As globalization is increasing rapidly and new products from the foreign countries are finding their way into the country, the trend of utilization by our inhabitants is gradually changing. They are becoming more disposed to buying. The reason why consumers are more inclined towards global or local brands is associated to their desire for maximum satisfaction. With the passage of time, the international fast food brands are getting more precedence in comparison to the local brands due to the influence by the western world. As the markets have globalized, complex marketing strategies have been developed. If any predisposition resulting from these strategies is seen in the buying decision, a close consideration should be given by the manufacturers, distributors, importers, exporters and other channel intermediaries to examine how it influence their businesses and employ appropriate strategies to counter this phenomenon.
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The notion that called globalization has guided many organizations to operate on a global level which as a result has changed the buying behavior of consumers and an increase in his knowledge regarding global fast food brands. Due to the societal and cultural effects of telecommunication, more awareness is spread in consumers about other cultures, lifestyles and brands. It has now been examined that foreign fast food brands are consumed more on a frequent bases in contrast to local ones. People feel modernized in consuming foreign fast foods.
It is a common viewpoint that consumers consider only factor while purchasing a foreign fast food brand. However, reality tells that there are a number of varied factors involved while evaluating a product. Studies show that consumers who dwell in developed countries give more preference to foreign fast food brands, particularly from the west, not only because of the perceived quality but also of social status. Hence, a brand’s country of origin serves as a summary of product quality and consumers prefer these types of fast food brands for status-enhancing reasons. Quality is conceptualized in terms of the product’s performance.
A consumer’s standard of living and his purchase pattern can also be determined by his income, education, occupation and family background, demographics significantly verify the exposure to and thus the purchase of expensive foreign goods. Like many other developing countries, Pakistani social classes also exhibit very evident brand preferences. Amongst the different social classes, elite class and the upper-middle class are more observed to be dining out at fast food foreign brands to sustain in the noticeable position in society. Karachi city has most of its people having the status consciousness characteristic. Whereas, foreign fast food brands are considered as a luxury for lower class, they do not consume them more often. The researchers intend to study that how the internal layout of dine-in restaurants, advertisements, celebrities showing up in the brand ads, friend’s circles and families, are affecting the consumer’s perception and making them aware to take informed decisions regarding it.
1.2. Problem Statement
In previous years, many studies have been done to find out the factors influence consumers on dining out. The result showed positive impact of consumers on dining out. Researcher found that location, service, hygiene, environment, brand image, quality, taste and price play a vital role to persuade consumers towards restaurants. It helps restaurants operations to be more efficient and serve excellent services. In Pakistan, there is lack of research on this topic as there is a trend of dining out. This research work is going to deal with the impact of trend in food industry and also restaurant services.
1.3. Research Objective
To determine the factors influencing customer’s preference of dine-outs
1.4. Research Question
What are the factors influencing customer’s preference of dine outs?
1.5. Scope of the Study
This study carries significance by a number of means as it will serve as the tool for the dine-in industry. Many researches are carried out only confined to Fast Food restaurants but this is not the case here as a result it becomes a vast medium of information to rely on. The research will be useful in understanding the dining out culture that is spreading rapidly in Pakistan. It will also aid us in understanding what the customers prefer when they dine out and for restaurants in improving the market value of their franchises. It will give an insight to the demands of the customers which will help them enhance their standards.
1.6. Limitations of the Study
Lack of time and space to conduct an extensive research
Lack of availability of funds to broaden the sample size
Vast geography could not be covered in the short span of time
2. Literature review
2.1 Theoretical Background
Johns and pine (2002) the study of consumer behavior deals with the different ways people play their role as consumer. In practice the consumer behavior deals with behavior related to finding product and service and buying and using of products and services. Lichtenstein and Solve (2006) preference can be explain as the attitude of individuals towards a set of object, which reflects in their decision making process. Preference have change over time, it may not necessarily stable. The choice of consumer varies from person to person the consumer choice may reflect by their own taste. Preference can also be explain as the desire of individual for consumption of goods and services.
