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Claudia Höck*
Institute for Marketing and Media,
University of Hamburg,
Von-Melle-Park 5, 20146 Hamburg, Germany
E-mail: claudiahoeck@econ.uni-hamburg.de
*Corresponding author
Christian M. Ringle
Institute for Industrial Management and Organisations,
University of Hamburg,
Von-Melle-Park 5, 20146 Hamburg, Germany
and
Centre for Management and Organisation Studies (CMOS),
University of Technology Sydney (UTS), Sydney, Australia
E-mail: cringle@econ.uni-hamburg.de
Marko Sarstedt
Institute for Market-Based Management,
University of Munich, Kaulbachstr. 45 / I,
80539 Munich, Germany
E-mail: sarstedt@bwl.lmu.de
Reference to this paper should be made as follows: Höck, C., Ringle, C.M. and
Sarstedt, M. (2010) ‘Management of multi-purpose stadiums: importance and
performance measurement of service interfaces’, Int. J. Services Technology
and Management, Vol. 14, Nos. 2/3, pp.188–207.
Christian M. Ringle is Full Professor and the Acting Head of the Institute for
Industrial Management and Organisations at the Faculty of Business,
Economics and Social Sciences of the University of Hamburg and is a Senior
Research Fellow at the Centre for Management and Organisation Studies
(CMOS) of the University of Technology Sydney (UTS). His researches mainly
focus on strategic management and related fields such as production
management, organisations and marketing. He focuses specifically on the
success factors of strategic alliances, (local) enterprise networks and virtual
organisations. Moreover, he is the Managing Director of the SmartPLS
software (www.smartpls.de).
1 Introduction
With the ever increasing growth of the sport business sector’s importance over the last
few years, the need has emerged to urgently turn professional sports clubs into corporate
businesses (Desbores, 2007). Consequently, sport clubs pay increasing attention to the
range of service they can offer with regard to the best business development
opportunities. Arenas or stadiums play a major role in such potential development
opportunities. The optimisation of this resource started with soccer clubs offering
business customers targeted services. Since then, mass customers have also been
addressed by means of new services designed to encourage them to visit the stadium
more often and to make use of the related facilities (Guenzi, 2007). By enlarging the
range of services provided in and outside the stadium, sport clubs have become multi-
service companies. In the course of this development, the last few decades have seen
traditional sports venues, such as indoor sports sites, replaced with modern event centres
in numerous cities worldwide (Siegfried and Zimbalist, 2000). These multi-purpose
stadiums provide room for large events of any kind. By offering a comprehensive food
and beverage service as well as an expanded collateral program, they evoke the character
of leisure-oriented venues.
In contrast to soccer stadiums, which are primarily supported by municipal or local
governments, the majority of these multi-purpose stadiums are privately financed.
Consequently, it is imperative for the operating and marketing concept to be designed and
implemented in a profit-oriented manner. Frequent and continuous utilisation by the
primary tenant (e.g., a sport association) and an offer of top events in the fields of culture,
sports, music and entertainment constitute the essential parameters of a stadium’s
190 C. Höck et al.
economic success. From the stadium operator’s viewpoint, visitor potential can only be
exploited if the stadium offers a large number and broad variety of events which
increases proceeds from ticket sales or advertisements or the allocation of broadcasting
rights. Furthermore, utilisation is affected by the attendance figures at events, as defined
by the indirect network effects concept (Katz and Shapiro, 1985). An important
determinant of attendance is customer satisfaction (Greenwell et al., 2006), which
mediates the relationship between service quality and behavioural intentions (e.g.,
Anderson and Sullivan, 1993). Specifically, customers’ evaluations of service quality
have influenced emotional satisfaction assessments and in turn, specific behaviours such
as customer loyalty (e.g., Fornell et al., 1996), customer retention (e.g., Garbarino and
Johnson, 1999), willingness to pay (Homburg et al., 2005) and price tolerance (Anderson,
1996). Stadium operators’ primary interest should therefore be to increase attendees’
satisfaction by improving the perceived service value (Gudergan and Ellis, 2007) so that
visitors are willing to attend events regularly and recommend visiting the stadium to
other persons.
