International Journal of Hospitality Management 108 (2023) 103351

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International Journal of Hospitality Management

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Antecedents and consequences of brand equity: Evidence from Starbucks

coffee brand
YuXuan Ren a, Yunseon Choe b, HakJun Song a, *
a
College of Tourism and Fashion Pai Chai University, 155-40 Baejae-ro, Seo-gu, Daejeon 302-735 South Korea
b
School of Community Resources and Development, The Hainan University-Arizona State University Joint International Tourism College, Arizona State University, 411N.
Central Ave, Phoenix, AZ 85004, USA

A R T I C L E I N F O A B S T R A C T

Keywords: This study aims to investigate the effects of coffee brand service quality and customer experience on brand
Service quality equity, brand personality, and brand reputation. To achieve this purpose, the proposed research model was
Customer experience examined with structural equation modeling using R. Empirical analysis indicates that brand personality and
Brand equity
brand reputation are determined by brand equity, which is formed by customer experience explained by service
Brand personality
Brand reputation
quality. Specific service quality factors that affect customer experience are interaction and result qualities.
Starbucks coffee brand However, physical environmental quality did not have a statistically significant effect on customer experience.
Analysis results suggest that the personality, reputation, and equity that customers have in a coffee brand can be
enhanced by customer experience through service quality. The results of this research support the idea of needing
to compete with strong brands and how marketing and management tactics around service quality and customer
experience can help a company compete.

1. Introduction psychological, marketing, and management perspectives.

However, fewer studies have discussed Starbucks’ brand equity,
Among numerous Asian countries, the growth of China’s coffee- brand personality, and brand reputation from the perspective of the
related business is impressive. With the improvement of the Chinese quality of services provided by Starbucks (Areiza-Padilla et al., 2020;
people’s standards of living and awareness of coffee culture, China’s Richey and Ponte, 2021). One of the significant approaches of Starbucks,
coffee consumption has been increasing annually, and interest and a leader in the coffee industry, is its transformation of coffee sales into a
popularity in coffee shop brands have continuously risen. The Chinese consumption experience process, rather than a mere service or business
coffee industry has increased 15 % year-over-year in the recent 30 years, goal (Gilmore and Pine, 2007). For the development of competitive
reaching a value of over US $8 billion in 2019 (Wethli, 2021). The coffee brands in China’s dynamic brand competition, examining the
awareness and popularity of coffee brands has provided an opening to relationship among service, experience, and brand components through
major U.S. coffee roasters and baristas within the country. empirical research can be a meaningful practical and academic
Among the many famous brand coffee shops, Starbucks, as a pre­ challenge.
mium coffee brand, is recognized as a popular lifestyle product and The current study attempted to verify the relationship between
preferred consumption space by Chinese consumers (Plog, 2005). By Starbucks coffee brands with consumers in the city of Shijiazhuang,
2018, Starbucks had over 70 % market share and 3600 stores in China Hebei Province, and China. Given that Starbucks emphasizes a unique
(Kumar et al., 2020) and has become China’s largest and most successful service experience to customers (Han et al., 2019), Starbucks will be
coffee brand by transforming coffee consumption into an experiential suitable research subject to achieve the purpose of the present research.
lifestyle product, creating a unique symbolic brand value (Lin, 2012). Gilmore and Pine (2007) stated that Starbucks is a brand that exerts
The worldwide success of Starbucks is a popular topic of research in effort to ensure customer experience value by providing customers with
marketing management and other industries. Studies have extensively a consistent and authentic experience.
discussed Starbucks’ brand value, brand assistance, and the phenome­ Although research has been conducted on service quality as an
non of Starbucks’ ethnocentrism in developing countries from antecedent of customer experience in the hospitality and tourism

* Corresponding author.
E-mail addresses: bobo000tt@[Link] (Y. Ren), [Link]@[Link] (Y. Choe), bloodia@[Link] (H. Song).

[Link]
Received 25 October 2021; Received in revised form 14 April 2022; Accepted 3 October 2022
Available online 2 November 2022
0278-4319/© 2022 Published by Elsevier Ltd.
Y. Ren et al. International Journal of Hospitality Management 108 (2023) 103351

