JOURNAL OF
SERVICE MARKETING
Customer Expectations and
Perceptions of Service Quality
in Retail Apparel Specialty
Stores
Kathryn Bishop Gagliano and Jan Hathcote
Introduction
How important are smiling, friendly sales
associates, and pleasant surroundings to retail
apparel customers? While retailers
traditionally think of customer service in
terms of store hours, gift wrapping, and credit
options, consumers typically view customer
service in relative terms based on their
expectations and experiences. Customer
service satisfaction depends on how well the
service customers receive match their
expectations (Austin, 1992). Factors such as
age, gender, ethnicity, and income shape
many of these expectations (Webster, 1989).
Recent surveys have confirmed that
consumers think retail customer service is
inadequate. A 1987 Washington Post survey
found that nearly half of all shoppers in the
Washington area thought that store service
was mediocre and declining (Mayer and
Morin, 1987). These shoppers, as well as
those who were surveyed in a national poll,
had similar thoughts about the causes of poor
Journal of Services Marketing, Vol. 8 No. 1, 1994, pp. 60-69
© MCB University Press, 0887-6045
60
service. Among these were long waits for
service, impolite sales clerks, unavailability
of advertised goods, and sales clerks who had
little or no product knowledge (Mayer and
Morin, 1987).
Realizing the escalating importance of
customer service, an increasing number of
retailers have attempted to improve their
service strategy. Many articles and books
have stressed the importance of service
quality, but defining it is difficult.
Parasuraman et al., p. 42 (1985) defined
service quality as “perceptions result(ing)
from a comparison of consumer expectations
with actual service performance”.
Customer satisfaction is important because
there are significant short- and long-term
costs associated with poor customer service.
Short-term dissatisfaction could result in a
walkout, whereas a long-term dissatisfaction
response might lead to customer defection.
When studying service companies, Reichheld
and Sasser (1990) measured the economic
impact of profit loss due to defecting
customers and found that these companies
increased profits by almost 100 percent by
 VOLUME 8 NUMBER 1
1994
retaining just 5 percent more of their
customers. Not only did losing a customer
represent the lost value of the long-term sales
potential of that customer, but it also
represented the additional costs of replacing
that customer.
Purpose of the Study
The purpose of this study was to obtain
information regarding retail apparel
customers’ expectations and perceptions of
the level of service quality offered in apparel
specialty stores. In addition, this study
examines the importance of service as a
patronage criterion and provides managerial
implications.
Specialty Stores
The opportunity for the development of
personal relationships, and therefore personal
attention, was one of the factors leading to the
emergence of the specialty store in the early
nineteenth century (Gist, 1968). As the
specialty store has evolved, this characteristic
of personal association between buyer and
seller has led to the popularity of the specialty
store retailer. Many of today’s specialty
retailers have become successful by
combining this element of personalized
service with a merchandise assortment geared
toward a particular market segment (Specialty
Retailing, 1986).
Between 1982 and 1992, specialty store
sales grew at a faster rate than total retail
sales. During this period specialty store sales
increased at an average rate of 9.7 percent
annually while the sales growth for total retail
was only 8 percent (Survey, 1983, 1993). It
has been suggested that much of the specialty
retailer’s successes have been at the expense
of the department stores.
Very little research has taken place
regarding service quality expectations in
61
apparel specialty store retailing. Only one
study was found pertaining to the apparel
retail industry. Finn and Lamb (1991)
examined apparel retailers by categorizing the
stores into four generalized groups including
those similar to: Kmart; J.C. Penny; Dillards;
and Saks. Finn and Lamb’s purpose was not
to differentiate among these store types but to
evaluate the SERVQUAL scale in a retail
setting. However, since the missions of these
stores were different it was likely that the
service quality expectations would vary
among the store types.
Webster (1989) examined expectations of
professional services (such as lawyers and
doctors) and nonprofessional services (other
services) using the SERVQUAL scale.
Findings revealed that demographic
characteristics were important when
determining the expected service quality for
non-professional services, but not for
professional services. This indicated a need to
examine demographic characteristics when
evaluating service quality in nonprofessional
service settings such as retailing.
Service Classifications
Outstanding service is considered one of the
most important attributes of specialty store
retailing. For the service industry, Gronroos
(1984) categorized service quality into two
categories: technical quality, primarily
focussed on what consumers actually
received from the service; and functional
quality, focussed on the process of service
delivery.
These types of service quality divisions
translate well with apparel specialty stores.
This study will retitle technical and functional
service quality to “Store Service” and “Sales
Service” respectively, in order to customize
the terms for the retailing sector. Conceptual
definitions are:
 JOURNAL OF
SERVICES MARKETING

