Unveiling the Intangible Impacts of Servicescape on Business Performance: A Qualitative Content Analysis

Unveiling the Intangible Impacts of Servicescape on Business Performance: A Qualitative Content Analysis
Izran Sarrazin Mohammad*, Syarah Syazwani Ariffin and Rohaya Abdul Jalil

Department of Real Estate, Faculty of Built Environment & Survey, Universiti Teknologi Malaysia, Malaysia

*Corresponding Author

DOI: https://dx.doi.org/10.47772/IJRISS.2025.907000226

Received: 02 July 2025; Accepted: 09 July 2025; Published: 08 August 2025

ABSTRACT

Servicescape, the physical environment in which a business operates, plays a critical role in influencing employee productivity and shaping customer perceptions and experiences. While the tangible aspects of servicescape such as space, energy use, lighting, and noise are well-documented, its intangible impacts remain underexplored due to their complexity and difficulty to quantify. This paper aims to identify these intangible impacts through a comprehensive literature review and content analysis using NVivo software. The findings reveal that servicescape influences emotional, cognitive, and psychological responses, which in turn affect how customers and employees perceive service quality and organisational image. The results underscore the need for facilities managers to incorporate intangible considerations in strategic decision-making, performance evaluation, and return on investment assessments.

Keywords – servicescape, intangible impacts, employee productivity, customer perceptions, facilities management

INTRODUCTION

In today’s highly competitive business environment, organisations are constantly seeking new ways to differentiate themselves and gain a competitive advantage. One often overlooked yet influential factor is the servicescape—the physical environment in which services are delivered. Servicescape subtly shapes customer perceptions, emotions, and behaviours, influencing satisfaction, loyalty, and overall business performance.

Servicescape includes elements such as space, lighting, temperature, noise, and layout, all of which contribute to the customer and employee experience. While the tangible elements of servicescape have been widely studied, its intangible impacts—such as emotional, cognitive, and psychological responses—remain underexplored. These intangible elements play a significant role in influencing user behaviour, service quality perception, and brand image.

This paper addresses this gap by identifying and analysing the intangible impacts of servicescape on business performance. Through a structured content analysis using NVivo, the study aims to provide insights for facilities managers and decision-makers to enhance service environments strategically.

In businesses such as hotels, shopping complexes, food and beverage establishments (including fast food industries and coffee shops), leisure services (like karaoke or casinos), and healthcare facilities, the servicescape plays a pivotal role as it encompasses elements that significantly influence customer perceptions, satisfaction, and overall experiences. The servicescape encompasses a multitude of elements that collectively shape the overall physical environment where services are provided. These elements include space, energy usage, luminosity, noise level, lighting, colors, sounds, and even temperature [13][28][47]. Understanding and optimizing these tangible elements can lead to enhanced customer engagement, improved employee morale, and ultimately, increased business performance.

Additionally, beyond the tangible elements, the servicescape also exerts intangible impacts that play a vital role in shaping customer experiences. These elements of the servicescape orchestrate the internal emotional responses of customers and employees alike. For instance, a well-designed and aesthetically pleasing environment with carefully curated colors, temperature, music, and lighting can create a sense of comfort, happiness and relaxation, enhancing customers’ overall experience [1][8]. Imagine walking into a cozy coffee shop with soft, warm lighting, gentle background music, and a welcoming aroma of freshly brewed coffee. The ambiance immediately puts customers at ease, making them more likely to stay longer, order more, and return for future visits.

Similarly, employees working in a pleasant and conducive environment are more likely to be motivated, leading to improved service delivery and, in turn, increased productivity [3][22]. Picture a workplace with an open layout, ample natural light, and a well-balanced color scheme that fosters a positive atmosphere for employees. They feel happier and more connected to their surroundings, which positively influences their interactions with customers, ultimately contributing to the business’s success. Thus, the intangible impacts of servicescape are essential for business

performance, ensuring the success of the business. These subtle yet powerful influences on emotions and perceptions have a lasting effect on how customers and employees perceive the brand, leading to long-term loyalty and positive word-of-mouth referrals.

