The Effects of Atmosphere on Perceived Values and Customer Satisfaction toward the Theme Hotel: The Moderating Role of Green Practice Perception

Abstract

Theme hotels are becoming popular because of their fascinating characteristics, within which, theme hotels that feature green practices have become a niche market in the highly competitive hotel industry. Despite past research demonstrating that the cognitive image created by a green hotel exerts strong effects on customers’ favorable reactions, how guest appreciation for green practices affects the relationship between the hotel atmosphere and guest satisfaction remains unknown for hotels of this kind. This research investigated the influence of atmospheric cues on customers’ perceived value and satisfaction and the possible effects of green practices in shaping customer satisfaction. In total, 267 valid responses from persons with experience with theme hotels were used to test the model using confirmatory factor analysis and path analysis of the structural equation model. Results of the research indicate that customers’ atmosphere perception of the theme hotel positively affects customer satisfaction, while the perceived value of the hotel mediated the effects of atmosphere on customer satisfaction. The guest’s appreciation of the hotel’s green practices moderated the relationship between atmospherics and customer satisfaction. Academic and managerial implications of the results, as well as limitations and directions for future research, are provided.

1. Introduction

Hotels with special features, such as themed hotels that feature sustainable or “green” design or innovative engineering [1] and those that make emotional or affective appeals to guests [2], have become increasingly common and competitive in the hospitality industry [3,4], both as options for accommodations and as destination choices [1]. Hotels were traditionally rated on the basis of guests’ experiences with decoration, comfort, and luxury. Although there is no official worldwide grading system, the most well-known and generally accepted systems originated in North America. The Forbes (Mobil) Travel Guide, for example, began ranking hotels on a one- to five-star ranking in 1958 and later graded luxury hotels globally. The American (Canadian) Automobile Association (AAA/CAA) rates hotels in North America from one to five diamonds. Hotels may incorporate these ratings into their marketing and guests may take these ratings into consideration in selecting accommodations. Given that hotels in the same category in each country offer similar or equivalent service, decoration, and comfort, competition within the same strategic market group becomes increasingly tougher as the market matures. One way for a hotel to differentiate itself from its competitors [5] is to cater to particular customer preferences. Indeed, so-called consumer-centric design has become a major trend in the hospitality industry. Beyond offering traditional services and facilities that align with or exceed expected standards, affective marketing can be an effective way to increase guest satisfaction and increase loyalty by offering affective attractions [2] with unique themes, especially in niche market segments [6,7].

Hotels employ various strategies to attract and retain guests. On one end of the spectrum, some compete on the basis of price or location; at the other end of the spectrum, others seek to provide guests with luxurious services. Beyond general categories of hotel ratings from low cost to luxurious, others seek to create extraordinary guest experiences with custom-designed services, such as Club Med. Apart from traditional luxury hotels, a theme hotel may focus on a niche market segment with particular preferences, such as cultural heritage, nostalgia, sports, religion, animals or pets, nature (forests, waters, mountains, plains), or particular personal experience and care [6,7]. Given that guests of such a hotel are more likely to favor the theme, the hotel may benefit from lower marketing costs. By staying in a theme hotel, guests seem to declare their interest in that particular theme, which makes them easier to satisfy. The design of the hotel, including the building and other facilities, customer service protocols, and organizational culture, should reflect guests’ preferred theme. Doing so will not only trigger the customer’s affective motive but also distinguish the theme hotel from its competitors in other categories.

Human behavior tends to be shaped or moderated by the environment, in particular, by the atmosphere that the environment stimuli have created. Numerous studies of consumer behavior have confirmed that a pleasant atmosphere, and its effect on customers’ moods, induces customers to spend more time in a store and to purchase more [8,9,10,11]. Studies of the hospitality industry have demonstrated that guests’ perceptions significantly impact their tour and leisure behaviors [12], particularly for those destinations or hotels that attempt to appeal to niche markets [13].

A recent trend of sustainable design or green design has emerged as one form of theme hotel (or at least plays a critical and substantial role in the hotel design management). A hotel characterized by green design signals to the public that it is both socially responsible and environmentally friendly, attracting both eco-oriented customers and general customers because of its additional perceived sustainability value to society [14]. Accordingly, the effects of green design persist long after customers actually perceive the hotel’s green features.

The current research has several purposes. The first is to investigate how guests recognize the atmospheric cues of the theme hotels and then to examine how such recognition may affect their satisfaction. Meanwhile, this research will explore customers’ perception of green design of a theme hotel and examines the effects of the perception of green design on the links between atmospheric cues and customer satisfaction.

2. Literature Review

2.1. Theme Hotels

In the hospitality industry, “theme” refers to an entire complex that is recognizable, in part or as a whole, as part of a certain culture [15]. Others believe it takes no more than the exterior and interior elements of the building and design to connect guests’ emotions and perceptions of value with the culture [16].

As a modern social trend, theming has become a useful strategy for going beyond guests’ expectations to provide guests with an extraordinary experience [17,18]. Themes allow restaurants, parks, clubs, casinos, and hotels to offer the guests memorable experiences [19], as advocated by modern experiential marketing [20]. A theme hotel uses architectural style, decoration, services, and other atmospheric items to provide guests with unique and person-specific experiences centered around a theme, such as history, local culture, cities, nature, myths, fairytales, and so on [4,21].

