Business Essays - Michelin Star System


Michelin Star System

Michelin Star System

Chapter 2 Literature Review

The system of rating organisations with a particular business sector according to the value and quality that these organisations provide to the end user, by methods such as those used by the Michelin Guide Star System is nothing new. However, it is important for the owners of these organisations to understand the relevance of such systems. For example, are they most relevant to the consumer in terms of meeting their needs and expectations and thus influencing behaviour or to the organisation in terms of improving its standing within the business sector and strengthening brand awareness? Commencing with the consumer, this critical literature review is intended to provide an understanding of the current theories and observations relating to these particular issues.

2.1 Consumer needs and satisfaction

Abraham Maslow's (1998) hierarchy of needs theory is recognised by most academics as having created the foundation for all subsequent research into understanding the consumer, providing a framework that allows organisations supplying a product of service to better understanding how they need to present these in order to satisfy the consumer need, thus achieving their objective of increasing market share. The research carried out by Szmigin (2003) and Porter (2004) also confirms that the success of a businesses strategy is also dependent upon the extent to which that strategy is designed to meet and therefore address the perceived satisfaction levels of the consumer.

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Figure 1 Maslow's hierarchy of needs

Esteem needs

achievement, status, responsibility, reputation


personal growth and fulfilment

Belongingness and Love needs

family, affection, relationships, work group, etc.

Safety needs

protection, security, order, law, limits, stability, etc.

Biological and Physiological needs

basic life needs - air, food, drink, shelter, warmth, sex, sleep, etc.

In relating the Maslow theory directly to the satisfaction of needs of the consumer with regards to their restaurant experience, it can be seen from the above diagram (figure 1), that this is dependent upon the level at which the consumer is within the hierarchy. For example, it is likely that those at the three basic levels of need will be less driven by optimal quality than price and pace to fulfil that need (Noone et al 2007 and Namkung and SonCheong 2007). The satisfaction of these levels of need is likely to be more important for the tourist sector of the hospitality industry, where the meal is expected to form just a part of their overall vacation experience (Atila and Fisun 2003).

However, where esteem and self-actualisation becomes more important is when the consumer wants to make a statement that separates him or her from the crowd. For example, if a salesperson wishes to make an impression with a prospective client, they are likely to want to dine in a restaurant that delivers a higher level of quality. In other words they will be looking for a perfect experience that will satisfy those they are trying to impress (Gupta et al. August 2007 and Chemlinski, R., 2006).

2.2 Consumer behaviour

The behavioural patterns of consumer, as with all human reactions, are dependent upon reactions that can result from a psychological, emotional or physical influence. One of the most influential factors that influence consumer behaviour is that of memory. Everything we do is affected by memory, and this will drive our conscious and sub-conscious reaction to a particular event and the ultimate choices that we make. However, the memories formed are also affected by the manner in which pre-existing experiences interpret them (Zaltman 2003, p.186). For example, if we have had a bad experience at a particular restaurant in the past, it is likely that this will deter us from repeating the experience, irrespective of how that particular restaurant may try to re-package the experience.

One of the difficulties that the restaurant owner has with delivering satisfaction of needs to the consumer of their product results from the fact that memory determinants of consumer choice are driven by both conscious and unconscious thought processes and therefore can be almost impossible for an outsider to see and measure, let alone alter (Zaltman 2003, p.15). This is certainly true in relation to actions resulting from subconscious memory as, in this case, as Bagozzi et al (2002, p.132) observe, even the person making the choice could be unaware of why they have reacted in the way they did. The memory processes will influence the manner in which the consumer makes a judgement about the benefits of the restaurant product and service being offered. Based upon previous memories it will subconsciously inform the consumer whether the expected experience is likely to be negative or (Zaltman et al 2002, p.68). Furthermore, the consumer will also then use that memory to judge whether the experience will lead to a satisfaction of their current level of need (Maslow 1998).

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2.3 Branding and the consumer

Brand image is another important factor that will influence the consumer's choice of purchase. It is an almost automatic reaction of the consumer to make an association between the brand and what it denotes. For example, in terms of restaurants and hospitality, the brand McDonald's automatically conjures up an image of fast, cheap food or the burger type variety. Irrespective of the adjustments that the burger chain tries to make to their products, such is the depth of that association within the mind of the consumer that it will be almost impossible to change Haig (2004, p.78 and 85). Once a brand has been created therefore, changing the consumer's perception of it is extremely difficult.