(1) Store service: factors. Five of the most common factors

● in-store credit; summarized by Berman and Evans (1992)
include: merchandise, price, service, location,
● returns/exchanges/adjustments;
and advertising.
● variety, quality, and dependability of
sevice;
● price of after-sale service. Research Questions
(2) Sales service: Two primary research questions were
developed to aid managers in understanding
● attitude, courteous, knowledgeable,
consumer expectations and perceptions of
helpful clerks;
service quality in apparel specialty stores (see
● prompt attention, prompt processing appendix for operational definitions of
of transactions; expectations and perceptions). According to
● individual attention/service. Webster (1989) demographic characteristics
were a factor in consumers’ expectations of
By classifying these services into the two
non-professional services. Therefore, the first
divisions, retailers can concentrate their
question asked was: Does consumer age,
service strategies on both “store service” and
gender, ethnicity, marital status, or income
“sales service”. Store operation managers
have an effect on expected and perceived
might be more involved with front-line
service quality in retail apparel specialty
employees in improving store service
stores? If there was a substantial effect,
policies; whereas, personnel managers might
marketers need to identify which factors are
work with the sales service aspects.
important to better define their target markets.
Second, how important is service quality in
the overall context of store patronage in retail
Service: Its Influence on Patronage apparel specialty stores?
While store image is an important factor
influencing store patronage (Berry, 1969), the
emergence of above average service as a Measuring Service Quality
specialty store strategy indicates the
It is difficult to measure service quality,
importance of service in determining store
especially in apparel specialty retailing.
patronage. Specialty store shoppers judged
Apparel specialty retailing combines the
store personnel (the major determinant of
selling of goods and services to the consumer,
“Sales Service”) as a more important
and consumers expect knowledgeable, helpful
determinant of patronage than the department
staff to assist in the sales procedures.
store or discount store shopper (Lumpkin and
The ultimate goal was to measure service
McConkey, 1984). For example, men who
quality of apparel specialty stores using the
patronized high fashion men’s apparel
refined SERVQUAL scale (Parasuraman, et
specialty stores cited knowledgeable, helpful
al. 1991) which indicated five determinants
sales associates as the most important factor
of service quality:
influencing store patronage (King and Ring,
1980). These findings provide insight about (1) Tangibles.
the importance of service as a criterion for (2) Reliability.
patronage. (3) Responsiveness.
While studies have shown that service is an
important criterion for store patronage in (4) Assurance.
specialty stores, there are also other important (5) Empathy.

62
 VOLUME 8 NUMBER 1
1994

Therefore it was expected that the 22-item factor had greater eigenvalues; therefore, it
SERVQUAL scale would develop a five- was used for this study.
dimensional structure (for methodology of Categorical names were developed to
study see Appendix). Once determined, describe the new groupings with the
managers can utilize these findings to exception of reliability and tangibles which
increase or improve the services perceived as corresponded fairly well with the original
most important and build consumer Parasuraman study (1991). The four
satisfaction. categorical titles used were (see Table I):
(1) Personal attention.
Findings and Discussion (2) Reliability.
The anticipated five-factor principle-axis (3) Tangibles.
factor analysis followed by oblique rotation (4) Convenience.
was conducted according to the methodology
set by Parasuraman et al. (1991). However, Thirteen items clustered to form the personal
due to the overlapping of two of attention factor:
Parasuraman’s factors and the low ranking of (1) never too busy to respond;
the fifth factor, the data was reanalyzed using
(2) best interests at heart;
a four-dimensional factor analysis. This four-
dimensional factor analysis reduced the (3) always willing to help;
variance level by only 3 percent, and each (4) understands specific needs;