literature, only a few studies on this topic have been pursued in the field certain group of services including travel, music, theater, restaurants,
of restaurants and coffee shops. In this context, the purpose of this hotels, and culture. The core of these services has to do with hedonic
research was to examine the effects of service quality and customer consumption (Hirschman and Holbrook, 1982). The experience concept
experience by identifying the complex brand-related consciousness is now also used to add value to consumer services, for instance in
process of customers that forms Starbucks brand equity, brand person­ telecommunications services, educational services, hotel services, and
ality, and brand reputation. In this study, four specific research goals airline services. For example, Ritz Carlton and Singapore Airlines, focus
were selected to examine the causal relationship between the afore­ not only on traditional service quality issues and factors such as reli­
mentioned research concepts using structural equation modeling (SEM). ability and assurance but also on creating favorable customer experi­
The first research objective was to investigate customer evaluations of ences (Edvardsson, 2005).
the Starbucks coffee brand on service quality, customer experience, Customer experience is designed to create a new competitive
brand equity, brand personality, and brand reputation. For the second advantage. Numerous researchers have addressed proposed marketing
research goal, this study endeavored to examine the relationship be­ elements (Brakus et al., 2009; Pine et al., 1999; Schmitt, 1999) that
tween customer experience and brand equity of Starbucks coffee shops. would focus upon customer experience. Traditional marketing has pre­
The third research goal was to investigate the relationship between viously focused only on the functions or benefits of products. However,
brand equity, brand personality, and brand reputation of the Starbucks experience marketing has been presented since the 2000s to overcome
coffee brand. Lastly, this study endeavored to identify the effects of the limitations of traditional marketing. Experience marketing indicated
service quality and customer experience on brand equity, brand per­ that consumers engage in consumer activities in products by reason and
sonality, and brand reputation from a macro perspective. also emotion. That is, customers’ emotional experience in the purchas­
ing process, and not only the functions or benefits of products is an
2. Literature review important marketing tool (Song et al., 2019; Song and Park, 2009).
Experience occurs in every process of providing goods and services and
As people’s standards of living have been improved, consumer de­ has become a new driver for economic growth (Pine et al., 1999).
mand has been changing. Consumption patterns of consumers in modern Moreover, good customer experience management helps customers
society are evolving from material-oriented rational consumption to maintain continuous interest, gain long-term competitive advantage,
emotional consumption of experience or spirit. A typical example of this and further plays a direct and indirect role in companies’ earnings
phenomenon is coffee consumption and preference for coffee brands. (Smith and Wheeler, 2002). Experience is the interaction of personal
Coffee is one of the most consumed beverages worldwide (Samoggia and consumption with products and services with special affection (Hol­
Riedel, 2019), which is produced in over 70 countries and consumed by brook and Hirschman, 1982; Lim et al., 2016; Wang et al., 2020).
approximately one-third of the global population. The growth of coffee
culture and coffee shops could be explained by consumers’ growing 2.2. Interaction quality and customer experience
demand for “third spaces” outside the home and office, social places
where people seek community away from their primary and secondary Lovelock and Wirtz (2004) defined the interaction qualities of res­
spaces. From this point of view, it can be an interesting research topic to taurants as the behaviors and attitudes between restaurants and cus­
investigate the effect of coffee brand service quality and customer tomers, employees and customers, and divided them into reliability,
experience on brand equity, brand personality, and brand reputation empathy, and qualification. The facets of interaction between employees
among the consumers of name-brand coffee shops. The hypothetical and their customers resulted in improved relationships among members
relationship between research concepts related to these research struc­ through the compatibility of the mutual information exchange, thought,
tures can be specified as follows. and experience (Bitner et al., 2000). The quality of interaction forms the
behavior and attitude of the two parties to each other, and the emer­
2.1. Service quality and customer experience gence of an interaction combination forms quality in a two-way rela­
tionship (Wu, 2005).
Service quality was originally defined by Lehtinen and Lehtinen At Starbucks, the customer’s understanding of the qualifications and
(1991). They explained that service quality is measured by the inter­ competencies of the employees serving the coffee is fundamental to the
action between the various elements of the service organization and customer’s experience of the service provided. The overall experience of
customers, it consists of material quality (e.g., equipment used in the coffee shop service increases if employees are capable of providing
process), quality of business (e.g., image or reputation of the entity), and excellent service and coffee. Doney and Cannon (1997), confirmed that
quality of interactions between the representative employees and cus­ if customers perceive employees’ abilities as excellent, customers will
tomers. Service quality is a measure of service, delivery, and consistency have substantial trust in employees. Therefore, they will have the con­
in meeting customer expectations (Joewono and Kubota, 2007). fidence that employees will keep their promises. The significant impact
Therefore, the degree to which service performance matches customer of interaction quality on customer experience is explained, showing that
expectations affects the degree to which customer experience is expe­ interaction quality has a greater impact on customer experience than
rienced. To measure this, the SERVQUAL scale was proposed by Para­ other characteristics. Furthermore, Yi and La (2002) found that in the
suraman et al. (1985). The uncertainty-based expectation model (Oliver, existing customer groups, the impact of interaction quality on customer
1980) is widely used to measure service quality. The scale contains 22 experience is higher than the physical environment quality. Based on the
items under the five dimensions of tangibility, reliability, responsive­ previous discussion of interaction quality and customer experience.
ness, assurance, and empathy. The particular personal service marketing Therefore, the following hypothesis is proposed:
aspect emphasized discourse on service quality (Edvardsson, 2005;
Gummeson et al., 1991), emphasizing customer evaluations of service Hypothesis 1. Interaction quality has a positive effect on customer
delivery. This quality of service is determined by the product itself, experience.
surrounding services, and the way the service company provides the
product and services (such as the behavior and attitude of employees, 2.3. Physical environmental quality and customer experience
the willingness of the service company to be flexible, etc.). The current
research used the previous studies as a base in which to regard service The physical environment is a concept that emerged in the 1970s
quality as an important factor that affects customer experience and, Kotler (1973) stated that the physical environment is a physical stimu­
thus, brand equity, brand personality, and brand reputation. lant in the form of visual, auditory, olfactory, and tactile effects, such as
In marketing literature, experiences are often used to refer to a visual (color, lighting), auditory (high speed of sound), olfactory

