Connecting nature with luxury service

Abstract

AbstractMany service and retail facilities, such as hotels, restaurants, hospitals, and airports, are incorporating nature elements into their building design. Individuals' affinity for nature is called biophilia. The literature on biophilic design heavily focuses on the restorative effects of biophilic design on the facility users, leaving many other effects under‐investigated. In particular, biophilic design implementation requires significant financial investment, thus, whether biophilic design can bring financial returns from consumers would be of interest to practitioners. This study investigates whether biophilic design attributes are linked to consumers’ willingness to pay a price premium (WTPP). Two pretests show that when biophilic attributes are moderately implemented, they can elevate aesthetic and attractiveness perceptions, but this effect tapers off if the implementation is excessive. Through three between‐subjects main experiments, this study confirms that WTPP is enhanced via increased aesthetic value and luxury perceptions when biophilic attributes are present (vs. absent—Studies 1 and 2), but this serial mediation is moderated by biophilic scarcity (low vs. high—Study 3). An adequate level of nature elements, when implemented in biophilic‐scarce areas, can improve customers' perceptions of aesthetic value and luxury. This, in turn, improves customers' WTPP for the service.