Knowledge about visitor satisfaction and its determining factors is consequently of
fundamental significance for operating companies. Despite its apparent importance,
research literature on this subject is very scarce. There are only a few studies in the sport
management research field that assess a sports facility’s ability to influence customers’
attendance or attendance intentions. Wakefield et al. (1996), for example, show that a
stadium’s physical characteristics can influence attendees’ desire to frequent it. This
study’s result is in line with a wide array of marketing literature that investigates the
physical environment’s effects on consumers’ cognitive and affective reactions and in
turn, their influence on consumer behaviour (e.g., Donovan and Rossiter, 1982; Spies et
al., 1997). Wakefield and Sloan (1995) and Hill and Green (2000) reveal that attendees’
perceptions of the sportscape significantly affect their desire to attend events.
Whereas these studies solely aim at evaluating attendance effects, Greenwell et al.
(2006) present a first evaluation of the influence of a sports facility’s characteristics on
customer satisfaction. In their study, the authors show that both the perceptions of service
personnel and the physical facility contribute to minor league ice hockey spectators’
satisfaction. However, Greenwell et al. (2006) limit their analysis to ‘traditional’ sport
stadiums, which differ materially from leisure-oriented multi-purpose stadiums in terms
of physical appearance and services offered. In addition, the authors’ approach to
measuring the perceptions of the physical facility and the service personnel suffers from
methodological flaws, as they disregard the epistemic nature of the relationships
between constructs and their measures. These constructs are specified according to
Churchill’s (1979) domain-sampling paradigm, in which an original item pool is
purified using different techniques (such as Cronbach’s α) to verify the reliability and
validity of the measures. Even though this approach is consistent with numerous scale
development approaches in marketing (e.g., Kohli and Jaworski, 1990), it is only valid
for reflectively measured constructs. In a reflective measurement approach, indicators are
regarded as functions of the latent variable, whereby changes in the latent variable are
reflected in changes in all associated manifest variables. Conversely, formative indicators
are assumed to cause a latent variable. That is, changes in the indicators evoke changes in
the latent variable’s value (Bollen, 1989; Bollen, and Lennox, 1991). The choice
of a measurement perspective leads to multi-item measures that differ materially in
terms of content, parsimony and criterion validity (Diamantopoulos and Siguaw,
2006) and is therefore critical when measuring a complex construct with multi-item
Management of multi-purpose stadiums 191
service offer could be visitors telling their friends about their experience (in this case, a
positive experience at the stadium) which, in turn, leads to the stadium acquiring new
visitors (Anderson et al., 1994).
Several approaches that are generally divided into objective and subjective procedures –
have been advanced for measuring satisfaction during the last few years. Objective
measuring procedures use indicators such as the number of units sold and/or a company’s
market share to draw conclusions regarding customers’ satisfaction with services. These
kinds of criteria are often difficult to obtain in particular analytical settings and do not
allow for precise conclusions due to such indicators’ numerous determinants. Therefore,
subjective measuring procedures are generally used for satisfaction studies. This study
draws on an explicit feature-oriented type of subjective measuring procedure which is
based on individual satisfaction assessments rated on a ranking scale. In accordance with
service delivery’s multi-stage process, respondents rate different service encounters in the
course of an ex-post analysis.
Consequently, a detailed analysis is required of the service delivery process in
multi-purpose stadiums for a subsequent evaluation of the satisfaction with each service
element. The aim of such studies is to extract and analyse all potential contact points and
related activities that the customer experiences over the course of the encounter (Bitner,
1993). This approach considers the aforementioned service delivery’s multi-stage
character adequately (Danaher and Mattsson, 1994). Using a direct observation technique
(Aaker et al., 2007), we were able to trace a typical stadium visitor’s encounters with
service delivery. We did not, however, limit the observation to the time the visitor spends
in the stadium (‘attendance in the more narrow sense’). Rather, this research analyses the
upstream and downstream of partial service interface interactions that accompany
attendance.