Food related variables includes taste of food, price of food, presentation of food, quality of food and variety of food. Soriano (2001) food related variables includes presentation of food, variety of food, quality of food and taste of food the most important reason of customer return to restaurant is fresh ingredients and quality of food. Convenience related variables include seating space, location, parking facilities and convenient opening hours.
Atmosphere related variables include ambience, neat staff, staff appearance and cleanliness. Horeco (2000) restaurants may have a competitive edge through ambience. The owner of restaurants must invest money to improve the appearance of restaurants because to attract social able customers who like to have new experience it is important to have a good atmosphere.
Service related variables include speed of service, table of service, consistent service standards and trained staff. In hospitably industry service is perceived as critical issue by many researchers. The operators of restaurants need to pay more attention to the service provided to their consumers.
Liu and Chen (2000) to understand the buyer behavior and needs of buyer it is important to know the reasons of dining out. According to the Philippine Hotel and Restaurant Association, there are various reasons due to which Filipinos eating outside. The reasons are treating, to celebrate different occasions, business requirements, suitable, enjoy high quality food and for food that can’t be prepared at home usually, it is a better technique to entertain guest, way to relax, reasonable price and enjoy with family.
Cleanliness of restaurant
Cleanliness of tablecloths and napkins
Cleanliness of food
Cleanliness of toilet and lavatory
Speed of service
Ease of making complaints to manager
Good behavior of service personnel
Location of restaurant
Price of food
Tastiness of food
Appearance/presentation of food
PRICE, TASTE AND QUALITY
Calm, quiet atmosphere
General appearance of restaurant
Consumer behavior on dining out
2.1.1 Conceptual Framework
2.2 Empirical Study
Nezakati et al., (2011) examines how the respondent’s perception will be influenced by factors of customer loyalty towards preferred fast food restaurants through a sample size of 196 respondents. They used nine variables: product quality, product attribute, brand name, store environment, service quality, store environment, promotion, price, brand name and customer satisfaction. They used correlation and regression as their technique. They concluded that the Malaysian consumers seem to be trust with their preferred fast food restaurants. They suggested that this study will benefit local fast food restaurant to enhance their customer loyalty and consumer repeat purchase intention in future.
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Sahari et al., (2012) examines to determine the principal drivers of customer satisfaction in the aspect of meal or food dimension in family restaurants in Malaysia through a sample size of 460 customers. They used variables namely: food quality, food pricing, food portioning, and food presentation. They used chi-square test as their technique. Their results indicate that customer satisfaction is influenced most by the quality of food, followed by the presentation of food, meal portion and food pricing. Thus this study provides potential ways for restaurateurs to increase customer satisfaction and loyalty by improving their understanding of the factors of food dimension that influence customer satisfaction.
Soriano (2002) examines the attributes which influences customers’ decisions to return to a restaurant for another meal through a sample size of 400 respondents. They used variables namely: quality of food, quality of service, cost of meal and places. He used the technique of multiple range tests. His result indicates that food was significantly more important than any of the other attributes. He recommended that restaurant managers must establish priorities among the strategic moves that are likely to improve a customer’s repeat purchase.
Baig and Saeed (2012) analyses the fast food market and customer attitudes in Pakistan by using convenience sample of 100 respondents. In their study, they used age, gender, education, income, lifestyles, activities and interests as their variables. They used proportion technique to analyze the results. It was concluded that fast food consumption is increasing day by day and they suggested that food is a means of life but it has become significant investment for business. Social dimensions of globalization of food business justify immediate attention that has been increasing global obesity.
Iglesias and Guillén (2004) examine the impact of perceived quality and price on satisfaction of restaurant customers. Their sample was divided into 3 groups. They used variables perceived quality, perceived price and satisfaction. They used correlation and regression technique. The result indicates that the satisfaction obtained by restaurant customers is increased by the level of quality that they perceive from those restaurants. They suggested that if the existing restaurant has not been concerned about generating the satisfaction of its customers, then the customers will leave it if the new competitor is capable of offering them greater quality and, therefore, greater satisfaction.