A theme may benefit the hotel in many ways, such as stimulating consumption [22], immersing the guests in the theme and image of an escape from reality [23], linking guest memories with a key idea or message [24], competing for hotel guests, and accordingly helping to build the hotel’s brand equity [25]. Geographic themes may help the hotel benefit from halo effects from local attractions (e.g., Disneyland), help substantially differentiate the hotel from competitors with unique features and images, and gain a distinguished position in the customer’s mind. As a result, designing and maintaining a hotel as a thematic hotel has become one of the optimal strategies in the hospitality industry [6,7,20]. As the theory of environmental psychology assumes, consumption behavior is shaped by the sensory, emotional, cognitive, and behavioral effects of the environment, making the experience memorable and, in turn, firmly establishing the hotel in memory for future travel decisions [26]. Designing the space with thematic atmospheric cues to enhance guests’ overall conception of the hotel is essential [27,28] to gain a sustainable competitive advantage [26].

Characteristics of a theme hotel. A hotel’s main function is to provide comfortable accommodations. At the same time, comfort is merely the bare minimum requirement for hotel guests, who typically have many alternatives to choose from, each of which promises comfortable accommodations. A theme hotel offers guests much more than the bare minimum requirements. Like a theme restaurant, a theme hotel may be characterized by several features. The theme is a unique concept that is drawn from well-known or preeminent cultural or natural resources, such as those in the fields of history, cinema, heritage, music, arts, sports, nature, and locality [15]. The theme is reflected in each element observable or accessible by guests: physical artifacts, sound, decors, uniforms, furniture, and even the service protocols.

2.2. Customer Satisfaction

Satisfaction is a post-purchase evaluation that includes both affective and cognitive components [29,30]. Marketing considers customer satisfaction to be an emotional response to a specific transaction. However, it is, by its nature, a cognitive decision to compare one’s experience with one’s expectations about a particular transaction [29]. Similarly, in the paradigm of consumer satisfaction and dissatisfaction (CS/D), customer satisfaction is the outcome of pre-purchase expectations and post-purchase examination [31]. In addition, customer satisfaction can result from the consumer’s comparison of the cost of and benefit obtained by using the product, which is a cost/benefit analysis [32]. In such a model, customer satisfaction will be high when the benefits received are greater than the cost incurred; when the contrary is true, customer satisfaction will be low. Put simply, satisfaction reflects a state of mind in which the customer’s expectations were fulfilled by the products or services the firm provided [33]. The current research proposes that customer satisfaction with green-themed hotels will be no different than customer satisfaction with general hotels [34]. Therefore, customer satisfaction can be regarded as an important part of the development of the hotel industry.

2.3. Atmospheric Cues

In service marketing, “atmosphere” (also known as store atmosphere or atmospherics) generally refers to the physical and non-physical characteristics of a store or place that are used to attract customers by producing an expected image in the customer’s mind. Atmospherics were proposed by well-known marketing academicians, such as Philip Kotler and May Jo Bitner, as a way to describe the firm’s effort to design a buying environment that will produce specific emotional effects in the buyer to enhance purchase probability [8,35]. The marketing literature generally agrees that atmosphere includes ambience factors, design factors, and social and interactional factors that significantly shape human behavior [35,36,37]. According to environmental psychologists, these multisensory factors play an important role in effecting participants’ emotions and behavior through scents, sounds, sights, tactile sensations, and tastes [27,28,38,39]. Some of these factors are physical or tangible, others are intangible, and some are both tangible and intangible. Studies have pointed out that creative integration of ambience, design, and social factors helps to increase both customer satisfaction and loyalty [39,40]. This is particularly important in the hotel business, where differentiating the property by providing the customer with unique values is the key to developing long-term customer relationships.

Many studies have shown the importance of customer experiences in service settings [36,41,42]. It is not surprising to find that companies generally use atmospherics to influence consumer behaviors in service encounters [8,37,43,44]. In the hotel business, the unique atmosphere created by the property’s distinctive design is part of the hotel’s intangible product, which can bring customers strong sensory and unique consumption experiences. A hotel’s well-designed sensory appeal not only attracts consumers, but also helps the property stand out from many competitors [45].

Atmospheric cues or atmospherics may include elements of ambience, design, and interaction [35,36,37,46]. The theory of servicescape, which focuses on the influences of the physical environment on the behavior of both customers and employees, includes ambience (such as temperature, air quality, noise, odor), function (such as layout, furnishing, installment), and signs (such as artifacts, decoration styles, signage) in the definition of a servicescape, which can influence the transactional and social interactional behaviors of people in the place [35]. Servicescape mainly focuses on the physical and design elements of the environment, although some studies include interactions as an additional element [36]. In summary, in the context of the hotel business, all dimensions of a guest’s physical and social surroundings have been shown to have a positive impact on the guest’s behavior during the stay at the property [38,39,46,47].

