INFLUENCE OF STORE ATMOSPHERICS ON CONSUMERS’ PURCHASING BEHAVIOUR IN APPAREL STORES WITHIN THE JUNCTION MALL, NAIROBI BY MUNGANIA KARWITHA LILLIAN A RESEARCH PROJECT SUBMITTED IN PARTIAL FULFILMENT OF THE REQUIREMENT FOR THE AWARD OF MASTER OF SCIENCE IN MARKETING, SCHOOL OF BUSINESS, UNIVERSITY OF NAIROBI 2016 DECLARATION This research project is my original work and has not been presented in any other institution for any academic award. Signed…………………………… Date…………………………. MUNGANIA KARWITHA LILLIAN D65/73013/2014 This research project has been submitted for examination with my approval as University Supervisor. Signed…………………………… Date…………………………… Dr. Raymond Musyoka Lecturer Department of Business Administration School of Business University of Nairobi ii DEDICATION I dedicate this work to my late parents Johana Mungania and Esther Mungania. iii ACKNOWLEDGEMENTS The completion of this research project would not be possible without the material and moral support from various people. It is my obligation therefore to extend my gratitude to them. First of all, I thank the almighty God for giving me good health, and for guiding me through the entire course. I am greatly indebted to Dr. Raymond Musyoka who was my supervisor, for his effective supervision, dedication, availability and professional advice. I extend my gratitude to the lecturers who taught me in the MSC Program, thus enriching my research by laying the theoretical grounding of this work. I am also greatly indebted to the management of The Junction Mall who accorded me the much needed support during data collection and their willingness to provide the required information during the fieldwork phase of this study. My appreciation also goes to my classmates Risper and Eric, with whom I weathered through the storms, giving each other encouragement and for their positive criticism. I also acknowledge my husband Paul and daughters Virginia, Ivy and Esther for their moral support and encouragement during the entire study period. Thank you all most sincerely for your patience and understanding. iv TABLE OF CONTENTS DECLARATION............................................................................................................... ii DEDICATION.................................................................................................................. iii ACKNOWLEDGEMENTS ............................................................................................ iv LIST OF TABLES .......................................................................................................... vii LIST OF FIGURES ....................................................................................................... viii ABSTRACT ...................................................................................................................... ix CHAPTER ONE: INTRODUCTION ..............................................................................1 1.1 Background of the study ........................................................................................... 1 1.1.1 Store Atmospherics .............................................................................................2 1.1.2 Consumer Buying Behaviour ..............................................................................2 1.1.3 The Retail Industry in Kenya...............................................................................3 1.2 Research Problem ...................................................................................................... 4 1.3 Research Objective .................................................................................................... 6 1.4 Value of the Study ..................................................................................................... 6 CHAPTER TWO: LITERATURE REVIEW .................................................................7 2.1 Introduction ............................................................................................................... 7 2.2 Theoretical Foundation ............................................................................................. 7 2.3 Influence of Store Atmospherics of Consumer Behaviour ....................................... 8 2.3.1 Influence of Sight on Consumer Buying Behaviour ...........................................9 2.3.2 Influence of Sound on Consumer Buying Behaviour ........................................10 2.3.3 Effects of Scent on Consumer Buying Behaviour .............................................11 2.3.4 Effects of Touch on Consumer Buying Behaviour ...........................................13 2.4 Summary of Empirical Studies ............................................................................... 16 CHAPTER THREE: METHODOLOGY .....................................................................17 3.1 Introduction ............................................................................................................. 17 3.2 Research Design ...................................................................................................... 17 3.4 Data Collection ........................................................................................................ 17 3.5 Data Analysis .......................................................................................................... 18 CHAPTER FOUR: DATA ANALYSIS, PRESENTATION & INTERPRETATION19 4.1 Introduction ............................................................................................................. 19 v 4.2 Response Rate ......................................................................................................... 19 4.3 Demographic Information of the Respondents ....................................................... 19 4.4 Influence of Store Atmospherics on Consumer Purchase Behaviour ..................... 21 4.4.1 Descriptive Statistics on the Influence of Sound on Consumer Purchase .........21 4.4.2 Descriptive Statistics on the Influence of Store Scent on Consumer Purchase .22 4.4.3 Descriptive Statistics on the Influence of Store Sight on Consumer Purchase .23 4.4.4 Descriptive Statistics on the Influence of Touch in the store on Consumer Purchase .............................................................................................................25 4.4.5 Descriptive Statistics on Consumer Purchase Behaviour ..................................26 4.5 Correlation Analysis ................................................................................................ 27 4.6 Regression Analysis ................................................................................................ 29 4.7 Discussion of Results .............................................................................................. 31 CHAPTER FIVE: SUMMARY, CONCLUSION AND RECOMMENDATIONS ...34 5.1 Introduction ............................................................................................................. 34 5.2 Summary of Findings .............................................................................................. 