CONSUMER BEHAVIOR IN RESTAURANT

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School of Management and

Entrepreneurship

INSTITUTE FOR INTERNATIONAL MANAGEMENT AND TECHNOLOGY

Introduction to Research MethodsAssignment 1

CONSUMER BEHAVIOR IN RESTAURANT

Semester – 2Academic Year 2011-12

Teaching TeamDr. Tanuja Kaushik (Module Leader)

Mr. Gaurav Tripathi

Submitted By:

Sachin Kumar (PGDM)

[email protected]

mailto:[email protected]

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www.sachingahlaut.webs.com

Executive summary

This report is talks about the consumer behavior in restaurants and reason for the failure of

restaurants.

This report talks about the satisfaction and the quality of the food or services providing by the

restaurants and how they can improve their quality to satisfy their customers.

This report starts with introduction and literature review which I did with the help of various

articles.

Literature review discusses the view point of authors regarding restaurants and then later in the

report I have written the complete information of respondents like gender, education,

occupation and etc. Then after I applied hypothesis test which shows my null hypothesis has

been rejected or accepted and my discussion is based on that. This report ends with my

conclusion and recommendations.

http://www.sachingahlaut.webs.com/

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Consumer Behavior in Restaurants:

Objective

To find out the changing taste of the customer with emerging food chains.

To find out the reasons that restaurants fail.

To find out the common denominators of restaurants.

Research design:

I have chosen descriptive research in which I will do the research on the basic of article and

research paper which I have collected from various sources and I will also do a survey through

questionnaires and will try to find out the changing taste of customer and reasons of restaurant

failure. I will also find out the consumer behavior in restaurant.

Sampling Design:

1. Target Population:

The target population from which I will collect the sample would be from college students,

people from business as well as service class and from faculty members about their taste.

These people can belong to any income-group, age group, occupation and profession.

i. Elements- both sex unisex (Male/ Female)

ii. Sampling Units- person between the age of 20 to 40

iii. Geographical Region- Gurgaon (IIMT Campus)

iv. Time- January to February 2012

2. Frame of Sampling

The data would be collected from the IIMT students as well as Faculty.

3. Techniques of Sampling

The Stratified Sampling Technique is used to collect the data.

4. Size of Sample

In this research a sample size of 30 respondents is to be taken.

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Introduction

Restaurant is a French word which means “to restore”- a place where we are restored to

strength and vigor refueling, as it were, with food.

“A successful restaurant makes everything in it, including the patrons, seem a little better

than they are.” (Cooley, M. 2001). Restaurant is a place where the people is buying their

basic need food and comes for the entertainment, reputation, good atmosphere and the best

quality of food.

The basic need of human is hunger. The human body needs food for energy and sustenance.

So that people is buying food from a fancy restaurant or a normal stall based on their

budget.

Convenience is also a factor that forces people to eat out. Many people, who don’t have time

to prepare food at home, find restaurant convenient. There are restaurants that cater to all

segments of society.

Social occasions are also a great reason why people eat food in restaurant. Businessman may

want to think of their families to celebrate birthday, anniversaries, religious festivals etc. in a

specialty restaurant.

Entertainment is a great reason to eat out. That is why restaurants go beyond food and

provide costumes, showmanship and music to create an amusing environment. Night club

and some specialty restaurants provide sheer entertainment.

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Literature Review-

According to Srinivasan, S., service economy is booming @ 55% in India and more is the

customer demand at economic rates because of changing external environment awareness.

He considered many researchers like Schemenner and verma in this paper. This paper talks

about shift in efficiency and also gives many provisions in this regard. (Srinivasan, S.,

2006)

The research shows that many attempts have been made to examine customer perception

about organic food available at a restaurant. The report also comprises of the factors

responsible for declining preference of the customer for the organic food. The research

concludes that women are more interested in organic food than men and they buy organic

food more frequently than men (Davis et al., 1995). Education also plays an important role

in developing consumer attitudes towards the purchase of organic product (Lea & Worsley,

2005).

Dube et al. are saying that people with higher education have more positive attitude towards

the organic products as they are more aware about the products. The purchase of organic

goods in the restaurant also depends on the income level of the consumers. The people with

higher income are more likely to purchase organic products and they have more positive

attitude. The satisfaction level of the customers also determines their attitude towards the

product. If the consumer is highly satisfied they will buy the product again (Dube et al.

2005). The process of a restaurant starts with the client when he places his order. The

service environment plays an important role in customer satisfaction. Many restaurants play

soothing music for the entertainment of its customers; many restaurants have a great

ambience which attracts the customer. The environment within the restaurant plays a very

important role in attraction and satisfaction of the customers (Yalch & Spangenberg,

1995).

