement of cash register counters
Observation was made regarding where these cash counters are placed and it was found that most
of cash register were placed at the exit of the store or at the back of store placement was made as given in
the Table 23
Table 23 Cash counters placement in the department stores

Placement of cash counters Observation (N=10) Percentage (%)


Entrance 1 10
Exit 4 40
Back of store 3 30
Central placement 2 20
Total 10 100

III) Type of assortment displays used in department stores


Observation was made regarding type of assortment displays used in department stores as given in
table 24
Type of assortment displays Observation (N=10) Percentage (%)
Open 3 30
Closed 0 0
Both 7 70
Total 10 100

Table 24 shows that 7 stores used both open and closed type assortment displays and only 3
stores were using only open type assortment display.

30
IV) Type of In-store displays used in the department store
In this observation was made regarding the various types of displays, which were used in the
store. Results obtained are given in Table 25.
Table 25 Type of In-store displays used in the department store
Type of In-store displays Observation
Ensemble display 10
Rack display 10
Case display 10
Cut case display 0
Dump bin display 8
Electronic display 0
Mobile display 7
*Multiple responses
Table 25 shows that all the 10 stores chosen used the ensemble, rack and case displays. There
were 7 stores, which were using mobile display. Out of 10, 8 stores were using dump bin displays.

V) Types of PoP used in the department store


In this observation were made regarding the type of PoP and in-store displays used in the store as
given in Table 26.
Table 26 Type of PoP used in the department store
Type of PoP Observation
Sticker 8
Danglers 7
Product displays 5
In store posters 5
Signboards 3
Shelf talkers 2
Banners 2
*Multiple responses
Table 26 shows that 8 stores were using stickers, 7 were using danglers and 5 stores were using
product display and in-store displays. There were only 2 stores, which were using shelf talkers and
banners.

31
VI) Mannequins used in the department stores
These are a full size model of a complete or partial human figure mainly used to display
clothing’s or jewellery. Observation is given in Table 27.
Table 27 Mannequins used in the department store
Use of Mannequins Observation (N=10) Percentage (%)
Yes 4 40
No 6 60
Total 10 100

According to the observation which was made it was found that 40% of the stores used mannequins
for display purpose and 60% did not used mannequins.

4.3 Effect of store atmospherics on shopping behavior of customers


This section analysis the response of customers toward the store atmospherics under the sub
headings profile of respondents, frequency of visit, average time spent in the store, spending of money,
type of payment method used, purpose of visit, effectiveness of different types of components of store
atmospherics, satisfaction with parking facility, effectiveness of store atmospherics in making the sales
and Unplanned purchases.
4.3.1 Demographic profile of the respondents
Table 31 shows the profile of the respondents with respect to demographics like the age group,
gender, occupation, family income and educational qualification.
Table 28 Demographic profile of the respondents
Demographic Variables Frequency Percentage
Gender
Male 84 56.0
Female 66 44.0
Total 150 100
Age
Less than 21 4 2.7
21-30 96 64.0
31-40 30 20.0
41-50 18 12.0
More than 50 2 1.3
Total 150 100

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Educational Qualification
Matric 6 4.0
Higher Secondary 33 22.0
Graduate 71 47.3
Post Graduate 40 26.7
Total 150 100
Occupation
Student 67 44.7
Professional 16 10.7
Service 19 12.7
Self employed 43 28.7
Housewife 5 3.3
Total 150 100
Monthly Family Income
Below Rs 10000 15 10.0
Rs10000-Rs20000 54 36.0
Rs20000-Rs30000 55 36.7
Above Rs30000 26 17.3
Total 150 100

Table 28 shows that 56% were male while 44% were female respondents. The respondents were
categorized into different age horizons. It was found that majority of the respondents fall in the age group
of 21-30 years (64.0 percentage), followed by 31-40 age group (20.0 percentage) and 41-50 age
group(12%). 2.7% respondents were in less than 21 age group. Similarly, 1.3 percent of consumers lied in
the age group of 41-50 years.
On categorizing consumers on the basis of their education, it was found that 47.3 percent were
graduates, 26.3 percent were post graduates. The result further revealed that 22.0 percent and 4.0 percent
were higher secondary and matric pass out respectively.
The results presented in Table 28 shows that majority of the respondents were students (44.7%).
It was further found that 28.7%, 12.7%, 10.7% and 3.3 percent of the respondents were self-employed,
service class professionals and housewives respectively.
The respondents were grouped into four categories on the basis of their monthly family income.
Majority was with Rs. 10000-Rs. 20000 and Rs. 20000-Rs. 30000 income group with 36.0 and 36.7

33
percent respectively, followed by above Rs. 30000 income group with 17.3 percent and less than Rs.
10000 income group with 10.0 percent.

