JOURNAL OF SERVICE MARKETING

Customer Expectations and Perceptions of Service Quality in Retail Apparel Specialty Stores
Kathryn Bishop Gagliano and Jan Hathcote

Introduction
How important are smiling, friendly sales associates, and pleasant surroundings to retail apparel customers? While retailers traditionally think of customer service in terms of store hours, gift wrapping, and credit options, consumers typically view customer service in relative terms based on their expectations and experiences. Customer service satisfaction depends on how well the service customers receive match their expectations (Austin, 1992). Factors such as age, gender, ethnicity, and income shape many of these expectations (Webster, 1989). Recent surveys have confirmed that consumers think retail customer service is inadequate. A 1987 Washington Post survey found that nearly half of all shoppers in the Washington area thought that store service was mediocre and declining (Mayer and Morin, 1987). These shoppers, as well as those who were surveyed in a national poll, had similar thoughts about the causes of poor
Journal of Services Marketing, Vol. 8 No. 1, 1994, pp. 60-69 MCB University Press, 0887-6045

service. Among these were long waits for service, impolite sales clerks, unavailability of advertised goods, and sales clerks who had little or no product knowledge (Mayer and Morin, 1987). Realizing the escalating importance of customer service, an increasing number of retailers have attempted to improve their service strategy. Many articles and books have stressed the importance of service quality, but defining it is difficult. Parasuraman et al., p. 42 (1985) defined service quality as perceptions result(ing) from a comparison of consumer expectations with actual service performance. Customer satisfaction is important because there are significant short- and long-term costs associated with poor customer service. Short-term dissatisfaction could result in a walkout, whereas a long-term dissatisfaction response might lead to customer defection. When studying service companies, Reichheld and Sasser (1990) measured the economic impact of profit loss due to defecting customers and found that these companies increased profits by almost 100 percent by

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retaining just 5 percent more of their customers. Not only did losing a customer represent the lost value of the long-term sales potential of that customer, but it also represented the additional costs of replacing that customer.

Purpose of the Study

The purpose of this study was to obtain information regarding retail apparel customers expectations and perceptions of the level of service quality offered in apparel specialty stores. In addition, this study examines the importance of service as a patronage criterion and provides managerial implications.

Specialty Stores
The opportunity for the development of personal relationships, and therefore personal attention, was one of the factors leading to the emergence of the specialty store in the early nineteenth century (Gist, 1968). As the specialty store has evolved, this characteristic of personal association between buyer and seller has led to the popularity of the specialty store retailer. Many of todays specialty retailers have become successful by combining this element of personalized service with a merchandise assortment geared toward a particular market segment (Specialty Retailing, 1986). Between 1982 and 1992, specialty store sales grew at a faster rate than total retail sales. During this period specialty store sales increased at an average rate of 9.7 percent annually while the sales growth for total retail was only 8 percent (Survey, 1983, 1993). It has been suggested that much of the specialty retailers successes have been at the expense of the department stores. Very little research has taken place regarding service quality expectations in

apparel specialty store retailing. Only one study was found pertaining to the apparel retail industry. Finn and Lamb (1991) examined apparel retailers by categorizing the stores into four generalized groups including those similar to: Kmart; J.C. Penny; Dillards; and Saks. Finn and Lambs purpose was not to differentiate among these store types but to evaluate the SERVQUAL scale in a retail setting. However, since the missions of these stores were different it was likely that the service quality expectations would vary among the store types. Webster (1989) examined expectations of professional services (such as lawyers and doctors) and nonprofessional services (other services) using the SERVQUAL scale. Findings revealed that demographic characteristics were important when determining the expected service quality for non-professional services, but not for professional services. This indicated a need to examine demographic characteristics when evaluating service quality in nonprofessional service settings such as retailing.

Service Classifications
Outstanding service is considered one of the most important attributes of specialty store retailing. For the service industry, Gronroos (1984) categorized service quality into two categories: technical quality, primarily focussed on what consumers actually received from the service; and functional quality, focussed on the process of service delivery. These types of service quality divisions translate well with apparel specialty stores. This study will retitle technical and functional service quality to Store Service and Sales Service respectively, in order to customize the terms for the retailing sector. Conceptual definitions are:

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(1) Store service: q in-store credit; q returns/exchanges/adjustments; q variety, quality, and dependability of sevice; q price of after-sale service. (2) Sales service: q attitude, courteous, knowledgeable, helpful clerks; q prompt attention, prompt processing of transactions; q individual attention/service. By classifying these services into the two divisions, retailers can concentrate their service strategies on both store service and sales service. Store operation managers might be more involved with front-line employees in improving store service policies; whereas, personnel managers might work with the sales service aspects.

factors. Five of the most common factors summarized by Berman and Evans (1992) include: merchandise, price, service, location, and advertising.

