Marketing eating out

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Starting and running a restaurant is not rocket science but a few errors especially in the beginning can lead to success or failure. And in this day and age there is so much competition that it takes more than just food and beverage for a restaurant to distinguish itself. A few decades ago, Delhi had little to offer by the way of world cuisines and there was not much else to offer beyond Moti Mahal, Wenger's, Karim's, United Coffee House and other such, mostly in the vicinity of Connaught place. But there has been heavy growth and diversification in restaurant business and now the consumers have enormous choices to make in the national capital.

There has been a rapid growth of consumer foodservice though standalone value at current prices of Rs. 11,574,491 from year 2003 to 2008. (Source - Consumer Foodservice: Euromonitor from trade sources/national statistics).

Now dining out is more of an afterthought than a planned occasion. People find themselves hungry with little or no time to cook, so they dine out, resulting in flourishing restaurant industry.

Unfortunately little has been researched to understand the fine dining (up class) strategies in context of ambience and life style in a restaurant. Collecting quantitative data is a very tough job for a researcher, as organizations seems to be hesitant to tell any information. This has lead to a huge gap in information, which expert bodies like FHRAI are trying to fill.

The research aims to study fine dining (up class) strategies in context of ambience and the life style from entrepreneurial perspective. For this purpose the researcher will evaluate the business strategies which will be helpful in understanding the factors that have crucial impact on the success/failure of the restaurant.

Therefore the study is conducted as an experimental work in the New Delhi region.


India is called as the land of snake charmers and magicians and the capital of this land of mystery is Delhi. Delhi dictates the history of India. The city was constructed and ruined seven times.

New Delhi is situated within the conurbation of Delhi and serves as the seat of Government of India and the Government of the National Capital Territory of Delhi. New Delhi was initially a ruling ground of the Mughal Empire. However, in 1803 AD it became a dominion of the British Kingdom and n 1911 the city was acknowledged as the capital of India.

New Delhi is situated on the banks of river Yamuna which makes its crop lands fertile. Being in the northern part of India Delhi comprises of plain areas. Delhi comprises a total area of 1483sq km. and is said to be the land of people with heart or 'dilwalas'.


History of Delhi specifies a legend of various empires like the Mughal, Khilji and Tuglaks who formerly ruled this city. The first ever indication of Delhi can be traced back to the times of Mahabharata in 1400 BC when it was called by the name of Indraprastha.

The last Hindu Emperor who ruled Delhi was Prithviraj Chauhan and he played the most vital role in shaping the History of Delhi.

Prithviraj Chauhan was the last Hindu Emperor who ruled Delhi and played a major role in shaping the history of Delhi. After that Qutub-ud-din-Aibak ruled Delhi from 1211 to 1227. From 1296 to 1316 Khilji Dynasty ruled Delhi and also established the Siri city within its premises. After Khilji dynasty Tughlags took the command of Delhi and established Tughlagabad.


It is very important to carry out a situational analysis to attain a better understanding situations prevailing in the market. Thus the situational analysis is sub divided into four parts; social, political, technological, and economical factors. By study of situational analysis the site proposed for the business and other external factors can be critiqued.

Social Factors

New Delhi is a potpourri of different cultures and is considered as a cosmopolitan city because of multi-ethnic and multi cultural presence of the vast Indian political system. New Delhi being the nation's capital hosts and celebrates the national events like Republic Day, Independence Day with great enthusiasm. People of New Delhi celebrate different religious festivals of all kinds and cultures with same energy and harmony ranging from Diwali, Holi, Maha Shivratri, Lohri, Baisakhi, Christmas, Eid ul-fitr and Mahavir Jayanti. Symbolizing the old tradition and heritage of the city, the people of Delhi follow various social customs and celebrate festivals throughout the year. Known for their cheerful nature and helping nature, the people of Delhi are quite admired in the whole country.

People of New Delhi are known to be very dynamic and ever changing in nature and their lifestyle. People of New Delhi are very advanced and open to embracing new customs and changes but at the same time they are very conscious of their culture. People from all parts of the nation live in New Delhi which makes the city very cosmopolitan in nature and New Delhi can be stated as one of the best examples for Unity in Diversity. This Unity in Diversity can be seen in social and cultural get-togethers where people of all the communities can be seen on one platform sharing one common view.