One of the problems that the Michelin Star System has in respect of brand image is that it has, consciously or unconsciously within the mindset of the consumer, created an image of quality, but with that quality being achieved at a price. In the minds of certain segments of the consumer public this puts their recommendations beyond the bounds of affordability, irrespective of whether it will satisfy their needs (Surlemont et al 2005). However, Porter (2004) would argue that the differentiation in terms of the quality of the product and the price premium could have certain competitive advantages. For example, it would appeal to those who wish to set themselves apart from the masses or, as indicated earlier, are trying to create an impression for their own purposes. Furthermore, as the research on consumer behaviour conducted by Zaltman (2003, p.227) suggests, this differentiation may also be able to produce satisfaction in terms of another influential factor that exists within the consumer decision-making process, this being peer influence. It is well recorded that our perception of what others think has a significant influence upon the way we make decisions. For example, we will often make decisions simply in an effort to be connected to a particular group or segment of people. As mentioned earlier, within the restaurant experience this may manifest itself in the need to impress others. However, in the hospitality sector it can be said to be equally true that people will dine at a certain restaurant simply as a means of making a statement, which indicates to others that one is within a different consumer group. In this case, the consumer will be satisfying the Maslow (1998) levels of need that relates to self-esteem and actualisation.

2.4 Restaurant recognition

Literature does however show that the Michelin rating system and the recognition it brings does make a difference within some areas of the sector (Guide 2008). From listening to the videos of the comments of Gary Rhodes and Anthony Demetre (Video Links 2008), it is apparent that to the proprietors of the restaurants concerned both consider that it improves the quality of their respective brands, which in turn will enhance the business drive for success. This view is reinforced by the reaction of those who lose or fail to gain stars, which shows obvious disappointment (Latest news 2008).

2.5 Summary

In the opinion of the author, the literature evaluated for this review shows why there is such a diversity of opinion regarding the relevance of the Michelin Star System within the current restaurant sector of the leisure and hospitality sector. There are those whose theories argue that, except for the higher levels of satisfying the consumer needs (Maslow 1998), which relate to self-esteem and actualisation, it has little impact upon the average consumer. Similarly, many consumers perceive that its influence is more related to the pricing strategy and restaurant environment than in delivering service satisfaction to the consumer (Snyder and Cotter 1998). However, employees and owners within the industry would argue that the Michelin Star has a beneficial impact in that it increases the strength of the brand (Balasz K 2002) and that it denotes an assurance of quality that the consumer can rely upon.

Chapter 3 Research Methodology

As McGivern (2006, p.4) observes within her study on the subject, research is about a systematic investigations to find things out, which means that the researcher has to devise a system of methods and rules to facilitate the collection and analysis of data (Hart 2006, p.28). Thus it follows that the particular method adopted for any research project has significant importance in relation to the intended aims and objectives of the study being conducted.

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Essentially, data used in a research studies can be collected through one of two methods. These are the primary resource, which often entails the direct collection of data through the use of surveys, interviews and questionnaires, or the secondary resource, which relies upon the use pre-existing data (Clark 2002). The decision that every researcher faces is which of these methods, of combination thereof, is most appropriate to the subject matter of their research project.

Bearing these factors in mind, the intention of this chapter is to provide the reader with an outline of the methodology chosen by the author for this study into the Michelin Star System.

3.1 Choice of research design

The restaurant sector of the leisure and tourism industry in which the Michelin Star System operates is diverse, both in terms of the numbers of participating market players, the business models used and the consumer audience to which they appeal. With the UK Michelin guide covering a total of over 4,500 hotels and restaurants (Hickman 2008) it is also a sizable sector for any research to cover. Furthermore, due to the importance of the restaurant sector in relation to the leisure and tourism industries, together with its influence upon the consumer, there is a proliferation of pre-existing academic and practical data available in relation to this sector, which is being increased on a regular basis. These include empirical studies in targeted leisure and hospitality journals, observations from external stakeholders such as magazines and newspapers and numerous regularly conducted questionnaires and surveys.

The considerations to be given to the choice of the research design was therefore to assess whether this level of secondary data would provide a sufficiency of information to add value to the research being conducted or if approaching the research using a primary data approach would prove to be of more relevance to the aims and objectives that form the basis of this paper.

In the final analysis the author decided to design the research around the secondary data approach. In reaching this decision, there were several reasons for the discarding of the primary option. The first of these took into account the limitations that would attach to primary data collection. Of necessity, the completion of this research is restrained by a definitive time set for its completion. Furthermore, in view of the size of the sector, it was considered that to construct and conduct a sufficiently robust primary data choice, through the use of questionnaires and interviews would be cost prohibitive. For example, there would need to be a sufficiently large sample of such data collection achieved through restaurant employees, consumers and other stakeholders to create a representative sample, which in the author's opinion could not be achieved within the prevailing limitations.