Research Questions
Two primary research questions were developed to aid managers in understanding consumer expectations and perceptions of service quality in apparel specialty stores (see appendix for operational definitions of expectations and perceptions). According to Webster (1989) demographic characteristics were a factor in consumers expectations of non-professional services. Therefore, the first question asked was: Does consumer age, gender, ethnicity, marital status, or income have an effect on expected and perceived service quality in retail apparel specialty stores? If there was a substantial effect, marketers need to identify which factors are important to better define their target markets. Second, how important is service quality in the overall context of store patronage in retail apparel specialty stores?

Service: Its Influence on Patronage

While store image is an important factor influencing store patronage (Berry, 1969), the emergence of above average service as a specialty store strategy indicates the importance of service in determining store patronage. Specialty store shoppers judged store personnel (the major determinant of Sales Service) as a more important determinant of patronage than the department store or discount store shopper (Lumpkin and McConkey, 1984). For example, men who patronized high fashion mens apparel specialty stores cited knowledgeable, helpful sales associates as the most important factor influencing store patronage (King and Ring, 1980). These findings provide insight about the importance of service as a criterion for patronage. While studies have shown that service is an important criterion for store patronage in specialty stores, there are also other important

Measuring Service Quality

It is difficult to measure service quality, especially in apparel specialty retailing. Apparel specialty retailing combines the selling of goods and services to the consumer, and consumers expect knowledgeable, helpful staff to assist in the sales procedures. The ultimate goal was to measure service quality of apparel specialty stores using the refined SERVQUAL scale (Parasuraman, et al. 1991) which indicated five determinants of service quality: (1) Tangibles. (2) Reliability. (3) Responsiveness. (4) Assurance. (5) Empathy.

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Therefore it was expected that the 22-item SERVQUAL scale would develop a fivedimensional structure (for methodology of study see Appendix). Once determined, managers can utilize these findings to increase or improve the services perceived as most important and build consumer satisfaction.

factor had greater eigenvalues; therefore, it was used for this study. Categorical names were developed to describe the new groupings with the exception of reliability and tangibles which corresponded fairly well with the original Parasuraman study (1991). The four categorical titles used were (see Table I): (1) Personal attention. Reliability. Tangibles. Convenience. (2) (3) (4)

Findings and Discussion

The anticipated five-factor principle-axis factor analysis followed by oblique rotation was conducted according to the methodology set by Parasuraman et al. (1991). However, due to the overlapping of two of Parasuramans factors and the low ranking of the fifth factor, the data was reanalyzed using a four-dimensional factor analysis. This fourdimensional factor analysis reduced the variance level by only 3 percent, and each
Personal attention 86 85 79 77 75 73 70 69 66 65 65 56 51

Thirteen items clustered to form the personal attention factor: (1) never too busy to respond; (2) best interests at heart; (3) always willing to help; (4) understands specific needs;

Items Q13 Q21 Q12 Q22 Q14 Q16 Q17 Q6 Q7 Q18 Q5 Q8 Q20 Q9 Q10 Q15 Q2 Q3 Q4 Q1 Q19 Never too busy to respond Best interests at heart Always willing to help Understands specific needs Behavior instills confidence Courteous employees Knowledgeable employees Interest in solving problems Dependable service Offer individual attention Prompt service Service delivered when promised Offer customization Error-free records When service will be performed Customers feel secure in transactions Appealing store appearance Well dressed, neat employees Appealing promotional materials Up-to-date equipment Convenient operating hours

Reliability

Tangibles

Convenience

65 61 53 67 60 52 57 52

Table I. Four Dimensions of Service Quality (Factor Loadings Multiplied by 100, n = 181)

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(5) behavior instills confidence; (6) courteous employees; (7) knowledgeable employees; (8) interest in solving problems; (9) dependable service; (10) offers individual attention; (11) prompt service; (12) service delivered when promised; and (13) offers customization. While these items represented a myriad of reliability, responsiveness, assurance, and empathy characteristics, they had an underlying common feature. All the items were distinctive of the specialty retailer and were apparent to customers each time they were in the store. For example, in a retail setting, courteous, knowledgeable employees were very obvious to each customer, but how secure customers felt about their transaction were more intangible. These personal attention characteristics reflected the sales service component of service quality. The tangibles factor comprised three items: appealing store appearance; well-dressed, neat employees; and appealing promotional materials. These were all tangible influences that customers notice before or upon entering a store. These characteristics help establish the image of the store and influence customer expectations (Shostack, 1981). In the words of a survey respondent, A stores appearance, employees, atmosphere, and equipment speak loudest to a customer because that is what we notice first. It is our first impression of the store. Three items formed the reliability factor: error-free records; reliable service performance; and reliability in transactions. Each of these items represented the trustworthiness of a specialty store. Error-free records, assurance of timely service, and transaction security were all pledges of reliability to customers. These items