Knutson et al. presents findings from a survey of 85 seniors regarding the important things

that customers consider in selecting a restaurant. He researched that two factors, Experience

and incentives are two attributes that are judges on factor and discriminate analysis. To

conclude, he also gave few implications. (Knutson, B., Beck, J. et al., 2006)

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In research done by Stevens et al., he mentioned about a reliable questionnaire called

‘Dineserv’ to know the feedback of customers visiting any restaurant. This gives an insight

about what a customer wants and what standards to be maintained and how should a

restaurant operator determine for satisfying the hidden needs of guests. (Stevens, p.,

Knutson, B., et al. 1995)

According to Vanniarajan, T., research done on increasing craze for restaurant services, he

mentions about increasing income, urbanization effect and availability of easy transport and

communication facilities in recent years. But this also creates a competitive market in food

service and forced restaurants to maintain quality and standards for a high-level customer

experience and a continuous quality improvement. This paper therefore discussed the

quality attributes considering the study done by graduate students. He concluded about five

important DINESERV variables that make it possible. (vanniarajan, T., 2009)

According to various studies, aroma helps in changing human’s behavior and their

emotions. It can change human mood into another mood. It is also help full not making

consumer hyper at a time.(Gue´guen, N., and Petr, C., 2005) Customer satisfaction is

closely related to the customer expectations if the services able to full fill the expectations

that means they have did their job.(Farhana, N. and Islam, S., 2011)

According to Rasli, A. Main work for any restaurants with providing quality food is that

customer satisfaction. Satisfaction leads to success and attracts more and more customers.

Satisfaction is strongly related with quality. If the owner of restraints or any hotel provides

services with quality it automatically satisfied their customers. For that service provider

should check service quality measurement timely to know the level of quality they are

providing and it will also help to do some changes regarding quality improvement and it

also increase the customer’s level of satisfaction and encourage customers to come again.

(Rasli, A. 2011)

Verma, R., Pullman, E. and Goodale, J. have done extensive literature survey and found that

case analysis of Food – Court operations at Chicago’s O’Hare, one of the largest and busiest

international airport terminals. Food services are mostly preference three language groups

which are English, Japanese and Spanish. The discrete choice analysis process is using

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different hypothetical changes for the four restaurants operating in the terminal’s food court.

Customer always chose the combinations feature that they want the most and expansions in

the menus, particularly the addition of menu item. Employee is always doing interaction

with customer, reliability and speed of completing transaction. Product is covering tangible

items such as building design, printed materials, employee appearance, cleanliness levels

and branding variety. According to Clark, cross national studies are very important in

international market settings because of national difference exist, difference can be observed

and difference significant bearing on both consumer behavior and strategic decision markets

firms. (Verma, R, Pullman, E and Goodale, J., 1999)

Goyal, A. and Singh, N.P. have done the research and found that the purpose of paper seeks

are to estimating important of various factors which is affecting the choice of fast food by

Indian young customers. Goyel, A. is analysis the consumption patterns like impact of

hygiene, nutritional values and rating of various attributes of McDonald’s and Nirula’s. The

Indian young customer are having a passion for visiting fast food for fun and change but

home foods are the first choice. Because they has highest nutritional values followed by

ambience and hygiene. McDonald’s have the higher score in rating differs significantly on

the seven attributes accepts “variety”. Customer is feeling that fast food is providing

additional information on nutritional values and hygiene conditions inside kitchen but fast

food is mainly focus on quality and variety of food beside the others service. There is a need

to communicate the young consumers about the hygiene and nutrition value of fast food

which is helping trust in the food provided by fast food players.(Goyal, A. and Singh, N.P.,

2007)

Markovic, S., Raspor, S. and segaric, K. have done the study on restaurant service quality.

They have the same aims which are: (a) difference between perceived and expected service

quality, (b) assess customers’ expectations and perceptions, (c) identify the number of

dimensions for expectations and perceptions scales of modified DineServ model and (d) test

the reliability of the applied DineServ Model.

They are saying after study that perception scores are lower than expectations, its means low

level of service quality. Seven factors are telling about best explain customers’ expectations

and two factors are telling about best explain customers’ perceptions regarding restaurant

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service. This case study is helping to indentify the strengths and weakness of service quality

and implement an effective strategy to meet the customers’ expectations. The most prospect

items were “accurate bill”, Clean rest rooms”, “clean, neat and dressed staff” and clean

dining areas” which is wrong under the dimensions reliability and tangibles.(Markovic, S.,

Raspor, S. and segaric, K., 2010)

Data Analysis:

Respondent Profile:

Female57%

Male43%

Gender

This survey is showing that there are 57% female respondents and 43% male respondents. The elements of this survey are both sex unisex male and female. The majority of female respondents are more than the male respondents and the respondents are not equal.