Personal
Items attention Reliability Tangibles Convenience

Q13 Never too busy to respond 86

Q21 Best interests at heart 85
Q12 Always willing to help 79
Q22 Understands specific needs 77
Q14 Behavior instills confidence 75
Q16 Courteous employees 73
Q17 Knowledgeable employees 70
Q6 Interest in solving problems 69
Q7 Dependable service 66
Q18 Offer individual attention 65
Q5 Prompt service 65
Q8 Service delivered when promised 56
Q20 Offer customization 51
Q9 Error-free records 65
Q10 When service will be performed 61
Q15 Customers feel secure in
transactions 53
Q2 Appealing store appearance 67
Q3 Well dressed, neat employees 60
Q4 Appealing promotional materials 52
Q1 Up-to-date equipment 57
Q19 Convenient operating hours 52

Table I.
Four Dimensions of Service Quality (Factor Loadings Multiplied by 100, n = 181)

63
 JOURNAL OF
SERVICES MARKETING
(5) behavior instills confidence;
(6) courteous employees;
(7) knowledgeable employees;
(8) interest in solving problems;
(9) dependable service;
(10) offers individual attention;
(11) prompt service;
(12) service delivered when promised; and
(13) offers customization.
While these items represented a myriad of
reliability, responsiveness, assurance, and
empathy characteristics, they had an
underlying common feature. All the items
were distinctive of the specialty retailer and
were apparent to customers each time they
were in the store. For example, in a retail
setting, courteous, knowledgeable employees
were very obvious to each customer, but how
secure customers felt about their transaction
were more intangible. These personal
attention characteristics reflected the “sales
service” component of service quality.
The tangibles factor comprised three items:
appealing store appearance; well-dressed,
neat employees; and appealing promotional
materials. These were all tangible influences
that customers notice before or upon entering
a store. These characteristics help establish
the image of the store and influence customer
expectations (Shostack, 1981). In the words
of a survey respondent, “A store’s
appearance, employees, atmosphere, and
equipment speak loudest to a customer
because that is what we notice first. It is our
first impression of the store”.
Three items formed the reliability factor:
error-free records; reliable service
performance; and reliability in transactions.
Each of these items represented the
trustworthiness of a specialty store. Error-free
records, assurance of timely service, and
transaction security were all pledges of
reliability to customers. These items
64
determined how secure a customer felt about
shopping a particular store. If performed well,
they assured the customer and increased
confidence in the store. Thus, the reliability
factor represented a component.
Another “store service” characteristic
involved convenience, the fourth factor, that
included: up-to-date equipment; and
convenient operating hours. Consumers
expected modern equipment such as quick
electronic “scanner” registers and convenient
hours for their shopping.
Demographic Characteristics
Following Webster’s (1989) methodology of
determining the differences among the
demographic characteristics when
determining expectations, analysis of
variance (ANOVA) was used to determine if
the gap factor score means varied among
different demographic characteristics.
Findings indicated that only three of the
characteristics, race, marital status, and
income, yielded significant differences at the
0.10 level in disparity of service quality.
(1) Race: Caucasian respondents indicated a
higher gap mean between expectations
and perceptions for Factor 4, convenience,
more so than non-white respondents
(p = 0.0303).
(2) Marital status: Married respondents noted
the greatest disparity between
expectations and perceptions for Factor 2,
reliability, than single respondents
(p = 0.0008).
(3) Income: Higher income households
(earning $35,000 and more) had greater
discrepancies with respect to expectations
and perceptions than lower income
respondents (p = 0.0751) for the
reliability factor. Age and gender were not
significant at the 0.10 level.
Analysis of variance provided evidence that
mean differences occurred between
expectations and perceptions among
 VOLUME 8 NUMBER 1
1994

demographic characteristics regarding two
factors, reliability and convenience. Higher
income households (earning $35,000 and
more) and married respondents held greater
disparity with the reliability factor than their
lower income, single counterparts. In
addition, Caucasians had greater dissention
with convenience than other respondents.
Since apparel specialty stores typically target
higher income consumers (Specialty
Retailing, 1986) this finding indicated stores
were either not getting the service message
out to these consumers, or else they were not
meeting these demanded consumers’
expectations. Further study needs to explore
the cause of these relationships and the
magnitude of these differences (see Table II).
Patronage Criteria Importance
To determine the importance customers
placed on store service, respondents were
asked to allocate 100 points among the
following store patronage criteria:
merchandise; price; service; location; and
advertising. The instructions indicated that
the largest number of points were to be given
to the most important factor in determining
store patronage. It was found that, service
ranked third in importance for specialty store
customers in determining where they shop