2.4. Perceived Value and Green Design

Perceived value from the combination of methods used to deliver products and services is essential to foster customer satisfaction [45]. Perceived value has been studied from a variety of perspectives. For example, the utilitarian perspective views value as an increase in wealth and measures perceived value by the price [48]. In the utilitarian perspective, perceived value is the trade-off between the utility and the disutility gained from using a particular service [49]. The utilitarian perspective has been criticized as ignoring the complexity of the concept of price [50]. On the other hand, the behavioral perspective contemplates perceived value in a more comprehensive way. In the context of social exchange theory, perceived value is not merely a trade-off between benefits and sacrifices [51,52,53]. Rather, it is a social interaction in which the customer’s perceived value has four dimensions: low price, quality for money, fairness of the transaction, and whatever value the customer seeks [52]. Others prefer the perspective of the expectancy disconfirmation paradigm, which suggests that the customer’s desired values have a significant impact on the customer’s evaluation of the values received [54]. Similarly, in this behavior-driven perspective, Sheth and colleagues identified five types of perceived values using the theory of consumption value: functional, social, emotional, epistemic, and conditional values [55]. Several measurements were then developed to capture the concept of perceived values These are PERVAL [56] for general products, SERV–PERF [57] for services, and, finally, GLOVAL [58] for tourism products that retain the three major perceived values of functional, emotional, and social values.

With respect to the relationship between atmospherics and perceived value, Jalil et al. [59] proposed that store atmospherics have a significant positive influence on perceived value. According to Jalil and colleagues, perceived value, in turn, affects customer satisfaction in later stages of consumer behavior. In this research, theme hotels with a green design provide guests with a sustainable, clean, and healthy product in that the atmosphere is healthier and more pleasant than those that do not have a green design, which will increase guests’ perception of value [60]. The current research, thus, proposes the following hypothesis:

H1. 

The customer’s perception of atmospherics positively affects the customer’s perceived value.

Green design in lodging describes those aspects of design and maintenance of the interior and exterior of a hotel that consciously strive to make the end product as sustainable and ecologically friendly as possible. Green or eco-friendly hotels may have been originally designed and operated based on green practices or, although built to traditional standards, have made a commitment to various environment-friendly practices, such as saving water and energy, reducing waste [61], reusing and recycling materials across various departments, educating people, and becoming actively involved in environment protection in the community [62,63,64].

In response to the challenges of climate change and global warming, while inhibiting natural resource degradation, individuals and organizations have adopted various measures and made various efforts to protect the environment. As a result, hotel guests are more concerned than ever about how the hotel management implements green practices [65,66], making green practices in the hotel industry a growing niche in the hospitality market [61,67]. Prior research has also confirmed that green hotel operation can at least facilitate customer satisfaction [68], if not act as the major contributor to it [69]. Given that human decision making is a product of human information processing, it is how customers perceive such sustainable practices, not what the hotel has actually done for environmental sustainability, that influences customer behavior. Green consumerism is, thus, becoming an important factor in hotel customers’ decision making [67]. This suggests that customers may perceive a hotel with green practices as a better value than those which do not follow green practices, as society at large pays more attention to the progress of sustainability. Walsh and Dodds [70] further showed that hotel management believes adopting green practices as a differentiation strategy is more important in gaining a sustainable competitive advantage than adopting a low-cost strategy. As a result, more and more hotels are adding eco-friendly attributes to their services and transforming their businesses into “green hotels” or “eco-friendly hotels” [65,71].

Customers perform some post-purchase evaluations to measure satisfaction. Customer satisfaction reflects the difference between customer expectations aroused in the pre-sale stage and performance perceived in the post-sale stage [72]. In the hotel industry, customer satisfaction is measured by comparing expectations before and after using the hotel’s services. In a sense of rationality, general customers are less willing than eco-friendly guests to pay more for services with green practices. As a result, satisfaction with hotel services will vary with the guest’s perception of the hotel’s green practices [73]. In other words, the customer’s appreciation of the hotel’s green practices will affect the relationship between service atmospherics and satisfaction.

The SOR (stimuli-organism-response) model suggests that humans’ internal emotions are aroused by stimuli from either the internal or external environment, which in turn creates a behavioral response. Mehrabian and Russell’s model is one of the most widely used models in the field of environmental psychology to explore the effect of environmental factors on customer behavior [74]. Although the effects of different aspects of atmospheric factors may vary across different contexts or types of business or stores, studies of this kind have generally shown that atmospheric factors have significant impacts on consumption behavior, including repetitive purchasing, referrals, and other demonstrations of loyalty, either directly or through the value perception of satisfaction among others [37,39,46,75].

That multisensory stimuli induce internal emotions and then shape human behavior had been confirmed in different fields of study, including a wide range of aspects of tourism and hotel industries [35,74,75,76,77,78]. Atmospherics of the theme hotels exert positive influences on customer satisfaction and loyalty [77,78,79]. The current research assumes that atmospheric cues in green-themed hotels that offer extra benefits to guests and are in line with the social concerns of sustainability will result in a better public image, which in turn will exert greater influence on guests’ moods of pleasure or arousal, which will in turn increase both customer satisfaction and customer loyalty [34,79]. The current research thus proposes the following hypothesis:

H2. 

