Linking servicescape to customer satisfaction: exploring the role of competitive strategy

Purpose – The purpose of this paper is to explore the relationship between firm service characteristics and customer satisfaction as moderated by firm competitive strategy. Specifically, this research utilizes Porter's depiction of generic competitive strategy to explain the strength of the relationship between a service's particular servicescape choices and customer satisfaction. Design/methodology/approach – The empirical data for this research were obtained from 1,287 customers of ten service organizations representing three industry segments. Multiple regression analysis is utilized to test three hypotheses that propose firm competitive strategy moderates the strength of the relationship between service characteristics and customer satisfaction. Findings – The results support the assertion that firm competitive strategy has an impact on the strength of the relationship between customer satisfaction and servicescape characteristics. Of note, these findings indicate that the payoff for investment in physical surroundings differs depending on firm competitive strategy. Practical implications – The results point to the importance of aligning firm strategy and operational decisions when seeking to maximize customer satisfaction. Decision makers benefit from understanding how strategy matters in service operational choices. Originality/value – The paper makes connections across academic disciplines to highlight the importance of linking firm competitive strategy with service operation choices to enhance customer satisfaction. The model developed here, supported with empirical results, provides insights for both researchers and practitioners regarding the value of investment in service‐related activities.