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(smells), and tactile (temperature, mood) effects. The aforementioned as a result of coffee shops’ service can be inferred to have a significant
research explained that artificially created purchasing environment and impact on customer experience. Therefore, the following hypothesis is
space is defined as the physical environment and is an important vari­ proposed:
able in marketing because physical stimuli affect customer sentiment
Hypothesis 3. Result quality has a positive effect on customer
and influence profitability. David (1984) presented physical environ­
experience.
ment, physical stimuli, and symbolic artifacts as integral components of
the physical environment, including a broad view of human factors and
2.5. Customer experience and brand equity
social relationships, as well as what customers see and feel. Baker (1986)
applied the categories of peripheral, design, and social factors. The
Customer experiences are essential to creating brand equity and
surrounding elements are related to the atmosphere (e.g., temperature,
customer experience is defined as the total of consumer-brand encoun­
color, lighting, fragrance, and sound) and design elements include
ters (Chattopadhyay and Laborie, 2005). Brakus et al. (2009) break
functional elements (e.g., architectural beauty and color). Social factors
down the customer experience to the sensations, feelings, perceptions,
also represent human factors related to employees, the number of cus­
and behavioral responses evoked by brand-related stimuli and are
tomers, and behavior. Bitner (1992) defined the physical environment as
moreover a part of brand design and identity, packaging, communica­
an artificial one, in which the delivery of services occurs and the inter­
tion, and environment. These stimuli imply that the customer experi­
action between employees and customers happens. In addition, the
ence is subjective and also elicits internal consumer and behavioral
physical environment characteristics of service companies were divided
responses (Şahin et al., 2011). The customer experience that consumers
into three main categories: ambient environment (temperature, atmo­
get through consumption may be stronger and more durable (Zar­
sphere, music, noise, smell), space layout and functionality (facility,
antonello and Schmitt, 2010). For example, the experience of coffee
arrangement, equipment), and various markings (symbols, handouts).
consumption may have a stronger, more lasting effect on the customer
Dabholkar et al. (1996) indicated that the physical environment
than the cup the coffee comes in.
generally means the appearance of facilities.
Brand equity is defined as the additional marketing effect compared
Kotler (1973) indicated that, in some situations, the atmosphere of
when the product or service of a particular brand does not have a brand
the place can be as important as the product itself (e.g., foods and ser­
(Aaker, 1991). Brands represent enormously valuable pieces of legal
vices) in purchase decision making. Creative use of physical design in a
property that is capable of influencing consumer behavior, being bought
restaurant operation would be essential in enhancing specific marketing
and sold, and providing the security of sustained future revenues to their
objectives such as positive customer perception of quality, positive
owner. The value directly or indirectly accrued by these various benefits
evaluation of experience, and positive attitudes. Because service is
is often called brand equity (Kapferer, 2012; Keller, 2011). The objective
generally produced and consumed simultaneously, the consumer is “in
concept of brand equity refers to the extent to which companies can
the factory,” often experiencing the total service within the property’s
maintain viable marketing results through subjective and intangible
physical facility (Bitner, 1992). Although the food and service should be
customer evaluation of brands. Brand equity is a significant asset that
of acceptable quality, pleasing physical surroundings (e.g., lighting,
determines the customers’ relationships with the brand (Ayesh and
décor, layout, and employee appearance) may determine to a large
Al-Zyoud, 2021). Accordingly, if brand names are not indicated or
extent the degree of overall satisfaction and subsequent behavior in the
lesser-known specific brand names are more effective than other
restaurant industry. Because services are mainly intangible and require
well-known brand products in marketing activities, then the specific
the customer to be present during the process, the physical environment
brands have positive brand equity. Liabilities and assets that constitute
can have a significant impact on perceptions of the overall quality of the
brand assets are associated with the symbols or names of particular
service encounter, which in turn affects customer experience in the
brands. If brand symbols or names change, then it may affect the lia­
restaurant industry (Bitner, 1990, 1992, Brady and Cronin, 2001; Kotler,
bilities and some or all of the assets.
1973; Ryu and Jang, 2007). In a similar study, Kim and Han (2011)
Biedenbach and Marell (2010) found that customer experience has a
found that hotel customers’ satisfaction is determined by the quality of
positive impact on brand equity, in addition to giving consumers deep
physical environment, interactions, and outcome. Therefore, the
meaning and memory, it also influences their trust in brands and pur­
following hypothesis is proposed:
chase intentions. Jones and Runyan (2013) and Rahman (2014) clearly
Hypothesis 2. Physical environmental quality has a positive effect on show that the intensity of consumer experience with a brand drives
customer experience. brand equity. Therefore, the following hypothesis is proposed:
Hypothesis 4. Customer experience has a positive effect on brand
2.4. Result quality and customer experience equity.

