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Expansion Trend of Fast Food Franchises in Metro Manila Chen, Mei-Liang, Lecturer, Department of International Business, Hsin Sheng College of Medical Care and Management, Taiwan Chen, Kuang-Jung, Professor, Department of Business Administration, Chihlee Institute of Technology, Taiwan Liu, Chu-Mei, Department of International Trade, Tamkang University, Taiwan ABSTRACT This study of late 2009 analyzes fast food buying behavior in Metro Manila and compares and contrasts the marketing’s four P’s of twelve fast food franchises. Fast food franchises dominate the food and beverage industry, and there are currently thirty-two thousand fast food restaurants in Metro Manila. The most commonly used promotion tools of these restaurants are window dressing, free delivery, and radio, TV, and flyer advertisings. The success of Manila’s fast food industry lies in its standard processes, limited menus, enhancement of values, speed, swift services, and distribution right. Fast food industry has successfully changed most people’s daily habits in many big cities. Nevertheless, fast food franchises are reluctant to develop in suburban areas. Regarding this, there is still plenty of room for fast food industry to expand in the Philippines. Keywords: Fast Food Industry; Influence Behavior; Markets; Marketing Strategies Filipinos are increasing into fast food, as the rapid expansion of fast food restaurants in Metro Manila can prove that. There are currently many newly opened fast food restaurants across Metro Manila and other major cities in the Philippines. Growth of population and changes in consumer behavior has facilitated the prosperity of fast food industry. In addition, influxes of population and changes in lifestyles such as preferences for leisure, convenience, and food-away-from-home, women’s changing role in the society, and the urbanization of families all contribute to the growth of fast food industry. Fast food industry builds upon two basic individual demands. From its model of franchise and product concepts, fast food industry will continue to grow. Being exposed to media advertisement, consumers’ dining habits have been changed. Furthermore, given the reasonable and affordable product prices, the increasing number of white-collar workers particularly white-collar women, whether single or married, young or old has boosted the demand for food service. Therefore, fast food industry can be said to develop upon the structural changes in working class and families. Statistics indicates that there are currently thirty-two thousand fast food restaurants in Metro Manila. However, the survey of consumer tendency in Metro Manila shows that profits of fast food franchises depend on product consumption frequencies. Most fast food franchises create profits by expanding branch stores. Obviously, there is still plenty of room for fast food industry to expand. Therefore, it is necessary for managements to apply effective management strategies for promotion programs. However, many enterprises are indifferent to whether or not advertisings or promotion strategies will facilitate their sales performances, despite the fact that integrating product, price, place, and promotion strategies into marketing mixes is a key process during decision-making. Given that fast

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Page 1: Expansion Trend of Fast Food Franchises in Metro Manila

Expansion Trend of Fast Food Franchises in Metro Manila

Chen, Mei-Liang, Lecturer, Department of International Business,

Hsin Sheng College of Medical Care and Management, Taiwan

Chen, Kuang-Jung, Professor, Department of Business Administration,

Chihlee Institute of Technology, Taiwan

Liu, Chu-Mei, Department of International Trade, Tamkang University, Taiwan

ABSTRACT

This study of late 2009 analyzes fast food buying behavior in Metro Manila and compares and

contrasts the marketing’s four P’s of twelve fast food franchises. Fast food franchises dominate the food

and beverage industry, and there are currently thirty-two thousand fast food restaurants in Metro Manila.

The most commonly used promotion tools of these restaurants are window dressing, free delivery, and

radio, TV, and flyer advertisings. The success of Manila’s fast food industry lies in its standard

processes, limited menus, enhancement of values, speed, swift services, and distribution right. Fast food

industry has successfully changed most people’s daily habits in many big cities. Nevertheless, fast food

franchises are reluctant to develop in suburban areas. Regarding this, there is still plenty of room for

fast food industry to expand in the Philippines.