Goyal and Singh (2007) examine the Consumer perception about fast food in India. Sample size of this research was 200 targeted populations. Variable of this research was service and delivery dimension, product dimension, and quality dimension. Statistical approaches were used in this research such as descriptive statistical analysis, frequency distribution and reliability analysis. Result indicates that mostly Indians who were found off visiting fast food outlets is just for change in taste and as well as for fun as compared to their home, but home food is their first preference.
Liu and Chen (2000) examine the fast food competition in the Philippines. Independent variable of this research were attributes and features of the fast-food restaurant and temporal variables were breakfast, lunch, & dinner while Social surrounding variables were alone, with friends and with clients. Statistical analyses were used in this research such as regression, coefficients and clustering procedure. The result shows the relative competition situation of fast food in Merto manila, Philippines. In order to make good images of the fast food outlets for consumer, brands should support financially with including loyalty and quick service will boost their business.
Park (2004) determines the Consumer values of eating-out and fast food restaurant consumption in Korea. Sample size of the research was 279 samples. Variables were used in this research were consumer’s age, income level, food preference taste, and store location. Methods used in this research were survey questionnaire, quantitative approach and correlation analysis. The results indicate that the price, promotional incentives and quick service are basic elements of fast food restaurants. Quality of quick service and promotional incentives are correlated with both consequences.
Voon (2011) explores the merits of service environment, food quality and it’s pricing from the customers viewpoint. The number of sample used in this research was 409. Variables of this research were gender, age, race and education. The method used in this research was survey questionnaire, Reliability analysis and multiple regressions. The result shows the satisfaction of a mostly customers with the restaurants and also in terms of human service and its pricing strategies. However the physical environment of fast food outlets will not necessarily related with the customer satisfaction if quality of food that is provided there is low.
Moussa et al., (2012) investigates the food quality attributes in table and delivery services in fast food operations. Variable of this research were Food, Quality, Sensory, Temperature, Pouch. Various method was used in this research, these include statistical analysis (percentages, weighted avg. method, charts), correlations tests, independent samples t-tests, paired samples t-tests, analysis of variance (ANOVA) tests & for the laboratory examination “taste panels” data analysis methods were used. The result shows that there is a need to redesigning the strategies of serving food. They need to focus on the delivery time and make the delivery time less than 10 minutes in order to efficiently grow the restaurant business and delivery vehicle must also have selected in viewpoint of the fast delivering of food as soon as possible.
Namkung and Jang (2007) investigate the key points that create differentiate between highly satisfied customer and unsatisfied customers. They did survey through questionnaire from four different restaurants according to the social status. Logistic regression was used to determine the qualities for satisfying the customers. They took different services of restaurant as independent variable and customer’s satisfaction as dependent variable. They found that there is highly big difference between the perceptions of satisfied customers and non satisfied customer. From a managerial standpoint, the results of this study help restaurant managers who observe that customers have become more demanding in terms of the level of quality.
Boyce et al., (2008) study the consumer perceptions related to food safety practice. They took interviews of a nine panelist and mediator to take public’s view about safety and packaging of takeout food. Their interview consisted of five questions associated with the person’s frequency of takeout food and they took interview from the people who belong from different kind of cultures and belong from the different ages. They use a qualitative methodology. The results shows that people always prefer hot food and the ability to re heated. The logo printed outside the container is also appealing for consumer. They find that as if a person takes out food the risk is illness will increase.
Tabassum and Rahman (2012) investigate the thoughts of consumers for different fast food restaurants in Bangladesh and their difference in attitudes. They took sample through questionnaire and 100 students of different universities take part in it. They took Consumers’ choice of a specific restaurant as dependent variable and factors like quality, location, price, environment as independent variables. They used and tested multiattribute model in four most visited fast food restaurants; KFC, Pizza Hut, Western Grill and Helvetia. They found that people mostly prefer Pizza Hut and Helvetia has least favorable attitude of consumers because of quality, quick, price, environment and service. The study recommends that fast food restaurants should focus more on food quality, speed of service, environment, and price as these factors influence consumers.