It is recognised that secondary data has two potential disadvantages. Firstly, with this method, the researcher is reliant upon the validity of data being collected from an external source over which they have no control; therefore there is no direct knowledge of the responses and theories available. Secondly, there is also the issue of the validity of the data to be considered. However, its main advantage is the depth and breadth of the amount of data available.

It choosing a design based upon secondary data it is recognised that there are two potential disadvantages. Firstly, with this method the researcher is reliant upon the validity of data being collected from an external source over which they have no control; therefore there is no direct knowledge of the responses and theories available. Secondly, there is also the issue of the validity of the data to be considered.

However, in addition to the limitations attached to the collection of primary data, there were also positive reasons for choosing the use of secondary data as the foundation for the design of this research paper. The first of these relates directly to the fact that, from an initial exploratory examination of the data field, it is apparent that much of the secondary information is of a higher quality and has a more extensive coverage than could be achieve from a primary method (Punch 1998). Secondly, as the aim of this dissertation concentrates upon the current value and relevance of the Michelin Star System, it is necessary to study the differing views and theories of academics and researchers in respect of those who are likely to be affected by the system, including the restaurant operators and their customers. In this respect the theory relating to business branding, quality and competitive advantage, such as those promoted by Arnold (1992) and Porter (2004) need to be considered. From the customer aspect, understanding the needs, expectations and behavioural patterns need to be included. For this area was considered that the academic studies and theories promoted by authors such as Abraham Maslow (1998) and Szmigin (2003) are also relevant. It is generally accepted that these authors have a high level of expertises and therefore, as Dingwell (1997) and Steward and Kasmins (2003) suggest, their works will adds a higher level of quality to the research being conducted for this study.

In reaching the choice of using secondary data for the design of this particular research, the author took the same view as other researchers, such as Steward and Kamins (1993), McGivern (2006) and Hart (2006). These authors suggest that the type of methodology used is not overly important providing the data and information collected is reliable, trustworthy and resolves the questions being posed within the research aims and objectives. The author is confident that the choices for secondary data made fulfil these criteria.

3.2 Construction of the chosen method

It is important that the correct approach is used in dealing with the quantity of data collected and its subsequent analysis and evaluation. This is particularly the case in terms of eliminating any bias that exists within the mind of the author. In this particular case it is the considered view of the author that, potentially, the research may conclude that the Michelin star system is only of relevance to the internal stakeholders of the restaurant sectors, namely the chefs and owners, and is paid little regard to from the consumers viewpoint.

Therefore, in selecting a range of between thirty and forty references from a range of databases, which includes books, professional journals, reports and surveys, websites and other online resources, these issues have been borne in mind. For example, in order to balance the potential bias, resources have been chosen that support the current relevance of the Michelin Star System current relevance as well as those sources that take the opposite viewpoint. Similarly, for the same reason it was felt the relationship between consumer needs, behaviour and branding also needed to be addressed, as this will provide a view of the influence that a Michelin Star brand has upon the end user of the restaurant facilities.

3.3 Sample

The sample of literature used within this research has been chosen from a number of relevant sources. In the main the concentration has been upon selecting resources from the most current available sources, being generally that produced within the last two to three decades, as this was considered to be the most appropriate for the issues being discussed. Similarly, the sampling was concentrated mainly upon the UK. The only exception to this was in cases such as Maslow's hierarchy of needs, which is considered to contain the founding principles of consumer behavioural determinants.

With the exception of the theoretical literature, where the approach of author choice was made for the reasons discussed in section 4.1 above, the sampling method used was based upon the maximum variation approach (Hart 1998 and 2006) as this was felt to provide a firm foundation from which to address the objectives of the study.

3.4 Procedure

The procedure used for the collection of the secondary data was through the normal database channels of journals, books accessed from libraries and speciality bookshops and online resources. However, these searches were further defined to ensure that there was a direct relevance to the tourism and leisure industry, with particular concentration upon hospitality.

3.5 Data analysis

Having collected the data using the previously defined methods and selection choices, it then needed to be analysed and evaluated. A dual approach was used for this purpose. The first stage involved correlating the data into differing viewpoints, for example those who considered the Michelin star relevant and those that did not. The second stage required evaluating the relevance that the various theories studied had in a practical application.

Chapter 4 Findings

As has been discovered within the literature review, there are conflicting opinions as to whether the Michelin Star system of quality measurement is of value within the restaurant industry. Using available secondary data within this chapter is in tended to present an analysis of the findings of the current opinion and research on this issue, which will then be discussed in depth.