4.3.2 Frequency of visit of respondents


The respondents were asked how often visited the department stores for making the purchase to
know their frequency of visit.
Table 29 Distribution of respondents based upon frequency of visit to the department stores
Frequency No. of respondents (N=150) Percentage (%)
Everyday 0 0
Once in week 54 36.0
Twice in week 40 26.7
Once in 45 days 56 37.3
Total 150 100

Table 29 shows how frequently respondents visited department stores. Table shows that 37.3% of
the respondents visited the store once in 45 days, 36% of the respondents which is second highest visit the
department store once in week followed by 26.7% of respondents who visit the store twice in week.

4.3.3 Average time spent in the department store by the respondents


The respondents were asked about how much time they spend during their visit to the department
store. The average time spent in the department stores varied from less than 45 minutes to more than 3
hours.
Table 30 Distribution of respondents as per their time spent in the department store
Visit No. of respondents (N=150) Percentage (%)
Less than 45 minutes 84 56.0
45 minutes-1hour 60 40.0
1-3 hours 6 4.0
More than 3 hours 0 0
Total 150 100

The results in Table 30 present that majority of customers (56%) stay in the department stores
for less than 45 minutes followed by 40% of customers who spent 45 min to 1 hr for shopping. 4% of
customers spent 1-3 hrs for shopping.

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4.3.4 Companion preference of respondents
The respondents were asked about with whom they prefer to visit the department stores. They
were given 4 options i.e. family, friends, co-worker or alone.
Table 31 Distribution of respondents as per their preference of companions while visiting the
department stores
Companion No. of respondents (N=150) Percentage (%)
Family 56 37.3
Friends 66 44.0
Co-worker 8 5.3
Alone 20 13.3
Total 150 100

Table 31 shows that 44% of customers preferred to visit department store with their friends
followed by 37% of customers who preferred to visit store with their family. Only 13% and 5% of
respondents preferred to visit the store alone and with co-workers respectively.

4.3.5 Money spent per visit by respondents in the department stores


The respondents were asked about how much they spend while their visit to the department store.
The average money spent in the department store varied from less than Rs.1000 to more than Rs. 7000.
The response of both men and women counterparts are given in Table 32.
Table 32 Distribution of respondents as per money spent per visit to the department stores
Amount spend No. of respondents (N=150) Percentage (%)
Less than Rs.1000 56 37.3
Rs.1000-Rs5000 54 36.0
Rs.5000-Rs.7000 20 13.3
>Rs.7000 20 13.3
Total 150 100

The results presented in Table 32 depict that 37.3% of respondents spend less than Rs.1000 during
their visit to the department stores. Only 13.3% of respondents spend Rs.5000-Rs7000 and more than
Rs.7000 during their visit to the department stores.

4.3.6 Method of payment used in the department store


Respondents were asked about what method of payment they preferred while shopping in the
department store. Table 33 shows the response of respondents.

35
Table 33 Distribution of respondents according to method of payment used in the department store
Method of payment No. of respondents (N=150) Percentage (%)
Cash 87 58.0
Credit/Debit card 6 4.0
Both 57 38.0
Total 150 100

Table 33 shows that most respondents (58%) preferred to make cash payment for shopping and
only 4% of respondents preferred to make payment by credit/debit cards. While 38% of respondents used
both methods of cash payment i.e. cash and cards.

4.3.7 Purpose of respondent’s visit to the department stores


The respondents were asked about what is purpose of their visit to the department store.
Table 34 Distribution of respondents according to purpose of respondent’s visit to the department
stores
Purpose No. of respondents (N=150) Percentage (%)
Window shopping 16 11
Shopping 114 76
Entertainment 10 7
Comparing 6 4
Free time 20 13
*Multiple responses
Table 34 shows that 76% of customers visited the department stores for shopping, 20% visited
the department stores in their free time while 11% of respondents visited stores for window shopping.
Only 7% and 4% of respondents visited stores for entertainment and comparing.
4.3.8 Importance of store atmospheric components to attract customers
Respondents were asked to rank the store atmospheric components according to their importance
to attract the customers on scale 1 to 4 where 1 means most important and 4 means least.
Table 35 Importance of store atmospherics components in the Department stores
Components Rank
Interior display 1
Exterior 2
Store layout 3
General interior 4

36
Table 35 shows the ranks of all the components of store atmospherics on basis of their mean
score. Higher the mean score, higher is the rank. Interior display with rank 1 is given more importance in
the department stores while exterior of store gets rank 2 according to its importance. Store layout and
general interior components of store atmospherics with ranks 3 and 4 respectively get importance.