Keywords: Fast Food Industry; Influence Behavior; Markets; Marketing Strategies

Filipinos are increasing into fast food, as the rapid expansion of fast food restaurants in Metro

Manila can prove that. There are currently many newly opened fast food restaurants across Metro

Manila and other major cities in the Philippines. Growth of population and changes in consumer

behavior has facilitated the prosperity of fast food industry. In addition, influxes of population and

changes in lifestyles – such as preferences for leisure, convenience, and food-away-from-home, women’s

changing role in the society, and the urbanization of families – all contribute to the growth of fast food

industry. Fast food industry builds upon two basic individual demands. From its model of franchise and

product concepts, fast food industry will continue to grow. Being exposed to media advertisement,

consumers’ dining habits have been changed. Furthermore, given the reasonable and affordable product

prices, the increasing number of white-collar workers – particularly white-collar women, whether single

or married, young or old – has boosted the demand for food service. Therefore, fast food industry can

be said to develop upon the structural changes in working class and families.

Statistics indicates that there are currently thirty-two thousand fast food restaurants in Metro

Manila. However, the survey of consumer tendency in Metro Manila shows that profits of fast food

franchises depend on product consumption frequencies. Most fast food franchises create profits by

expanding branch stores. Obviously, there is still plenty of room for fast food industry to expand.

Therefore, it is necessary for managements to apply effective management strategies for promotion

programs. However, many enterprises are indifferent to whether or not advertisings or promotion

strategies will facilitate their sales performances, despite the fact that integrating product, price, place,

and promotion strategies into marketing mixes is a key process during decision-making. Given that fast

Page 2: Expansion Trend of Fast Food Franchises in Metro Manila

food franchises dominate the food and beverage industry, this study aims to analyze fast food buying

behavior in Metro Manila and compare and contrast the marketing’s four P’s of twelve fast food

franchises. The twelve fast food franchises here refer to MOS Burger, Tropical Hut, Shake, Pizza Hut,

Jollibee, Domino, McDonald’s , Wendy’s, KFC, Cindy’s, Burger King, and Subway.

THEORETICAL FRAMEWORK

This study carries out a thorough research on consumer behavior based on the theories of Hawkin et

al. (1983) in an attempt to propose effective marketing strategies and feasible guidelines for these

strategies. Hawkin et al. defined consumer lifestyle as a way of reflecting individuals’ self-images and

self-concepts. It is also an accumulation of previous experiences and future plans. Therefore, each

individual or family has his/her own unique lifestyle. Products can indeed maintain or change individual

or family lifestyles.

It is suggested that products should be evaluated based on their relationship with consumer

lifestyles. Therefore, managers should understand consumers’ lifestyles and factors affecting them.

Many marketing managers usually survey consumers’ demographic traits, but related data is insufficient.

Instead, studying consumers’ lifestyles can help marketing managers to realize that consumers are

individuals who have thinking and desires and that why consumers purchase certain products. In the

case proposed here, the couple who decides to eat out has to consider whom they are dining with. If

they are eating out with out-of-town relatives or special friends, they need to choose a restaurant with fine

atmosphere or special features. If they are going with their children, they need to choose a restaurant

suitable for families. Table 1 indicates selections of restaurants based on different situations, which refer

to the time or location in which the consumers use a product or service. These situations cover all

factors influencing the purchase and use of products but not just factors of marketing or service.

Table 1: Restaurant Selections based on Different Situations

Situations Restaurant Selections Situations Restaurant Selections

My wife and I are going

to celebrate our 20th

marriage anniversary,

and our best friends are

coming, too.

A restaurant with fine

atmosphere or features

My father’s birthday is

in next week. He likes

to try something new, so

I am going to surprising

him by taking him to an

exotic restaurant.

A restaurant serving

exotic cuisines

We are taking our kids

to a restaurant. Hope

they will behave.

A restaurant for families I can only squeeze out

30 minutes from my

client visits. I am in a

rush.

A fast food restaurant

Under different situations, consumers select different forms of products in the same category. Given

that different types of restaurants attract people in different situations, marketing managers can segment

markets based on consumer expectations. For instance, the beverage Gatro-Aid is designed to help

people who have just finished exercising to quench thirst, such as people who have just played tennis.

On the other hand, in a social occasion where beverages for diluting alcohol are required, 7up will do.