Perceptions of atmospherics positively affect customer satisfaction.

The link between value perception and customer satisfaction is well established in the tourism industry [34]. As an essential part of the industry, hotels that feature green attributes will be placed in an even better position to trigger perceptions of greater value, and, thus, will result in the customer’s satisfaction toward the particular hotel, as well as the hotel’s brand [31,34,68,69,76]. This research hypothesizes that, like the effects of perceived value on satisfaction in general industries [31], perceived value will have positive effects on customer satisfaction with green-themed hotels, as follows:

H3. 

The perceived value of green-themed hotels positively affects customer satisfaction.

On the other hand, previous research has generally confirmed that the customer’s value perception is at the core of customer loyalty through customer satisfaction [54,55,80]. When atmospheric cues put customers in a pleasant mood, it fosters both their value perception and satisfaction. In other words, there is a relationship among atmospherics, perceived value, and customer satisfaction, in which perceived value links atmosphere and satisfaction. As with other service settings, theme hotels with green designs devote more resources to creating a favorable atmosphere than those that do not have green designs, which guests in turn perceive as a better value, as noted in the previous section [59,60]. The customer’s preference for the hotel’s atmosphere positively affects both the customer’s value perception [59,60] and the customer’s satisfaction, and the customer’s value perception in turn affects the customer’s satisfaction [68,69,76]. We therefore hypothesize that value perception will play a mediating effect between atmosphere and satisfaction. In addition, as a source of competitive advantage, perceived value can be a strong foundation for customer satisfaction in fostering long-lasting customer loyalty [54]. We propose the following hypothesis:

H4. 

Perceived value mediates the association between atmospheric cues and customer satisfaction.

The key to building lasting customer relationships is to create superior customer value, in which a clear link between the customer’s perceived value and the customer’s satisfaction has been confirmed [81]. Green design proclaims that the hotel is not only actually bringing customers fresh and clean air and image, but also creating the perception of environment-friendly practices. The link between green practices and satisfaction has been tested and confirmed by previous studies in the context of the hotel business [82,83]. Therefore, the customer’s perception of the value of green design will affect both their preference for atmospherics and their satisfaction [33]. This means that a hotel’s green practices will moderate both the customer’s preference for atmospheric cues and the customer’s satisfaction. In the hotel industry, customer satisfaction is measured by comparing expectations and experiences before and after using the hotel’s services [72]. In the sense of rationality, general customers are less inclined than eco-friendly guests to pay more for green practices. As a result, satisfaction with the hotel will vary along with the guest’s perception of the hotel’s green practices. In other words, we expect our study will demonstrate that the customer’s perception of the hotel’s green practices affects the relationship between service atmospherics and satisfaction. Just as previous research has confirmed that eco-friendly attributes moderate the relationship between service quality and customer satisfaction [84], this research thus proposes the following hypothesis:

H5. 

Appreciation of green practices moderates the relationship between atmospherics and customer satisfaction.

3. Materials and Methods

3.1. Research Framework

The current research proposes that a theme hotel’s atmosphere will positively impact the customer’s perception of value and satisfaction, respectively, whereas perceived value mediates the association between atmosphere and satisfaction. In addition, the customer’s perceived appreciation of green practices moderates the relationship between atmosphere and the customer’s satisfaction and loyalty, respectively, as shown in Figure 1.

3.2. Research Instrument and Measurement

We used a structured questionnaire with four scales to measure atmospherics, perceived values, appreciation of green practices, and customer satisfaction. Socio-economic factors, such as gender, age, education, occupation, income, and purpose of visiting, were also included.

Measures

As suggested by the review work of Turley and Milliman [27], atmospherics include five distinctive dimensions: external and internal environments, service design, interior layout, reception, and participants. Items used to measure this construct have been drawn from previous studies on the impacts of atmospherics [13,27,28,35,43,79]. The variable of perceived value is used to measure guests’ perception of the value of hotel services using four distinctive dimensions of quality, emotional reaction, price, and social reputation [56], all drawn from previous studies [56,57,85]. The appreciation of green practice as a variable in this research has been used to measure guests’ appreciation of the hotel’s green practices. Items were drawn from studies on the green design [33], green building [86], and general green practices [14,61,66,69]. With respect to general green practices, we adopted the conventional notion of experience exceeding expectancy to measure customer satisfaction [29,30,32].

3.3. Subjects and Data Collection

We gathered responses from 267 subjects who had stayed in a theme hotel in the preceding six months. The respondents were recruited through an electronic survey platform of Survey Cake and provided with a brief description regarding the meaning of theme hotels, using examples such as Leofoo Resort Hotel, Dive Cube Hotel, and Hotel Cham Tainan. Respondents who were younger than 20 years old or had not stayed at a hotel of this kind within the previous six months, were excluded in the first screening stage. All subjects provided written and informed consent before participating in the investigation using a self-administered questionnaire. Participants were advised that they could terminate the survey at any time. The details of the respondent profiles are shown in

Table 1. Profiles of respondents.