34 5.3 Conclusion of the Study .......................................................................................... 35 5.4 Policy Implications of the Study ............................................................................. 36 5.5 Recommendations of the Study .............................................................................. 36 5.6 Limitations of the Study ......................................................................................... 36 5.7 Areas Suggested for Further Research .................................................................... 37 REFERENCES .................................................................................................................38 APPENDICES ..................................................................................................................43 vi LIST OF TABLES Table 4.1 Respondents’ distribution by Gender…………………………………… 19 Table 4.2 Respondents’ distribution by age……………………………………….. 20 Table 4.3 Distribution of the Respondents by Education level……………………. 20 Table 4.4 Distribution of the Respondents by Frequency of Visits Clothing Store... 21 Table 4.5 Descriptive Statistics on the Influence of Sound on Consumer Purchase.. 22 Table 4.6 Descriptive Statistics on the Influence of Store Scent on Purchases…….. 23 Table 4.7 Descriptive Statistics on the Influence of Store Sight on Purchases……… 24 Table 4.8 Descriptive Statistics on the Influence of Touch on Consumer Purchase. 25 Table 4.9 Descriptive Statistics on Consumer Purchase Behaviour………………. 26 Table 4.10 Correlation Analysis…………………………………………………….. 28 Table 4.11 Model Summary........................................................................................ 29 Table 4.12 ANOVA..................................................................................................... 30 Table 4.13 Coefficients................................................................................................ 30 vii LIST OF FIGURES Table 4.1 The Mehrabian-Russell’s Environmental Psychology ………………… 7 viii ABSTRACT Retail industry is a kind of business with high level of competition. The success of retail business is influenced by its fast response and its ability in understanding consumers’ behaviors. Retail business must focus on its consumer preferences and factors that influence a customer’s purchase decision. The objective of this study was to establish the influence of store atmospherics on consumers’ purchasing behavior in apparel stores within The Junction Mall, Nairobi. The study endeavored to answer the question, what influence does store atmospherics have on consumers buying behavior in apparel retail stores within the Junction Mall? This study was anchored on the Mehrabian and Russell (M-R) environmental psychology model. This was a case study of all 9 apparel stores in at The Junction Mall. Questionnaires were used as instrument for data collection. A total of 270 respondents were targeted from the nine clothing stores and the Junction Shopping Mall out of which 195 responded giving a response rate of 72%. Descriptive statistics such as frequencies, percentages, means and standard deviations were used. Inferential statistics such as correlation and regression analysis was used to test on the relationship between the variables studied. The study found that sound in the store influences consumer purchase behaviour as evidenced by the fact that respondents agreed with the statement that the slow rhythm of the background music makes them comfortable. Findings from correlation analysis showed that that there is a positive correlation between consumer purchase behaviour and sound. On the influence of store scent on consumer purchase behaviour, the respondent agreed that fragrance in the retail chain outlets makes them spend more time and that scent in the store makes them revisit retail chain outlet. The findings from correlation analysis showed that consumer purchase behaviour has a positive relation with scent. Regarding the influence of sight on consumer behaviour, the respondent agreed that retail chain outlet display allows them to see displayed products clearly. The findings from correlation analysis further revealed that consumer purchase behaviour is positively related with sight. Finally, regarding the influence of touch on consumer purchase behaviour, the study found that respondent agreed that touching and feeling a product makes their purchasing decision easier. Correlation analysis findings revealed that consumer purchase behaviour have a positive relation with touch. The study concluded that store sight, scent, sound and touch influences consumer purchase in apparel stores at The Junction Mall. The study recommends that aapparel store owners should ensure that that their stores are attractively arranged to attract customers. It was finally recommended that the same study be replicated in other retail stores in Nairobi. ix CHAPTER ONE: INTRODUCTION 1.1 Background of the study One of the most important recent advances in business thinking is the recognition that people in their purchase decision making respond to more than simply the tangible product or service on offer. The tangible product is only a small part of the total of consumption package. Buyers respond to the total product which include but not limited to services, warranties, packaging, advertising, pleasantries, image and other features that accompany the product. One of the most significant features of the total product is the place where it is bought or consumed. In some cases, the place, more specifically the atmosphere of the place, is more influential than the product itself in the purchase decision. In some cases, the atmosphere is the primary product. In today’s society consumers are experiencing more time pressures and have a need to escape from hectic and stressful days (Deccan Chronicle, 2011). It can therefore be inferred that it might be essential for retailers to realise this and make their physical in- store environment as pleasant as possible in order to satisfy consumer needs and provide them with an enjoyable experience, not reminding them of their “busy and rushed” lifestyles (Gobé, 2009). Liaw (2007) states that retail stores that do improve on their in- store environment create an effective consuming condition that might stimulate and satisfy the consumers’ immediate purchasing behaviour. Ogden-Barnes and Barclay (2001) are of the opinion that subtle factors experienced through the senses, namely sight, sound, touch, scent and taste, either individually or together, can affect a consumer’s emotion in relation to a degree of stimulation and relaxation. For example, different light and temperature combinations can act to influence consumer perceptions of the retail offer, with soft or warm light tones and cool or warm temperature variables all creating different perceptions in dissimilar product sectors. It is therefore critical for retailers to determine how these key atmospheric elements are optimised in relation to the brand and product offer in order to create a pleasurable shopping environment that will stimulate and encourage sales. 1