The Influence of Store Environment on Quality Inferences and Store Image Julie Baker University of Texas at Arlington Dhruv Grewal A. Parasuraman University of Miami The study reported here examines how combinations of specific elements in the retail store environment influence consumers' inferences about merchandise and service quality and discusses the extent to which these inferences mediate the influence of the store environment on store image. Results show that ambient and social elements in the store environment provide cues that consumers use for their quality inferences. In addition, store environment, merchandise quality, and service quality were posited to be antecedents of store image--with the latter two serving as mediators--rather than components of store image (as they are typically treated in the store image literature). Theoretical and managerial implications of the findings are discussed, and future research directions are proposed. Retailers facing an increasingly competitive market- place are finding it more difficult to differentiate their stores solely on the basis of merchandise, price, promotion, or location. The store itself, however, can offer a unique atmosphere, or environment, that may influence the con- sumer's patronage decision (Kotler 1973). Consumers in- teract with retailing environments during virtually all household purchases they make (Sarel 1981), and many consumers make decisions at the point of purchase (Keller 1987). Thus, in-store elements such as color, lighting, style, or music may have more immediate effects on deci- sion making than other marketing inputs that are not pre- Journal of the Academy of Marketing Science. Volume 22, No. 4, pages 328-339. Copyright 9 1994 by Academy of Marketing Science. sent at the point of purchase (e.g., advertising). A key role store environment plays is to provide informational cues to customers about merchandise and service quality (Gard- ner and Siomkos 1985; Olson 1977; Zeithaml 1988). Store environment has also been found to be one of several inputs into the consumer's global store image, or overall attitude toward the store (e.g., Lindquist 1974; Darden, Erdem, and Darden 1983; Zimmer and Golden 1988). Furthermore, store image is an important part of the store choice decision (e.g., Stanley and Sewall 1976; Nevin and Houston 1980; Malhotra 1983). Darden, Ordem, and Darden (1983) found that consumers' beliefs about the physical attractiveness of a store had a higher correlation with patronage intentions than did merchandise quality, general price level, or selection. The store image literature also treats merchandise qual- ity and service quality as key variables influencing store image (e.g., Hildebrandt 1988; Mazursky and Jacoby 1986). Additionally, merchandise and service quality evaluations are critical inputs to the consumers' decision- making process (Dodds, Monroe, and Grewal 1991; Zeithaml 1988). Thus the literature suggests that there are linkages between store environment, merchandise and service quality, and store image. We propose that these linkages are established through the process of inference making. In particular, we posit that consumers make infer- ences about merchandise and service quality based on store environment factors and that these inferences, in turn, influence store image. The inference-making perspective is consistent with Mazursky and Jacoby's (1986, p. 147) definition of store image that has been adopted for this study: "a cognition and/or affect (or a set of cognitions and/or affects), which is (are) inferred, either from a set of ongoing perceptions and/or memory inputs attaching to a phenomenon (i.e., either an object or event such as a store,