Bitner (1992) introduced the servicescape concept (i.e., the physical environment where services are delivered) and emphasized its role in shaping customer perceptions and behaviors. Kotler (1974), who introduced the term atmospherics, an element of servicescapes, found that music, shapes, scents, and colors provoked emotions and influenced purchase activity. Similarly, Bitner (1992) discovered that background music alone could influence purchasing behavior. Moreover, Hooper et al. (2013) conveyed that equipment intended for customer use in a service environment relays important messages to consumers. Additionally, cleanliness is another servicescape factor that attracts or dissuades consumer attention.

Cultural variation has implications for how servicescapes are perceived and how they influence loyalty behavior. According to Rosenbaum and Massiah (2011), customers from different national cultures respond differently to ambient cues and spatial arrangements, depending on their underlying motivational orientations. Harris and Ezeh (2008) found that servicescapes that reflect local culture and values can strengthen community ties and foster a sense of belonging. Moreover, in collectivist contexts, design elements that emphasize social spaces, communal interactions, and symbolic alignment with local traditions may be especially potent in meeting affiliation needs and fostering loyalty (Hofstede, 2001). Conversely, in individualistic cultures, elements that promote personalized attention, autonomy, and self-expression may be more effective. These insights suggest that the relationship between servicescape perceptions and loyalty is not culturally static but is likely influenced by socio-cultural context.

Additionally, the physical environment of a retail space can significantly influence customers’ satisfaction and their willingness to return to the retailer (Bitner, 1992). Thus, servicescapes act as a form of nonverbal communication, where aspects of the environment, such as furniture, décor, lighting, color, layout, temperature, and customer service, significantly influence customer perceptions of and outcomes for small businesses (Bitner, 1992; Hooper et al., 2013). Customers form opinions about servicescapes, which determine their levels of patronage and show-of-support for businesses. Well-designed servicescapes can enhance customer experiences by creating a pleasant atmosphere, which in turn can lead to increased customer loyalty (Wakefield & Blodgett, 1996). Therefore, businesses should use their physical setting to stimulate customer behaviors that benefit their businesses.

McClelland (1961) posited individuals (i.e., small business customers), accumulate three principal emotional needs that drive their motivation: the need for achievement (nAch), the need for power (nPow), and the nAff. McClelland’s work showed that individuals (i.e., small business customers) are motivated to some extent by each motivation trait and many individuals have high levels of motivation stemming from a single trait.

When a person is motivated by social connections and relationship building, they have a high nAff. Customers’ nAff, personal connection to, and identification with a company are directly and positively related (Marín & Ruiz de Maya, 2013). Thus, consumers often seek experiences with small businesses where their sense of belonging is heightened (Bitner, 1992).

Consumers have evolving emotions, moods, plans, and purposes (Bitner, 1992; Li & Yang, 2012). They also move through phases of spending based on lifestyle and purchasing power shifts driven by age, tastes, health status, and/or economic changes (Gilboa et al., 2019). Further, consumers can be influenced by their relationship with a business (Li & Yang, 2012); thus, they search for cues about a business’s competence and product quality through its servicescape (Bitner, 1992). Servicescapes contribute to the metamessage customers take away from an experience and shape their views of future patronage (Bitner, 1992; Kiran & Diljit, 2011).

Marín and Ruiz de Maya (2013) suggested that customers seek a social connection to and identify with businesses to fulfill belonging needs. Customer identification with firms stems from affiliation motivation, perceptions of the business, and relationships with salespeople. The experience of a business’s physical setting evokes pleasure or displeasure, leading to positive or negative reactions (Bitner, 1992). Ultimately, a customer adopts either approach behaviors, such as repeat patronage, or avoidance (Akhter et al., 2011; Bitner, 1992). Customers who remain in a space, browse, and interact with others show affiliation characteristics, including enjoying the experience, being friendly, and purchasing. Each of these factors is directly and positively linked to customer identification with a company (Marín & Ruiz de Maya, 2013). When affiliation needs are met, positive patronage behaviors, retention, and loyalty follow.