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Below 3053%

30-4040%

40-507%

Age

The survey shows that 53% respondents are at below 30 years age group and 40% respondents are at 30-40 years age group and 7% respondents are at 40-50 years age group.

Graduate27%

Post Graduate40%

Professionally Quali-fied33%

Education

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The survey shows that only 27% respondents are graduate, who 50% graduates are having

the knowledge regarding the specific food and 50% respondents don’t know. 40%

respondents are post graduate, who 54% respondents are having the knowledge regarding the

specific food and 46% respondents are not having the knowledge regarding the specific food.

33% respondents are professionally qualified, who 43% respondents are having the

knowledge regarding the specific food and 57 % respondents are not having the knowledge

regarding the specific food.

Yes50%

No50%

Knowledge regarding the specific food

The survey shows that 50 % respondents are know about the traditional cultural- specific food of the ethnic tribes depicted at IIMT’s restaurant and 50% respondents are not know about this. All questionnaires fill up by IIMT students and faculty. The survey has done in IIMT campus.

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Service20%

Food Quality57%

Ambience10%

Menu7% Price

7%

Factors like more in the Restaurant

The survey shows that 56% respondents are like Food quality in the IIMT Restaurant because

restaurant is providing food, if food quality is not good customer will not go again in the

restaurant. 20% respondents are like service. 7 % respondents are like price of food. 7%

respondents are like menu. Only 10 % respondents are like ambience. The survey is telling

about that more than 50 % customer are going for quality of food.

Hypothesis:

Null Hypothesis

H0: µi ≤ 4, where “i” is the variable that keeps on changing.

Alternate Hypothesis

H1: µi > 4, it means that scale is statistically significant.

NOTE: Here i= 1 to 22. It is the index no. for the scale items given in the questionnaire.

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The questionnaire is based on 7 point scale ranging from

1- Highly disagree

2- Disagree

3- Slightly disagree

4- Indifferent or Neutral

5- Slightly agree

6- Agree

7- Highly Agree

For Hypothesis T-Test has been considered; this is due to the sample size and the sample

size in this paper is 30 and T-test is used, where the sample size is 30 or less than 30.

T-test has been calculated on the basis of:

T-calc. = (Average- neutral value)/ (S.D./sqrt (n))

For calculating T-tabulated we assumed that the value of the level of significance is 0.05 and

the degree of freedom is 29. In this case total respondents are 30 and the calculation of

degree of freedom is (n-1) i.e. (30-1 =29).

Result:

T-calc.> T-tab

Null hypothesis is rejected

T-calc. < T-tab

Null Hypothesis is accepted

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S No Null

Hypothesis

Alternative

Hypothesis

T-cal. T-tab .Comparison

between T-calc. and

T-Tab.

Decisions

1. µ1<=3 µ1>3 0.8105 0.6830 T-calc.<T-tab Accept











12 µ12<=3 µ12>3 6.5297 0.6830 T-calc.<T-tab Accept






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The subscript (1-22) is the indicator for statement 1-22 in the questions.

In this tables T-calc. > T-tab. Value is showing that null hypothesis (H0) has been rejected

and T-Calc. < T-tab. Value is showing that alternate hypothesis (H1) is accepted. Five of

statements in the questionnaire are related to menu. Five of statements in the questionnaire

are related to food taste, quality, Temperature. According to this survey all questionnaire are

accepted. Its means respondents are satisfy with the food quality, service, ambience, price

etc.

Chi Square Test:

H0:- Knowledge regarding the specific food is independent of education

H1:- Knowledge regarding the specific food is not independent of education

I have applied the chi square test on the basic of questionnaire. Chi square test is used for know the relationship between two factor. The questionnaire has two questions on the education and Knowledge regarding the specific food. I fill up that question in IIMT campus. The survey shows that 50% respondents know about the specific food in IIMT restaurant and 50% respondents don’t know about any specific food. Graduate respondent are 50%, who have knowledge about specific food. Post graduate are 54%, who have knowledge about specific food. Professionally Qualified are 43 %, who knowledge about the specific food.

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X2 Cal > X2 tab

Null hypothesis is rejected

X2 Cal < X2 tab

Null Hypothesis is accepted

X2 Cal = 0.209

α = 0.05

X2 tab = 5.990

Comparison between T-calc. and T-Tab. = X2 Cal < X2 tab

Decision is accept.