Marketing guru Kolter (2008) stated that to succeed in selling a product requires an effective and

complete marketing mix, which includes product or service selection, pricing, promotion tool selection,

and identifying the connection with consumers. He further pointed out that to achieve their goals,

Page 3: Expansion Trend of Fast Food Franchises in Metro Manila

marketing managers must understand the needs and demands of their target markets and create more

satisfactions for their consumers than their competitors. Giving considerations to consumer satisfactions

helps to make more feasible marketing plans. Figure 1 indicates the twelve fast food franchises’

marketing strategies of product, pricing, promotion, and place in an attempt to create stronger and more

positive consumer attitudes and behavior. It is essential for products to meet target consumers’ demands.

Given the ever-changing nature of the market environment, the process of matching products and

demands should be dynamic. Therefore, this study explores how fast food franchises apply marketing’s

four Ps to establish brand loyalty and increase market shares.

Figure 1: How Consumer Buying Behavior Influence Marketing’s Four Ps of Fast Food Franchises

Related Literature and Research

Enterprises make marketing strategies in an attempt to achieve sales goals and increase transactions.

Typically, the purpose of marketing strategies is to increase profits or consumption frequencies, such as to

make consumers frequently purchase certain products from certain stores. Such a purpose can be

fulfilled by applying marketing mixes to a selected target market. Understanding consumers is a key

factor in the making of marketing strategies. As indicated in Table 2, strategy-making always involves

in considerations of consumer behavior. For instance, a marketing manager must understand how

consumers perceive and feel about a competing brand, who purchase the competing brand and why, and

under what types of situations do consumers purchase and use products of the competing brands. These

are all questions must be asked and answered when analyzing sellers and buyers. Generally speaking,

Page 4: Expansion Trend of Fast Food Franchises in Metro Manila

the more you know your consumers, the more likely that you will work out a set of successful marketing

strategies.

Table 2: Question Samples Relevant to Marketing Strategies

Strategic Elements Questions about Consumers

Segmentation Who are our potential consumers for our product?

Product What product are the consumers using currently? What benefits do they expect

from this product they are using?

Promotion

What type of promotions should we resort to in an attempt to influence the

consumers into buying and using our product? What type of advertisements can

maximize the effects for our product?

Price In an ever-changing target market, how important prices are to the consumers?

How will changes in prices influence buying behavior?

Place Where do the consumers buy this product? Will different places (distribution

channels) influence buying behavior?

According to Solomon, marketing managers can use product strategies to influence consumers in a

short-run and long-run. In the short run, new-product strategies should aim to draw consumers to the

products. Therefore, when introducing new products, a marketing manager should thoroughly consider

what influences the products have on consumers. S/he should also understand perceptions, behavior,

and environments of consumers and closely monitor product lifecycles. Tellis and Fornell specified that

the diversity of product features is the key to the success of products and brands. Strictly speaking, this

is not counted as one of the product features, but it too is important to the success of products and profits.

Tellis and Fornell also stated that brand image and symbol were often the only benefits provided by

enterprises. It is a very common situation because many product categories under the same brand

provide similar functions to consumers. In many cases, a good brand image is created by marketing

mixes. Creating a good brand image by means of promotions means to match promotions with positive

evaluations and create product attraction. Furthermore, promotions direct consumers’ attention to

certain product features so as to stress the superiority of the product involved. Many people know that

very few consumers can tell the differences in tastes among different brands of beers. In fact, many

consumers do not like the tastes of beers at the beginning, so beer makers instill into consumers’ minds

that their beers taste the best, or at least tell consumers that theirs are as good as those with higher prices.

Tellis and Fornell also indicated that pricing also helped to create brand images. Sometimes high

product prices imply high quality, and consumers accept the connection between prices and quality and

evaluate the quality of a brand based on prices. Lastly, Tellis and Fornell pointed out that diverse

distribution channels could also be used to gain benefits.

According to Ferrel (1989), businesspersons promote products not only to propagate, educate, or

entertain; most importantly, to escalate transactions. The long-run goal of promotions is to influence and

encourage consumers into accepting or using a product, service, or a concept. Promotions influence

potential customers into purchasing a product or increase purchase frequencies of current customers;

these together determine the ultimate outcome of promotions. Hussian (1991) conducted a research on

recent marketing strategies in food industry. His research revealed that promotions were what made

McDonald’s and Jollibee successful. Hussian discovered that the most frequently used promotions by

these two enterprises were window dressing, free delivery, radio, TV, and flyer advertising, and super deal

promotions. He also stated that advertising played a major role in expanding product market shares.