Rust and Oliver (1994) explained that in the course of service, in 2.6. Brand equity and brand personality
viewing the results of a service, technical quality has a profound effect
on the assessment of customers’ service quality. Brady and Cronin Advertisers and marketing practitioners were the first to coin the
(2001) stated that result quality of a service product that remains, such term ’brand personality’ long before the concept was studied and
as taste or price, after the service delivery process ends. Result quality embraced in academia. Back in 1958, Martineau (1958) used the word
can be defined in four sub-levels: wait time, type result, balance, and to refer to the immaterial dimension that makes a store special. Aaker
service level. For example, if the product is satisfactory, but the service is (1997) provided a highly cited definition of brand personality, which is
superior then customers have a better experience than expected. “the set of human characteristics associated with a brand” and
Mattila (2001) called the three factors that must be most concerned concluded that personality is described by an individual or by an enemy
about maintaining customers in a restaurant the quality of service, side or by a different characteristic from her skills and abilities. Cus­
surroundings, and food. They also explained that the most important tomers that can identify themselves with the brand personality seen on
factor is the quality of food. Ryu and Han (2010) also stated that the social media are expected to develop positive feelings toward the com­
most important standard for assessing restaurant service quality is the pany and the brand. Consumer perceptions of brand personality reflect
quality of food. For example, in terms of the quality of the results, in the the added value of the brand (Valette-Florence et al., 2011). The added
service provided by a coffee shop, no matter how good the surrounding value that brand personality creates is conceptualized as customer-based
facilities and staff, if the final coffee served is poor in taste and quality, it brand equity, which is the “differential effect of brand knowledge on
will be meaningless. By combining the preceding studies, coffee served consumer response to the marketing of the brand” (Keller, 1993, p. 2).