4.3.9 Effect of various components store atmospherics on shopping behavior of customers


The respondents were asked to rate various statements regarding effect of store atmospherics on
buying behavior of customers on scale 1 to 5 where 1 indicates strongly disagree and 5 indicates strongly
agree
Table 36 Effect of various components of store atmospherics on shopping behavior of customers
(N=150)
Statements Mean Score t value
Exterior
The exterior design of store attracts me 3.35 4.478*
I visit the store because parking space is good 3.04 .375NS
Marque visibility is good 3.48 6.988*
Walkways and display windows are wide and large 3.81 10.322*
Store display window allows me to see displayed products
clearly. 3.95 8.995*
General Interior
The interior design of store attracts me 3.56 7.612*
I like the color and texture of walls and flooring 3.68 9.413*
I like distinctive smell of store 3.29 3.568*
The lighting and decoration attracts me 3.67 7.751*
Different lighting is used in each area 3.04 .454NS
The light at the corners of the store (more hidden areas) is
sufficient. 3.45 5.963*
Ventilation system of store is good 4.01 12.539*
The rhythm of the background music is pleasant. 3.91 14.393*
Aisles are wide and not crowded 3.72 8.557*
Store Layout
Space allocation is optimum in store 3.77 9.075*
Grouping of product offering is good 4.04 15.725*

37
The store can handle a lot of people 3.84 10.762*
Traffic flow pattern is optimum 3.37 5.393*
The locations of each department in the store are important. 4.23 17.787*
More floor space is devoted to product displays 3.75 9.852*
Interior displays
Placement of cash register is right 3.41 5.371*
Encourage to buy a particular product or a brand 3.16 1.823NS
The products are tidy and not damaged. 4.12 15.557*
The product organization allows me to identify the location of
products in the store easily. 3.81 10.799*
Assortment displays is optimum in store 3.84 16.191*
Mannequins are rightly placed 3.64 9.448*
Use of direction signs to merchandise is adequate 3.71 8.595*
The clear shelves information increases my well being and
comfort. 3.84 12.305*
* Significant at 5% level of confidence ttable (df =149) = 1.97 =3 NS: Non significant
Table 36 depicts the mean scores of the respondents to the statements regarding effect of store
atmospherics on buying behavior of customers. “The products are tidy and not damaged” (mean
score 4.12) is most important statement related to store atmospheric effect. It is followed by
“Grouping of product offering is good” (mean score 4.04) and “Ventilation system of store is
good” with mean score of 4.01.
Further t-test at 5% level of significance shows that all the statements regarding effect of store
atmospherics on buying behavior of customers were found to be significant for all the statements except
the “I visit the store because parking space is good”, “Different lighting is used in each area” and
“Encourages to buy a particular product or a brand”.

4.3.10 Satisfaction with parking facility of the department stores


Respondents were asked about their satisfaction with parking facility. Table 37 shows
response of respondents toward available parking facility of the department store.
Table 37 Satisfaction with parking facility of the department stores
Satisfaction No. of respondents (N=150) Percentage (%)
Yes 134 89.3
No 16 10.7

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Table 37 shows that most of customers (89.3%) are satisfied with parking facility provided by
department store while only 10.7% were not satisfied with parking facility.

4.3.11 Satisfaction with employee’s service of the department stores


Response of respondents towards satisfaction with employee’s service is given in the following
table.
Table 38 Satisfaction with employee’s service of the department stores
Satisfaction No. of respondents (N=150) Percentage (%)
Yes 143 95.3
No 7 4.7
Total 150 100

Table 38 shows that most of customers (95.3%) are satisfied with service of employee of the
department store while only 4.7% were not satisfied with service of employee.

4.3.12 Effect of store atmospherics on the customer’s mind set and behavior towards a Department
store
The respondents were asked to rate various statements regarding affect of store atmospherics on
customer’s attitude and buying behavior towards a department store on scale 1 to 5 where 1 indicates
strongly disagree and 5 indicates strongly agree.
Table 39 Effect of store atmospherics on the customer’s mind set and behavior towards a
Department store
(N=150)
Statements Mean Score t value
I would like to shop longer in the store because of good store
atmospherics 2.98 -.231NS
I end up spending more money in store due to friendly behavior
of store staff 2.65 -4.001NS

Store atmospherics results in impulse purchase 3.33 3.742*


Store atmospherics increases my well comfort level 3.58 7.532*
I am in good mood whenever I am in the store 3.13 1.599*
I would like to visit the store again due to attractiveness of store
3.47 5.225*
atmospherics
Store atmospherics increases my purchase probability 3.38 4.107*
I would like to tell my friends and family about the store as
store atmospherics are good 3.94 11.307*

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Good store atmospherics make my store loyal 3.61 8.681*
Attractiveness of store atmospherics make me ignore
competitors ‘offer 3.14 1.654NS
* Significant at 5% level of confidence ttable (df =149) = 1.97 =3 NS: Non significant
Table 39 depicts the mean scores of the respondents to the statements regarding affect of store
atmospherics on customer’s attitude and buying behavior towards a department store. “I would like to tell
my friends and family about the store as store atmospherics are good” (mean score 3.98) is most
important statement related to store atmospheric affect. It is followed by “Good store atmospherics make
my store loyal” (mean score 3.61) and “Store atmospherics increases my well being and comfort” with
mean score of 3.58.
Further t-test at 5% level of significance shows that all the statements regarding affect of store
atmospherics on customer’s attitude and buying behavior towards a department store were found to be
significant for all the statements except the “Attractiveness of store atmospherics make me ignore
competitors ‘offer”, “I would like to shop longer in the store because of good store atmospherics” and “I
end up spending more money in store due to friendly behavior of store staff”.