4.1 The Michelin Star reward system

The Michelin Guide, which derives its name from the Tyre company from which it originated, was first introduced in France in 1900 (Johnson et al 2005). Its original intention was to assist drivers with technical and travel advice. From there it developed into a tourist guide until eventually, in the 1930's, it became the gastronomic guide that it is renowned as today. By 2005 the Red Guide, as it had become known, was selling over one million copies across eight countries (Johnson et al 2005).

Restaurants and other eating establishments cannot be included within the guide until their location has been visited and the meals judged by a dedicated team of inspectors. In order to avoid accusations of bias and to ensure independence, these inspectors are employed by Michelin and are required to pay for their meals and any accommodation that may be required. In fact, they also do not inform the establishment of the reason for their visit until after their inspection has taken place. In this respect, Michelin suggest, and other research has confirmed (Balasz 2001), the results of the inspections show a greater level of independence than that of some other guides, which give advance notice of the inspection and do not expect to have to settle the meal bill.

According to the Michelin Guides Direct, Mr Naret, the Michelin inspectors are also not swayed by the name of the chef or the establishment. This was made evident in a recent interview where he said, "Inspectors aren't looking at the name. They don't care whether the chef is on television or how many of his cookbooks you might have on your shelf. They enter the restaurant and look solely at what is on the plate: the quality of ingredients, how they are cooked, how well the flavours are kept, presentation, personality and consistency" (Foster 2007), although as will be discussed later, there is some disagreement over this claim.

The Inspectors, of which there are currently around 70 operating throughout Europe, are persons who have had at least five years experience within the hotel and catering industry, particularly in respect of the cuisine element. Prior to being allowed to commence their inspection duties, these persons also have to undergo a vigorous six months training programme to ensure that they meet with and maintain the required Michelin standards (Johnson et al 2005). Michelin states that on average one inspector will perform the following tasks during the course of a year: -

Inspect 240 meals per annum

Undertake 130 overnight stays

Submit 1000 reports

It has to be stated that this is an exceptionally heavy workload for one person. It is partially because of this level of activity that some expert observers, and indeed restaurateurs' themselves, have called into question the quality, appropriateness and validity of the inspection teams work and conclusions. This element of concern is discussed in later sections within this chapter.

The guide includes a wide range eating establishments, most of which are included simply for information purposes, with these totalling around 50,000 in number, a level that is constantly increasing. However, amongst this number around five percent are picked out for special mention, these being rated based upon the awarding of the coveted Michelin Star to them. There are up to three stars available, the awarding of which depends upon the consistency of quality and, as Johnson et al (2005) explain, To some extent tradition. Michelin denote the definition of their stars as follows: -

One Star

A very good restaurant in its own category

Two Stars

Excellent cooking, worth a detour

Three Stars

Exceptional cuisine worth a special journey. One always eats extremely well here, sometimes superbly.

In 2005 a further merit recognition was introduced, which was called the Bib Gourmand. This is awarded to an establishment that had not quite managed to reach the level of quality required to achieve one star status, but which was considered by the inspector to be able to achieve that position within the near future.

Although there is limited information available as to the criteria which is used for the determination of the star level being awarded, in the main this relies upon the standard exhibited within the following five areas: -

Meal ingredient quality

Culinary skills exhibited in preparation and the combination of flavours

Level of creativity that has been displayed

How consistent the meal standards at the establishment are

Monetary value of the product

4.2 General academic perception of the Michelin Brand and competition

Academics such as Johnson et al (2005), Yuksel and Yuksel (2003) and Balasz (2001) have mixed views about the quality and relevance of the Michelin Star system. Yuksel and Yuksel (2003) in their research into the systems entry into the Japanese culinary market, suggest that, in that country at least, the guide fails to take into account the people factor. In other, it is being suggested that by using paid professionals, the Michelin organisations does not pay sufficient attention to the qualities of reliability and satisfaction that lead to repeat usage of the establishment by the consumers. This area is considered by many academics that study consumer behaviour to be of equal importance to the standard of the fare being offered (Bagozzi et al 2002) and should therefore be incorporated into the Michelin procedures.

The second element of concern expressed related to the pressure that the Michelin Star System placed upon the establishment chefs and owners. Although, as Johnson et al's (2005) research concluded, the possession of a Michelin star does not guarantee profitability, its loss was discovered to have serious implications for the business, with some experiencing revenue reductions of up to 50% when this situation occurred.

Issues of a practical nature in relation to the Michelin Start system have also been raised by many observers. There is a general view that the reflection of changes within eating establishments is not dealt with efficiently by the Michelin inspectors, with the awarding or removal of stars failing to keep up with these changes in many cases. There is little doubt that the excessive workload of the Michelin inspectors outlined in section 4.1 is a contributory factor in the occurrence of these delays.

Furthermore, it is felt by many that, outside of the Star system originating market, France; the rating system lacks the same level of reliability. This will be evidenced by the response from the Japanese restaurant industry presented in the following section.