Conclusion of Chi Square Test: - there is no relationship between Education and Knowledge regarding the specific food which means Knowledge regarding the specific food is independent of education.

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Conclusion:

In the restaurant, the most important factor is food quality. The survey shows that mostly

customer are going for food quality in restaurant. Second important factor is service. After

the food quality customer are going for good service. The entire five star hotel restaurants are

giving good service. The most important factor of restaurant failure is food quality and

service. Restaurant is gaining profit which is giving good food quality, service, ambience,

menu item, and price. IIMT restaurant is giving good customer satisfactions.

Recommendations:

Limitation: It is not possible to collect the data from whole region as sample size is small so only

preference to be given to Gurgaon.

Lack of chances of mistakes.

Respondents don’t have a time to read the full questionnaire as they fill it randomly.

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Goyal, A., Singh, N. (2007), ‘Consumer perception about fast food in India:an exploratory study’ British Food Journal, 109:2, pp. 182-195. (Online) (cited 21th January 2012). Accessed from <URL: www.emeraldinsight.com/0007-070X.htm>

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Markovic, S., Raspor, S. et al (2010), DOES RESTAURANT PERFORMANCE MEET CUSTOMERS’ EXPECTATIONS? AN ASSESSMENT OF RESTAURANT SERVICE QUALITY USING A MODIFIED DINESERV APPROACH’ Tourism and Hospitality Management,16:2, pp.181-195. (Online) (cited 9th march 2012). Accessed from <URL:hrcak.srce.hr/file/93311>

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APPENDIX:

Questionnaire: Dear respondent, I, Sachin Kumar, want you to fill this questionnaire on “Consumer Behavior in IIMT Restaurants”. Please give your valuable time.

Personal Details

Gender: Male Female

Age: Below 30 30-40 40-50 above 50

Education: Graduate Post Graduate Professionally Qualified

Occupation: Business Student Professional Housewife Government Service Retired

Yearly [family] income: Below 4 lakhs 4 lakhs to 8 lakhs above 8 lakhs

1. Which of the following factors you like more in this restaurant?

Service Food Quality Ambience Menu Price

Other ………………..

2. Do you have any knowledge regarding the traditional cultural-specific food of the ethnic tribes depicted at IIMT’s Restaurant?

Yes No

3. Do you have any knowledge regarding the traditional cultural-specific food of other tribes or nationalities?

Yes No

If Yes please specify……………………

4. How satisfied are you with the whole meal experience offered at IIMT’s Restaurant?Totally dissatisfied dissatisfied neutralSatisfied totally satisfied

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The following set of statements relate to your opinions about the Restaurant. Please show the extent to which you think the Restaurant possess the features described by each statement by ticking one of the seven numbers next to each statement. If you agree to the maximum, please tick 7, and if you agree the minimum please tick 1. 1- Highly disagree,

2- Disagree, 3- Slightly disagree, 4- Indifferent or Neutral, 5- Slightly agree 6- Agree, 7- Highly Agree

5. A complete traditional menu 1 2 3 4 5 6 76.menu with some traditional dishes 1 2 3 4 5 6 77.A menu with traditional ingredients prepared in a western manner 1 2 3 4 5 6 78.The current menu 1 2 3 4 5 6 79.Presentation or appearance 1 2 3 4 5 6 710.Taste of the food 1 2 3 4 5 6 711.Temperature of the food 1 2 3 4 5 6 712.Menu item variety 1 2 3 4 5 6 713.Food quality 1 2 3 4 5 6 714.Authenticity of the food 1 2 3 4 5 6 715.Friendly, polite and helpful staff 1 2 3 4 5 6 716.Attentive staff 1 2 3 4 5 6 717.Efficient service 1 2 3 4 5 6 718.Staff have food and beverage knowledge 1 2 3 4 5 6 719.Staff have culinary heritage knowledge 1 2 3 4 5 6 720.Sympathetic handling of complaints 1 2 3 4 5 6 721.Restaurant’s temperature 1 2 3 4 5 6 722.Restaurant’s appearance 1 2 3 4 5 6 723.Décor (Table setting, crockery and cutlery) 1 2 3 4 5 6 724.Staff appearance 1 2 3 4 5 6 725.General excitement a place generates 1 2 3 4 5 6 726.Music 1 2 3 4 5 6 7

Thank you very much for your participation and for completing the “dining meal experience” questionnaire.Your participation and time are greatly appreciated.