4.3.13 Unplanned purchases by respondents


It is the purchase, which is made without prior planning. In this respondents were asked that
whether they make unplanned purchases or not.
Table 40 Distribution of respondents according to unplanned purchases by respondents
Unplanned purchases No. of respondents (N=150) Percentage (%)
Yes 106 70.7
No 44 29.3
Total 150 100

Table 40 shows that 70.7% of the respondents make unplanned purchases while making purchase
in one category or other. While 29.3% respondents said they do not make unplanned purchases.

4.3.14 Products bought unplanned by respondents


Respondents were asked about the products they buy without prior planning. Responses are given
in the table below.
Table 41 Distribution of respondents according to Products bought unplanned
Category No. of respondents (N=150) Percentage (%)
Soaps & shampoos 63 42
Chocolates & chips 92 61.3

40
Processed foods 79 52.7
Beverages 44 29.3
Ice cream 64 42.7
Cosmetics 40 26.7
Apparels 51 34
*Multiple Responses
Table 41 shows that 61% respondents buy chocolates & chips without prior planning, followed
by 52% respondents buy processed foods and 42% buy ice cream and soaps & shampoos without prior
planning.

4.3.15 Percentage spent on unplanned purchases by respondents


In this respondents were asked that how much they spent on unplanned purchases.
Table 42 Distribution of respondents according to Percentage spent on unplanned purchases
Percentage spent No. of respondents (N=150) Percentage (%)
0%-20% 86 57.3
20%-40% 48 32.0
40%-60% 16 10.7
60%-80% 0 0
80%-100% 0 0
Total 150 100

Table 42 shows that 57.3% of respondents made 0%-20% of unplanned purchase and 32% of
them made 20%-40% of unplanned purchases. Only 10.7% respondents made more than 60% unplanned
purchase.

4.4 Discussion
The study showed that most of the people (76%) visited the department for shopping only
followed by window shopping (11%) and during free time visit people (10). Friends are the foremost
companion to whom the people give the foremost priority while visiting the department stores followed
by family. It was found out that most people (87%) preferred cash for payment and only 57% preferred
both methods of payment i.e. cash and cards. Study also showed that 56% people visited department store
once in 45 days or more for shopping and only 54% visited department store once a week.
Statements regarding effectiveness of store atmospherics on buying behavior of customers
showed that “The products are tidy and not damaged” (mean score 4.12) is most important

41
statement related to store atmospheric effectiveness. It is followed by “Grouping of product
offering is good” (mean score 4.04) and “Ventilation system of store is good” with mean score of
4.01.
The study showed that most of customers (89.3%) are satisfied with parking facility provided by
department store while only 10.7% were not satisfied with parking facility. Study also reflected that most
of people (95%) were satisfied with the service of employee of the department store and only 5% of
customers were not satisfied with the service of employee.
Study also showed that customer gave more important to interior displays component of store
atmospheric with Rank 1 to followed by exterior of store and store layout components of store
atmospheric with ranks 2 and 3 respectively.
The statements regarding effectiveness of store atmospherics on customer’s attitude and buying
behavior towards a department store in showed that “I would like to tell my friends and family about the
store as store atmospherics are good” (mean score 3.98) is most important statement related to store
atmospheric effect. It is followed by statements “Good store atmospherics make my store loyal” (mean
score 3.61) and “Store atmospherics increases my well being and comfort” with mean score of 3.58. All
the statements were found to be significant at 5% level of significance for all the statements except the
“Attractiveness of store atmospherics make me ignore competitors ‘offer”, “I would like to shop longer in
the store because of good store atmospherics” and “I end up spending more money in store due to friendly
behavior of store staff”.
Further study also showed that 70% of respondents made unplanned purchase due to good store
atmospherics and most of unplanned purchase items of customers consist of chocolates & chips and
processed food. Customers spent 0%-20% on unplanned purchases due to good store atmospherics. Only
20% of customers ever faced problems relating to store atmospherics while visiting the department store.

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Chapter-V
SUMMARY

In this chapter a brief summary and conclusions of the study have been presented, so as to
understand the implication of findings. Store atmospherics form the overall context within which shoppers
make decisions of store selection and patronage. Retailers must realize the importance of atmospherics and
systematically try to implement them that will attract their target customers. Further, purchase decision
making has become complex due to inseparability of product and services offered in retail outlets. Visual
merchandising and store design are important component in atmospherics management. It includes both
store exterior and interior. Store exterior includes window display, retail premises and front where as store
interior includes store layout, fixtures and fitting, wall display and store highlights. There are components
governing both store exterior and interior, which includes color co-ordination, lighting design and the
application of design principles. The retail environment is changing more than ever before. It is
characterized by intensifying competition and more sophisticated and more demanding customers who
have greater expectations related to their consumption experiences.
Store atmospherics can affect consumer’s perceptions of a retail environment and thus there is a
likelihood of approaching or avoiding the product or store. Creating superior customer experience seems to
be one of the central objectives in today’s retail environments. Customer experience encompasses the total
experience including the search, purchase, consumption and after-sales phases of the experiences. All these
are closely related to store atmospherics planning and have significant impact on the customer experience
of a retail firm. Store atmospherics could affect shoppers’ behaviors in several ways. Certain
response of human being to environment may be conditioned or hard-wired in the human brain.
Store atmospherics also influences various stages of shoppers’ cognitive process inside a store,
including attention, perception, categorization and information processing
Therefore the present study was conducted to understand the store atmospherics strategies used by
department stores and to study the effect of these store atmospherics on customers of these department
stores in Ludhiana city. Therefore the present study was undertaken with the following specific objectives:
1) To study the elements of store atmospherics of selected department stores.
2) To study the effect of store atmospherics on shopping behavior of customers.