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Corstjens and Lal (2000) found that store brand influences store appeal. profitable brand in almost every industry and business. Academic and
Aaker (1997) indicated that brand personality affects trust and prefer­ managerial schools of thought jointly agree on the aspect that a positive
ence and explained that products with high brand personalities are reputation results in a profitable brand, and it serves as a competitive
easily remembered by consumers. Therefore, if consumers are highly advantage in the industry (Bianchi, Pike, and Lings, 2014). When it
aware of particular brands’ personalities, then these brands’ personal­ comes to building reputation, one must understand that it is a long
ities will have high brand/annulation. Aaker (1997) also studied brands’ process that takes decades to complete, and all stakeholders contribute
self-expression roles through the interaction of personality traits asso­ equally to developing a long-term reputation of a brand. Therefore, the
ciated with these brands and individuals’ self-concepts that affect atti­ following hypothesis is proposed:
tudes (i.e., consumer attitudes toward the brand showed that the target
Hypothesis 6. Brand equity has a positive effect on brand reputation.
was associated with a personality trait that provides self-expression or
symbolic benefits to consumers). Accordingly, brand personality has The present study uses the literature review as a basis for providing a
been shown to influence consumer sense of self. Overall, the higher the framework for a research model for hypotheses testing (see Fig. 1).
self-expression, uniqueness, and attractiveness of brand personality, the Moreover, the current research represents a conceptual framework
higher the consumers’ sense of unity in brands (Kim, 2000). This brand involving service quality, customer experience, and brand equity.
consensus is directly linked to the brand.
Brand personality, defined as all the personality traits used to char­ 3. Method
acterize a person and be associated with a brand, is an important
concept in the field of relationship marketing (Louis and Lombart, 3.1. Measurement
2010). Understanding brand personality is necessary to create and build
meaningful consumer-brand relationships. It explains how these re­ The initial measurement project was generated after an in-depth
lationships affect consumer behavior at the individual level (Fournier, review of the following literature on service quality, customer experi­
1998; Sung et al., 2009; Sung and Kim, 2010) and performance in­ ence, and brand equity. The recommendation is that all variables in the
dicators at the product level (Freling and Forbes, 2005). Additionally, model be measured using multiple target scales to ensure the validity of
brand personality is an effective and efficient way of product differen­ the metric. Quality of service was divided into three dimensions: inter­
tiation that helps influence brand performance. According to anthro­ action quality, physical environmental quality, and result quality, to
pomorphism theory, humans feel the need to anthropomorphize objects measure the quality of service recognized by customers of coffee shops.
to help them interact with the invisible world. Concepts of brand per­ Interaction quality was defined as the quality of employee attitude and
sonality provided in the literature acknowledge the use of human de­ behavior in the exchange between employees and customers during the
scriptors to portray brands (Plummer, 2000; Freling and Forbes, 2005; service delivery process (Brady and Cronin, 2001; Stevens et al., 1995).
Geuens et al., 2009; Maehle et al., 2011). All consumer interactions with Physical environmental quality was divided into five categories ac­
brands, whether direct or indirect, generate and influence perceptions of cording to the comfort, convenience, and aesthetic nature of coffee
brand personality traits (Plummer, 2000). Thus, the following hypoth­ shops, relying on previous studies (Bitner, 1992; Brady and Cronin,
esis is proposed: 2001). The resulting quality was defined as the quality of coffee pro­
vided as a result of the service, and four questions were used to measure
Hypothesis 5. Brand equity has a positive effect on brand personality.
the quality of coffee as a tangible result, by referring to the leading
research (Brady and Cronin, 2001; Gefen et al., 2003). Four dimensions
2.7. Brand equity and brand reputation of experience were operationalized with four items each, as suggested by
previous research (Brakus et al., 2009; Hosany and Witham, 2010;
Brand reputation refers to the public’s reputation for understanding Mehmetoglu and Engen, 2011; Zarantonello and Schmitt, 2010).
the business conduct, ethics, and standards of particular brands. Van Aaker (1991) referred to brand assets as total assets and liabilities
Riel and Balmer(1997) theory indicates that the concept of corporate relating to brands, their names, and their symbols and suggested that
reputation has been changed to three levels. The first stage was in the factors comprising brand assets are brand guidance, brand image, brand
1950s when reputation was studied around the image of enterprises and loyalty, perceived quality, and exclusive asset values. Keller (1993)
brands, and the second was in the 1970s and 1980s, focusing on defined brand assets as the discriminatory effect of the brand knowledge
corporate identity and corporate communication. Lastly, in the 1990s, that consumers react to marketing activities related to the brand based
the third phase began to identify and focus on corporate brand man­ on their perspective. The current study defined brand assets as tangible
agement and reputation. Roberts and Dowling (2002) studied the rela­ and intangible assets held by customers for brands; the components of
tionship between corporate reputation and financial performance to brand assets comprised brand maps, perceived quality, and brand im­
demonstrate such a relationship. That is, positive reviews have had a ages, as in Aaker (1991), Kim (2000), and Cho (2012). All variables in
positive impact on stakeholders investing in organizations, affecting the the current study were measured using a 5-point Likert-type scale,
flow of talented people, and maintaining customers. From a marketing ranging from “strongly disagree” (1) to “strongly agree” (5).
or strategic perspective, reputation is defined as the accumulation of
perceptions resulting from the interaction between entities and their 3.2. Data collection and analysis
stakeholders (Fombrun and Shanley, 1990).
Studies have indicated that a positive image can form a good repu­ The regions where this coffee shop and coffee brand growth is
tation for brands (Freeman and Beale, 1992). In this regard, Ryu and notable are major cities in China. According to statistics, the average
Han (2010) reported that brand equity has a positive impact on repu­ annual growth rate of coffee consumption in China is 15 %, which is
tation. When customers accumulate positive experiences of product markedly higher than the world’s 2 % growth rate. (Wethli, 2021). In
performance, they develop positive attitudes and feelings towards the China, despite many citizens displaying heavy anti-corporate behaviors
brand. A company’s good reputation is a valuable strategic asset that toward Western brands, have accepted Starbucks because it offers Chi­
helps differentiate it from its competitors (Azham and Ahmad, 2020). A nese consumers access to spaces that portray a perceived experience of
company may charge a premium if it possesses a competitive advantage the Western way of life (Maguire and Hu, 2013).
in terms of superior brand reputation (Kucharska, 2020). A well-reputed The data were collected in Shijiazhuang in China from July 29 to
company attracts more qualified personnel and that, in turn, brings August 9, 2019. Research respondents were randomly selected and
about valuable transactions from customers (Azham and Ahmad, 2020). contacted in five Starbucks coffee shops across Shijiazhuang using face-
Corporate reputation plays a vital role in the success and in being a to-face and paper-based questionnaires. For this study, Shijiazhuang was

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Fig. 1. Research model.