Night life in New Delhi is one more addition to the new lifestyle being admired by the locals. Night clubs in the city opens till late night and one can munch and sip along with dance on the floor. Shopping and mall culture in New Delhi has changed the way people used to shop earlier.

Political Factors

New Delhi is governed by the Municipal Government known as New Delhi Municipal Council (NDMC). The administrative structure of NDMC includes a chairperson, three members of New Delhi's legislative Assembly, two members Nominated by the Chief Minister of National Capital Territory of Delhi (NCT) and five members nominated by the central government. The most important street in New Delhi is parliament Street, also known as Sansad Marg. The parliament House of India is located in this street. The city has its own police force called as the Delhi Police headed by the Commissioner of Police, Delhi.

Technological Factors

New Delhi was planned by Edwin Lutyens and Herbert Bakers, and the city is admired for its wide tree-lined boulevards. Being a planned city it has many roads of iconic status including Rajpath, janpath, Shantipath, Akbar road etc. the maintenance and construction of these roads falls under NDMC's civil engineering department. New Delhi has a large number of subways from the time of British and is still in operation.

Delhi Metro constructed and run by Delhi Metro Railway Corporation (DMRC) connects the New Delhi with the rest of the capital. New Delhi Railway Station is the 2nd largest and busiest station in India.

Indra Gandhi International Airport is minutes away from National Highway 8 and is the primary aviation hub for the city. The airport transported 22.84 million passengers in year 2008-2009.

Public transport in New Delhi comes in 4 main forms: buses, metro, auto-rickshaw, yellow cab and private cabs. Delhi Transport Corporation runs the world's largest fleet of environment friendly CNG buses which connects the whole city and the suburbs.

Delhi Metro Railway Corporation currently operates at 128 km of route and with the upcoming plans for 2020 it will operate at 413.8 km, making it longer than the London Underground.

New Delhi being the national capital and a cosmopolitan city has seen unparalleled rise in technology and IT industry.

Economic Factors

The key industries in New Delhi include Information Technology, Telecommunications, Hotels, Media, Banking and Tourism. Delhi State Industrial and Infrastructure Development Corporation (DSIICD) has played a vital role in developing the economy of New Delhi at such a fast pace. DSIIDC constructed 994 industries sheds on 8 industrial complexes, to implement the scheme launched by Government of India titled "Half-a-million Job Programme."

New Delhi has a workforce of approximately 33% and the unemployment rate in New Delhi is one of the lowest in the country about 5%.

Real Estate, Construction, Telecommunications and Power are the leading industries. The Retail industry is one of the most flourishing in India. The industrialization of New Delhi is supported by its highly skilled labor and huge consumer market. The major industrial areas in New Delhi are Kirtinagar Industrial Area, Mangolpuri Industrial Area, Naraina Indutrial Area and Okhla Industrial Area.

The Government of National Capital Territory of Delhi publishes an official report of the whole Delhi every year and does not release any specific figures for the contribution made by New Delhi to the annual report. Delhi being the largest commercial center in Northern India totaled a Net State Domestic Product of Rs. 1,182 billion in nominal terms.

National Environmental Engineering Institute (NEERI) is constructing 15 Combined Effluent Treatment Plants which will cover 21 Industrial Estates of Delhi.


Strong economic growth and increased disposable income have boosted a sturdy demand for eateries in New Delhi. The restaurant business being a low entry barrier industry has attracted many entrepreneurs leading to great competition in the restaurant trade. One way to survive and grow is to market differently. Most of the entrepreneurs are new to the industry and may or may not have experience in restaurant business. It is vital for restaurateurs to understand customer demands and expectations before starting the venture due to high rate of restaurant failures.

Nieporent, D. said in an interview that "Nobu is a great example of how everything works in sync. We told the designer that there should be no clichés. He came up with non-traditional yet strong artistic images of things that one would see in Japan. The overall look is new contemporary, and there's enough going on in the design to keep people visually engaged throughout the dining experience. The design fits perfectly with our goal of making the Japanese dining experience more accessible to the U.S. masses."