Var.	Categories	n.	%	Var.	Categories	n.	%
Gender	Male	98	36.7	Age (years old)	<23	24	9.0
	Female	169	63.3		24–35	124	46.4
Marital	Married	124	46.4		36–47	98	36.7
	Single	143	53.6		48–59	19	7.1
Education	<H. School	3	1.1		>60	2	7
	H. School	26	9.7	Job nature	Full-time	227	85.0
	College	168	62.9		Part-time	35	13.1
	Graduate	70	26.2		Volunteer	5	1.9
				Income/M, Household	<20 K	15	5.6
Jobs	Student	26	9.7		21~40 K	73	27.3
	Retired	8	3.0		41~60 K	58	21.7
	Blue collars	63	23.6		61~80 K	36	13.5
	Office staff	101	37.8		81~100 K	43	16.1
	State	31	11.6		>101 K	42	15.7
	Professional	26	9.7	Area	Urban	210	8.7
	Bus. owner	6	2.2		Rural	54	20.2
	Top managers	6	2.2		Others	3	1.1
Origin	Fujian	199	74.5	Purpose of staying	Business	34	12.7
	Hakkai	38	14.2		Vacation	205	76.8
	O. province	17	6.4		Conference	18	6.7
	Primitive	2	0.7		Friend visit	7	2.6
	Foreigner	6	2.2		Others	3	1.1
	Others	5	1.9

n = 267.

.

3.4. Data Analysis

Analysis of the results of the survey followed the two-step approach of structural equation modeling (SEM) proposed by Anderson and Gerbing [87] to estimate the measurement and structural model. The first step examined construct reliability and validity of the measurement model using confirmatory factor analysis (CFA). The second step checked the path effects and the significance of the structural model. The measurement model was assessed by using the maximum likelihood estimation (MLE) in terms of factor loadings, reliability of measurement, convergent validity, and discriminant validity.

Descriptive analysis was used to describe the profile of respondents. Path analysis was applied to test the relationships among the independent variables of atmospherics perception on perceived value and customer satisfaction, including the mediating effects of perceived value and the moderating effects of the appreciation of green practice. The bias-corrected percentile of the bootstrapping method was used to determine whether the mediating effect was present by checking the lower and upper bounds of indirect effects. This research adopted software packages of the SPSS 22 and AMOS 22.0 (IBM Corp, Armonk, NY, USA, sourced from TriStar, Kaohsiung City, Taiwan). All significance levels were set at p ≤ 0.05.

4. Results Analysis and Discussion

4.1. Socio-Demographic Factors

The subjects were all residents of Taiwan, with the typical subject being female (169 (63.3%) females, 143 (53.6%) single, 168 (62.9%) with college education, 124 (46.4%) aged between 24 to 35 years old, 199 (74.5%) with Fujian background, and 210 (78.7%) urban residents). On the other hand, the respondents included 227 (85.0%) full-time workers, 101 (37.8%) who worked in the private sector, and 73 (27.3%) with a household income at the level of “20,000~40,000 NTD”.

As in

Table 2. Reasons of choosing the hotel.

Reasons		Responses	Observations
	n	%	%
Relative recommend	91	14.5%	34.1%
Easy accessibility	85	13.5%	31.8%
Only hotel around	36	5.7%	13.5%
Reputation	40	6.4%	15.0%
Facilities	126	20.1%	47.2%
Friendly	88	14.0%	33.0%
Reasonable pricing	146	23.2%	54.7%
Familiar servants	11	1.8%	4.1%
Others	5	0.8%	1.9%
Sum	628	100.0%	235.2%

, reasons for staying in theme hotels are more or less similar to those for choosing traditional hotel. The top three reasons are reasonable pricing (23.2%), facilities (20.1%), and recommendation of relatives (14.5%)

4.2. Confirmatory Factor Analysis

4.2.1. Convergent Validity

As shown in

Table 3. Convergent validity.

Construct	Construct Reliability	Convergent Validity
	CR	AVE
Customer satisfaction	0.716	0.695
External	0.867	0.521
Interior	0.915	0.546
Design & layout	0.906	0.580
Reception	0.882	0.599
Personnel	0.928	0.619
Quality	0.891	0.673
Emotional	0.905	0.706
Price	0.878	0.644
Social	0.837	0.632
Atmospherics	0.955	0.809
Perceived value	0.933	0.776

, the composite reliability values of the constructs range from 0.716 to 0.955, exceeding the 0.7 recommended by Nunnally and Bernstein [88] and indicating that all constructs are internally consistent. All average variances extracted (AVE) range from 0.521 to 0.809, exceeding the suggested level of 0.5 [89,90] and demonstrating that all constructs have adequate convergent validity.

4.2.2. Discriminant Validity

For each construct to be discriminately valid, the square root of the average variance extracted (AVE) of a given construct must be larger than its correlations with any other constructs [89,90]. As shown in

Table 4. Discriminant validity for the measurement model.