Figure 1 indicates the sequence of typical visitor’s service encounters when attending
an event. This kind of systematic approach includes all relevant processes and
interactions with service interfaces that occur during the experience including travel to
and return from the stadium. The processes of searching for information and purchasing
tickets are not considered because these activities frequently occur long before the visit to
the stadium. It may also be assumed that, at best, they have a minimum impact on the
satisfaction assessment after the event. We also need to underline that in the sense of
‘attendance in the more narrow sense’, the three encounters may be traversed several
times in some instances and not always in a specific sequence. It is possible, for example,
to use food and beverage services before, during and after the event.
Even though the analysis of the service delivery process allows the potential drivers
of overall satisfaction to be identified, the definition of these drivers is much too abstract
to allow for a suitable measurement. Consequently, we needed to identify relevant
indicators to operationalise visitor satisfaction with the different stages of the process (de
Ruyter et al., 1997). These indicators would then be integrated into a structural equation
model’s measurement models in order to analyse each service’s influence on satisfaction
with the stadium. An elementary requirement for conducting such an analysis is
formulating a consistent set of hypotheses. The process of formulating hypotheses means
including both the cause-effect relationships between non-observable (latent) variables
194 C. Höck et al.
and between latent variables and observable indicators. Formulating these relationships
allows a particular latent variable to be measured sensibly and logically in terms of the
issue under investigation.
In line with de Ruyter et al. (1997) and Danaher and Mattsson (1994), indicators were
selected, each referring to emotional (E), practical (P), and logical (L) aspects of the visit.
Emotional criteria refer to visitors’ feelings during the various service encounters.
Conversely, the rational aspects of a partial process cover practical features as well as
technical/functional and logical criteria. Given the multiple layer nature of individual
encounters, several practical and logical indicators will be considered case by case.
1 Travel to stadium
2 Arrival at stadium
Our study addresses the two primary means of transportation (arrival via public
transportation and arrival via car) to measure satisfaction with travel to and departure
from the stadium (phases 1 and 7). The two modes of transportation therefore needed to
be evaluated separately in terms of (L) accessibility. We also captured satisfaction with
direction signs (L) and the availability of parking spaces (P). In this respect, we waived
capturing an emotional component as there is no contact with the companies providing
the service or with other visitors.
H1 The indicators ‘direction signs to stadium’ [SSIGNS], ‘availability of parking spaces’
[PARK], ‘accessibility via car’ [CAR] and ‘accessibility via public transportation’
[PTRAN] have a positive influence on satisfaction with conditions related to
transportation to and from the stadium [accessibility].
We recorded visitor contact with security personnel during periods of arrival at and
leaving, the stadium (phases 2 and 6), i.e., their presence, in terms of an emotional value
Management of multi-purpose stadiums 195
contribution. We likewise evaluated satisfaction with the direction signs that provide
orientation outside the stadium (L), the general physical external appearance and the
external facilities (P):
H2 The indicators ‘appearance of the stadium’ [S_APPEAR], ‘quality of exterior
facilities’ [S_EXTFAC], ‘external direction signs’ [S_EXTSIG,] and ‘availability of
security services’ [S_SECURI] have a positive influence on satisfaction with
conditions related to arrival at and departure from the stadium [stadium (exterior)].
The atmosphere and emotional components come into play again inside the stadium
(phase 3). This phase is characterised by several heterogeneous service features. We
consequently considered three logical and practical/functional criteria related to the
temperature in the concourses, the number of cloakrooms and restrooms (L) as well as
interior design, cleanliness and seating comfort (P):
H3 The indicators ‘atmosphere in the stadium’ [S_ATMOSP], ‘temperature in the
concourses’ [S_CONCOU], ‘number of wardrobes’ [S_WARDRO], ‘number of
restrooms’ [S_RESTRM], ‘interior design’ [S_INTER], ‘cleanliness’ [S_CLEAN]
and ‘seating comfort’ [S_SEAT] have a positive influence on the stay in the stadium
[stadium (interior)].