Despite the acknowledged importance of servicescape on overall business performance, a significant gap remains in comprehensive research that delves into the intangible impacts of servicescape, and their profound influence on businesses. While numerous studies focus on tangible elements such as spatial layout and design, the equally crucial psychological and emotional impacts of the servicescape on both customers and employees frequently escape notice. For instance, [76] conducted a comprehensive study that explored the concept of servicescape elements, with a specific focus on the integration of safety as an essential element. The findings revealed that when customers perceive a service environment as safe and secure, they are more likely to trust the brand and feel at ease, positively impacting their overall experience and likelihood of returning. [51] contributed to the research by exploring the application of the e-servicescape model in the context of online exhibitions. The study shed light on how the virtual environment’s design and features influence visitors’ engagement, immersion, and satisfaction. Understanding these factors can help businesses optimize their online platforms to create more enjoyable and meaningful experience for customers. [6] investigated the impact of both offline and online servicescapes on customer satisfaction and repurchase intention.

The research found that a seamless and consistent transition between the physical and digital environment positively influenced customers’ perceptions of the brand, leading to increased loyalty and repeat business. Furthermore, [53] presented a comprehensive model of the servicescape in the fast casual dining industry. The study highlighted the importance of aligning the servicescape with the brand’s identity to create a cohesive and immersive dining experience for customers. By doing so, business can foster stronger emotional connections with their target audience and differentiate themselves in competitive market.

However, despite these valuable contributions, research on the intangible impacts of servicescape is still limited, especially in the realm of facilities management.  Facilities managers play a vital role in shaping the servicescape and must recognize the significance of understanding and optimizing the servicescape’s intangible impact. By acknowledging how elements of the servicescape influence the internal emotions of customers and employees, facilities managers can strategically design spaces that foster positive experience for both parties. Moreover, aligning the servicescape with the brand’s values and identity can create a cohesive and immersive environment that enhances business performance.

Therefore, research endeavors should strive to strike a balance between exploring both tangible and intangible impacts of servicescape to comprehensively grasp the full spectrum of its effects on businesses. Hence, this article embarks on a comprehensive exploration of the intangible impacts of the servicescape on business performance.

Understanding and optimizing these intangible impacts can give businesses a competitive edge and contribute to their long-term success. By delving into research on environmental psychology and servicescape, this paper aims to shed light on the intangible impacts of servicescape on customers’ and employees’ experiences and, ultimately, the success of businesses. In the forthcoming sections, this paper will delve into the various elements that constitute the servicescape and explore the intangible impacts on cognitive, emotional, and psychological responses, as well as behavioural responses. By understanding the psychological and emotional impact of the servicescape, facilities managers can make informed decisions that enhance customer experience, increase employee engagement, and ultimately boost business performance.

LITERATURE REVIEW

The concept of servicescape emerged during the 1980s and has since evolved into a crucial area of research in the field of service marketing. The term “servicescape”, coined by Bitner in 1992, is recognized among scholars as the atmospheric [10] [38] [61], physical environment [15] [44], and store environment [70].

The servicescape plays a crucial role in the performance of various consumer-oriented services, including leisure services, hotels, shopping malls, restaurants, and related industries. It shapes the atmosphere for its occupants, influencing their internal responses and behaviour. The term ‘servicescape’ pertains to the environment within which a service is provided, serving as the backdrop for interactions between seller and customer. It encompasses tangible elements that aid in the execution or communication of the service [21]. According to [86], the servicescape significantly influences customers’ overall experience and satisfaction with the service, encompassing elements of the physical facility and other tangible elements of the service setting. Servicescape encompasses all tangible elements present around consumers during service transactions [43].

There are various tangible elements of servicescape identified by scholars in various fields. Below, the subsection explains the various tangible elements of the servicescape in further detail.

Tangible Elements of Servicescape

Numerous viewpoints regarding servicescape elements are derived from scholars studying various types of service settings. [1] focused on hotels, [8] on coffee shops, [63] on shopping complexes, [64] on restaurants, [5] on water sports and recreation, and [37] on healthcare services . Table 1 shows several research studies conducted during a comprehensive literature review from 2018 to 2023, investigating the essentials of tangible elements in diverse service settings.