Page 5: Expansion Trend of Fast Food Franchises in Metro Manila

Del Mounte Philippines, Inc. was selected as one of Asia’s top six outstanding marketing

enterprises by World’s Executive Digest (1992). For over seventy years, this company has been

producing products by using corps from its own lands. Products with the brand name “Del Monte” are

very well-known in the market. In the environment featured with fierce competitions, Del Monte has

brought out many marketing issues, including:

1. New Product Development: In addition to introducing foreign crops to the domestic market, Del

Monte educates homemakers and develops new products to feed their needs. There is no product that

one can not find in categories of Del Monte.

2. Kitchenomics as a highly successful promotion activity: Through Kitchenomics, Del Monte provides

budget-friendly recipes to its consumers.

Kitchenomics Club was then established. Current it has one hundred and fifty thousand members,

and it has increased its customers to four hundred and fifty thousands by means of direct mail activities.

These efforts have produced more and more rewards to the company and had its sales quintupled in five

years, making its brand even more outstanding.

ASSUMPTIONS

Based on the following assumptions:

1. Fast food franchises usually apply marketing mixes related to marketing’s four Ps.

2. The success of a fast food franchise lies on the demands, desires, and buying behavior of consumers.

HYPOTHESES

The following hypotheses are proposed based on the theme of this study:

1. There is no significant difference between the two respondent groups in the following strategies used

by the fast food franchises:

(1) product strategy(2) pricing strategy(3) place strategy(4) promotion strategy

2. In the aspect of service provided, there is no significant difference in perceptions between consumers

and fast food staff.

3. There is no significant connection between consumers’ personal backgrounds and how much they

value the following qualities of fast food franchises:

(1) food quality (2) forms of service (3) employee etiquette (4) cleanness (5) consistency (6) menus

(7) environment (8) locations (9) prices

Scope and Limit of Research

This study surveys and confirms current marketing strategies used by twelve outstanding fast food

franchises in Metro Manila. These fast food franchises are MOS Burger, Tropical Hut, Shake, Pizza

Hut, Jollibee, Domino, McDonald’s, Wendy’s, KFC, Cindy’s, Burger King, and Subway. This study

covers SY2007-2008 and applies all changes in promotion tools. Additionally, the framework of this

study does not include marketing strategies made by the interviewed franchises. Specifically speaking,

this study attempts to analyze the twelve fast food franchises’ marketing strategies in products and

service, pricing, places, and promotions. This study aims to evaluate buying behavior in Metro Manila,

the Philippines, so this study surveys general Filipino consumers without specifying their locations,

Page 6: Expansion Trend of Fast Food Franchises in Metro Manila

incomes, or social status. The respondents are three hundred and four consumers and one hundred and

twenty-four staff of the twelve fast food franchises.

METHODOLOGY

This study adopts descriptive survey. According to Sanchez’s explanation, it is logical to survey

respondents in the twelve fast food franchises. Descriptive survey is a method used to obtain

information of a current prevailing phenomenon (this study selects several facts). Basically, this method

describes general characteristics of a population in an attempt to look for answers from facts in current

status quo. The respondents of this study are categorized into two groups: consumers and staff of the

twelve fast food franchises, which are Tropical Hut, Shake, Pizza Hut, Jollibee, McDonald’s, Wendy’s,

KFC, Cindy’s, MOS Burger, Burger King, Subway, and Domino.

Table 3: Respondent Distribution

Franchises Consumers Staff Total

No % No % No %

Shake 25 8.2 10 8.1 35 8.2

Cindy’s 25 8.2 10 8.1 35 8.2

MOS Burger 25 8.2 10 8.1 35 8.2

Domino 25 8.2 10 8.1 35 8.2

Pizza Hut 26 8.5 11 8.8 37 8.6

KFC 26 8.5 11 8.8 37 8.6

Jollibee 25 8.2 10 8.1 35 8.2

McDonald’s 26 8.5 11 8.8 37 8.6

Burger King 26 8.5 11 8.8 37 8.6

Subway 25 8.2 10 8.1 35 8.2

Wendy’s 25 8.2 10 8.1 35 8.2

Tropical Hut 25 8.2 10 8.1 35 8.2

Total 304 100% 124 100% 428 100%

Table 4: Respondent Information

Basic Information Consumer(%) Staff(%)