Surlemont and Johnson's (2005, p.589) research also indicated that, in their opinion, there were some flaws within the Michelin star system. In the first of these it was noted that there were restaurants included within the varied stars that did not merit their positions, which adds to the perception that there might be a problem with the quality and reliability of the system and its operating procedures. Secondly, the lack of a structured measurement process being implemented by Michelin, its awarding of stars being solely at the discretion of inspector reports, did mean that the chefs had no definable target to aim for. Instead they simply had to develop their own style and be patient, and hope that it would be noticed and appreciated by the Michelin inspectors at some stage.

Another area that has been questioned with regard to the Michelin Star system is its prevalence for print guides. Although the company has recently introduced online facilities for consumers to respond to the content of the guides, the main method of information distribution is through the published guides, which at prices starting at around 9.99 ($20.00) is seen by some consumers to be quite expensive, especially as access to restaurant reviews and comments is freely available through the Internet. Bagozzi et al (2002), indicate that consumers pay a considerable amount of attention to peer pressure and comments, and the Internet provides them with access to this type of response. Others such as Zaltman (1998) also suggest that the reliance upon peers can be a strong determinate for purchase, thus if consumers recommend restaurant brands in many cases this will produce a more positive effect upon others than the professional approach of recommendations provided by Michelin. The recent drop in guide sales in Europe shows that this situation is affecting the strength of the Michelin brand, at least in this geographical area, and is seen as part of the reason for the guides expansion into the US and Asia.

In addition, there are competitors to Michelin Guides. There are two that are particularly worthy of note. The first, which has built a significant market share in the UK, is the AA Rosette system, which is awarded to hotels and restaurants for their culinary standards. In this case there is a five star system in operation, with the lowest being awarded to restaurants of note in their particular location to the highest being awarded to establishments that are considered to be world class. There are consumers and observers who believe that the AA Rosette system is a more reliable indicator of quality than Michelin.

The other guide that is receiving good reviews, and like the Michelin guide originates from France, is the Zagat guide. What has brought this guide to the attention of culinary observers is the fact that its rating system is based upon an aggregation of the opinions of unpaid individual consumers their experiences of the restaurant establishment (Gobe 2002, p.139). Michelin would argue that this is not a professional approach to the determination of quality, standards and culinary skills. Nonetheless, the fact that the Zagat guide is increasing in popularity indicates that it is having an impact upon consumer choice and behaviour.

4.3 Industry reaction to the Michelin Brand

Within the culinary industry itself there is considerable debate about the value of the Michelin star system, with the supporters and opponents of this accolade being equally vocal in expressing their views on the subject.

For example, in terms of country bias, a survey of 791 Michelin-ranked restaurants conducted by Johnson et al (2005) conducted throughout eight countries indicated that France was favoured in the awarding of stars, with it being home to 62 percent of the one-star restaurants, 67 percent of the two-star restaurants, and 25 of the 32 three-star operations.

Furthermore, its financial importance to financial success is also argued. For example, whilst Belasz (2002) suggests that holding a Michelin star can provide an establishment can be a key determinant for its financial success, Johnson et al (2005) disputes this claim, finding in their research that in most cases there was no indication of this being the case, at least in terms of profitability. However, Johnson et al did concede that the Michelin star made a difference to revenue in most cases, although this does not mean that the restaurant became more profitable as a result.

The impact that the Michelin stars have had upon chefs and their reactions to the system has also been diverse. As Balasz (2001 and 2002) mentions in her research into behaviour and leadership within the hospitality industry, chefs belong to the rare species of individuals who are able to take on the duel role of businessperson and creator at the same time. Referring also to their dedication to the craft of culinary creation, Balasz also mentions that chef's approach this with an almost sacred obsession and in this respect they aspire simply to be the best. Therefore, it is not surprising that the Michelin star system has a significant affect upon these people.

There are many chefs and culinary establishments that crave being awarded the stars and make little secret of this desire. For instance, in addition to the response from TV chefs Rhodes and Demetre (Video links 2008), one of their peers Gordon Ramsey, whose various establishments are said to currently hold the most number of stars (12), was also delighted with the recent additions to this elite club, which occurred with the recognition of his restaurant based in Manhattan, New York. In the Editorial (2007), Ramsey expounded the view that it showed the quality and customer value that the staff at the restaurant delivered to the customer. However, other US food critics and observers did not share Michelin's opinion, branding the food as 'overcooked', 'rubbery', 'leathery' and 'a distinct disappointment. Nevertheless, other American chefs are supporting of the Michelin rating system. Eric Ripert and Mario Batali, both of whom have been starred by Michelin have indicated that it is important to their businesses (Petkanas 2006). Ripert suggested that those who were complaining about the pressure Michelin stardom placed upon the chef were misguided and, as far as he was concerned, it had a positive effect upon the profitability of his restaurant. Similarly, Batali, who runs a restaurant in New York, indicated that inclusion was beneficial as in his opinion many Americans relied upon it, particularly when travelling abroad, although he felt that the standards should concentrate more upon the cooking instead of the table setting (Petkanas 2006).