Business owners understand that customer loyalty is essential, and the customer relationship aspect is impactful on loyalty (Kiran & Diljit, 2011). For instance, Akhter et al. (2011) found a significant correlation between relationship quality and loyalty. Similarly, Li and Yang (2012) found a significant and positive effect between customer satisfaction and loyalty. According to Akhter et al. (2011), customer loyalty is essential for small businesses’ long-term survival: adding a customer is significantly costlier than retaining a customer. Loyalty results in consumer desire for a product, repeat patronage, contributions to organizational revenues, and decreased needs for marketing and word-of-mouth referrals (Claycomb & Martin, 2001). Thus, businesses are purposeful in their actions to connect with customers to gain their loyalty (Akhter et al., 2011).

The United States is home to more than 33 million small businesses which make up 99.9% of all firms in the economy (U.S. Small Business Administration, 2023). Globally, at a count of 400 million, 90% of all businesses are small businesses (Carpenter, 2024). Each year, new small businesses enter the marketplace, competing for market share and striving to be profitable. Unfortunately, small businesses are prone to failure: One-third of all new small businesses fail within two years, half fail within five years, and two-thirds fail within ten years (Isle et al., 2018; Lambert, 2019). Therefore, small business owners must remain alert to consumer preferences and spending habits, which are contributing factors to small business fragility.

Retail managers, specifically, must be alert to the impact of servicescapes and purposely devise their retail space’s servicescape to direct customers’ positive patronage behaviors (Hooper et al., 2013). Positive patronage results in additional customer loyalty, which in turn translates to higher perceived service quality, repetitive patronage, referrals, and increased revenues (Kiran & Diljit, 2011). Additionally, loyal customers reduce a business’s risk of losing patronage to rivals.

This study focuses on two central topics: individuals' need for affiliation (nAff) and the small business context. These focuses were chosen because small businesses are uniquely defined by close, relational interactions, and individuals high in nAff are naturally drawn to environments that foster social connection, emotional warmth, and interpersonal engagement. Human motivations are complex: Maslow’s Hierarchy of Needs Theory posits that individuals are initially motivated by satisfying lower-level needs before being motivated to satisfy higher-level needs (Maslow, 1943). Lower-level needs include food, water, shelter, and security, and higher-level needs include self-actualization. McClelland’s theory asserts that individuals are motivated and react based on their needs for achievement, power, and affiliation (McClelland, 1988). While McClelland’s Three Needs Theory differs from Maslow’s Hierarchy Theory, McClelland’s construct of nAff, which includes the social component, has similarities to Maslow’s higher-level needs. Further, McClelland’s theory of human motivation positions nAff as a dominant psychological drive that shapes behavior in interpersonal and group contexts. In consumer settings, this trait influences how individuals perceive and respond to physical and social cues within an environment.

Emotional, community, and personal connections are essential to shaping consumption choices of consumers who are dispositionally motivated by affiliation (Marín & Ruiz de Maya, 2013). Unlike achievement or power-driven motivations, affiliation is particularly relevant for the retail interactions that small businesses are uniquely positioned to offer due to the social, emotional, and experiential dimensions (Baumeister & Leary, 1995; McClelland, 1988). Consequently, elements such as layout, design, decor, and ambient conditions play a crucial role in shaping customer experiences (Bitner, 1992).

According to Rosenbaum and Massiah (2011), affiliation-motivated consumers are drawn to retail spaces that promote interaction, comfort, and a sense of belonging. As such, the physical environment, particularly in small businesses, where personalization and community ties are more pronounced, can serve as a powerful vehicle for fulfilling this psychological need. Since small businesses often lack the scale, brand recognition, or advertising power of larger firms, they appropriately rely heavily on emotional connection, community belonging, and personal relationships to attract and retain customers (Marín & Ruiz de Maya, 2013).

Environmental psychology provides additional theoretical support for the association of nAff, comfort, and a sense of belonging. The Stimulus-Organism-Response (S-O-R) model (Mehrabian & Russell, 1974) suggests that environmental stimuli, such as lighting, layout, temperature, and ambient music, trigger internal emotional and cognitive responses that ultimately shape behavior. For individuals high in nAff, servicescape elements that foster warmth, sociability, and aesthetic appeal may be perceived as more salient because they signal potential for interpersonal connection and a welcoming atmosphere. Hence, customers with a high nAff tend to have positive opinions of servicescapes that promote social interaction. Rosenbaum and Massiah’s (2011) research confirms that environments designed to facilitate socializing and community-building are highly valued by such customers.