Age:

Below (including) 25 53.0 39.6

26-35 40.0 38.4

Over (including) 36 7.0 22.0

Gender:

Male 27.0 47.0

Female 73.0 53.0

Marriage Status:

Single 82.0 38.0

Married 18.0 62.0

Educational Background:

Graduated from Senior High School 27.0 21.7

University Drop-out 23.0 5.3

Graduated from University 36.0 55.0

Graduated from Graduate School or Higher 14.0 18.0

Occupation:

Student 50.0 ─

Page 7: Expansion Trend of Fast Food Franchises in Metro Manila

Staff 25.0 ─

Housekeeper 18.0 ─

Other 7.0 ─

Seniority

1-2 Years ─ 41.2

3-4 Years ─ 46.3

5-6 Years ─ 12.5

The following methods were applied to gather data for further analyses:

1. Questionnaires: Two types of questionnaires were designed with one for the consumers and the other

aiming at the staff. The questionnaires were close-ended, meaning that each question came with

several possible answers for the respondents to choose from. With the pre-set range of choices,

respondents need not explain their answers. The questionnaires were pre-tested for suitability in fast

food restaurants. After the pre-test, the questionnaires were distributed to the respondents, and then a

one-on-one survey was carried out to correct the questionnaires.

2. Interviews: Unstructured interviews were carried out to further verify the staff’ concepts and ideas

about the marketing practices and strategies of their companies and to correct the misguided answers

in the questionnaires.

3. Observations: Managers of the franchises were requested to observe for a period of time how their

consumers selected food and how their staff served the consumers.

4. Documentations: Records of marketing trends and distribution channels were obtained from the

marketing departments of the fast food franchises.

Statistic Analyses

1. Percentage: the interviewed consumers were categorized based on genders, ages, marriage statuses,

nationalities, educational backgrounds, and occupations; the interviewed franchises were categorized

based on stock issue volumes, forms of ownership, nationalities, number of staff, and years of

operation. The information was listed based on the percentage of the categories.

2. Weighted Average: the results in the questionnaires were calculated with weighted average, which can

be explained with the concepts of numerical boundary values. The weighted average is indicated in

Table 5:

Table 5: Weighted Average

Average Weighted Description

4.51-5.00 5 Strongly Agree

3.51-4.50 4 Agree

2.51-3.50 3 Uncertain

1.51-2.50 2 Disagree

1.00-1.50 1 Strongly Disagree

3. t-test: t-test determined the perceptual differences in the four marketing elements (product, price,

place, promotion) between the two respondent groups. The obtained t-values were compared with

the critical values calculated based on the table. If a t-value was larger than its critical value, the null

hypothesis was rejected, and there was a significant difference between the two respondent groups.

If a t-value was smaller than its critical value, the null hypothesis was accepted, and there was no

significant difference between the two respondent groups. The comprehensive analysis of the

information produce the following findings:

Page 8: Expansion Trend of Fast Food Franchises in Metro Manila

Buying Behavior

Buying behavior at different aspects:

1. Buying frequencies: consumers occasionally go to the fast food restaurants during holidays or in other

special situations, but they frequently spend at fast food restaurants during weekdays and weekends.

2. Meals purchased: 37% of the consumers frequently purchase lunches or dinners from the fast food

restaurants. 73% also purchase snacks. 42% spend at the fast restaurants anytime during a day.

3. Dining locations: 62% of the consumers occasionally dine at the fast food restaurants. 43% take their

orders home. 66% dine at the restaurants and also take their orders home.

4. Companions: 52% of the consumers frequently go to the fast food restaurants with their friends, and

they occasionally dine with their families and relatives or alone at the restaurants.

5. The person in charge of ordering: usually it is the head of household who is in charge of ordering, but

sometimes his/her spouse or children place orders.

6. Reasons to choose fast food restaurants: the consumers spend at the fast food restaurants for six major

reasons. The first reason is “cozy air-conditioning”, the second is “sanitary food handling”, the third is

“fast service”, and the last is “playgrounds for children”.

7. Reasons to spend on fast food: 72% of the interviewed consumers spend on fast food when going out

with their families or friends. The second reason is they sometimes feel like having

food-away-from-home instead of cooking by themselves. Some spend at fast food for the nutritional

values it provides. Still some do it to treat their children in the name of celebrations. The last reason is

related to the change in women’s role.