Table 1. Servicescape elements and attributes suggested by previous studies.

Scholars have made various attempts to propose elements of the servicescape in different types of business service settings. The elements of the servicescape vary depending on the nature of the business service and the customers’ needs. [40] contended that universally standardized determinants for the servicescape do not exist for all service organisations. These elements represent the crucial factors within each business service that contribute to an organisation’s success. [77][85] all agree that internal responses influence customers’ and employees’ behaviour, which is influenced by elements of the physical environment, including the facility and tangible elements of the servicescape. The servicescape, with its efficient elements, plays a crucial role in influencing business performance. Moreover, the elements of the servicescape are of paramount importance for business services and can have intangible impacts on individuals’ emotional, cognitive, and psychological responses, thereby influencing behaviour and ultimately enhancing the productivity and profitability of businesses. [2] also supports the notion that tangible elements significantly influence people’s emotions, cognition, and psychological responses.

Intangible Impact of Servicescape

The servicescape elicits various internal responses, including cognitive, emotional, and physiological reactions, from both customers and employees. Figure 1 depicts Bitner’s initial structure of servicescape elements, which primarily centered on the retail sector, such as a shopping mall. This framework highlights the significance of physical environments in service organisations and examines how they are perceived by both customers and employees. Both groups respond to the intangible impact of the servicescape, encompassing cognitive, emotional, and physiological responses to the environment. These responses, in turn, influence their approach or avoidance behaviour.

 Figure 1. The Impact of Servicescape in Business Services

Cognitive responses

Cognitive responses involve the mental processes people employ when interacting with and processing information related to the physical environment of a service establishment [71]. Additionally, cognitive refers to the mental ability that individuals employ to process information acquired through perception, knowledge, and subjective experience [23][26][29]. These responses encompass perceptions of the ambiance, such as whether it is lively, relaxing, or casual. For instance, the cognitive response can shape people’s perceptions of a product or business service based on interior design or decor, influencing beliefs about the store’s perceived expense or success  [25]. [19] refers to cognitive processes that include beliefs, categorisation, and symbolic meaning, all of which can significantly affect people’s belief about a product or service.

Moreover, cognitive responses extended to also post-consumption satisfaction assessments, evaluating whether the experience met or fell short of previous expectations [80]. This highlights the role of tangible elements of the servicescape, such as interior design, in shaping people’s perceptions and satisfaction with a business.

Emotions responses

Customer emotional responses are significantly influenced by the servicescape, eliciting a wide array of feelings and emotions. According to [79], emotions refer to the benefits derived from affectionate statements or feelings, resulting in the enjoyment and pleasure obtained from a product or service. Extensive research conducted by [58][7][11][67] has identified various emotions in response to the servicescape, such as pleasure, enjoyment, comfort, satisfaction, safety, happiness, sadness, romance, passion, arousal, and excitement.

These emotional responses have been studied within the field of environmental psychology, coined by [57], which explores how physical stimuli impact individuals’ emotions and behaviours, influencing areas such as work performance and social interaction. Emotions can be categorised into three fundamental dimensions: pleasure, arousal, and dominance, reflecting individuals’ current emotional state.

Pleasure dimension

Pleasure is defined as the state of consciousness or sensation induced by the enjoyment or anticipation of what is perceived or experienced as good or desirable [31]. Pleasure encompasses contentment, happiness, satisfaction, relaxation, a sense of importance, care, hopefulness, and joy in the environment. [74] highlights that pleasure is associated with feelings of happiness or satisfaction, leading customers to spend more time and money in a business environment. For example, utilising visual displays, appealing scents, stylish decor, and soothing music can contribute to a pleasurable shopping environment that encourages exploration.