Further, Wakefield and Blodgett (1996) demonstrated that customers appreciate servicescapes that are welcoming and comfortable, as these environments, which are conducive to social interaction and relaxation, fulfill their nAff. Aesthetically pleasing and emotionally comforting servicescapes are not merely decorative; they function as socio-emotional cues that align with customers’ relational motivations and influence satisfaction and loyalty outcomes. Bitner (1992) noted that well-designed servicescapes enhance customer satisfaction, which is closely linked to their need for social connection. Thus, environments that create a sense of community and belonging are important to affiliation-oriented customers as they seek environments where they feel socially connected. Further, customers’ nAff influences their satisfaction with servicescapes, leading to positive opinions.

Moreover, research in consumer behavior has demonstrated that consumers’ personality traits influence the extent to which they process and are affected by environmental cues (Gilboa et al., 2019). Affiliation-oriented customers are more attuned to relational and emotional dimensions of service experiences, making them particularly sensitive to the symbolic and emotional meanings conveyed by servicescape design. For instance, cozy lighting, human-scale furnishings, and professional staff attire may convey social warmth and inclusivity, reinforcing the customer’s sense of connection.

Consequently, we hypothesize H1: higher need for affiliation leads to more positive opinion of servicescapes, as affiliation-driven individuals are more likely to interpret environmental cues as indicators of potential social belonging and relational value.

Wakefield and Blodgett (1996) found that servicescapes contribute to customer satisfaction, which is a critical antecedent of loyalty. A well-designed, aesthetically pleasing, and comfortable servicescape enhances the perceived quality of the service, leading to higher satisfaction, positive customer opinions, and greater levels of customer trust and loyalty behaviors (Bitner, 1992; Wakefield & Blodgett, 1996). Further, according to Mehrabian and Russell’s (1974) model of environmental psychology, environments inducing positive emotions enhance customer retention. Likewise, Harris and Ezeh (2008) demonstrated that favorable perceptions of the servicescape lead to stronger loyalty intentions, including repeat patronage and recommending the business to others. Turley and Milliman (2000) agreed that positive opinions about the distinctive elements of a servicescape encourage customers to return to the business and remain loyal.

Customers often associate well-maintained and thoughtfully designed environments with reliability and care (Wakefield & Blodgett, 1996). Unique and engaging servicescapes differentiate small businesses from competitors, fostering customer loyalty (Turley & Milliman, 2000). Thus, positive opinions of servicescapes contribute to enhanced satisfaction, emotional engagement, perceived quality, and ultimately, increased customer loyalty to small businesses. Therefore, we contend that customer retention and loyalty are outcomes when customers’ needs are met in environments they choose to patronize because they favor the atmosphere. Hence, we also hypothesize H2: higher positive opinion on servicescapes leads to higher customer loyalty.

Figure 1 illustrates the study’s framework, encompassing the assertions of the two hypotheses. It combines concepts from Bitner’s (1992) and Marín and Ruiz de Maya’s (2013) models beginning with the need for affiliation and personal connection to a business as they affect consumers’ perceived value of servicescapes and identification with a business, or the small business owner or employees, and ultimately customer loyalty. We recognize that owner-customer relationships are essential for all customers (Akhter et al., 2011; Bitner, 1992; Kiran & Diljit, 2011) as those relationships heighten the positivity of the customer experience. Therefore, we expect this study’s framework will help explain the influence of affiliation needs and customers’ perceived value of servicescapes on customer loyalty.