8. Important features of the fast food restaurants: the consumers believe the most important feature is

“cleanness”, which is followed by “price”, “staff etiquette”, “dining environment of the restaurants”,

“food quality”, and “consistency”. However, the consumers do not care very much about the menus.

Marketing strategies

Strategies related to marketing’s four Ps:

1. Product

(1) The consumers agree that food sold by the fast food franchises is high quality, there are sufficient

food supplies or stocks provided by the franchises, the franchises provide well-designed packages

and offer conveniences, and that the franchises themselves have created values for their

promotions.

(2) The staff strongly agrees that there are sufficient food supplies or stocks provided by the

franchises, the production of the food is authorized by local or overseas companies, food sold by

the fast food franchises is high quality, and that the food is attractive to the consumers and

provides favorable nutritional values.

2. Price

(1) The consumers agree that the prices are consistent throughout all of the fast food branch stores,

the prices are easily affected by those of the competitors, the prices are reasonable, all product

prices are fixed, and that the prices are generally accepted in the market.

(2) The staff agrees that the prices fluctuate with their target markets, the prices are generally

accepted in the market, the franchises adjust prices based on the prediction of inflations, the

prices are consistent throughout all of the fast food branch stores, and that the fast food franchises

lower their costs and operate in the market with price reductions.

Page 9: Expansion Trend of Fast Food Franchises in Metro Manila

3. Place

(1) The consumers agree that the fast food franchises have their own efficient distribution channels,

which is a key for their marketing strategies. They also agree that the locations of the franchises

are close to their target markets and that the franchises plan their own operation areas.

(2) On the other hand, the staff agrees the most that the locations of the franchises are close to their

target markets. They also agree that the fast food franchises have their own efficient distribution

channels, which is a key for their marketing strategies.

4. Promotion

(1) The consumers agree the most that TV and radio advertisings are the most suitable promotion

tools. The fast food franchises’ advertising plans are effective in terms of raising the consumers’

awareness of the products.

(2) The staff agrees the most that the fast food franchises have powerful and effective promotion

strategies. They believe that TV advertising is the most suitable media in terms of advertising

service. They also believe radio and newspaper advertisings are suitable media.

PERCEPTIONS

1. There are significant differences in terms of the perceptions of marketing strategies.

Table 6: Perceptions of Marketing Strategies

Strategies X t-value Critical Value at 0.5 Significant

Level

Consumers Staff Difference

Product 3.875 4.032 0.921 11.935 2.131 0.5

Price 3.432 4.537 0.838 10.232 2.134 0.5

Place 3.971 4.871 0.746 8.356 2.237 0.5

Promotion 4.132 4.621 0.421 2.017 2.167 .NS

In the aspect of product, there is a significant perceptual difference between the consumers and the

staff. In the aspect of price, there is a significant perceptual difference in pricing strategies between two

respondent groups. In the aspect of place, there is a significant perceptual difference between the

consumers and the staff. As for the aspect of promotion, the data indicates that the consumers pay much

attention to the franchises’ promotion strategies but less to other strategies.

2. The respondents’ perceptions of the franchises’ overall service

Table 7: Perceptions of Service

Service Consumers Staff

Average( X ) Standard

Deviation (SD) Average( X ) Standard

Deviation (SD) t-value

Good Service 3.82 0.59 0.46 14.21

Immediate

Quotation 3.63 0.64 0.43 15.42

After-sales

Service 3.41 0.85 0.46 13.53

Free Delivery 3.83 0.63 4.61 0.47 12.53

Total Average 3.67 4.67

Cr=2.58 Significance Level =0.01

Page 10: Expansion Trend of Fast Food Franchises in Metro Manila

Most of the consumers agree that the fast food franchises provide good delivery service; on the

contrary, the staff agrees the most that the franchises provide good service. Both the consumers and the

staff agree with the franchises’ abilities in supplying and quoting. The consumers give the lowest

evaluation to “after-sales service”, showing that they no longer require such a service when having the

fast food they order. The consumers agree that free delivery is a reason for good sales performance.