selected as a study site, which is the capital of Hebei Province, People’s 4. Results
Republic of China, located in the south-central part of the province.
Shijiazhuang is an important central city in the Beijing-Tianjin-Hebei 4.1. Respondents’ demographic characteristics
region, located within the Bohai Sea Economic Rim, and is one of
China’s major modern service industry bases, as well as the political, The demographic characteristics of the respondents are shown in
economic, cultural, and foreign exchange center of Hebei Province Table 1. The proportion of female respondents (56.4 %) was higher than
(Wethli, 2021). The city has a total area of 14,060 km2 and a population that of males (43.6 %). Most of the respondents were 20–29 years old
of 10,716,000. (56.4 %) and 30–39 years old (15.4 %). Their educational background
Starbucks coffee shops are a common choice for many consumers, was undergraduate (41.4 %), followed by college (31.3 %). Numerous
especially young people in their 20–30 s (Song et al., 2019). Five of the respondents (26 %) indicated that their income level is CNY 3000 or
ten Starbucks coffee shops in the survey area were randomly selected below, CNY 3000–4999 (25.4 %), and CNY 5000–6999 (22.1 %). Most of
(Han et al., 2019). A member of the research team approached potential the respondents (55.6 %) were single, and their most common
study participants to ask for their participation in a research study and
informed of the study purpose. Those who met the study participation
Table 1
criteria (Starbucks customers between the ages of 18 and 65) were asked Socio-demographic characteristics of the respondents (N = 408).
to participate in the study. A self-administered questionnaire was
Characteristics N ( %) Characteristics N ( %)
administered to those who agreed to participate in this study.
Questionnaires were originally developed in English and translated Gender Monthly income (CNY)*
into Chinese. In terms of the specific survey process, one of the research Male 178 Below 3000 106
team members approached the potential study participants and (43.6) (26.0)
informed them about the purpose of the study before the survey. Those Female 230 3000–4999 104
(56.4) (25.5)
who satisfied the research participation criteria (Starbucks customers Age 5000–6999 90 (22.1)
between the ages of 18 and 65) were asked to participate in the study. A Below 20 years old 27 (6.6) 7000–8999 45 (11.0)
self-administered questionnaire was conducted on those who agreed to 20–29 230 Over 9000 63 (15.4)
participate in this study. (56.4)
30–39 63 (15.4) Occupations
A total of 500 questionnaires were collected from the five Starbucks
40–49 57 (14.0) Government official 20 (4.9)
coffee shops in Shijiazhuang, China. However, responses that showed 50–59 30 (7.4) Technician/professional 24 (5.9)
logical inconsistencies provided a false answer to any control question, 60 or above 1 (0.2) Business manager 27 (6.6)
or incomplete survey responses were removed from the final data Education level Service sales 31 (7.6)
sample. After 92 invalid questionnaires were removed, a final sample of representative
Below high school 40 (9.7) Office worker 80 (19.6)
408 valid responses was obtained to test the hypotheses representing an
College 127 Farmer 8 (2.0)
81.6 % of response rate. (31.3)
For data analysis, SEM was performed using R. A two-stage testing Bachelor’s 169 Student 94 (23.0)
procedure was adopted as the SEM analysis approach of the current (41.4)
Master’s or above 72 (17.6) Retired 12 (2.9)
study. For the first step in data analysis using SEM, R was used to
Marital status Other 112
conduct preliminary analyses to clean the data and develop the de­ (27.5)
mographic file. For the second step, hypothesis testing was performed Single 227
through measurement model and structural equation models using R. (55.6)
Measurement model was conducted to test the fit of proposed constructs. Married 165
(40.4)
Structural equation model testing was conducted to test causal re­
Others (divorced/ 16 (4.0)
lationships among variables in the research model. widowed)
*
1 US Dollar is equivalent to 6.5 Chinese Yuan (CNY)

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occupations were students (23 %), office workers (19.6 %), and service 4.3. Structural model
sales representatives (7.6 %).
After identifying a well-fitted measurement model, the relationships
4.2. Measurement model among all observed and latent variables in the proposed model were
tested using SEM. The results showed excellent fit to the data (χ2 =
Before analyzing the data, the following methods were used to test 589.126, df = 384, p < 0.001, χ2/df = 1.534, RMSEA = 0.036, CFI =
for multiple outliers. Mahalanobis distance was conducted. The results 0.980, TLI = 0.977). A maximum likelihood estimation approach was
showed three extreme cases, and these outliers were removed for further utilized for the generation of this model. Table 3 and Fig. 2 represent the
analyses. The remaining responses were 408 cases. The measurement results of the structural model.
model was first generated to assess the quality of the measures. The Interaction quality (βIQ→CE = 0.578, t = 10.590, p < 0.001) and
measurement model was assessed using confirmatory factor analysis result quality (βRQ→CE = 0.372, t = 5.365, p < 0.001) were positively
(CFA), and the hypothesized structural models were tested thereafter associated with customer experience. Thus, Hypotheses 1 and 3 are
using R. Several fit indexes were used to test the model fit: comparative supported. These findings imply that the higher the qualities of the
fit index (CFI) and Tucker–Lewis index (TLI).
Values of 0.90 or above and a root mean square error of approxi­
mation (RMSEA) value of 0.08 or below were used as indicators of good Table 3
model fit (Anderson and Gerbing, 1988; Hair, 2006). The result of the Standardized parameter estimates of structural model (N = 408).
measurement model test showed good fit to the data: χ2 = 589.126, Hypotheses Coefficients t-values Test of hypotheses
p < 0.001, CFI = 0.980, TLI = 0.977, RMSEA = 0.036. (Table 2). H1 IQ→CE 0.578*** 10.590 Accepted
The highlighted values of AVE are along the diagonal; squared cor­ H2 PEQ→CE 0.022 0.338 Rejected
relations among latent constructs are above the diagonal; correlations H3 RQ→CE 0.372*** 5.365 Accepted
H4 CE→BE 0.999*** 191.845 Accepted
among latent constructs are within parentheses, and standard errors
H5 BE→BP 0.951*** 98.866 Accepted
among latent constructs are below the diagonal. H6 BE→BR 0.932*** 88.889 Accepted
Merdia’s normalized coefficient: 126.586; All standardized factor Fit Indexes 2 2
χ = 589.126, df = 384, p < 0.001, χ /df = 1.534, RMSEA = 0.036,
loadings are significant at p < 0.001. CFI = 0.980, TLI = 0.977
Suggested value is based on Bearden et al. (1982) and Hair (2006). *p < 0.05, **p < 0.01, ***p < 0.001
Note. IQ = Interaction quality; PEQ = Physical environmental quality; RQ
= Result quality; CE = Customer experience; BE = Brand equity; BP = Brand
personality; BR = Brand reputation