	AVE	Customer Satisfaction	Atmospherics	Perceived Value	Green Practice
Customer satisfaction	0.695	0.834
Atmospherics	0.809	0.688	0.899
Perceived value	0.776	0.678	0.636	0.881
Green practice	0.653	0.694	0.504	0.546	0.808

Note: The figures in boldfaces represent the square roots of the AVE; off-diagonal elements are the correlation estimates.

, all of the bold numbers in the diagonal direction, which represent the square roots of AVE of each construct, are larger than the correlations with other constructs. This means that all constructs have acceptable discriminant validity.

4.3. Associations of Atmospheric Cues, Perceived Value, and Satisfaction

4.3.1. Model Fit

The fit of the proposed model with the empirical data was tested using SEM to generate model fit indices, as shown in

Table 5. Model fit indicators.

Model Fit	Criteria	Model Fit of Research Model
χ2	The small the better	2347.539
DF	The large the better	1472
Normed Chi-sqr (χ2/DF)	1 < χ2/DF < 3	1.576
RMSEA	<0.08	0.047
GFI	>0.9	0.918
AGFI	>0.9	0.902
NFI	>0.9	0.918
TLI(NNFI)	>0.9	0.921
CFI	>0.9	0.924

χ², normal theory, weighted least squares chi-square; DF, degree of freedom; RMSEA: root mean square error of approximation; NFI: normed fit index; NNFI: non-normed fit index; CFI: comparative fit index; GFI: goodness-of-fit index; AGFI: adjusted goodness-of-fit index.

. The obtained major indices of model fit are χ²/DF = 1.576 < 3; RMSEA = 0.047 < 0.08; GFI = 0.918 > 0.9; AGFI = 0.902 > 0.9; NFI = 0.918 > 0.9; TLI = 0.921 > 0.9; CFI = 0.924 > 0.9. All indices show a good level of model fit. A more detailed illustration is presented in the section of discussion.

4.3.2. Path Analysis

Results from the path analysis show that atmospherics (β = 0.644, p < 0.001) significantly impact perceived value. H1 is supported with 41.50% of the variance explained. Perceived value (β = 0.407, p < 0.001) and atmospherics (β = 0.426, p < 0.001) significantly impact customer satisfaction. H2 and H3 are supported with 57.0% of the variance explained, as shown in

Table 6. Regression coefficient.

DV	IV	Unstd.	S.E.	Unstd./S.E.	p-Value	Std.	R2
Perceived value	Atmospherics perception	1.249	0.163	7.638	0.000	0.644	0.415
Customer satisfaction	Perceived value	0.463	0.080	5.767	0.000	0.407	0.570
	Atmospherics perception	0.941	0.166	5.657	0.000	0.426

and Figure 2. As the antecedents of customer satisfaction, atmospherics produce larger effects than perceived value. On the other hand, the effect of perceived value on satisfaction may derive from the atmospherics.

Reception contributes the most to the guest’s atmospheric perception (coefficient of 0.940), followed by design and layout (0.9190), interior environment (0.902), personnel (0.895), and external environment (0.848). On the other hand, price dimension contributes the most to the guest’s perception of value (coefficient of 0.901), followed by quality (0.883), emotional (0.874), and social recognition (0.864), as shown in Figure 2.

4.3.3. Perceived Value as a Mediator

Given that bootstrapping mediation analysis, and particularly bias-corrected bootstrapping [91,92], can provide confidence intervals for researchers to use in examining indirect effects, it is preferable than other methods of testing mediation. In this bootstrapping method, mediating effects are confirmed when the confidence intervals do not include “0” [91,92].

Our tests of the effect of perceived value on the relationship between atmospherics and customer satisfaction in the current research have shown the bias-corrected confidence intervals of [0.131, 1.507], as shown in

Table 7. The analysis of indirect effects.

Effects	P.E.	S.E.	P.C.		BCB
			Z	p	Lower	Upper
Atmospherics– Perceived Value- Satisfaction	0.579	0.354	1.636	0.102	0.131	1.507

P.E., point estimate; S.E., standard error; P.C., product of coefficients; BCB, bias-corrected bootstrapping (bootstrap 1000 times, bias corrected at 95%).

. As no “0” is included in the confidence intervals, the indirect effect is present in the perceived value as a mediator, and H4 is thus supported.

4.4. The Effects of Green Practices

To test the moderating effects of green practices, we examined changes in chi-square values for the relationship between atmospherics and customer satisfaction, after adding the green practice appreciation. As shown in

Table 8. Moderating effect test results.

D.V.	Models	χ2	d.f.	Δχ2
Customer satisfaction	M1 Base model	6620.974	2944
	M2 Moderating	6624.935	2945	3.961 *

D.V., dependent variable; d.f., degree of freedom; * denotes Δχ² is significant at α = 0.05.

, the change in chi-square value for the path of atmospherics to customer satisfaction are significant at 3.961. The difference in the chi-square value is significant and denotes that the moderating effect on the relationship is present. H5 is thus supported.