15
(n) F1 F2 F3 F4

Sex
Female 96 –0.0630 0.0365 0.0317 –0.0221
Male 85 0.0932 –0.0654 –0.0468 0.0327
(F) 0.7289 0.3021 0.2401 0.1207
Race:
Caucasian 152 –0.0654 –0.0270 –0.0390 0.0744
Other 29 0.3269 0.1352 0.1949 –0.3720
(F) 2.7015 0.5618 1.2391 4.8128**
Martial status:
Single 61 –0.1327 –0.3566 0.0897 0.0518
Married 120 0.0869 0.2009 –0.0440 –0.0425
(F) 1.3574 11.810*** 0.6455 0.3354
Age:
Under 44 112 –0.1099 0.0170 –0.0110 –0.0817
45-64 33 0.2043 0.0039 0.0322 0.1659
65 and over 36 –0.0453 –0.0866 –0.0356 –0.0711
(F) 1.2809 0.0823 0.0448 1.1161
Income
< $25,000 42 0.1538 –0.4018 0.1522 –0.2081
$25-$34,999 48 –0.2620 –0.0472 0.0903 0.2143
$35-$49,999 31 –0.0923 0.2921 –0.1082 0.0444
>$50,000 60 0.1913 0.00690 –0.1020 –0.0805
(F) 1.5680 2.3640* 0.6369 1.2677

*** p < 0.01

** p < 0.05
* p < 0.10
Note: Means are represented in terms of factor scores

Table II.
Effects of Demographic Variables on Differences between Service Quality Expectations and Perceptions
Using Analysis of Variance