Table 2
Results of the measurement model.
Constructs IQ PEQ RQ CE BE BP BR Items Standardized factor loadings

Interaction quality 0.841 0.863 0.849 0.772 0.872 0.815 0.835 IQ1 0.786
(IQ) (0.929) (0.922) (0.879) (0.934) (0.903) (0.914) IQ5 0.857
IQ6 0.857
IQ7 0.854
IQ8 0.853
Physical environmental quality 0.046 0.828 0.871 0.735 0.782 0.785 0.777 PEQ1 0.813
(PEQ) (0.934) (0.857) (0.884) (0.886) (0.881) PEQ2 0.837
PEQ3 0.824
PEQ4 0.842
PEQ5 0.825
Result quality 0.044 0.047 0.829 0.720 0.820 0.850 0.877 RQ1 0.831
(RQ) (0.849) (0.906) (0.922) (0.937) RQ2 0.822
RQ3 0.814
RQ4 0.847
Customer experience 0.043 0.045 0.043 0.727 0.875 0.818 0.761 CE1 0.733
(CE) (0.935) (0.905) (0.872) CE2 0.730
CE3 0.626
CE4 0.593
Brand equity 0.044 0.046 0.044 0.044 0.777 0.866 0.816 BE1 0.730
(BE) (0.930) (0.903) BE2 0.768
BE3 0.759
BE4 0.780
Brand personality 0.043 0.045 0.044 0.043 0.044 0.738 0.887 BP1 0.746
(BP) (0.942) BP2 0.754
BP3 0.720
BP4 0.731
Brand reputation 0.043 0.046 0.045 0.043 0.044 0.043 0.827 BR 0.822
(BR) BR 0.848
BR 0.828
BR 0.810
CR 0.964 0.960 0.951 0.914 0.933 0.918 0.950 Model fit
Cronbach 0.963 0.960 0.951 0.913 0.933 0.918 0.950 S-B X2(df): 589.126(384)
alpha Normed S-B X2: 1.534
CFI: 0.980
NFI: 0.945
NNFI: 0.977
RMSEA: 0.036

*Highest correlation between pairs of constructs

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Y. Ren et al. International Journal of Hospitality Management 108 (2023) 103351

Fig. 2. Results of the structural model. *p < 0.05, * *p < 0.01, * **p < 0.001. Note. IQ = Interaction quality; PEQ = Physical environmental quality; RQ = Result
quality; CE = Customer experience; BE = Brand equity; BP = Brand personality; BR = Brand reputation.

interaction and results, the better the customer experience. However, experience and brand equity are formed according to service quality for
physical environmental quality and customer experience (βPEQ→CE = Starbucks consumers in China, thereby affecting brand personality and
0.022, t = 0.338, not significant) were not statistically significant. brand reputation. This study showed that focusing on service quality (i.
Hence, Hypothesis 2 is rejected. e., quality of interaction and quality of results) can increase the level of
Customer experience (βCE→BE = 0.999, t = 191.845, p < 0.001) was positive experiences for Chinese Starbucks’ consumers. In addition,
positively associated with brand equity. Therefore, Hypothesis 4 is service quality and customer experience have been found to play an
supported. These findings imply that the better the customer experience, important role in developing a successful and sustainable marketing
the better the brand equity. Brand equity (βBE→BP = 0.951, t = 98.866, strategy for Starbucks by enhancing brand equity, brand personality,
p < 0.001) was positively associated with brand personality. Hence, and brand reputation.
Hypothesis 5 is supported. These findings imply that the better the brand Several theoretical implications can be presented based on the re­
equity, the better the brand personality. Brand equity (βBE→BR = 0.932, sults of this study. First, the introduction of service quality and customer
t = 88.889, p < 0.001) was positively associated with brand reputation. experience contributed to understanding the complex brand-related
Accordingly, Hypothesis 6 is supported. These findings imply that the consciousness formation process of customers that formed Starbucks
better the brand equity, the better the brand reputation. brand equity, brand personality, and brand reputation. Therefore, ser­
vice quality and customer experience appear to be a suitable theoretical
5. Discussion and conclusions framework to explain the process of forming customer brand loyalty.
Second, the significant influence of interaction quality and result
The coffee industry is becoming one of the catering categories with quality on customer experience shows that customer experience is made
the largest audience and scope of work in the world. Even in Asia, where mainly from high evaluation of interaction quality and result quality
tea is traditionally consumed, coffee consumption has emerged, rather than of physical environment quality. Among them, interaction
becoming one of the world’s most consumed beverages (Ferreira and quality was determined to have the greatest influence on customer
Ferreira, 2018; Samoggia and Riedel, 2018). In this context, the current experience. This result indicates that Chinese Starbucks customers tend
study mainly aimed to investigate the effects of coffee brand service to consider how Starbucks employees provide service to them as more
quality and customer experience on brand equity, brand personality, important than the product quality itself. Therefore, when Starbuck’s
and brand reputation among Starbucks consumers in China. The find­ customer service in China focuses on human service rather than physical
ings of the present study are as follows. First, the interaction and result service, it can have a higher impact on customer experience.
qualities are positive for customer experience, corresponding to past The significant relationship between customer experience, brand
findings (Doney and Cannon, 1997; Ryu and Han, 2010; Mattila, 2001; equity, brand personality, and brand reputation formed by service
Yi and La, 2002). Different from expectations, physical environment quality indicates that Chinese Starbucks consumers with high customer
quality has no significant impact on customer experience. This result experience satisfaction tend to value the Starbucks brand highly. This
showed that the higher the interaction and result service quality, the study, which emphasized service quality and customer experience, can
better the customer experience, Moreover, the physical environmental suggest management implications for the sustainable development of
quality is not a significant latent variable that can explain the formation the Starbucks brand.
of service quality. First, for brand loyalty, Starbucks managers should exert efforts to
Second, the results of the current research showed that customer improve quality and human service for consumers. In particular, Star­
experience has a positive and significant impact on brand equity. This bucks may conduct regular surveys to manage Starbuck’s service qual­
outcome indicated that the better the customer experience, the more ity. In this case, a survey could be conducted through the membership
conducive to the formation of brand equity. That is, customer experience program to lead to high-quality survey results. Second, the analysis re­
will have an impact on brand equity, and in turn, brand equity plays a sults indicated the importance for Starbucks managers and executives to
decisive role in attracting customers. Third, this study found that brand form positive relationships between consumers and Starbucks. Hence,
equity has a positive and significant impact on brand personality and customer requirements should be immediately identified and additional
brand reputation. Hence, brands with higher brand equity simulta­ services (e.g., freebies, coupons, discount policies) must be effectively
neously have higher brand personality and brand reputation. provided. Accordingly, customer management based on big data
This study confirmed the causal relationship between customer received by surveys can be usefully used. Lastly, since social media can