Eating takes place in a context of environmental stimuli known as 'ambience'. Ambience of the restaurant greatly affects the customer and his/her preferences. With reference to the above quote an example is eating with chopsticks or sitting on the floor to eat in oriental restaurants can be discomforting if the customer is not familiar with the new setting.

For the purpose of research, the study will review relevant literature regarding principles of ambience, ambience strategies applicable in New Delhi, India. The research will also review various journals and articles which have already been researched on the area of ambience from different markets of other continents.


  • To study the effect of ambience on dining experience in standalone fine dining restaurants - in a restaurant an assortment of external factors such as social and physical environment, smell, color, temperature, and disturbance affect food intake and preferences. However the influence of ambience on dining experience is not fully understood. This aim summarizes the research on ambient influences on food intake and food preferences.
  • To study the strategy of the ambience and different factors to improve the dining experience - a certain target market is taken into consideration while creating any restaurant, because every section has their own needs. Therefore it is essential for the researcher to study ambience as a strategy to tune with what the target market really want. And by assessing the target market and developing a holistic approach for deciding the ambience the researcher will be able to improve the dining experience.
  • To evaluate the basics and essentials of creating a good ambience with reference to the lifestyle - ambience relates more to intangibility because by creating a good ambience customer is not given any physical object but is provided with an experience. Thus the researcher aims to identify such external factors and evaluate the ambient influences which can support building a good ambience with reference to the lifestyle.


As far as study of ambience as a business strategy is concerned, its application is fully dependent on the target market it has been created for. Beyond that others may find it uncomfortable and unacceptable. The study is conducted as an experimental work in New Delhi thus the lifestyle of Delhiites is taken into consideration.


  • The research is limited to only New Delhi.
  • The research studies ambience as a business strategies for only fine dine (up class) restaurants.


The structure of the research paper would be divided approximately in four chapters. The first chapter of the paper includes Introduction to the dissertation. The purpose of the study, statement of aim and objectives, scope and limitations of the work and dissertation structure are included into the chapter one - Marketing Eating Out.

The second chapter is literature review which is mainly the body of the paper. This chapter includes the detail research about the principles of ambience and its effect on food intake and food preferences.

The third chapter deals with the research methodology. The fourth chapter is conclusion and recommendations for further research. The research paper would be finished with Referencing and Bibliography.



  • Nieporent. D, (2001) New York in Baraban, R., Durocher, J. (2001) Successful Restaurant Design, Canada: John Wiley and Sons, Inc
  • Birchfield, J. (2008) Design and Layout of Foodservice Facilities, Canada: John Wiley and Sons.


  • Stroebele, N. and Castro D. M. J (2004) 'Effect of ambience on food intake and food choice', Elsevier Nutrition- The International Journal of Applied and Basic Nutritional Sciences, 20, 9, 821-838
  • Swinyard, W. R., Struman, K.D. (1986) 'Market Segmentation: Finding the Heart of Your Restaurants Market' Cornell Hotel and Restaurant Administration Quarterly, 27: 1, pp. 96.

Web references

  • Services International. History [online] Available at: [Accessed 23rd January 2010]
  • Department of Information and Technology. Govt of National Capital Territory of Delhi. History Available at: [Accessed 23rd January 2010]
  • Population of New Delhi [online] Available at: [Accessed 25th January 2010]
  • Delhi State Infrastructure and Industrial Development Corporation Ltd. Industrial Division - Sheds Constructed Under Half a Million Job Programme [online] Available at: [Accessed 25th January 2010]
  • Delhi Capital. Delhi's Economy [online] Available at: [Accessed 26th January 2010]


Ambience is a frequently used term - both in business contexts and everyday life. However, the perception is indefinite. It is often used unknowingly and transmits different meanings. In order to assess the importance of ambience in relation to hospitality industry, an adequate definition is required.

The researcher will refer to ambience as atmosphere. Kotler, (1973) defined ambience as "the air surrounding a sphere." The term is also used to describe the quality of environment, i.e. elements of the environment, which goes far beyond an individual perspective. Ambience is created by the interaction between individuals and their environment.