While existing literature has established a general link between servicescapes and loyalty (Bitner, 1992; Wakefield & Blodgett, 1996), our study contributes a more nuanced understanding by situating this relationship within the context of small businesses and considering the psychological mechanism of affiliation need as a driver. In particular, our framework positions perceived value of the servicescape as a mediating mechanism through which affiliation-oriented consumers evaluate their experience and ultimately develop loyalty. This extends the literature by suggesting that servicescapes are not simply physical environments, but meaning-rich contexts through which psychological needs are either fulfilled or left unmet, thereby influencing behavioral outcomes like loyalty. In this way, our model offers a pathway-focused contribution by integrating motivational psychology (e.g., nAff) with servicescape theory and relational loyalty dynamics.

Our study also highlights how the impact of servicescapes may be amplified in small business settings due to the distinctiveness of these environments. Unlike large corporate retailers, small businesses often cultivate intimate, community-oriented atmospheres that allow for personalized interaction, emotional resonance, and sensory richness which are characteristics that make servicescape cues more personally relevant and emotionally salient to customers. In such settings, the alignment of servicescape design and consumer psychological needs (e.g., belonging, familiarity, trust) becomes critical. These conditions serve to intensify the influence of servicescape impressions on customer loyalty. For example, the use of familiar decor, locally inspired artwork, or ambient elements that reflect community identity may deepen the perceived authenticity of the experience, reinforcing emotional attachment to the business.

Moreover, this study suggests a potential moderating role of psychological traits, such as nAff, in shaping the strength of the servicescape-loyalty relationship. Although not formally tested here, our findings open the door for future investigations into whether the effectiveness of servicescape design depends on individual differences in consumer motivation or values. This points to a novel theoretical implication: servicescapes may function not just as universal cues of quality or atmosphere, but as differentiated psychological triggers that vary in their effectiveness based on customer characteristics. By incorporating these perspectives, our study adds meaningful depth to the understanding of how, when, and for whom servicescapes are most likely to translate into loyalty, particularly in the relationally rich, resource-constrained world of small businesses.

Ultimately, this study offers a theoretical contribution by advancing a psychologically enriched model of customer loyalty that situates servicescape evaluation as a function of motivational needs. By doing so, it moves beyond environmental design as a static or universally interpreted concept and positions it as a personally mediated experience, filtered through individual psychological dispositions like nAff (Mehrabian & Russell, 1974; Rosenbaum & Massiah, 2011). This approach aligns with contemporary perspectives in environmental psychology and consumer research that advocate for greater attention to individual differences in how consumers perceive and interact with retail spaces (Asghar Ali et al., 2021). It also provides a new pathway for understanding the variability in servicescape effectiveness, suggesting that loyalty outcomes are not just a matter of physical design, but of psychological resonance.

Data for our study were collected via an internet-based survey of small business customers in a mid-sized city located in the northeastern United States. Of the 333 small business consumers who engaged with the survey, 68 participants were excluded due to missing responses. The result was 265 usable responses and a usable response rate of 79.60%. The average small business customer who participated in this survey was between 42 and 57 years old and identified themselves as Caucasian; 65.50% were female (Joyal & Bartlo, 2025).

The minimum sample size was calculated using the methodology proposed by Wolf et al. (2013) using Mplus version 8.10 and a specified estimated power of 80% or greater (with α = .05) for all parameters of interest (i.e., factor loadings, correlations, regressive paths) contained in the model; the number of available responses significantly exceeded the minimum. Further, the sample size of 265 exceeded the commonly suggested minimum sample size of 200 to conduct a SEM (Boomsma, 1982).

Given that all data for this study were collected via self-report measures from a single survey instrument, the potential for common method bias (CMB) was carefully considered. To mitigate this risk, we employed both procedural and statistical remedies: Procedurally, several design strategies were implemented to reduce respondents’ evaluation apprehension and consistency bias. These included ensuring anonymity, using different scale types for separate constructs, and varying the order of items throughout the survey to reduce the likelihood of respondents forming systematic answer patterns. These approaches are consistent with recommendations by Podsakoff et al. (2003) for minimizing method-related bias at the design stage.