5. Discussion

5.1. The Role of Atmosphere Perception

A plethora of studies have confirmed that environmental factors affect human behavior through sensory responses. This research has found that these atmospheric cues in the servicescape of theme hotels indeed significantly influence guests’ perceived values and their satisfaction. The hotel’s initial reception of the guest appears to have the greatest influence on the guest’s overall perception of atmosphere. In other words, the first encounter between guest and hotel is key to gaining the guest’s acceptance [93]. Elements of the hotel’s external environment, such as its physical appearance, landscaping, and proximity to highways have less influence on guests’ perceptions. Guests expect a warm and friendly atmosphere at any accommodation, especially guests exhausted after a long journey [94].

5.2. Index of Model Fit

Chi-square (χ²) is generally used as an index of the absolute fit between model and data—the lower the chi-square value, the better the fit. A low ratio of chi-square value to degrees of freedom also indicates a better model fit (i.e., χ²/DF). It has been suggested that values of χ²/DF less than 3 indicate a good fit and values of 3 and higher indicate “badness of fit” [95,96]. For this model, the chi-square value is 1.576, suggesting a good fit.

Other indices of absolute fit include the root mean square error of approximation (RMSEA), goodness of fit (GFI), and adjusted goodness of fit (AGFI) [97]. RMSEA is used to assess the distance between the hypothesized model and a perfect model. RMSEA is a parsimony-adjusted index, in which values closer to 0 represent a good fit and RMSEA values between 0.05 and 0.10 indicate a model fit. An acceptable RMSEA is less than 0.08 [98,99]. The RMSEA of the current model is 0.047—less than both the “good” level of 0.05 and the “standard” level of 0.08. GFI measures the fit between the hypothesized model and the observed covariance matrix, while AGFI corrects the GFI, which can be affected by the number of indicators. GFIs and AGFIs range between 0 and 1, with a value of over 0.9 generally indicating an acceptable model fit [100]. The GFI and AGFI of the current model are 0.918 and 0.902, respectively, showing a good level of model fit.

Another index used to assess model fit is the incremental fit index, which compares the fit of a hypothesized model with that of a model baseline or saturation model. The comparative fit index (CFI) [101], normed fit index (NFI), and non-normed fit index (NNFI, or Tucker–Lewis index (TLI) [102,103] are the widely used incremental fit indices. The CFI shows the discrepancy between the data and the hypothesized model, while adjusting for the sample size in the chi-squared test of model fit [101]. CFI values range from 0 to 1, with larger values indicating better fit—a CFI value of at least 0.90 or even 0.95 is acceptable as an indicator of good fit [104]. The CFI of the current model is 0.924, larger than the traditional standard yet slightly less than the advanced level of 0.95. This means the model fit is at a fair to a good level.

5.3. Growing Concern about Green Practices

In response to consumers’ increasing green consciousness, hotels, as the largest sector and the major consumer of natural resources, inevitably are exposed to multiple campaigns urging the adoption of eco-friendly policies in the lodging industry [65,66]. A hotel’s green practices can encompass a wide array of aspects, ranging from resource-saving construction and maintenance to daily service procedures covering every aspect of hotel operation. With respect to service design, green design should be included throughout the hotel building process, from the first blueprint to the design of protocols for guest services.

All of these green practices should be included in, if not used as a theme for, the hotel’s communication strategy. At the very least, these practices should be obvious to guests and easily perceived as eco-friendly attitudes and behaviors.

Although the hotel’s adoption of green practices will increase customer satisfaction [66], as the current study has shown, some argue that guests do not perceive green practices as important to increasing guest satisfaction nor to decreasing guest satisfaction if absent [105]. In fact, some viewed green practices as nothing more than a “facilitating attribute” that provides guests with nothing more than transitory pleasure [68]. However, more recent studies, such as the current study, have confirmed that green practices do positively affect satisfaction [82,83] and a hotel’s eco-friendly attributes significantly enhance the impact of service quality on customer satisfaction [84], similar to the moderating effects of green practices on the relationship between atmosphere and satisfaction. The failure of older studies to find an impact of green practices on customer satisfaction [68,105] may stem from the inability of guests to perceive or recognize the green practices the hotel has adopted. Given that there was no consensus between hotels and guests on a standard or acceptable level of green or sustainable practices, the hotel’s efforts may not have been consistent with guests’ expectations. Such a discrepancy could easily explain the failure of green practices to influence guests’ sensory responses. Careful exploitation of the customer’s environmental values and other ecofriendly knowledge (e.g., low-carbon practices) should improve the customer’s cognitive and affective images of the hotel and, consequently, the customer’s favorable responses to it [106]. The results of this study shed more light on the effects of green practices on customer satisfaction. Green practices can be used to enhance the guest’s sensory perception of the hotel and, as previous studies have confirmed, customer satisfaction as a moderator.

5.4. Responding to Changing Consumer Behaviors in the Context of COVID-19

Consumer decision making is greatly shaped by the environment. The COVID-19 pandemic substantially restricted consumers’ shopping alternatives [107] and accordingly modified consumers’ purchasing and consuming behaviors [107,108]. The harsh environment for retailers had the same impact on the hospitality business. Hotels with well-perceived green practices that were known as eco-friendly and healthy during the pandemic, especially those approved with internationally recognized labels or endorsed by social media influencers (SMIs), may instill trust in each step of the consumer’s decision-making process [109], making consumers more confident in their choice of hotel accommodations [110].