In framework of service delivery Bitner, (1992) suggested that it is relevant to make distinction between ambience and servicescape. Servicescape is the physical surroundings where the service is delivered, whereas ambience is the result of interaction between people and the physical environment. Ambience may vary in the perceptions of different people and the occurrence of ambience is intangible and unclear.

Within service environment customers can be exposed to numerous stimuli, all of which influences the customer's behavior, preferences and actions. Research conducted over the past years avail empirical data to support the reality of the effect of ambience, especially in dining environments. However, our acquaintance of ambience still remains somewhat limited.

Unique to this study is a discussion and test for the affects of ambience: a relationship yet to be explored.


Ambience is always created and for creating something inputs are required. Fisher and Byrne (1975), Martin (1986), Marks (1988) and Baker et al., (1992) all agree that there are three factors required to create an ambience are as follows:

  1. Atmospheric factors - these factors include the background conditions in the environment ranging from temperature, odor, sounds and lighting. These factors have great significance in hospitality industry.
  2. Social factors - these factors include human perspective of ambience. Fisher and Byrne (1975) explained how the individuals and social factors influence the perception of ambience.
  3. Design factors - Baker et al., did an elaborate study on the design factors and concluded that managers can control and influence these factors which is important to ambience. These factors include architecture, style, theme and floor plans.

It is evident that many studies have been carried out in past on these factors but data regarding the combined effects of all three types of creator/drivers of ambience lacks in context of hospitality industry.

Particularly in hotel industry, a guest interacts more with physical environment than with the service provider. The guest interacts with the servicescape prior to experience the service. And this first experience helps them to build a perception of the whole environment and the dining which has not yet taken place. Mehrabian and Russell (1974) explained how these perceptions stimulate guest's emotional responses (e.g. authority, excitement and gratification). Hence it is noted that noesis comes before emotion when individuals are appraising the servicescape.

Mehrabian and Russell (1974) termed this behavior as "approach avoidance" (Figure 1). Approach avoidance behavior in hospitality environment would include evaluation of the servicescape, emotional evaluation of the dining experience, long-term patronage decisions, exploration of the environment etc.


A recent study (Schiffman, 2001) found that one's own predisposition, expectation, motives and knowledge reaped from the past clubs together with the various inputs from the ambience gives birth to perception.

The term "Gestalt" is of German origin which means a "configuration of physical, biological, or psychological phenomena so integrated as to constitute a functional unit with properties not derivable from its parts in summation." With remote viewing, gestalts are normally represented with ideograms.

In a recent study Schiffman, (2001) found that the German psychologist - Max Wertheimer, Kurt Koffka and Wolfgang Kohler studied patterns of stimuli and observed that some stimuli appears to be impulsively grouped together. Max Wertheimer et al (Ingrid, Y. L. 2004, p. 165) stated that a perception cannot be meaningfully broken into its basic components (e.g. sensations), and proposed that the basic unit of perception is perception itself, also known as "Gestalts".

Schiffman, (2001) summarizes that according to Gestalt psychology, there are six principles that individuals make use to group different forms. And each principle amongst these six can be used to design the physical environment in hotels.

The principles are as follows:

  1. Proximity/closeness - individual elements are grouped together according to a similar perceived distance, which can be close or far.
  2. Common fate - elements moving in same direction are clubbed together. This principle is applicable to moving objects.
  3. Symmetry - preference in grouping is given to naturally balanced, symmetrical figures over asymmetrical ones. It is considered as a critical factor in aesthetics.
  4. Closure - grouping takes place in a way that favors perception of a more enclosed or complete figure.
  5. Similarity - elements that are physically similar are grouped together.
  6. Continuity - elements pointing in same directions are perceived to be together. Such as a straight line or simple curve.

These principles illustrate how people organize perceptual images. Individual's behaviors are a result of their interaction with their environment.