The quality features friendliness of personnel (E), selection of food and beverages (L)
and their quality (P) operationalise food and beverage services (phase 4). We likewise
considered cleanliness as an additional practical/functional aspect.
H4 The indicators ‘selection of food and beverages’ [FB_SELECT], ‘quality of food and
beverages’ [FB_QUAL], ‘cleanliness’ [FB_CLEAN] and ‘availability and
friendliness of food and beverage services personnel’ [FB_PERSO] have a positive
impact on visitor satisfaction with food and beverage services [food & beverage
services].
The event itself (phase 5) is just as important as the stay in the stadium. The event is
evaluated by means of the atmosphere (E). Acoustics and view, two logical criteria, are
considered the core service, i.e., the actual presented event:
H5 The indicators ‘acoustics’ [EV_ACOUST], ‘atmosphere of the event’ [EV_ATMO],
‘presentation’ [EV_PRESEN] and ‘view” [EV_VIEW] have a positive impact on
visitor satisfaction with the event [event].
In accordance with our research approach, we assume that satisfaction with individual
phases determines the transaction-specific overall satisfaction with attendance of an
event.
H6 The exogenous latent variables transportation to and from the stadium [accessibility],
arrival at and departure from the stadium [stadium (exterior)], stay in the stadium
[stadium (interior)], food and beverage services [food and beverage services] and
event [event] have a positive impact on visitor satisfaction [visitor satisfaction].
Statements by interviewees regarding their overall satisfaction with their visit to the
stadium, their intention to recommend the venue to friends and their intention to visit the
stadium again serve as indicators to determine the construct ‘visitor satisfaction’. This
operationalisation allows for a simultaneous assessment of visitor satisfaction and
reaction by means of their behavioural intentions.
196 C. Höck et al.
al., 2009; Lohmöller, 1989). Drawing on the findings of comparisons of both approaches
by, for example, Lohmöller (1989), we chose to apply the PLS approach to model
estimation because its formal premises embody a greater range of flexible applications.
Moreover, the objective of our analysis was to determine the impact of latent success
factors that can be measured by formative measurement models. The PLS approach
emerged as more suitable in this regard.
0.343
FB_SELECT
0.270
FB_PERSO food & stadium
beverage (interior)
FB_QUAL 0.083
services
FB_CLEAN 0.518
0.120 0.333
0.286
EV_ACOUST
0.899 OV_RECOM
0.501
EV_ATMO 0.154 visitor
0.834
event satisfaction OV_STAD
EV_PRESEN R²=0.485
0.125
0.842 OV_AGAIN
EV_VIEW 0.381
0.189
0.095
0.313
SSIGNS
0.285 stadium
PTRAN
accessibility (exterior)
PARK 0.293
The statistical software application SmartPLS 2.0 (Ringle et al., 2005) was used to
compute the PLS path model. Figure 2 illustrates the path model under consideration, the
path coefficients’ values as well as the R² value of the endogenous latent variable ‘visitor
satisfaction’. Based on the rationale presented above, the exogenous latent variables are
operationalised formatively. In contrast, the three indicators gained in respect of ‘visitor
satisfaction’ were identified as exchangeable indications of their underlying construct and
were thus treated reflectively.
Within the scope of structural equation modelling, model assessment requires
researchers to assess the reliability and validity of the measures used. Given the lack of
global goodness-of-fit measures in PLS path modelling, Chin (1998) put forward a
catalogue of non-parametric criteria to assess partial model structures. A systematic
198 C. Höck et al.
application of these criteria requires a two-step process (Henseler et al., 2009). First of
all, model assessment focuses on the measurement models. A systematic evaluation of the
PLS estimates reveals the measurement reliability and validity based on certain decisive
factors which are specifically associated with the formative or reflective outer mode.