Kara et al., (1995) investigate the difference of perception between consumer of USA and Canada. The data of this study were collected through questioners in the three-county region of York-Lancaster- Pennsylvania, Harrisburg, USA and cities of Canada are Bedford, Dartmouth and Halifax, Nova-Scotia, Canada. Correspondence analysis (CA) was used for this study. The results shows three main difference; frequents consumer of USA prefer speed, variety and friendly staff for choosing restaurants while less frequent consumer prefer price and deals and in Canada frequent consumer prefer seating arrangement and nutritional value while less frequent consumer are like their US consumers. They suggest that the study offer several managerial implications. Like culturally different people have different perceptions and different influencing factors. This emphasizes the importance of target marketing for fast-food restaurants.
Bouranta et al., (2009) study the relationship between internal service quality has a direct impact on external service quality. 27 restaurants were randomly selected for survey and they received 100 usable responds from full time waiters and 203 from patrons. Statistical analysis was carried out with SPSS and Stat graphics. They found that nine out ten customers are satisfied from the quality of restaurants and regarding waiters, eight out of ten also reported to be reasonably satisfied from the quality of service received by their internal suppliers. They suggest that managers should focus on internal service quality if they want to develop external service quality.
Ali & Rehman (2011) analyses the factors that makes quality of service a fundamental part of customer satisfaction. They have undertaken responses of 400 customers. They used two variables: tangibles and responsiveness. They used servqual and dineserv tool as a technique. The results support by recommending high standards of service in restaurant industry leading to satisfaction. The study also recommends that feedback through M-commerce marketing can be an effective tool to testify quality.
Andaleeb and Conway (2006) testify the factors that create an impact on the restaurant service industry. They have taken three variables: price, product quality and service quality. They have taken 119 respondents. Factor analysis and multiple regressions was a used as a technique. The results show a positive impact on customer satisfaction by response of front employees, price and quality of food respectively.
Ryu et al., (2010) analyses how “hedonic and utilitarian” values, “customer satisfaction and behavioral intentions” affect each other in the “fast-casual” dinning industry. They have taken four variables: hedonic value, utilitarian value, customer satisfaction and behavioral intentions. They have used structural equation modeling and confirmatory factor analysis as a technique. The results show that hedonic and utilitarian values have a positive impact on customer satisfaction leading to behavioral intentions whereas utilitarian values show a greater impact.
Clark & Wood (1998) analyses the overall market perception of customers in restaurant selection. They have collected a sample 63 people. They have used four variables: Food type, food quality, value image/atmosphere and location. They have used statistical tool along with interviews as a technique. The results show that superiority and variety or kind of food is key determinants in consumer constancy, but that the perception of “quality of food” offers a range of understanding.
Lee et al., (2012) examines the parts of food service quality (physical environment, food, and service) influencing restaurant image, customer perceived value, customer satisfaction, and behavioral intentions. They collected a total of 300 samples for final study. They have taken five variables into consideration: food service quality, restaurant image, and customer perceived value, customer satisfaction, and behavioral intentions. They have used structural equation modeling as a technique. The results show that food service quality plays a role in restaurant image which itself plays a role in customer perceived value. Behavioral intentions are affected by customer satisfaction on other hand it is lead by customer perceived value is affected by environment and food.
Kim et al., (2011) examines the Chain restaurant patrons’ well-being perception and dining Intentions in South Korea. The sample size of this research was 249 consumers. Variable of this research were Income, race, gender and educational level. The methods used in this research were squared correlation, average variance and standardized coefficient analysis technique. The result shows that Brand image plays major role in creating patrons positive behavioral intensions. Findings also indicate that these days CWB plays a strong psychologically and motivational role for patrons viewpoint.
Hwang et al., (2011) investigate the impact of crowding in the effective control of the waiting environment. Sample size of their study was 61 students and their variables were Attitude towards service, independent variable is crowding, and dependent variable is approach avoidance response that is affect, affiliation; spend money and willingness to wait. They use mean, standard deviation, Regression analysis models. It is resulted that in a restaurant waiting area influences customer approach-avoidance responses and high crowded condition make people feel avoiding others and avoiding talking to each other.