A micro-perspective means consideration of the issues which affect perception at the individual level. It includes applying principles of Gestalt to explain image formation, and also includes the individual level variables such as personality traits, pre-consumption expectations, goal behaviors, and cognitive style in research projects. Whereas macro-perspective direct to the issues which are outside of the individual. Macro-perspective includes socio-cultural influences (e.g., Feng-Shui principles, individualism vs. collectivism) and aesthetic effects (e.g., interior decor and design). As per the study of Schiffman (2001) servicescape can be enriched with the inclusion of both micro- and macro-perspective variables.

Hall, T. H. (1966) categorized human sensory system into two components: (1) distance receptors, and (2) immediate receptors. The author further explained that the distance receptors include retrieval of visual sensory input from eyes, auditory sensory data from the ears, and olfactory sensory data from the nose. In other words distance receptors allow us to gather data about surrounding without making a contact with it. On other hand immediate receptors include the sensory response collected from skin, membranes, tissues and muscles. These receptors collect data only after coming in contact with the environment or objects.


Bitner, M. J. (1992) has indicated that within a servicescape there are various visual cues including: color, lighting, space and function, personal artifacts and plants, and layout and design. The researcher will further study and discuss previous assessment of these components, specifically color, lighting, and space and function.


Color can be a food-internal or a food-external stimulus. Kotler, P. (1973) termed colors as the most powerful marketing tool used in today's advertising industry. Morton, J. L. (n.d.) stated that colors have an effect on both mood and biological processes, such as increase in blood pressure, producing heat, hunger, or thirst. Research has shown that different colors stimulate varying personal moods and emotions. And while evaluating a servicescape, this visual sensory input forms a metal picture through cognitive processing prior to affecting individuals' emotions and personal moods.

Bellizzi and Hite (1992) found that consumers react more suitably to a blue environment in retail settings, and that warm-colored backgrounds seem to be more capable of drawing attention and attracting people to approach a store. Their findings confirmed that blue stores had higher simulated purchase rates. The authors also determined that colors influence people's emotional pleasure more strongly than excitement or dominance. Boyatziz and Varghese's study (cited in Lin, I. Y. 2004, p. 168) stated that children often related positive emotions with light colors and negative emotions with dark colors. Though the above studies did not examine individuals' cognitive processing. But cognitive process comes first and follows in the emotional response as a fundamental element (Fig.2).

In food service, food colors and colors of the object acts together. For example blue grapes do not appear blue when served on a blue plate. Favre and November's study (cited in Pahulla, M. D. (n.d.) p. 200) found that the choice of color for decorating a restaurant depends on the potential customers. Young people prefer bright, strong colors, whereas adults take pleasure in their meals in weak, modestly colored environments. Thus, soft darkish colors are used mainly in the dining restaurants, whereas fast-food restaurants mostly use furniture and equipment with bright colors. Even the colors of food-related utensils such as silverware or Table cloths are taken into consideration when consumers' preferences are examined. Coffee drinkers judged the same coffee served from a blue pot as mild and from a brown pot as too strong. The best judgment of "aromatic and strong" was given to coffee served in a red pot.

Color of the food also affects people's judgment and perceptions about food. For example, orange juice which is bright yellow-orange is color is expected to be sweeter, that is why the most recent studies in food science and marketing focus on food color effects on consumer's choice and preference (self conceptualization).

Space and Function

The fixtures in a servicescape link the space with its occupants and transmit the personality of the servicescape through form, line, color, texture, and scale. The furniture position may express a sense of enclosure, define spatial movement, function as walls, and communicate visible or invisible boundaries. Recognizable changes in ceiling heights affect spatial perception more than a similar change in room width or length. High ceilings convey feelings of spaciousness, whereas low ceilings are associated with coziness and intimacy. All of these elements help individuals form a mental picture prior to affective response and judgments toward a specific servicescape.


Ryu, K. and Jang, S. S. (n.d. p. 60) in reporting Kurtich and Eakin's study, states that all sorts of lighting in an environment directly control an individual's perception of the definition and quality of the space, influencing his or her consciousness of physical, emotional, psychological, and spiritual aspects of the space. Light also controls the perception of form, color, texture and enclosure. Kim, (1998) found that participants perceived tasks more positively and reported decreased boredom in a room with windows, in contrast to a room without windows.