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 JOURNAL OF
SERVICES MARKETING
Mean
Rank Variable score
1 Merchandise 26
2 Price 24
3 Service 17
4 Location 14
5 Advertising 10
Table III.
Store Patronage Criteria
(see Table III). Merchandise was most
important, followed closely by price.
Location and advertising were of leat
importance.
Limitations
While the SERVQUAL scale has proven a
reliable scale for several studies assessing
pure service firms, the scale does not perform
as well as expected with the service functions
of apparel specialty retailing. The five
determinants did not factor out as expected
(see Appendix). Finn and Lamb (1991) had
similar difficulties with the SERVQUAL
scale in a retail setting.
The sample was selected from households
across the Southeastern United States and
therefore does not represent the United States
as a whole. Those who responded to the
mailed questionnaire were representative of
the Southeastern population with respect to
sex (Southeast female population 52 percent,
sample female 53 percent) and age
(Southeastern population over 45 years old,
59 percent, sample over 45 years old, 57
percent); however, the sample did not reflect
the Southeastern marital status (Southeast
population 56 percent married, sample 43
percent married), race (Southeastern
population 78 percent Caucasian, sample 84
percent Caucasian) or income (Southeastern
population median income $31,345 Sample
66
less than $35,000) (1990 Census, 1991). The
sample therefore represents a higher income,
single, predominately Caucasian population.
While apparel specialty stores target the more
affluent consumer (Specialty Retailing, 1986)
the sample is not representative of the general
Southeastern population.
Future Research
The results of this study suggest that
refinement of the SERVQUAL scale is
needed before it can be accepted as a valid
measurement scale in an apparel specialty
store setting. Magnitude and direction of
consumer disparity also warrant future
research. In addition, it would be interesting
to see if consumers in other areas of the
country assess service quality of apparel
specialty stores similarly to consumers in the
Southeastern United States. Another project
would involve the segmentation of retail
apparel customers by store type based on
their service quality expectations and
perceptions.
Managerial Implications
From the factor analysis, personal attention
(“sales service”) factors held the greatest gap
scores, indicating disparity between what
specialty store consumers expected and their
perceived service quality. Customers receive
personal attention from store employees
every day in specialty store settings. Some of
the items that factored together forming
personal attention may actually be
antecedents of other items. For example, store
employees should be responsive, courteous,
and knowledgeable in order to offer prompt,
individualized service. The importance of
personal attention highlights the service act
provided by store sales associates. The
underlying implications suggest that front line
employees represent the store and, as such,
 VOLUME 8 NUMBER 1
1994
are performing a marketing function. This
finding stresses the need for customer service
training programs to align service quality
with consumer expectations.
The factor analysis revealed the tangibles
dimension (“store service”) as second in
disparity for apparel specialty store
consumers. The store appearance, its
employees, and promotional materials offer
visible cues to customers that they use to
form perceptions of store image. Because
tangibles often form consumers’ first
impressions, it is important for retailers to
create an image for the store that they wish to
project and then survey customers as to their
perception of the store’s image. While the
convenience and reliability (“store services”)
factors represent lower gap scores for
customers in this study, it is important not to
diminish their meaningfulness. For example,
having up-to-date equipment often allows a
store to facilitate activities such as registering
stock-keeping unit information. On the
contrary, too much automation reduces the
personal attention factor that apparel specialty
stores pride themselves for delivering. Behind
the scenes technology is important but not
necessarily visible to consumers. Accurate
inventory information affects the merchandise
assortment in the store, a factor which was
rated as the most important consumer
patronage criterion. In addition, accurate
records and convenient hours of operation
form a supportive structure on which personal
attention and tangibles rely.
The rankings for store patronage indicated
several reasons why specialty stores have
enjoyed widespread success in recent years.
Specialists offer merchandise targeted to
specific customers. In addition, they often
target niche markets (high, middle, or low
end) that enable them to offer merchandise at
attractive price points. Outstanding service
offerings (both “store” and “sales”) combined
with merchandise at competitive prices help
create an advantage.
67
Additional comments from survey
respondents confirm the basis of the success
for specialty retailers. Several respondents
noted, “Product, and then service determine
where I shop”. Other responses of interest
included: “Selection of merchandise is
everything when you don’t have time to shop
around”, and “I can deal with salespeople
who are knowledgeable”.
The significant demographic characteristics
of this sample that possessed the greatest
disparity between expectations and
perceptions were married Caucasians with
higher incomes. Many specialty stores target
this market segment and are either not
reaching their target market or are not
delivering the service their customers expect.
Those who do target this market need to
reassess their marketing strategy and
concentrate on diminishing this disparity
among this group of consumers.
A final implication of this study
underscores the current success of specialty
store retailers. Store service, ranked third in