determined how secure a customer felt about shopping a particular store. If performed well, they assured the customer and increased confidence in the store. Thus, the reliability factor represented a component. Another store service characteristic involved convenience, the fourth factor, that included: up-to-date equipment; and convenient operating hours. Consumers expected modern equipment such as quick electronic scanner registers and convenient hours for their shopping. Demographic Characteristics Following Websters (1989) methodology of determining the differences among the demographic characteristics when determining expectations, analysis of variance (ANOVA) was used to determine if the gap factor score means varied among different demographic characteristics. Findings indicated that only three of the characteristics, race, marital status, and income, yielded significant differences at the 0.10 level in disparity of service quality. (1) Race: Caucasian respondents indicated a higher gap mean between expectations and perceptions for Factor 4, convenience, more so than non-white respondents (p = 0.0303). (2) Marital status: Married respondents noted the greatest disparity between expectations and perceptions for Factor 2, reliability, than single respondents (p = 0.0008). (3) Income: Higher income households (earning $35,000 and more) had greater discrepancies with respect to expectations and perceptions than lower income respondents (p = 0.0751) for the reliability factor. Age and gender were not significant at the 0.10 level. Analysis of variance provided evidence that mean differences occurred between expectations and perceptions among

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demographic characteristics regarding two factors, reliability and convenience. Higher income households (earning $35,000 and more) and married respondents held greater disparity with the reliability factor than their lower income, single counterparts. In addition, Caucasians had greater dissention with convenience than other respondents. Since apparel specialty stores typically target higher income consumers (Specialty Retailing, 1986) this finding indicated stores were either not getting the service message out to these consumers, or else they were not meeting these demanded consumers expectations. Further study needs to explore

the cause of these relationships and the magnitude of these differences (see Table II). Patronage Criteria Importance To determine the importance customers placed on store service, respondents were asked to allocate 100 points among the following store patronage criteria: merchandise; price; service; location; and advertising. The instructions indicated that the largest number of points were to be given to the most important factor in determining store patronage. It was found that, service ranked third in importance for specialty store customers in determining where they shop

15 (n) Sex Female Male (F) Race: Caucasian Other (F) Martial status: Single Married (F) Age: Under 44 45-64 65 and over (F) Income < $25,000 $25-$34,999 $35-$49,999 >$50,000 (F) 96 85 F1 0.0630 0.0932 0.7289 0.0654 0.3269 2.7015 0.1327 0.0869 1.3574 0.1099 0.2043 0.0453 1.2809 0.1538 0.2620 0.0923 0.1913 1.5680 F2 0.0365 0.0654 0.3021 0.0270 0.1352 0.5618 0.3566 0.2009 11.810*** 0.0170 0.0039 0.0866 0.0823 0.4018 0.0472 0.2921 0.00690 2.3640* F3 0.0317 0.0468 0.2401 0.0390 0.1949 1.2391 0.0897 0.0440 0.6455 0.0110 0.0322 0.0356 0.0448 0.1522 0.0903 0.1082 0.1020 0.6369 F4 0.0221 0.0327 0.1207 0.0744 0.3720 4.8128** 0.0518 0.0425 0.3354 0.0817 0.1659 0.0711 1.1161 0.2081 0.2143 0.0444 0.0805 1.2677

152 29

61 120 112 33 36 42 48 31 60

*** p < 0.01 ** p < 0.05 * p < 0.10 Note: Means are represented in terms of factor scores

Table II. Effects of Demographic Variables on Differences between Service Quality Expectations and Perceptions Using Analysis of Variance

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Rank 1 2 3 4 5

Variable Merchandise Price Service Location Advertising

Mean score 26 24 17 14 10

less than $35,000) (1990 Census, 1991). The sample therefore represents a higher income, single, predominately Caucasian population. While apparel specialty stores target the more affluent consumer (Specialty Retailing, 1986) the sample is not representative of the general Southeastern population.