The study was restricted to Ludhiana city. Ten stores from Ludhiana city which qualify the
definition of Department store, were selected for the study. Further, 15 customers were selected from each
store on basis of simple random sampling. Thus, a total sample size of 150 customers was surveyed.
Primary data was collected with the help of structured and non-disguised questionnaires and observation
chart. To satisfy the first objective data was collected from the store managers with the help of

43
questionnaire and observation chart. Another questionnaire was prepared to satisfy the second objective
and data was collected from customers. Data was collected related to store atmospherics i.e. exterior,
store layout, general interior and interior displays from store managers and customer buying preferences
and behavior from customers. Data was analyzed using appropriate statistical tools like percentage, mean
scores, test of significance etc.

5.1 Main findings of the study


The main findings of the study are given below:

5.1.1 Store atmospherics strategies followed by the department stores


 It was found out Interior display is the most important factor while considering components of
store atmospherics according to their importance with rank 1 followed by store layout and
exterior of the department store. The least important component is general interior of the store.
 The study showed that decision about various components of store atmospherics to be used for
the department store was taken by the company in all the 10 stores.
 Analysis showed that store atmospherics were changed in 4 stores (40%) in 4-6 months and in
case of other 6 stores (60%) after 6 months as per the new promotional schemes and
advertisement which were offered from time to time.
 It was further found out that that only 5 stores (50%) make changes in store atmospherics
according to festival while 3 stores (30%) made changes in store atmospherics on account of
special event and rest of 2 stores (20%) made changes with change in season
 Study shows that 4 stores displayed their products on category basis. 2 stores displayed products
on basis of the sale of the product, 2 stores to promote any brand and rest 2 stores displayed
products on any other criteria. This shows that most of department stores display product on
category basis for customer convenience.
 According to response given by mangers inorder to find out the contribution of store
atmospherics towards store ambience and customer convenience, statement “Helps in building
store image” with a mean score of 4.31 was found to be most effective, followed by statement “It
creates curiosity and excitement among customers” with mean score 4.3. Further t-test at 5%
level of significance shows that all the statements regarding the contribution of store
atmospherics towards store ambience and customer convenience were found to be significant for
all the statements except for two statements.
 According to response given by managers in order to find out the effectiveness of store
atmospherics in making sales, statement “Helps in increasing the footfall rate” with a mean

44
score of 4.6 was found to be most effective, followed by statement “Helps to promote
sales” with mean score of 4.5. All the statements are significant at 5% level of
significance; therefore all attributes contribute towards increasing the sales of a store.
5.1.2 Various store atmospherics components of Department stores as observed
 On the basis of observation it was found that 8 stores (80%) used modular structure and 2 stores
(20%) have unique building design to attract the customers.
 According to observation made it was found that 8 stores used bright colour marquees, while
other 2 were using black and white colours.
 It was found that 7 stores were having push pull entrance and other 2 were having electric. One of
them has climate controlled entrance.
 Observation showed that 7 of department stores have wide width to accommodate large number
of customers while 3 stores have narrow width walkways.
 According to observation made it was found that only 4 stores had display windows, while other
6 were not having. Size of display windows of these stores was medium.
 On the basis of observation it was found that half of the department stores had disguised exterior
height and other half had non-disguised height.
 It was observed that all the ten stores have parking facility. Out of them 2 had free and other 2
had paid parking facility. Rest of 6 had both type of parking facility availability.
 It was found that all of the department stores used cemented flooring of a single colour.
 Observation showed that 4 department stores had bright and vibrant colour pattern on walls and
rest 6 stores had plain white walls.
 Regarding general interior, it was observed that 7 department stores had distinctive store smell
and rest 3 do not have distinctive store smell.
 According to observation made it was found that 70% department stores used direct and constant
lighting and 90% of stores used white lighting. Observation shows that great importance is given
to lighting in the store.
 It was found that 9 stores had wide and uncrowded aisles and one store had narrow and crowded
aisles.
 Observation showed that 5 stores had pain dressing rooms and 3 stores had elaborate dressing
rooms. In 3 stores department dressing rooms were absent.
 On the basis of observation it was found that 6 stores had single level where as rest of 4 stores
had multilevel. Multilevel stores used elevator, escalator or stairs for movement of customers to
different levels of the store.