Arousal dimension

The arousal dimension of emotional responses encompasses a range of heightened states and sensations that individuals experience in response to the servicescape. Arousal refers to being stimulated, excited, jittery, aroused, frenzied, autonomous, wide awake, and having a sense of control [20][25][54][55]. This dimension is characterised by varying levels of stimulation and excitement, often influencing customers’ perceptions and behaviours. Elements of the servicescape, such as lighting or colors, contribute to raising arousal levels. A lively environment with vibrant colors and energetic music can stimulate customers and keep them engaged.

Dominance dimension

Dominance describes the sensation of being able to ‘win’ in a particular situation, as observed in contexts like casinos, as pointed by [54] the case of Macau’s casino industry. According to [55], dominance pertains to the extent to which an individual senses influence, control, or important. For example, karaoke venues with private rooms offer a sense of dominance to groups, allowing them to control the ambiance, song choices, and overall experience within their designated space.

Moreover, [33] notes that pleasure includes emotions such as happiness instead of unhappiness, pleasure instead of annoyance, or delight rather than sorrow. Arousal, in contrast, can manifest as feelings of stimulation instead of relaxation, excitement rather than calmness, or frenzy instead of apathy. Meanwhile, dominance is indicated by emotions related to a sense of control rather than being controlled, being influential rather than being influenced, or being in control rather than being cared for. Additionally, [35]  argue that pleasure encompasses a range of emotional states, including feelings of joy or discontent, comfort or unease. Arousal, on the other hand, spans from excitement to calmness, while dominance involves emotions related to control, submission, overpowering, or obedience.

Physiological responses

The physiological response is linked to bodily reactions and responses that arise during the servicescape experience. Tangible elements of the servicescape, such as lighting, temperature, and scent, can significantly influence consumers’ physiological responses, including heart rate, respiration, and stress levels. For instance, soothing background music or calming scents may lead to a more relaxed physiological state. According to [88], the physiological response arises from the ambient conditions of the business services. This can lead to either comfort or discomfort during the service encounter, influencing the customer’s decision to continue or discontinue service consumption, consequently impacting their attitudes and behaviour towards the service provider. Another example is that warm colors (red and orange) have been found to elicit physiological responses and, at times, even cause stress, whereas cool colors (blue and green) tend to induce relaxation and reduce feelings of stress [42].

Excessive noise or unsuitable temperature in the environment could lead to physical discomfort, while inadequate air quality might lead can to breathing difficulties, and insufficient lighting could reduce visibility of products and strain the eyes [24]. A negative physiological response, such as discomfort or elevated stress levels, may lead to a negative evaluation of the service and deter customers from returning. [19] discussed how the servicescape can trigger various physiological responses among individuals, such as experiencing pain due to uncomfortable seating, feeling comfort in a well-designed environment, reacting to the layout with different movement patterns, and displaying physical reactions in response to the service settings. These physiological responses highlight the significant intangible impact of the servicescape on people’s well-being and overall service experiences.

Behaviour Impact of Servicescape

The intangible impact of servicescape influences behavioural responses, which can either be approach or avoidance. If individuals are more likely to approach the service, it indicates that they feel drawn to it and are more willing to engage with it. On the other hand, if they experience a negative emotional response, they may avoid the service, meaning they are less likely to interact with it and may seek alternatives.

Approach behaviours, as highlighted by studies [5] [20] [47] [49] [50] [75] [78], include desires to explore, stay for longer durations, visit more frequently, display loyalty, engage in word-of-mouth promotion, enhance corporate image, and engage in unplanned spending. For instance, the scent and the genre of music need to be congruent with a business environment, such as restaurant’s, to increase the length of stay and spending [62].

On the other hand, a negative experience leads to triggered avoidance behaviour. For instance, customers perceived the physical environment as unsafe, threatened, or uncomfortable, consequently resulting in a willingness not to stay, affiliate, or engage with the service. Avoidance behaviours in the servicescape include reduced visit frequency, buying less, a desire to leave earlier, switching to competitors, negative word-of-mouth, hindering promised service delivery, and seeking online alternatives due to negative perceptions or emotions associated with the service environment [20]. Additionally, negative emotional among employees may leads to ignoring communication with customers, hindering the performance of promised delivery, or avoiding service encounters with customers [44]. This highlights the significance of designing the service and work environment carefully for the organisation to ensure positive customer interaction and employee productivity.

