New or repeat customers: How does physical environment influence their restaurant experience?

This study proposed a conceptual model to examine how customers’ perceptions of the physical environment influenced disconfirmation, customer satisfaction, and customer loyalty for first-time and repeat customers in upscale restaurants. Using a structural equation modeling analysis, this study showed that facility aesthetics, lighting, layout, and service staff had significant effects on disconfirmation. Moreover, disconfirmation exerted a direct influence on customer satisfaction and customer loyalty. Customer satisfaction also positively influenced customer loyalty. Finally, the impacts of facility aesthetics, lighting, table settings, and service staff on disconfirmation significantly differed between first-time customers and repeat customers. More specifically, facility aesthetics, lighting, and service staff were significant predictors of both first timers’ and repeaters’ perceived disconfirmation, while layout and table settings were significant determinants of only repeat visitors’ perceived disconfirmation. The implications for academic researchers and marketing practitioners are discussed.

Research highlights
► In this study, we examined first-time and repeat customers’ loyalty formation in upscale restaurants.
► Results of the structural model showed that physical environment had significant effects on disconfirmation.
► Disconfirmation exerted a direct influence on satisfaction and loyalty.
► The impacts of physical environment on disconfirmation significantly differed between first-time and repeat customers.