Other support for the system has come from unexpected places, such as Holland. In a survey conducted with restaurateurs in the Netherlands (Gehrels et al 2006, p.51) it was found that 53.84% considered that being included within the Michelin Guide was the most important element of their promotional activities. Furthermore, 30.77% were of the opinion that the guide was influential as a tool for word of mouth promotion by consumers, in other words the consumer would be happy to promote restaurants that had been mentioned in the guide to others.

However, there has also been a lot of criticism from renowned chefs aimed at the Michelin Star system. Some of these criticisms have emanated from restaurants that have not been included within the star system. For example the owner of a Paris bistro Le Comptoir, who has been on the Michelin waiting list, criticises the publication, arguing that despite his bistro specialising in great regional cooking and yet again it scarcely rates a flicker on Michelin's scale. He goes on to ask who is the winner? One thing's for sure: it's not Michelin's readers (Elliott 2008).

If such criticism were to be seem as only being voiced by those who have not been honoured with one or more of the Michelin it could be argued, as some have done (Elliott 2008), that this could be a simple case of expressing disappointment. However, over the past few years there has been an increasing amount of criticism being levelled at the Michelin system from prominent chefs who have been consistently achieving high levels of star recognition.

One of the most noticeable defections from the Michelin Star ratings is Alain Senderens, who use to run the Lucas Carton restaurant in Paris (Petkanas 2006). Senderens, who held the three star Michelin honour for nearly three decades has recently renounced his inclusion in this rating system and, according to Petkanas (2006) he is one of many French chefs who are taking similar action, preferring to rely upon their own standard of quality and standards to increase their business and its profitability levels. Senderens complaint against the Michelin system is that it rewards puffed-up service, boilerplate "luxury," and dishes with sticker-shock ingredients like lobster and caviar, rather than concentrating upon what was really wanted by the consumer. Another of Sendersens criticism relates to the cost of achieving star status, which can be seen from his comment that "Someone has to pay for all that: the client. To win three stars you must run a very formal operation and make a monumental economic investment. If the china isn't Dior, Michelin isn't interested. In his view, You should be able to use plastic tablecloths and get three stars. You should get them for what's on the plate."

This level of criticism is not reserved for the French either. In London, one of the city's most highly regarded chefs, Landanis, has voiced similar concerns and reservations. Whilst agreeing with the French Chef views that the type of foods and the costs of creating the required atmosphere to deliver the standard required by Michelin are out of touch with reality, Landanis goes further. He has two other issues with the Michelin system. In the first place, bearing in mind the competitive nature of chefs and others in the restaurant business, he believes that, in fuelling that competitiveness it is driving up the price of eating out to the detriment of the consumer, these being the very people who are supposed to benefit from the ratings. In other words he is suggesting that the star system is more seen as an expression of inter-chef rivalry that fulfilling its original intentions. His other issues with it is that, in his opinion, Landis believes that the relevance of the Michelin star system is not as strongly felt in London as it is in France.

As noted earlier, this latter viewpoint expressed by Landanis has also been echoed in Japan, where the Michelin Star system has recently been introduced (Frackler 2008). Many important Japanese chefs, including Toshiya Kadowaki, have turned down the opportunity to be ranked within the Michelin system, despite the fact that some of his most notable dishes are French-inspired.

Part of the objections being raised by Japanese chefs is aimed at the lack of local knowledge of Japanese culture and traditions that Michelin inspectors have, and for this reason they find the rating system unpalatable. In Franker's (2008) report, Kadowaki summed this feeling up when he commented that . Japanese food was created here, and only Japanese know it. How can a bunch of foreigners show up and tell us what is good or bad?

These adverse chef views about the relevance of Michelin star rating have been reported liberally throughout the media and these publications are also expressing concern about the issue. For example, William Sitwell, which is the editor of the in-store Waitrose Food Illustrated (Elliott 2008) commented that chefs had told him that the guide was championing food that people no longer wished to eat. It seems to me that too many chefs are slaving in the kitchen to please Michelin and get stars, when people are looking for less poncey and more normal food. His view on this was that, because of the spread of these concerns, there was serious concern within the industry that the Michelin system had ceased to become relevant.