Stewart and Davis (2005) explore variation in the price and accessibility of fast food across major urban areas by their collection of sample concerning price information on 253 restaurants. They use mean and standard deviation technique. Their variables are average price, number of restaurants, income level, number of people, characteristics of market. Result indicates that the socio demographic profile of people and community manipulate the number and accessibility of fast food restaurants.
Islam and Ullah (2010) indicate the features which affect consumer’s choice on fast food and changing of food eating habit in Dhaka, Bangladesh. This study has been carried out by 250 samples. Their three variables were fast food energies the respondents, fast foods are preferred when people are outside their homes, and fast food is good for lifestyle. They use mean, standard deviation, regression analysis techniques. Result indicates that the consumers prefer most the brand image, taste, quality and cost by which consumers motivate and give preferences to those fast food restaurants having these qualities. Study suggests that brand reputation image, quality, cost and taste attract more consumers towards fast food restaurants.
Frank (2012) investigate attitudinal and behavioral reasons behind adolescents’ suboptimal food choices. They use moderated regression analysis model technique. They use seven variables Germany, Restaurants, Fast foods, Customer satisfaction, Consumer behavior, Word of mouth, Fast food restaurant, Social recognition. The results imply that fast food-related childhood obesity may be caused by lack of rationality rather than peer pressure or lack of knowledge. They suggest that the primary determinants of customer attitudes and intentions are food quality, the public brand image, social recognition, and perceived competitive advantages.
Rahman (2012) explore the dynamics of consumers’ perception, demographic characteristics and consumers’ behavior towards selection of a restaurant with the sampling frame of 350 Respondents. They use exploratory factor analysis (EFA) model technique. They use five variables consumers’ perception, consumers’ age, consumers’ income, consumers’ gender and consumer’s behavior. The result shows that a significant proportion of consumers in Dhaka city of Bangladesh are very sensitive towards choosing a restaurant services. They suggest that consumers’ perception always mediating by consumers’ age, gender differences and their income.
Jangga et al., (2012) identify factors that determine the level of satisfaction experienced by customers when they visit a family-chain restaurant through sample size of 40 outlets in Malaysia. They use reliability and validity Analysis test technique. They use four variables Customer satisfaction, family-chain restaurants, food, service, and ambience. Result shows that a high level of satisfaction will outcome in return visits to the restaurant and therefore generate a sense of loyalty for this category of restaurant in general and the restaurant’s brand name in particular. They suggest that the customers place more importance on courtesy, followed by efficiency and friendliness of the staff.
Liu and Tsai (2010) focus on consumers of health foods in Taiwan as a research subject and questionnaire survey is executed by the sampling method. They use correlation analysis model technique. They use four variables service quality, lifestyle, choice of channel type, health food industry. Retail service quality has a positive relationship with consumers’ choice of channel type. They conclude that: (1) Service quality has a significant and positive relationship with choice of channel types; (2) Satisfaction of service quality in the aspects of personnel interaction and problem solving significantly influences consumer’s choice of channel types; (3) Both price and leisure factors of lifestyle significantly affect consumer’s choice of channel types; and (4) Some demographic variables may significantly influence consumer’s choice of channel types and perception of service quality.
Ramdeen et al., (2007) apply the cost of quality (COQ) concepts in a hotel restaurant environment using the PAF (prevention, appraisal, and failure costs) model. They use five variables Hotels, Restaurants, Quality costs, Prevention costs, internal failure costs, Customer satisfaction. They suggested that more emphasis must be laid on prevention activities to improve the quality in food and services.
Tat et al., (2011) identify the key determinants of customer satisfaction in fast food outlets. They took survey of 358 respondents. Their dependent variable is customer satisfaction of fast food restaurant, and 5 independent variables were tangibility, reliability, responsiveness, assurance and empathy. They use multiple linear regressions analysis technique. They resulted that customer purchase intentions positively influence customer satisfaction in fast food restaurants. They suggested that customer satisfaction’s dependent on the top management of fast food restaurants services that can be managed by planning, promotion, marketing and operating.
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