Table III. Store Patronage Criteria

Future Research
The results of this study suggest that refinement of the SERVQUAL scale is needed before it can be accepted as a valid measurement scale in an apparel specialty store setting. Magnitude and direction of consumer disparity also warrant future research. In addition, it would be interesting to see if consumers in other areas of the country assess service quality of apparel specialty stores similarly to consumers in the Southeastern United States. Another project would involve the segmentation of retail apparel customers by store type based on their service quality expectations and perceptions.

(see Table III). Merchandise was most important, followed closely by price. Location and advertising were of leat importance.

Limitations
While the SERVQUAL scale has proven a reliable scale for several studies assessing pure service firms, the scale does not perform as well as expected with the service functions of apparel specialty retailing. The five determinants did not factor out as expected (see Appendix). Finn and Lamb (1991) had similar difficulties with the SERVQUAL scale in a retail setting. The sample was selected from households across the Southeastern United States and therefore does not represent the United States as a whole. Those who responded to the mailed questionnaire were representative of the Southeastern population with respect to sex (Southeast female population 52 percent, sample female 53 percent) and age (Southeastern population over 45 years old, 59 percent, sample over 45 years old, 57 percent); however, the sample did not reflect the Southeastern marital status (Southeast population 56 percent married, sample 43 percent married), race (Southeastern population 78 percent Caucasian, sample 84 percent Caucasian) or income (Southeastern population median income $31,345 Sample

Managerial Implications
From the factor analysis, personal attention (sales service) factors held the greatest gap scores, indicating disparity between what specialty store consumers expected and their perceived service quality. Customers receive personal attention from store employees every day in specialty store settings. Some of the items that factored together forming personal attention may actually be antecedents of other items. For example, store employees should be responsive, courteous, and knowledgeable in order to offer prompt, individualized service. The importance of personal attention highlights the service act provided by store sales associates. The underlying implications suggest that front line employees represent the store and, as such,

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are performing a marketing function. This finding stresses the need for customer service training programs to align service quality with consumer expectations. The factor analysis revealed the tangibles dimension (store service) as second in disparity for apparel specialty store consumers. The store appearance, its employees, and promotional materials offer visible cues to customers that they use to form perceptions of store image. Because tangibles often form consumers first impressions, it is important for retailers to create an image for the store that they wish to project and then survey customers as to their perception of the stores image. While the convenience and reliability (store services) factors represent lower gap scores for customers in this study, it is important not to diminish their meaningfulness. For example, having up-to-date equipment often allows a store to facilitate activities such as registering stock-keeping unit information. On the contrary, too much automation reduces the personal attention factor that apparel specialty stores pride themselves for delivering. Behind the scenes technology is important but not necessarily visible to consumers. Accurate inventory information affects the merchandise assortment in the store, a factor which was rated as the most important consumer patronage criterion. In addition, accurate records and convenient hours of operation form a supportive structure on which personal attention and tangibles rely. The rankings for store patronage indicated several reasons why specialty stores have enjoyed widespread success in recent years. Specialists offer merchandise targeted to specific customers. In addition, they often target niche markets (high, middle, or low end) that enable them to offer merchandise at attractive price points. Outstanding service offerings (both store and sales) combined with merchandise at competitive prices help create an advantage.

Additional comments from survey respondents confirm the basis of the success for specialty retailers. Several respondents noted, Product, and then service determine where I shop. Other responses of interest included: Selection of merchandise is everything when you dont have time to shop around, and I can deal with salespeople who are knowledgeable. The significant demographic characteristics of this sample that possessed the greatest disparity between expectations and perceptions were married Caucasians with higher incomes. Many specialty stores target this market segment and are either not reaching their target market or are not delivering the service their customers expect. Those who do target this market need to reassess their marketing strategy and concentrate on diminishing this disparity among this group of consumers. A final implication of this study underscores the current success of specialty store retailers. Store service, ranked third in patronage criteria, has been cited as a major factor in specialty retailing success stories. True competitors (high end versus high end, or low end versus low end) can easily duplicate merchandise mix and price, the first two factors of store patronage. Therefore, by offering the correct combination of merchandise, price, and service, a specialty store retailer can gain an advantage over competitors.