Gifford (1998) carried out research on the lighting level and room décor on interpersonal communication, comfort, and arousal. The author came to a result where more communication took place in bright environment, whereas more intimate conversation occurred in softer light. Steffy (1990) suggested that environments in which the lighting is designed to complement/go with furniture and accessories are considered to be more pleasant than environments in which lighting does not complement with other elements of the room.


The notion that background sounds/noise/music can be used to influence consumer behavior is derived from the concept of atmospherics (Kotler, 1973). Given a choice, consumers choose environments which offer a pleasant atmosphere and extend a feeling of acceptance. In case of fine dining (up class) restaurants the atmosphere may be more influential than the product itself in the purchase decision (Kotler, 1973) and can directly influence consumer behavior and attitude/ image formation (Baker et al., 1992). Bitner (1992) suggested that the physical surroundings (atmosphere) of services businesses have a large impact because patrons frequently consume services within the firm's environment. Background music is generally considered to be one of several atmospheric variables that can influence evaluations, willingness to buy, mood, cognition, and behavior (Baker et al., 1992).

Smith and Curnow's 1966 study (cited in Swingle, 2007, p. 12) stated that in shopping and dining places the expenditure are influenced by the volume and tempo of background music. Slower tempo and lower volumes tend to make retail patrons shop or eat at a more leisurely pace and in certain instances spend more money than faster tempos and higher volumes. Also shopper behavior tends to differ according to the type of music played. More specifically, shoppers may spend more when the music "fits" with the product and/or closely matches the musical tastes of shoppers (self conceptualization).


In a servicescape, guests take note of music and noise as auditory components of their evaluation. Studies on music and consumer behavior have demonstrated that music can be used as an efficient tool to minimize the negative consequences of waiting in any service operation. Music can also be a positive auditory cue exciting specific consumer behaviors and emotions, as many research studies have discovered.

McCarron and Tierney (1989), Harbgreaves and North (1997) and Stroebele and Castro (2004) all agree that the chosen music is meant to cover one party from the other party and to neutralize noises from guests or from the environment. However music can do more than just covering the unwanted sounds. Music can support relaxation or change mood and can also influence the amount of food and fluid consumed. McCarron and Tierney (1989) stated that despite of the prior frequencies of soft drink utilization and experience to loud music, increasing acoustic lead to an increase in total consumption.

A recent study (Caldwell and Hibbert, 2002) indicated that slower music was accompanied with slower rate of eating but larger bar bills for customers. The study further found that preference for the type of music playing also manipulates the time spent in the restaurant. The more the people liked the music played, the longer they stayed at the location. The researchers concluded that tempo and its relations with preference have a noteworthy influence on time and money spent in a restaurant, which encourages increased food and fluid intakes. "People who like the environment (which is related to the music tempo above other variables) stay longer and end up ordering dessert or another drink to prolong their stay, whereas people who do not like the atmosphere choose to leave. The more the music is liked, the more subjects like the atmosphere and the more they want to return to the situation" (Stroebele and Castro, 2004 p.829).

Non-musical Sounds

Kryter's (1985) study cited in (Lin, I. Y. 2004, p. 170) stated that noise and loudness are perceived to be irritating and annoying. The author further explained that the two components of sound volume (loudness) and pitch. Volume is related to amplitude of sound waves, and pitch relates to the frequency of sound waves. According to Kryter's (1985) study too much volume or high pitch has a negative stimulation, especially when they are unexpected or perceived as undesirable. Such sounds result in distraction, irritation, increased activity and tension.

Kryter (Lin, I. Y. 2004, p. 170) concluded that constant sound, quiet, and silence may be equally problematic, and a balance of loud and constant sound is the key to create a pleasant sound environment.


Hirsch, (1992, 1995) and Bone & Ellen (1999) all agree that fragrance can be used to increase sales as a powerful tool. Hirsch (1992, p.390) stated that "scents can influence a consumer's desire to make a purchase; for instance, they can increase a bakery's sales by as much as 300%".

Hirsch (1995) tested the effects of two ambient odors on the amount of money spent on slot machines in a Las Vegas Casino. The author found that one scent drastically increased the amount of money gambled, whereas the other did not.



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