45
 It was observed that 100% of stores allocated both selling and merchandise space where as only
80% of stores allocated personnel space and only 10% of stores allocated customer space.
 According to observation made it was found that 8 department stores had curving traffic flow
while only 2 stores had straight traffic flow.
 The observation made showed that all the 10 stores used price displays.
 It was found out that all the 10 department stores had more than 2 cash register counters and most
of cash registers were placed at the exit of the store or at the back of store placement
 Regarding interior displays, it was observed that 7 stores used both open and closed type
assortment displays and only 3 stores were using only open type assortment display.
 Observations showed that all the 10 stores chosen used the ensemble, rack and case displays.
There were 7 stores, which were using mobile display. Out of 10, 8 stores were using dump bin
displays.
 On the basis of observation it was found that 8 stores were using stickers, 7 were using danglers,
and 5 stores each were using product display and in-store displays. There were only 2 stores,
which were using shelf talkers and banners.
 According to the observation which was made it was found that 40% of the stores used
mannequins for display purpose and 60% did not used mannequins.
5.1.3 Effect of store atmospherics on shopping behavior of customers
 The profile of respondents showed that 56% were male while 44% were female respondents. It
was found that majority of the respondents fall in the age group of 21-30 years (64.0 percentage)
and 47.3 percent were graduates and majority of the respondents were students (44.7%). Majority
of respondents were with Rs. 10000-Rs. 20000 income group with 36 percent .
 Study showed that 37.3% of the respondents visited the store once in 45 days and 36% of the
respondents visited the department store once in week.
 Analysis also showed that majority of customers (56%) stay in the department stores for less than
45 minutes followed by 40% of customers who spent 45 min to 1 hr for shopping.
 It was found out that 44% of customers preferred to visit department store with their friends
followed by 37% of customers who preferred to visit store with their family.
 It was further found out that 37.3% of respondents spend less than Rs.1000 during their visit to
the department stores.
 Study shows that most respondents (58%) preferred to make cash payment for shopping and only
4% of respondents preferred to make payment by credit/debit cards.

46
 Analysis also showed that 76% of customers visited the department stores for shopping, 20%
visited the department stores in their free time while 11% of respondents visited stores for
window shopping.
 It was found out that interior display with rank 1 is given more importance in the department
stores while exterior of store gets rank 2 according to its importance.
 According to response given by customers in order to find out effect of store atmospherics on
buying behavior of customers. “The products are tidy and not damaged” (mean score 4.12)
is most important statement related to store atmospheric effect. Further t-test at 5% level
of significance shows that all the statements regarding effect of store atmospherics on
buying behavior of customers were found to be significant for all the statements except 3
statements.
 Study showed that most of customers (89.3%) are satisfied with parking facility provided by
department store while only 10.7% were not satisfied with parking facility.
 It was further found out that most of customers (95.3%) are satisfied with service of employee of
the department store while only 4.7% were not satisfied with service of employee.
 According to response given by customers in order to find out affect of store atmospherics on
customer’s attitude and buying behavior towards a department store. “I would like to tell my
friends and family about the store as store atmospherics are good” (mean score 3.98) is most
important statement related to store atmospheric affect. Further t-test at 5% level of
significance shows that all the statements regarding effect of store atmospherics on
buying behavior of customers were found to be significant for all the statements except 3
statements.
 Study shows that 70.7% of the respondents make unplanned purchases while making purchase in
one category or other. While 29.3% respondents said they do not make unplanned purchases.
 Analysis also showed that 61% respondents buy chocolates & chips without prior planning,
followed by 52% respondents buy processed foods and 42% buy ice cream and soaps &
shampoos without prior planning.
 It was further found out that 57.3% of respondents made 0%-20% of unplanned purchase and
32% of them made 20%-40% of unplanned purchases.
5.2 Conclusion

In retail industry high level of competition exists. Fast response and ability in understanding
customers’ behavior influences the success of retail business. Retail business must focus on its customer

47
preferences and factors influencing a customer’s purchase decision. As the competition in each category is
increasing, especially as more and more multinational companies are coming in retailing, it is very difficult
for retailer to attract customers. Store atmospherics are effective way of disseminating the information and
messages about particular product, brand or company to the people. Store atmospherics play an important
role in the overall communication to the shoppers because it talks to them when money, product and
willingness to buy, come together at the retail outlet. All these factors create a situation conductive to
influence the decisions of the shoppers at the department store.

The study revealed that all the department stores are using store atmospherics as a tool to attract
customers to the store. All the store atmospherics decision is taken by company and not by store manager.
According to manager store atmospherics help in increasing footfall rate in store and helps to promote
sales. The customers feel that store atmospherics increase their well being and comfort and make them
store loyal. They also think that store atmospherics helps to sell the product on promotional offers and
encourages to make unplanned purchases.