References
Austin, N.K. (1992), The Service Edge, Working Woman, July, pp. 26-8. Berman, B. and Evans, J.R. (1992), Retail Management: A Strategic Approach, 5th ed., Macmillan, New York, NY. Berry, L. (1969), The Components of Department Store Image: A Theoretical and

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Empirical Analysis, Journal of Retailing, Vol. 45 No. 1, pp. 3-20. Finn, D.W. and Lamb, C.R., Jr (1991), An Evaluation of the SERVQUAL Scales in a Retailing Setting, Advances in Consumer Research, Vol. 18, pp. 483-90. Gist, R.R. (Ed.), (1968), Retailing: Concepts and Decisions, John Wiley & Sons, New York, NY. Gronroos, C. (1984), A Service Quality Model and its Marketing Implications, European Journal of Marketing, Vol. 18 No. 4, pp. 36-44. King, C.W. and Ring, L.J. (1980), Market Positioning Across Retail Fashion Institutions: A Comparative Analysis of Store Types, Journal of Retailing, Vol. 56 No. 1, pp. 37-55. Lumpkin, J.R. and McConkey, C.W. (1984), Identifying Determinants of Store Choice of Fashion Shoppers, Akron Business and Economic Review, Vol. 15 No. 4, pp. 30-5. Mayer, C.E. and Morin, R. (1987), Retailers Return to Basics to Win, Keep Customers, The Washington Post, 25 October, p. H-1a. Parasuraman, A., Zeithaml, V.A., and Berry, L. (1985), A Conceptual Model of Service Quality and its Implications for Future Research, Journal of Marketing, Vol. 49, Fall, pp. 41-50. Parasuraman, A., Zeithaml, V.A. and Berry, L. (1991), Refinement and Reassessment of the SERVQUAL Scale, Journal of Retailing, Vol. 67 No. 4, pp. 420-50. Reichheld, F.F. and Sasser, W.E., Jr (1990), Zero Defections: Quality Comes to Services, Harvard Business Review, Vol. 68, September-October, pp. 105-11. Specialty Retailing: Markets and Strategies for the 1990s, (1986), Find/SVP, New York, NY. Shostack, G.L. (1981), How to Design a Service, Donnelly, J. and George, W.R. (Eds), AMA, Chicago, IL, pp. 221-9.

Survey of Current Business (1983, 1993), US Department of Commerce Economics and Statistics Administration, Washington DC. 1990 Census of Population and Housing (1991), US Department of Commerce, Bureau of the Census, Washington, DC. Webster, C. (1989), Can Consumers be Segmented on the Basis of Their Service Quality Expectations?, Journal of Services Marketing, Vol. 3, Spring, pp. 35-53.

Appendix
Method A sample purchased from Survey Sampling Inc. resulted in a random sample of 861 deliverable questionnaires. The sample was stratified to represent household populations across the Southeastern United States including Alabama, Georgia, Florida, Mississippi, North Carolina, South Carolina, and Tennessee that responded to mailed questionnaires. The Southeastern US was selected to avoid bias of service perceptions that might vary by geographical location. The final sample consisted of 181 usable questionnaires. Description of the Instrument The first section of the survey consisted of SERVQUAL expectation statements operationally defined as what customers would expect from an ideal specialty apparel store offering excellent quality service. Following the expectations segment, instructions asked respondents to name a specialty clothing store which they shopped. Then, based upon the store they indicated, respondents answered questions in the perceptions section of the SERVQUAL. This segment consisted of 22 items that paralleled the expectations segment. For each of the statements, respondents indicated on a scale from one (strongly disagree) to seven (strongly agree) the extent to which they

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believe the specialty store they shopped in had the features described (see Table I). In the next section of the survey, respondents allocated a total of 100 points among five retail strategies used to increase store patronage (Berman and Evans, 1992). Highest point ratings were distributed to the feature deemed most important. This section determined the importance of service with respect to other factors of store patronage (see Table III). The final section of the survey concerned personal demographics of the survey respondent. The demographics were used as independent variables for the ANOVAs (see Table II). Data Analysis To analyze the gap between customer expectations and perceptions, the expectations score of each SERVQUAL statement was subtracted from the perceptions score on the corresponding statement, resulting in 22 measurement items. Using the 22 gap scores, a five factor principle-axis analysis followed by oblique rotation was conducted to analyze the a priori

factors determined by Parasuraman et al. (1991). Due to low eigenvalues, a second factor analysis using four factors followed by oblique rotation was performed. This resulted in a greater eigenvalue for each variable and diminished the variance by only 3 percent. One way Analysis of Variance was used to determine if there were significant differences among the various demographic categories in regard to the gap scores that measured disparity between service quality expectations and perceptions (question one). The means for each demographic characteristic with regard for each factor are reported in Table II. The importance of store service in relation to other possible patronage criteria (question two) was determined through additional analysis. By averaging the points allocated to each variable, it was possible to obtain overall scores for each variable. A visual inspection rank ordered the patronage criteria (see Table III).
Kathryn Bishop Gagliano and Jan Hathcote are based at the University of Georgia, Athens, Georgia, USA

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