All measures employed for the constructs included in this research were adopted from existing scales, with modifications made to the content and wording to suit our study. Statistically, we conducted Harman’s single-factor test to examine whether a single latent factor could account for the majority of the variance in the dataset, which would indicate the presence of CMB. All measurement items were entered into an unrotated exploratory factor analysis, and the results showed that the first factor accounted for only 28.4% of the total variance, well below the 50% threshold commonly used to suggest substantial common method bias. This result provides empirical evidence that CMB is unlikely to have distorted the observed relationships among variables in this study. Nonetheless, we acknowledge that no method fully eliminates CMB risk, and future research using multi-source or time-lagged data could further strengthen causal inferences.

Table 1 contains all the items used in the study, including their loadings. The need for affiliation items were originally developed by Steers and Braunstein (1976) and continue to be used extensively (e.g., Schaffer & Manegold, 2024; Yim et al., 2024) within business research. The perceived value of servicescape items were adapted from Sweeney and Soutar (2001) who defined the term servicescapes for respondents before the scale items were presented. Finally, the items developed by Bobâlcă et al. (2012) were employed to measure customer loyalty.

CFA was employed using SPSS 28.0 to assess the measurement model of the items included in the survey. In line with recommendations from Tabachnick and Fidell (2007), we applied a .71 threshold for standardized factor loadings in our CFA to ensure excellent item-to-construct relationships and overall model fit. While this conservative criterion enhances statistical rigor, we recognize the importance of also maintaining content validity.

Based upon the results of the initial CFA and following best practices in the literature (e.g. Boles et al., 2000; Hennig-Thurau et al., 2002), ten items with loadings below the established ‘excellent fit’ cutoff of .71 (Tabachnick & Fidell, 2007) were deleted from the analysis. The items removed included two from the need for affiliation scale, seven from the servicescape scale, and one from the customer loyalty scale. All ten items with loadings below the cutoff are shown in Table 1 with a notation of their deletion.

Despite these removals, the retained items continue to reflect the core dimensions of each construct. For example, retained affiliation items emphasize social sensitivity and interpersonal engagement, such as preference for group work and attentiveness to others’ feelings, which is consistent with McClelland’s conceptualization of nAff. For servicescapes, retained items span visual aesthetics (e.g., lighting, color, layout) and ambient factors (e.g., temperature, aroma), which are central to environmental psychology literature. For customer loyalty, the remaining items strongly reflect attitudinal attachment and preference for the small business over alternatives. Thus, while some narrower content aspects were necessarily excluded, the breadth and theoretical alignment of the constructs remain intact.

A second CFA was conducted using AMOS 28.0 after the ten items were deleted. The fit indices show that the model has a good overall fit: X² = 866.58, with 135 df; CFI=.933, TLI=.920, IFI=.932, and RMSEA=.077. The reliability of the scales employed in the survey was assessed by examining construct reliability. Table 2 indicates that the construct reliability for each variable remaining in the model was larger than .70, indicating reliability (Fornell & Larcker, 1981). In addition, Fornell and Larcker (1981) state that consistency among scale items is indicated when the average variance extracted (AVE) equals or exceeds .50. As shown in Table 2, all have values were larger than .50, providing further support for the reliability of the scales employed in this research.

Further, our measurement model exhibits convergent validity since each indicator loads significantly on the construct they were supposed to represent, which indicates minimal cross-loadings, and establishes convergent validity (Anderson & Gerbing, 1988). Discriminant validity was assessed by comparing nested CFA models with the latent constructs constrained to 1. The X² differences were all significant (p < .01), which supports discriminant validity (Fornell & Larcker, 1981).

SEM using AMOS 28.0 was employed to test the hypotheses (Figure 2). The results demonstrate an acceptable overall fit with the data, producing fit indices of IFI=.961, CFI=.959, TLI=.953 and RMSEA=.044. The X² / df ratio was equal to 2.948 (392.098 with 133 df) with ratios under 3 indicating acceptable fit (Carmines & McIver, 1981). Estimates of the path coefficients indicate support for H1 and H2. Specifically, higher levels of a customer’s need for affiliation were significantly and positively related to higher levels of perceived value of the servicescapes within a small business establishment (β = .713, p = .016), thus supporting H1. Also, H2 was supported as higher levels of a customer’s perceived value of servicescapes within a small business was significantly and positively related to higher levels of customer loyalty (β =.61, p < .001). A summary of the results appears in Table 3.