5.3 Recommendations
The following recommendations have been suggested from the study:
 The Department stores may change the store atmospherics more often to create curiosity
among shoppers and increase footfalls.
 Competitor survey should be carried out to understand what competitors are doing.
 Customer’s feedback about store atmospherics should be taken as store atmospherics are for
their conveniece.
 Drinking water facility should be made available in the department store.
 Store staff should attend the customers more politely.
 No charges should be charged for polybags.
 Parking facility should be near the department store.
 More attendants should be at cash counter registers for fast payment service

48
REFERENCES

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51
ANNEXURES I
QUESTIONNAIRE -I
(For Management)
Name of the store: _____________________________________________

Name of business group that owns the store: ________________________

Structure of the store: __________________________________________

1. According to you which of store atmospherics component is more effective. Rank them from 1 to
4 where 1 means most important and 4 means least.
a) Exterior
b) Store layout
c) General interior
d) Interior display
2. Who decides type of store atmospherics components to be used for store?
a) Store manager
b) Company
c) Any other
3. How often you change store atmospherics?
a) <1 months
b) 1-4 months
c) 4-6 months
d) >6 months
4. Reasons for changes in store atmospherics, special event and festival:
a) Changes in season b) Special event c) Festival
5. On what criteria do you display products in the store)
a) On the basis of sale of the product
b) On category basis
c) To promote any brand
d) No criteria
e) Any other
6. Give your opinion regarding contribution of store atmospherics towards store ambience and
customer convenience. Rate on scale from 1 to 5 where 1 indicates strongly disagree and 5
indicates strongly agree.

Disagree

Disagree
Strongly

Strongly
Neutral
Statements

Agree

Agree
Helps in building store image

It creates curiosity and excitement among


customers
Adds to beautification of store

Helps in creating atmosphere for better


shopping experience
Encourages to buy a particular product or a
brand

7. Give your opinion regarding effectiveness of store atmospherics in increasing sales? Rate on scale
from 1 to 5 where 1 indicates strongly disagree and 5 indicates strongly agree.
Disagree

Disagree
Strongly

Strongly
Neutral

Agree

Agree
Statements

Store atmospherics are effective in helping to


make unplanned sale

Helps to promote sales

Helps in increasing the footfall rate

Good way to sell low image products

Effective in selling products even when


customers are not interested in buying
ANNEXURES II
QUESTIONNAIRE-II
(For Customers)
1. Demographic Profile
i) Name:- _____________________________
ii) Gender
a) Male
b) Female
iii) Age
a) Less than 21
b) 21-30
c) 31-40
d) 41-50
e) More than 50
iv) Educational Qualification
a) Matric
b) Higher Secondary
c) Graduate
d) Post Graduate
e) Any other (please specify) ______________________
v) Current occupation
a) Student
b) Professional
c) Service
d) Self employed
e) Housewife
f) Any other ________________________
vi) Monthly family income
a) Below Rs 10000
b) Rs 10000-Rs 20000
c) Rs 20000-Rs30000
d) Above Rs 30000
2. How frequently you visit department store?
a) Everyday
b) Once in week
c) Twice in month
d) Once in 45 days or less
3. What is average time spent for shopping in department store (in hours)?
a) Less than 45 minutes
b) 45 minutes – 1 hour
c) 1-3 hours
d) More than 3 hours
4. With whom you prefer to visit department stores?
a) Family
b) Friends
c) Co-Worker
d) Alone
5. How much you spend per visit to department store?
a) Less than Rs 1000
b) Rs 1000-Rs 5000
c) Rs 5000- Rs 7000
d) >Rs 7000
6. Mode of payment you use to make payment in department store?
a) Cash only
b) Credit/ Debit Card
c) Both
7. What is purpose of your visit to department store?
a) Window shopping
b) Shopping
c) Entertainment
d) Comparing
e) During free time
f) Other specify ___________________________________
8. According to you, which of the following component of store atmospherics is important to attract
customer? Rank them on scale from 1 to 4 where 1 means most important and 4 means least.
a) Exterior
b) Store layout
c) General interior
d) Interior displays
9. Rate the following statements regarding effect of various components of store atmospherics on
your shopping behavior on scale from 1 to 5 where 1 indicates strongly disagree and 5 indicates
strongly agree.

Disagree
Strongly

Strongly
disagree

Neutral

Agree

Agree
Statements

Exterior
The exterior design of store attracts me
I visit the store because parking space is good
Marque visibility is good
Walkways and display windows are wide and large
Store display window allows me to see displayed products
clearly.
General Interior
The interior design of store attracts me
I like the color and texture of walls and flooring
I like distinctive smell of store
The lighting and decoration attracts me
Different lighting is used in each area
The light at the corners of the store (more hidden areas) is
sufficient.
Ventilation system of store is good
The rhythm of the background music is pleasant.

Aisles are wide and not crowded


Store Layout
Space allocation is optimum in store
Grouping of product offering is good
The store can handle a lot of people
Traffic flow pattern is optimum
The locations of each department in the store are
important.
More floor space is devoted to product displays
Interior displays
Placement of cash register is right
Encourage to buy a particular product or a brand
The products are tidy and not damaged.
The product organization allows me to identify the
location of products in the store easily.
Assortment displays is optimum in store
Mannequins are rightly placed
Use of direction signs to merchandise is adequate
The clear shelves information increases my well being and
comfort.

