EFFECT OF SPECIALTY STORE ENVIRONMENT ON CONSUMERS' EMOTIONAL STATES: THE MODERATING ROLE OF PRICE CONSCIOUSNESS

Purpose - This research study seeks to explore the effect of retail environment on consumer behavior outcomes, mediated by consumers' emotional states in the stimulus-organism-response framework. It is suggested that the atmosphere, as represented by ambient and social factors, and employees positively infl uence the customer purchase experience, and this experience positively infl uences the intention to become a return customer. Additionally, the moderating eff ect of price consciousness is proposed. While customer experience is defi ned as a multi-dimensional construct, the focus of this study is the aff ective dimension due to its relevance in defi ning the importance of experience. Design/Methodology/Approach - Computer-assisted personal interviewing was used to gather data from 298 visitors of specialized garden centers in Slovenia. The hypotheses were tested using structural equation modeling. Findings and implications - The results indicate that both the atmosphere and employees positively infl uence customer experience (pleasure and arousal). More specifically, ambience and employees increase pleasure, while ambience and the social factor increase arousal. Pleasure also increases an individual's desire to become a return customer, while arousal decreases the intention. The results further reveal a significant moderating effect of price consciousness on three relationships: ambience-pleasure, ambience-arousal, and social factor-pleasure. Limitations - The data used to test the conceptual model were cross-sectional, but a longitudinal approach could provide more insight into the relationships. In addition, more specific elements of the environment could be integrated into the model to better explain the customer purchase experience. Originality - The study seems to be the first one to explore the moderating role of price consciousness in the relationship between the retail environment and consumers' emotional states.