Only if the computed latent variable scores show evidence of sufficient reliability and
validity is it worth pursuing the evaluation of inner path model estimates. This
assessment also includes the predictive power of the PLS path model. The PLS path
model evaluation steps are:
1 outer model (measurement model) evaluation with regard to the reflective constructs’
reliability and validity or the reflective constructs’ validity
2 inner model (structural model) evaluation in respect of variance accounted for, path
estimates and the predictive relevance of the inner model’s explanatory variables for
the endogenous latent variable.
where ξi is the specific exogenous latent variable i in the inner model; E[.], min[.] and
max[.] representing these variables’ expected minimum and maximum value. The
minimum and the maximum values are determined using the associated measurement
model’s manifest variables:
ni
min [ξi ] = ∑w
j =1
ij ⋅ min ⎡⎣ xij ⎤⎦ , (2)
or
ni
max [ξi ] = ∑w
j =1
ij ⋅ max ⎡⎣ xij ⎤⎦ , (3)
where xij represents the j-th (j = 1,…,ni) manifest variable in the measurement model of a
specific latent variable ξi and wij indicates the associated estimate of the non-standardised
formative weights in the measurement model (Fornell et al., 1996). The mean value of all
latent variable values, readjusted as indicated above, finally results in the index value of
their performance expressed on a scale between 0 and 100 with the higher values
indicating a better result. Corresponding importance-performance analysis-related PLS
path model computations are integrated into the SmartPLS 2.0 software application
(Ringle et al., 2005), which was used for this study. Table 1 presents the index values of
the latent variables in the inner model and the exogenous latent variables’ total
effects (denoting direct effects in this specific case) on the endogenous latent variable
‘visitor satisfaction’.
Table 1 Index values and total effects
In keeping with this procedure, an index value of 81.272 results, for example, in respect
of the latent variable ‘event’. These additional results of the service interface performance
serve as a foundation for preparing the priority map. Figure 3 visualises the ‘performance
level’ of each exogenous latent variable along with its impact on the endogenous latent
variable. Management-oriented decisions are easily recognisable from this kind of
graphical representation. If, for example, the index value of the latent variable ‘stadium
(interior)’ increases by one unit, the index value of the endogenous latent variable ‘visitor
satisfaction’ should increase by 0.33 points in a (static) ceteris-paribus assessment of
results.
Management of multi-purpose stadiums 201
Figure 3 Importance-performance analysis (priority map) for ‘visitor satisfaction’ (see online
version for colours)
The performance-level results from manifest variables’ average value in exogenous latent
variables’ formative measurement models and the relative importance of their total effect
on the endogenous latent variable ‘visitor satisfaction’. A visual inspection of the map
reveals two groups of manifest variables as well as two outliers (‘S_ATMOSP’ and
‘FB_QUAL’). Owing to their increased relative importance, the service interfaces in
Group 1 and the outlier ‘S_ATMOSP’ have special relevance for the selection of
measures to increase visitor satisfaction. This result also reveals the emotional indicators’
dominance in respect of the service interfaces. The manifest variable ‘S_ATMOSP’ is by
far the most important performance measure of visitor satisfaction, already having a very
high performance value. Activities for increasing visitor satisfaction should nevertheless
aim at improving satisfaction, or at least at all costs avoiding a decline of the performance
dimension. The manifest variables ‘S_SECURI’, ‘S_CLEAN’, ‘S_APPEAR’ and
‘EV_ATMO’ are likewise of greater importance. All the remaining manifest variables are
still negligible in terms of their influence. Based on these analytical results, it is clear that
the atmosphere in the stadium itself is the most important driver of visitor satisfaction
with multi-purpose stadiums, followed by several criteria that, for example, relate to the
security personnel and/or the cleanliness of the stadium.
Orientation towards service interface performance and perceived service value leads to
visitor satisfaction and constitutes the central requirement for modern multi-purpose
stadiums’ long-term success. Our study identifies the relevant service factors that
influence visitor satisfaction with stadiums as based on a typical service delivery process
when attending an event. An analysis of this process by means of direct observation
allowed us to identify relevant relationships for a structural equation model analysis.
Management of multi-purpose stadiums 203
Using data from almost 2,500 visitors to a major German multi-purpose stadium, the
hypothesised relationships were subsequently tested by means of the PLS path modelling
approach. We identify the epistemic nature of the visitor satisfaction construct as being
formative (Gudergan et al., 2008) and, thus, find solutions for the methodological and
content-related problems in Greenwell et al.’s (2006) measurement model for visitor
satisfaction.