RESEARCH METHODOLOGY

This paper is specifically devoted to explore and reviewing the literature on the intangible impact of servicescape. Figure 2 illustrates the methodology employed to achieve this objective. Qualitative content analysis was utilised to assess published material related to the intangible impact of servicescape on business performance. Following the method used by [90] and [91], three stages were employed to extract, analyse, and present the literature-based conclusions. The initial stage involved identifying the articles to be included in this review. The subsequent stage encompassed the formulation and execution of comprehensive guidelines that outlined how to capture and evaluate the literature. The final stage consisted of synthesising the scrutinized particulars and deducing the research findings.

For the initial phase of content analysis, all articles related to servicescape, intangible impacts of servicescape, environmental psychological, and business performance, published in journals, academic conferences, website, blog, posts, google scholar, and books were gathered. The literature selection encompasses English-speaking journals, peer-reviewed papers; conference proceedings, and books exploring the intangible impacts of servicescape, spanning a twenty-four-year timeframe from 2009 to 2023. To compile the literature sample, a search was conducted using a combination of keywords; “servicescape”, “intangible impact of servicescape”, “environmental psychological”, and “internal responses to the servicescape”. These keywords were queried within title, keywords, or abstracts. The structured keyword search was conducted across prominent databases subscribed to by the Universiti Teknologi Malaysia library (UTM online databases, e-journals, and e-books): Science Direct, SAGE journals, Scopus, Emerald Insight, Wiley, SpringerLink, Web of Science, and Taylor & Francis online. Through these procedures, a total of 87 qualitative research articles relevant to the intangible impacts of servicescape were identified. Subsequently, these 87 papers are referred to as the ‘primary’ set of papers.

NVivo is employed to analyse the content of the selected literature, allowing for in-depth exploration and identification of intangible impacts of servicescape. NVivo had previously been effectively used in this manner by [90] and [89]. A detailed set of guidelines was devised to organise, code, and analyse the extracted papers in the NVivo database. All sixty articles were saved and organised as “documents” and “nodes”. The analysis involved only one level of coding. The primary areas of interest (intangible impact of servicescape) were positioned at a high level in main tree-level nodes in NVivo, aligning with the specifications of the first set of guidelines. The three-level node represents a logical location within NVivo, enabling the organisation and storage of content logically grouped during the coding process. As per the guidelines, each paper was manually reviewed in NVivo to inductively identify the key area of interest (intangible impact of servicescape). The coding process was carried out by linking relevant sentences or statements to the nodes. The result of the analysis (the coded content) was examined to derive the intangible impact of servicescape.

This process facilitated the recognition of the intangible impact of servicescape on business performance, as evidenced by the coded literature. The comprehensive research outcomes will be elaborated upon in the subsequent section.

Fig 2. Three-Stage Qualitative Content Analysis Framework for Identifying Intangible Servicescape Impacts

FINDINGS

In this section, the paper presents the results of the content analysis conducted to identify the major intangible impacts of servicescape. Table 2 displays the findings of these major intangible impacts, as identified through the analysis. For comprehensiveness, the list also includes intangible impacts that were mentioned only once. Additionally, table 3 provides an overview of the sub-impacts related to the intangible impact of servicescape.

The study identifies three major intangible impacts of the servicescape: cognitive, emotional, and physiological responses, which significantly influence individuals’ behavior, leading to either approach or avoidance in the business environment.

Cognitive responses encompass a range of mental processes, including perception, memory, and decision-making. These cognitive responses are crucial for shaping customers’ understanding of a service or brand. For instance, a visually appealing and well-organised retail environment can positively affect a customer’s perception of the quality and professionalism of a business, ultimately influencing their decision to engage with it [93][64]. As mentioned by [58], physical discomfort resulting from disturbances in the servicescape can give rise to negative cognitive perceptions, subsequently affecting individuals’ overall experience. Additionally, the significance of these cognitive responses extends to employees, as they also experience the effects of the servicescape on their performance and job satisfaction [44].