From a practical standpoint, this study delivers actionable guidance for small business owners seeking to enhance customer loyalty through cost-effective and emotionally resonant servicescape strategies. Our findings underscore that customers high in nAff are particularly responsive to design elements that convey warmth, sociability, and personal attention. Small businesses can prioritize environmental cues that encourage interpersonal connection, such as soft ambient lighting, comfortable seating clusters, warm color palettes, subtle background music, and visible human presence (e.g., staff visibility and engagement). Recognizing that the majority of global small businesses operate with tight financial constraints (Flaminiano & Francisco, 2021) and limited marketing resources (Cromhout & Duffett, 2022), we recommend a phased approach to servicescape improvements, beginning with low-cost, high-impact changes like warmer lighting or rearranged furniture and progressing to structural upgrades as resources allow. Owners should also gather customer feedback to evaluate emotional impact and focus efforts on elements offering the greatest relational return on investment.

Beyond atmosphere, employee behavior and interpersonal cues serve as powerful extensions of the servicescape for affiliation-oriented customers. Staff who greet patrons by name, engage in casual conversation, or exhibit authentic friendliness can fulfill customers' relational needs without additional financial investment, requiring only targeted training or a service-oriented culture. These “human servicescape” components, when paired with a warm physical ambiance, significantly enhance the perceived value of the experience, especially for consumers motivated by belonging and interpersonal harmony (Parasuraman et al., 1988; Wirtz et al., 2000). While small businesses may lack the resources to fully optimize factors like brand image or switching costs, focusing on servicescapes offers a more agile and cost-effective path to loyalty (Brüggen et al., 2011).

The key takeaway for global small business owners is that making personal connections with customers fosters loyalty. A well-designed servicescape projects a complete image of quality and usage for the intended market, serves as a differentiation strategy, and shapes how customers interact with the business. As Shashikala and Suresh (2013) note, ambiance, aesthetics, layout, symbols, cleanliness, and social factors significantly affect loyalty. Ultimately, this study highlights how loyalty is driven not just by satisfaction or utility but by deeper motivational and emotional needs (Morgan & Hunt, 1994; Oliver, 1999). By linking McClelland’s theory of nAff with servicescape design, we present an integrative framework valuable to scholars and practitioners alike, especially in a post-pandemic context where emotional connection and personalization are essential for small business success.

This study showed that when small business customers’ affiliation needs are fulfilled by evoked feelings from servicescapes, they positively relate to customer satisfaction and loyalty. To expand on servicescape research, we recommend exploring small business owners’ nAff and corresponding use of servicescapes to satisfy their own affiliation needs and drive customer loyalty. One approach could examine whether improving servicescape quality leads to increased purchases or sales from the business owner’s perspective. Additionally, we recommend conducting a large-scale global study using our framework. Future research could replicate and expand our model across diverse cultural settings, testing for moderation effects of national cultural dimensions such as individualism-collectivism, power distance, or uncertainty avoidance (Hofstede, 2001; Triandis, 2018). Such studies would reveal whether the mechanisms observed in this sample hold in other cultural environments or whether new pathways emerge. By articulating the potential for cultural variance and encouraging cross-national validation, this study lays a foundation for broader theoretical development and practical application across the global small business landscape.

While the present study focused on direct relationships among need for affiliation, servicescape perceptions, and customer loyalty, future research would benefit from expanding the model to include mediating or moderating variables. Constructs such as trust and emotional attachment likely play important roles in shaping how customers evaluate servicescapes and translate those evaluations into loyalty behaviors. For example, trust may mediate the relationship between perceived servicescape quality and loyalty, especially in small businesses where credibility and authenticity matter. Emotional attachment, fostered through positive sensory and interpersonal experiences, could strengthen the link between servicescape satisfaction and loyalty. Though our data did not include these variables, their theoretical relevance is well supported by prior research (e.g., Morgan & Hunt, 1994; Thomson et al., 2005). Finally, future researchers should consider integrating these constructs through longitudinal or mixed methods designs to better understand the evolving nature of small business customer loyalty.