10. i) Are you satisfied with parking facility?


a) Yes
b) No

ii) If no, why not__________________________________________________________

11. Does the employee provide good service quality to you?


a) Yes
b) No
12. Effect of overall store atmospherics on the customer’s mindset and behaviour. Rate on scale from
1 to 5 where 1 indicates strongly disagree and 5 indicates strongly agree.
Disagree
Strongly

Strongly
disagree

Neutral

Agree

Agree

Statements

I would like to shop longer in the store because of good store


atmospherics
I end up spending more money in store due to friendly behavior
of store staff
Store atmospherics results in impulse purchase
Store atmospherics increases my comfort level
I am in good mood whenever I am in the store
I would like to visit the store again due to attractiveness of
store atmospherics
I would like to tell my friends and family about the store as
store atmospherics are good
Store atmospherics increases my purchase probability
Good store atmospherics make my store loyal
Attractiveness of store atmospherics make me ignore
competitors ‘offer

13. Do you make unplanned purchases (Impulse Purchase) due to good store atmospherics?
a) Yes b) No
14. Which of the following products you buy without prior planning due to attractiveness of store
atmospherics?
a) Soaps & shampoos
b) Chocolates & chips
c) Processed foods
d) Beverages
e) Ice cream
f) Cosmetics
g) Apparels
h) Any other, specify___________________________

15. About what percentage you spend on unplanned purchases due to good store atmospherics?
a) 0%-20%
b) 20%-40%
c) 40%-60%
d) 60%-80%
e) 80%-100%
16. Give suggestions to improve the store atmospherics so that your visit may be more satisfying?
______________________________________________________________________________
______________________________________________________________________________
______________________________________________________________________________
ANNEXURE-III
OBSERVATION CHART

A. Exterior
1. Type of store front
a) Modular structure
b) Prefabricated
c) Recessed storefront
d) Unique building design
2. Marque
i. Visibility
a) Good
b) Bad
ii. Colors used
a) Black and white
b) Bright colors
c) Dull color
3. Entrance
i. Number ____
ii. Type of entrance
a) Revolving
b) Electric
c) Push-pull
d) Climate-controlled
e) Other, specify___________
4. Walkways
a) Wide
b) Narrow
5. I) Is there display windows
a) Yes
b) No

II) Size

a) Large
b) Medium
c) Small
6. Exterior building height
a) Disguised
b) Non-disguised
7. Parking facility
i. Availability
a) Yes b) No
ii. If yes then type
a) Free b) Paid c) Both
B. General Interior
8. Flooring
a) Cemented
b) Wood
c) Linoleum
d) Single color or multicolor
9. Walls
a) Bright and vibrant color pattern
b) Plain white walls
c) Color pattern matches with merchandise
10. Distinctive store smell
a) Yes b) No
11. Lighting
a) Direct or indirect
b) White or color
c) Constant or flashing
12. Aisles
a) Wide and uncrowded
b) Narrow and crowded
13. Dressing room
a) Elaborate
b) Plain
c) Non-existent
14. Level of store
a) Single level
b) Multiple level
C. Store layout
15. Space Allocation
a) Selling space(display of merchandise)
b) Merchandise space(storage room/area)
c) Personnel space(employee’s rest rooms)
d) Customer space(customers’ rest rooms)
16. Type of traffic flow pattern
a) Straight (gridiron) traffic flow
b) Curving (free flowing) traffic flow
D. Interior displays (POP)
17. Store price displays
a) Yes b) No
18. Cash register display
i. Number
a) One
b) Two
c) >Two
ii. Placement
a) At the entrance
b) At the exist
c) At back of store
d) Central placement
e) Any other. Specify__________________
19. Type of assortment displays in the store
a) Open
b) Close
c) Both
20. Type of displays
a) An ensemble display
b) A rack display
c) A case display
d) A cut case display
e) Dump bin
f) Electronic
g) Mobile
21. Type of POP and in store displays placed in the store
a) Danglers
b) In-store poster
c) Product display
d) Stickers
e) Signboards
f) Banners
g) Shelf talks
22. Use of mannequins
a) Yes
b) No
VITA

Name of the Student : NAVDEEP SINGH


SEKHON

Father’s Name : Mr. Sukhmander Singh

Mother’s Name : Mrs. Jaswinder Kaur

Nationality : Indian

Date of Birth : 23-10-1989

Permanent Address : Village Bhane, P.O. Dhudi


Faridkot(Punjab)
Pin code- 151203

Phone No. : +919888550640

EDUCATIONAL QUALIFICATIONS

Bachelor’s Degree : B.Tech

University and Year of : Punjab Technical University,


Award Jalandhar, 2013

Percentage : 72.5%

Master’s Degree : MBA


(Marketing Management)

University and Year of : Punjab Agricultural


Award University, Ludhiana,
2015

OCPA : 7.51/10.00

Title of Master’s project : STUDY OF STORE


Report ATMOSPHERIC OF THE
DEPARTMENT STORE
AND ITS EFFECT ON
BUYING BEHAVIOR OF
CUSTOMERS