6. Conclusions and Implications

6.1. Conclusions

In response to the fierce competition in the lodging industries, capabilities in retaining and sustaining guests are vital to be successful, for which customer satisfaction with theming and green practices are the most remarkable approaches. Literature had generally proven that customer satisfaction is the foundation for the customer’s loyal behaviors, which will lead to better financial returns. Theming and green design emerged recently in the hotel industries in response to the environment protection ideology and the customer’s novelty needs. The current research adopted the concept of environmental psychology to test the effects of the atmosphere of the theme hotels on customer satisfaction.

Reception is the most important factor in the atmospheric cues, whereas value for the money is the most significant contributor to value perception. Hypotheses of the research are all supported by test results. This research concludes that the atmosphere perception of the theme hotels positively affects the customer satisfaction, as well as the customer’s value perception toward the hotel. Although the customer’s perceived values significantly affect customer satisfaction, as well as mediate the relationship between atmospheric perception and satisfaction, it is less influential when compared with the direct effects of atmosphere perception on customer satisfaction. This means the atmosphere of the theme hotels is the primary factor in gaining customer satisfaction. The guest’s appreciation of the hotel’s green practices positively moderates the relationship between atmospherics and customer satisfaction. This means that with higher levels of customer appreciation of the green practices of the theme hotels, the atmospheric factors that the theme hotels created will have greater opportunity to enhance the guest’s satisfaction.

6.2. Academic Implications

Several academic implications can be inspired by the current research. This research provides additional evidence to support the association between the customer’s sensory perception of spatial atmosphere and customer satisfaction, especially in this particular field of theme hotels. In the meantime, this research confirmed the role of perceived value as a mediator of customer satisfaction. The final academic implication is the moderating effects of green practice, which will advance our understanding of how green practice may affect service performance in this and other industries.

6.3. Managerial Implications

The current research also brings several managerial implications. Firstly, performing green practice is not simply to follow a trend of environmental protection or to fulfill social responsibility, it brings benefits to the business as well by strengthening the effects of atmosphere perception on customer satisfaction. In other words, the atmosphere the hotel has created is important to achieve customer satisfaction, and the green practice can further assure or elevate its impact.

The second managerial implication is to use green practice as a strategic action rather than simply a promotional campaign. Despite the fact that the Green Hotel Association has a clear definition of green hotels—“Green Hotels are environmentally friendly properties whose managers are eager to institute programs that save water, save energy and reduce solid waste—while saving money—to help protect our one and only earth!” [111]—guests to the hotel may hold a different ideology on environmental protection. Therefore, it is essential to communicate the hotel’s commitment to eco-friendly actions to gain the customer’s recognition. As a strategic action, the green practice should be endorsed and supported by hotel management and announced to the public as hotel policy. In addition, a careful study on the priorities the target customers expected for the green actions of the hotel should be conducted and continuously updated to align the hotel’s improvement project with the guests’ demands.

The third managerial implication is that hotel management should carefully use the green practice as a moderator to enhance the effects of the atmosphere on customer satisfaction rather than a driver for customer satisfaction or other business goals. Bear in mind that no matter how hard the hotel may work to exercise green activities, the contribution of these activities to the guest satisfaction may be trivial without a warm atmosphere and benevolent services because the guests may just simply perceive it as a symbol, not a material benefit.

6.4. Limitations and Future Study Directions

The literature, both in general business operation and in hotel industries, has widely accepted that customer satisfaction and loyalty have a strong correlation, though this research did not include customer loyalty. Although the customer satisfaction in most cases is the foundation of building customer loyalty or even acts as an antecedent of forming customer loyalty behavior, there is no evidence in this research to conclude whether the customer’s satisfaction with the atmospherics and perceived value toward the theme hotels will result in customers’ loyalty to the hotel. This is the first limitation, and future research may include the construct of customer loyalty to test the effects of these variables.

Dimensions in the atmosphere are many, including those causing the guests’ sensory responses. This research did not examine the role of the individual effects of each dimension on the perceived value and customer satisfaction, as well as how each dimension can be affected by the green practice. Exploring the effects of each atmospheric dimension on the customers’ perceived value, the satisfaction for the theme hotels, and the relationship with green practice will bring valuable insight to both academic study and industrial application.

Respondents to the research are visitors who had experienced a theme hotel of any type. The theme of a hotel might have possible impacts on the guest’s perception of the value of a theme hotel, for example, a heritage-themed hotel may bring guests a historical atmosphere that is usually a cultured, tranquil, and solemn, which may induce different emotional reactions to those for hotels with other themes (e.g., Disneyland, wildlife, etc.). The respondents’ experience with hotels with different themes may limit the generalizability of this research.

Last but not least, because the convenience sampling method was used to collect the research data, the generalizability of the results is limited accordingly. To ensure external validity, a more comprehensive sample in a wider range of hotels is needed in future research. To deepen understanding of the relationship between atmospherics and the dependent variables, other factors, such as customer nationality and types of theme hotel, could also be incorporated in future research models.