More than a mere cup of coffee: When perceived luxuriousness triggers Chinese customers’ perceptions of quality and self-congruity

Abstract While prior research shows that atmospheric cues such as visual design trigger customers' cognition and emotions, thus leading to approach-avoidance responses, this article proposes self-congruity as a mediator, paralleling cognitive evaluation (i.e., perceived quality). More specifically, this article, situated in the context of the coffee shop industry in China, investigates how perceived luxuriousness, reflected from the service provider's visual design, affects customers' willingness to pay a price premium (WTPP). The findings show that perceived luxuriousness leads to customers' inferences of high quality of the coffee and high self-congruity, thus increasing WTPP. Further, cosmopolitanism moderates the effect of perceived luxuriousness only via self-congruity, but not via perceived quality. This article contributes to the existing literature on atmospherics, self-congruity, brand equity, and cosmopolitanism. More importantly, this article provides managerial implications for global coffee/food brands that aim to set up their chain outlets and expand rapidly in China, one of the largest emerging markets.