Emotional responses, on the other hand, relate to the feelings and emotions that the servicescape evokes in individuals. A warm and welcoming surrounding environment, for instance, can trigger positive emotions, making customers feel comfortable and inclined to stay longer, interact with staff, and make purchases. Conversely, a cold and unwelcoming environment can lead to negative emotions, discouraging customers and potentially driving them away. Additionally, it’s important to recognize that these emotional responses also extend to employees who work within this environment, affecting their morale, and job satisfaction. According to [14], the servicescape has a significant impact on individual emotions.

Physiological responses encompass the physical reactions individuals have in response to the servicescape. These might include changes in their heart rate, blood pressure, or even stress levels. For instance, a noisy and chaotic environment can induce stress in customers, making them more likely to hurriedly complete their transactions or avoid the place altogether. Furthermore, it’s crucial to acknowledge that these physiological responses also extend to employees, as they, too, experience the effects of the servicescape on their performance and job satisfaction. The servicescape can evoke cognitive, emotional, and physiological responses, subsequently shaping the behavior of both customers and employees [19] [2] [64] [32].

Table 2. Summary of findings derived from content analysis (intangible impact)

Table 3. Summary of findings derived from content analysis (sub-major intangible impacts).

Table 3 highlights the sub-major intangible impacts of the servicescape, which are pleasure, arousal, and dominance. The pleasure dimension encompasses feelings of happiness, enjoyment, delight, and satisfaction. When individuals experience in a service environment, it means that the ambiance and tangible elements of the servicescape contribute positively to their emotional states. Arousal refers to the level of excitement or stimulation that the servicescape generates. It can range from relaxation and calmness to moments of frenzy or high energy. It reflects how the servicescape influences people’s emotional and psychological states. The dominance dimension relates to how individuals perceive their influence or control within a particular service environment. It’s about feeling in charge or having a sense of authority in that space. However, [94] contends that dominance should be disregarded as it demonstrated little significance in its association with a person’s emotions.

These impacts play a pivotal role in enhancing productivity, profitability, and overall performance in the business environment. Notably, the pleasure and arousal dimensions exhibit particularly high significance, while the dominance dimension elicits relatively lower responses, suggesting it may be more suited to specific environments, such as casinos or karaoke bars. In such places, a sense of dominance, control, or opulence aligns with the desired atmosphere. For example, in a casino, it could evoke a feeling of ‘winning the situation’ and ‘being in control’, while in a karaoke bar, it might encourage patrons to take centre stage and perform confidently. Pleasure, arousal, and dominance are regarded as three basic dimensions of emotional responses that reflect an individual’s emotional state [57] [11].

These intangible impacts and sub-major intangible impacts of servicescape are crucial for both customers and employees within a given service environment. Positive responses, in turn, contribute to increased productivity and overall business performance within the business environment.

CONCLUSION

Facilities managers play a central role in shaping service environments that align with strategic business goals. While tangible elements like layout and lighting are easily measured, intangible impacts such as emotional and cognitive responses require deeper consideration.

Recognizing and effectively harnessing these responses can provide facilities managers with a strategic advantage. By optimizing the servicescape to create a positive experience in these dimensions, they can enhance customer satisfaction, foster employee morale, and ultimately achieve greater success for the business. This holistic approach, integrating tangible elements and intangible impacts, is vital in the decision-making process for facilities managers as it not only enhances the overall business experience but also contributes to the organisation’s profitability, productivity, and reputation.

This article embarks on a comprehensive journey to unveil the intangible impacts of the servicescape in the modern business environment. Through a blend of theoretical insights and practical examples, this paper provides valuable information and perspectives that help organisations, especially facility managers, leverage the power of the servicescape to enhance their performance and elevate the customer experience, ultimately boosting profitability, productivity, and reputation.

Acknowledgment

The authors would like to express our utmost gratitude to the Ministry of Higher Education, Malaysia for funding this research project through the Fundamental Research Grant Scheme (FRGS Grant R.J130000.7852.5F629) and Universiti Teknologi Malaysia for the provision of exceptional research facilities that make the undertaking of this research and authoring of this paper possible.

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