3. The connection between the consumers’ personal backgrounds and how much they value fast food

quality

How the consumers value the fast food quality is not influenced by their ages, genders, marriage

statuses, educational background, and occupations. Educational backgrounds and occupations affect

how the consumers value the forms of service, and ages, educational backgrounds, and occupations affect

how the consumers value staff attitudes and cleanness. Marriage statuses, educational backgrounds, and

occupations greatly affect how the consumers value the environment and locations of the restaurants.

Genders and educational backgrounds affect how the consumers value the prices, but not ages and

marriage statuses.

CONCLUSIONS

The conclusions of this study are as follows:

1. Demographic information alone is not enough to define buying behavior or to obtain sufficient data to

compete in the current market environment. Managers of the twelve fast food franchises use

demographic information and habits to define their markets. However, when trying to make the best

strategies, they need related information to better understand how their consumers perceive and feel

about their products and service.

2. Consumers and staff have positive opinions and attitudes towards the prospect of fast food industry in

Metro Manila. They believe it is reasonable for fast food industry to value consumer benefits, which

can be achieved by providing high quality products, convenient locations, good facilities, affordable

prices, and efficient service.

3. Staff usually has higher perceptions than consumers about product, price, and place of marketing

strategies of fast food industry. However, consumers and staff share similar perceptions about

promotion strategies, which is that advertising and personal selling are the most effective marketing

tools.

4. Consumers and staff both agree that the success of fast food industry can also be attributed to other

factors, such as standard processes, limited menus, enhancement of values, swift and effective

services. These factors are like catalysts to the promotions of fast food. They also agree with the fast

food franchises’ philosophy of serving with smiles, good sales performance, friendliness and modesty

and satisfying consumers’ demands with fast service.

5. The success of fast food industry in the Philippines can largely be attributed to the adoption of

franchise (distribution right). By the same token, the popularization of franchise (distribution right)

can also be attributed to fast food industry, which takes franchise as an important part of their growth

strategies.

6. Managements of the twelve fast food franchises believe there is an increasing need for specialized

food service equipment, which facilitates more efficient food production. For instance, specially

designed conveyor belts can service grilled burgers to consumers and in the mean time, process

pre-made pies; deep-fry pots equipped with filtration can effectively extend the oil use time. These

Page 11: Expansion Trend of Fast Food Franchises in Metro Manila

are only a few of the examples of food service equipment. Currently what the public requires the most

is high quality and healthier food containing more cellulose.

RECOMMENDATIONS

The recommendations of this study are as follows:

1. Fast food marketing managers must learn to discover the origin of demands from special use of

products or service. Given the variety of their lifestyles, consumers have different patterns of use of

products or service. Therefore, different situations will inevitable lead to different needs and

demands for specific products. Understanding these situations will help managers to realize that

under what circumstances their products or service is most likely to be needed by consumers.

2. Fast food marketing managers must apply “comprehensive management”, which uses precise

measurement, analytical skills, and strategic plans to deal with new pressures and complicated matters.

Managers must repeatedly review the effects of their marketing strategies and influence consumers

and staff into following their strategies.

3. Fast food marketing managers should develop specific strategies to increase the chance of having

consumers accept their information and products. There are three ways to achieve this goal: enhance

dissemination, maximize the chance of dissemination, and keep disseminating. Managers should

disseminate their information to their surroundings to increase the chance of approaching appropriate

targets. They also need to cautiously select good media mixes, such as magazines, billboards, and

TV, so that consumers are more likely to accept their advertisings.

4. To escalate their sales, fast food franchises should provide more beneficial and convenient facilities to

consumers and improve their service based on consumers’ needs. For example, the provision of

parking space, music, and air-conditioning can indeed attract consumers.

5. Pricing strategies are a must in a competitive market. Therefore, fast food franchises should provide

cash discounts to increase their sales. Furthermore, images that fast food franchises want to establish

should also be considered when deciding price standards for their food.

6. Fast food industry should rapidly switch their attention to new technologies. As competitions turn

fierce in fast food industry, marketing managers should make fast changes to suit consumers’ needs

before their competitors become aware of it. Managers must modernize their food preparation,

service, food technology, and distribution practices to allow their service become internationalized.

REFERENCES

Ceng Guang Hua (2008), Introduction of Marketing Management: Principles and Practices, Future Culture Management Company.

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