patronage criteria, has been cited as a major
factor in specialty retailing success stories.
True competitors (high end versus high end,
or low end versus low end) can easily
duplicate merchandise mix and price, the first
two factors of store patronage. Therefore, by
offering the correct combination of
merchandise, price, and service, a specialty
store retailer can gain an advantage over
competitors.
n
References
Austin, N.K. (1992), “The Service Edge”,
Working Woman, July, pp. 26-8.
Berman, B. and Evans, J.R. (1992), Retail
Management: A Strategic Approach, 5th
ed., Macmillan, New York, NY.
Berry, L. (1969), “The Components of
Department Store Image: A Theoretical and
 JOURNAL OF
SERVICES MARKETING
Empirical Analysis”, Journal of Retailing,
Vol. 45 No. 1, pp. 3-20.
Finn, D.W. and Lamb, C.R., Jr (1991), “An
Evaluation of the SERVQUAL Scales in a
Retailing Setting”, Advances in Consumer
Research, Vol. 18, pp. 483-90.
Gist, R.R. (Ed.), (1968), Retailing: Concepts and
Decisions, John Wiley & Sons, New York,
NY.
Gronroos, C. (1984), “A Service Quality Model
and its Marketing Implications”, European
Journal of Marketing, Vol. 18 No. 4,
pp. 36-44.
King, C.W. and Ring, L.J. (1980), “Market
Positioning Across Retail Fashion
Institutions: A Comparative Analysis of
Store Types”, Journal of Retailing, Vol. 56
No. 1, pp. 37-55.
Lumpkin, J.R. and McConkey, C.W. (1984),
“Identifying Determinants of Store Choice of
Fashion Shoppers”, Akron Business and
Economic Review, Vol. 15 No. 4,
pp. 30-5.
Mayer, C.E. and Morin, R. (1987), “Retailers
Return to Basics to Win, Keep Customers”,
The Washington Post, 25 October, p. H-1a.
Parasuraman, A., Zeithaml, V.A., and Berry, L.
(1985), “A Conceptual Model of Service
Quality and its Implications for Future
Research”, Journal of Marketing, Vol. 49,
Fall, pp. 41-50.
Parasuraman, A., Zeithaml, V.A. and Berry, L.
(1991), “Refinement and Reassessment of
the SERVQUAL Scale”, Journal of Retailing,
Vol. 67 No. 4, pp. 420-50.
Reichheld, F.F. and Sasser, W.E., Jr (1990),
“Zero Defections: Quality Comes to
Services”, Harvard Business Review, Vol. 68,
September-October, pp. 105-11.
Specialty Retailing: Markets and Strategies for
the 1990’s, (1986), Find/SVP, New York, NY.
Shostack, G.L. (1981), How to Design a
Service, Donnelly, J. and George, W.R. (Eds),
AMA, Chicago, IL, pp. 221-9.
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Survey of Current Business (1983, 1993), US
Department of Commerce Economics and
Statistics Administration, Washington DC.
1990 Census of Population and Housing
(1991), US Department of Commerce,
Bureau of the Census, Washington, DC.
Webster, C. (1989), “Can Consumers be
Segmented on the Basis of Their Service
Quality Expectations?”, Journal of Services
Marketing, Vol. 3, Spring,
pp. 35-53.
Appendix
Method
A sample purchased from Survey Sampling
Inc. resulted in a random sample of 861
deliverable questionnaires. The sample was
stratified to represent household populations
across the Southeastern United States
including Alabama, Georgia, Florida,
Mississippi, North Carolina, South Carolina,
and Tennessee that responded to mailed
questionnaires. The Southeastern US was
selected to avoid bias of service perceptions
that might vary by geographical location. The
final sample consisted of 181 usable
questionnaires.
Description of the Instrument
The first section of the survey consisted of
SERVQUAL “expectation” statements
operationally defined as what customers
would expect from an ideal specialty apparel
store offering excellent quality service.
Following the expectations segment,
instructions asked respondents to name a
specialty clothing store which they shopped.
Then, based upon the store they indicated,
respondents answered questions in the
“perceptions” section of the SERVQUAL.
This segment consisted of 22 items that
paralleled the expectations segment. For each
of the statements, respondents indicated on a
scale from one (strongly disagree) to seven
(strongly agree) the extent to which they
 VOLUME 8 NUMBER 1
1994
believe the specialty store they shopped in
had the features described (see Table I).
In the next section of the survey,
respondents allocated a total of 100 points
among five retail strategies used to increase
store patronage (Berman and Evans, 1992).
Highest point ratings were distributed to the
feature deemed most important. This section
determined the importance of service with
respect to other factors of store patronage (see
Table III).
The final section of the survey concerned
personal demographics of the survey
respondent. The demographics were used as
independent variables for the ANOVA’s (see
Table II).
Data Analysis
To analyze the gap between customer
expectations and perceptions, the
expectations score of each SERVQUAL
statement was subtracted from the
perceptions score on the corresponding
statement, resulting in 22 measurement items.
Using the 22 gap scores, a five factor
principle-axis analysis followed by oblique
rotation was conducted to analyze the a priori
69
factors determined by Parasuraman et al.
(1991). Due to low eigenvalues, a second
factor analysis using four factors followed by
oblique rotation was performed. This resulted
in a greater eigenvalue for each variable and
diminished the variance by only 3 percent.
One way Analysis of Variance was used to
determine if there were significant differences
among the various demographic categories in
regard to the gap scores that measured
disparity between service quality expectations
and perceptions (question one). The means
for each demographic characteristic with
regard for each factor are reported in Table II.
The importance of store service in relation
to other possible patronage criteria (question
two) was determined through additional
analysis. By averaging the points allocated to
each variable, it was possible to obtain
overall scores for each variable. A visual
inspection rank ordered the patronage criteria
(see Table III).
Kathryn Bishop Gagliano and Jan Hathcote are
based at the University of Georgia, Athens,
Georgia, USA