The model assessment substantiates the reliability and validity of the PLS path
modelling results. The empirical analysis provides support for our hypothesised
cause-effect relationships in the model. The presented theoretical concept explains
approximately 50% of visitor satisfaction with the analysed stadium. We enlisted the
importance-performance analysis procedure in order to extract differentiated information
in addition to the results obtained through a standard PLS analysis. Even though we have
been able to empirically confirm the hypothesised structural model, four relationships in
formative measurement models (‘temperature in the concourses’, ‘interior design’,
‘quality of food and beverages’ and ‘presentation’) do not exhibit empirical significance
for the particular stadium in this study.
The stadium’s interior design is the most important area of influence for visitor
satisfaction. Upon closer scrutiny of the pertinent indicators, it becomes evident that for
visitors to experience their chosen event in an atmosphere that appeals to them is of
predominant importance. In a similar manner, areas of lesser importance, i.e., ‘stadium
(exterior)’, ‘accessibility’, ‘food and beverage services’ and ‘event’, are dominated by
one or two indicator(s), with emotional criteria primarily having a major influence on
partial satisfactions. Surprisingly the stadium’s ‘accessibility’ as well as ‘food and
beverage services’ exert a comparatively low impact on visitor satisfaction. Apparently,
visitor needs in terms of traffic infrastructure and culinary preferences barely play a role
in visitor satisfaction with an event in the analysed multi-purpose stadium. The influence
of the event on visitor satisfaction is also rather low. The interviewees were apparently
aware that the quality of the actual performance did not fall within the stadium operator’s
scope of responsibility and consequently, did not consider this matter at all, or only to a
minor extent when evaluating their satisfaction with the venue. These results were further
scrutinised by investigating the impact of the measurement models’ manifest variables on
visitor satisfaction. According to our analysis, visitor satisfaction is primarily determined
by the atmosphere in the venue and the actual event itself, by the stadium’s exterior
appearance and cleanliness as well as the availability of security personnel.
Visitor satisfaction is a central element of the leisure industry’s success in general and
particularly of the management of event stadiums. The empirical analysis of our
theoretically deduced model helps to provide a first of a kind derivation of strategically
significant recommendations for stadium managers as based on a service performance
analysis. Linkage of the PLS path analysis method with the importance-performance
mapping technique clearly points to significant areas for improvement of management
activities. Given the exogenous latent variables’ formative operationalisation, this
technique for the management-oriented processing of a PLS analysis’s results is
particularly informative in the presented model set-up.
As in any empirical research, the results of this study cannot be interpreted without
taking the limitations of the study into account. Firstly, the study was restricted to the
evaluation of visitor satisfaction with regard to one multi-purpose stadium. Consequently,
future research should conduct similarly designed studies in cooperation with other
arenas and stadiums to generalise and deepen the results of our study for multi-purpose
204 C. Höck et al.
stadiums’ operating companies. This would allow for testing the measures’ test-retest
reliability and assess whether the few non-significant effects in the formative
measurement models only hold for the particular sample used. Secondly, the present
study did not account for the interviewees’ different usage rates, which would allow the
segmentation of the attendees’ behaviour. It is perfectly possible that the importance of
the various factors differ with regard to infrequent and frequent visitors to the stadium
due to, for example, habituation effects. Future research should therefore consider this
issue by segmenting the data along such behavioural variables’ values (Ringle et al.,
2010; Sarstedt and Ringle, 2010). Lastly, there is a general need for empirical research on
the leisure industry’s various sectors in which success factor research on service features
is assuming an important role. However, little attention has been paid to these sectors to
date in terms of the subject matter of our study. In this respect, the PLS methodology in
conjunction with index-oriented analyses will play an imperative role due to its flexible
applicability. Further research will provide managers with a clearer understanding of the
service experience components that have the greatest impact on customer satisfaction and
ultimately, on profitability.
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