Finally, other industry concerns have been targeting the transparency and bias of the Michelin system. In particular this concern centre's on what is seen to be an indigenous bias towards the French and French cuisine. In giving substance to this opinion, it has been noted by observers that the development of Michelin stars in New York has exhibited bias. New York has four establishments that have earned Michelin's three star status. However, out of this number three are being run by French chefs, these being Alain Ducasse at Alain Ducasse, Jean-Georges Vongerichten at Jean Georges, and Eric Ripert at Le Bernardin. The suggestion is that this is not a coincidence, but a sign of the fact that the Michelin inspectors use French cuisine and cooking expertise as an unfair measurement of standards against which it compares establishments that are either outside of France or whose chefs do not exhibit similar skills in terms of the types of meals that they present.

It has to be noted that recent adverse incidences involving the Michelin guide have only served to increase the levels of concerns being expressed. For example, in 2005 a restaurant in Ostend, Belgium, was given the rating of Bib Gourmand despite the fact that it had not even opened for business (BBC News 2005). In fact it was several weeks after the guide had been published that the said restaurant first opened its doors to the public. This brought into question the validity of the inspections being performed and the standard of those being employed by Michelin. This situation was further inflamed by a book written by a serving inspector, who suggested that there was bias towards certain chefs, which meant that they were almost guaranteed of their star ratings and, furthermore, that there were not enough inspectors to deliver the expected level of service (BBC News 2005).

4.4 Consumer reaction to the Michelin Brand

It is a generally held belief that, in the eyes of the consumer, the restaurant and its owners/chef's serve two main purposes. These are to satisfy the consumer's demand for an experience that delivers to their needs in terms of quality and standard of the culinary product and the time spent in the restaurant environment. In other words, satisfaction of the consumer needs is paramount (Bagozzi et al 2002). From a competitive viewpoint, this means that the restaurateur, to improve market share and thus the profitability of his or her business, has to create a business that exhibits sufficient differentiation to encourage consumer's to choose their establishments in preference to another (Muller 1999, p.401).

Furthermore, as the Japanese research conducted by Yuksel and Yuksel (2003, p.52) affirms, not all consumer segments have the same levels of purchasing determinants. For examples, the levels of quality and satisfaction will not be equal across the whole of the consumer segmentations (Zaltman 2003), with not only different groups having different expectations but also the fact that these expectations differ depending upon the experience being required. For example, those on vacation may be looking at a restaurant experience in a very different way to the business person who is seeking to impress his clients, or the romantic who is looking to celebrate a special occasion.

The difficulty that many consumers perceive to be the case with the Michelin star rating system is that much of it is concentrated upon the higher quality end of the market, particularly in the case if the higher star ratings. Furthermore, because all of the chefs within this sector are seen to be competing for standards and quality that are measured in a manner that tends to produce a similar experience, there is also consumer concern that the element of choice is more limited than the all of the consumer segments would desire. This is confirmed in the Japanese research mentioned earlier where Yuksel and Yuksel (2003, p.52) identified that there were five distinctive consumer segments and that each one of these expect different levels of quality and service.

Furthermore, as mentioned earlier, there is increasing evidence that the consumer is moving away from responding solely to information provided from what they consider professional sources, which would include the Michelin guide and star system. As Poiesz (2004, p.317) explains in his research into consumer behaviour, the modern consumer will also rely upon information made available from other sources. With increased levels of leisure and social activities, together with the expansion of Internet use, many of these other sources originate from the comments and writings of other consumers. As Zaltman (2003) explains, the degree of trust and confidence that consumers have in each other is, in many cases, stronger than the bond of trust that can be developed between a commercial or professional organisation and the consumer. Therefore, from this consideration, many would argue that the Michelin guide is losing its relevancy and importance for the consumer because of the lack of inclusion of individual customer experiences within the rating measurements. In other words, the perception of the consumer might be that the standards of the Michelin inspectors is designed more towards the impact that it will have upon the industry providers than it is towards those people that these people are in business to serve.

This movement away from the traditional methods of influencing consumers is reflected in research and other observations. Poiesz (2004, p.335) and Bagozzi et al (2002) find that consumer choice is driven by numerous factors outside of rating systems. In some respects they also consumers also consider the formal approach displayed in reports such as the Michelin guide as being rather offensive. As William Stillwell succinctly put it, We've moved on from these preachings and I think more and more people go by word of mouth when choosing where to eat. People use the internet and sites such as, which gather communities of like-minded people (Elliott 2008).