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Y. Ren et al. International Journal of Hospitality Management 108 (2023) 103351

be an effective means for brands to raise the level of customer service surveyed focused on women in their 20 s, thereby limiting the gener­
quality and experience, continuous social media development should be alizability of the findings. Care should be taken to ensure that further
implemented to differentiate the Starbucks brand level through various evenly distributed studies are conducted. Third, although the number of
social media activities. official survey samples in this study is 408, the larger the number of
Although the results were limited to Chinese customers visiting samples in the field of marketing, the more reliable and representative
Starbucks coffee brand in China, the sample cannot be generalized to the conclusion. In this regard, the sample size of the current study could
visiting other coffee brands, locations, and/or beyond the study popu­ be increased slightly. Future studies could also measure finance-based
lation. Thus, additional testing of the model on other samples in diverse types of brand equity. Such further research will help improve perfor­
contexts would likely provide extensive insights to identify new contexts mance measurements for the financial performance (e.g., revenues) of
on how coffee brand service quality and customer experience may the relevant coffee brands (Ambler et al., 2002).
positively impact their brand equity. Second, most of the respondents

Appendix. Reliability and confirmatory factor analysis

Factors and scale items Standardized loading Cronbach’s alpha

F1: Interaction quality (IQ)

Starbucks employee quickly corrects and responds to any mistakes 0.786 0.963
Starbucks employee is willing to help customers. 0.857
Starbucks employee provides a quick service to customers. 0.857
Starbucks employees attach great importance to customers. 0.854
Starbucks employee responds carefully to customers’ needs. 0.853
F2: Physical environmental quality (PEQ)
Starbucks facility is suitable for enjoying coffee. 0.813 0.960
Starbucks has a good atmosphere for enjoying coffee. 0.837
Starbucks music is suitable for enjoying coffee. 0.824
Starbucks seating arrangement is suitable for enjoying coffee. 0.842
Starbucks has enough room for people to enjoy coffee. 0.825
F3: Result quality (RQ)
The taste of Starbucks is satisfactory. 0.831 0.951
The aroma of Starbucks is satisfactory. 0.822
The design of Starbucks is satisfactory. 0.814
Starbucks material is of good quality. 0.847
F4: Customer experience (CE)
The Starbucks experience was really nice. 0.733 0.913
The setting of Starbucks provided pleasure to my senses. 0.730
I forgot my daily routine in Starbucks. 0.626
The Starbucks offered a real learning experience. 0.593
F5: Brand equity (BE)
Starbucks is very enthusiastic about the respondents. 0.730 0.933
Starbucks is highly reliable. 0.768
Starbucks provides reliability assistance to customers. 0.759
Starbucks has an innovative spirit. 0.780
F6: Brand personality (BP)
I feel safe when I bought any product (good/service) of Starbucks. 0.746 0.918
The marketing campaign of Starbucks is dynamic. 0.754
For buying Starbucks I feel that everybody accepts me. 0.720
Starbucks is always simply. 0.731
F7: Brand reputation (BR)
Starbucks is responsible for all the product it provides. 0.822 0.950
Starbucks is well managed. 0.848
Starbucks is interested in environmental protection. 0.828
Starbucks is a profitable company. 0.810
Note: All standardized factor loadings are significant at p < 0.001.

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