The Japanese example given in Frankler (2008) is a typical example of this response. A banker in his late 30's, who was interviewed with regards to a $200 meal that he had recently experienced in a star rated restaurant considered that the standards required of the Michelin system was leading to a egregious violation of Japanese cuisine's minimalist tenets. Referring to an exceptionally large piece of eel that was delivered with his sushi meal ordered, he remarked, You needed a knife and fork to eat that. I can see why it would appeal to Frenchmen who don't use chopsticks.

Nevertheless, despite the adverse comments described previously, there is still an element of restaurant consumers in favour of the Michelin star system and other similar quality measurement processes (Johnson et al 2005). Johnson et al's (2005) research found that in response to the guides Michelin receive approach 50,000 letters a year. Of these it is stated that three quarters are favourable, with the balance raising concerns and issues about the guides and star ratings. This level of response has also been reflected within the recent Internet interaction process introduced by the company where, as of 2005, e-mail correspondence from consumers had already reached seven thousand a year.

4.5 Discussion

The Director of Michelin guides was right when he suggest that, in terms of the consumer restaurant experience Food is a big part of that. The beauty of gastronomy and the hotel business is that you can choose what you want to do for your consumer. Just make sure you get it right" (Foster 2007). However, as the previous sections of this chapter have shown, when an organisation is in the business of making judgements on the establishments that deliver this experience to the consumer, it is equally important for these organisations to ensure that all the elements of their procedures, including its objectives, are right as well. In terms of the general perceptions, the industry and consumer reviews, it is clear that there is presently a very mixed reaction to the validity and relevance of the Michelin star system.

From an industry viewpoint those who support the Michelin system see that it adds quality to the business standing, improves its financial performance and succeeds in attracting customer. This is supported for other more general research, such as that carried out by the foods standards agency, which discovered that the overwhelming majority of restaurants felt that the displaying of standards and rating was a good idea, with 72% of the opinion that customers took notice of ratings (Greenstreet Berman 2006, p.19 and 22). The same report found that in the main consumers were responsive to this situation, although not to the same degree.

There is little doubt from this research that, particularly with regard to the industry players, the Michelin system still has relevance at many levels. For example, in terms of promotion it can be seen to be beneficial in two main areas. The first, and perhaps most important of these is its promotional value for the business or the chef. For example, TV chef Gordon Ramsey has received world wide exposure because of the standards of his culinary skills. It is likely that the number of Michelin stars his various restaurant enterprises have collected have contributed to this level of media exposure. It is similarly also likely to be the case that should his business empire start to lose these stars in numbers, Ramsey's media and promotional value could decline. The same applies for the other well known chefs who gain exposure and external revenue through books and other media activity because of their Michelin standing.

The second advantageous aspect to being starred by Michelin is the type of customer that is attracted to these establishments. There is little doubt that restaurants with Michelin stars, partially because of the cost of gaining and maintaining this award, deliver their product, in other words the restaurant meal and drinks, at a higher price than would be appropriate in a restaurant that was not rated. Furthermore, in line with the differentiation realising a premium price the consumer segment for these establishments is likely to be one that can afford to pay an increased bill and less likely to concern themselves with value for money.

However, there are limitations to the benefits these celebrity chefs' experiences from their star rating, although it is doubtful there would be too much concern in this respect. Certainly, in terms of market penetration the growth levels are being limited due to the fact many of these establishments have a limited appeal in terms of consumer segments. Secondly, except for the elite few chefs who have gained brand popularity, the workload requirement and profitability levels of the rated establishments are more difficult to maintain, requiring a considerably higher level of investment than those establishments that are outside of this rating system.

From a consumer aspect, it is confirmed that the increase in public to public communication through technology such as the Internet, the consumer reliance upon established methods of information to assess standards of quality and service within the restaurant industry is diminishing. Where these are being used it is apparent that they need to be more consumers focused. To achieve this organisations such as Michelin have to ensure that the factors within their standards of quality and other measurement processes are directed more appropriately towards the satisfaction of consumer demands, needs and expectations. In many respects, and certainly across a number of consumer segments, this is not the case at present. Indeed, it can also said to be failing in some areas of its delivery of benefit to the establishments that its star system is aimed at promoting, as the unrest within that industry segment clearly identifies.

Finally, the level of quality control within the Michelin star system itself shows signs of weakness and stress. With errors being made in terms of those being granted star status, the perceived lack of sufficient inspectors, together with lack of transparency in terms of bias, it is likely that unless these issues are addressed confidence in the brand will further diminish.
Chapter 4 Conclusion

The intention of this research was to ascertain whether it is necessary to have the Michelin star system in restaurant industry or not? In other words is it still relevant. In the author's opinion it is not possible to reach a definitive conclusion on this question apart from saying that the star system has limited relevance in the current restaurant and hotel marketplace.

4.1 Where the Michelin star system has relevance

In the author's opinion the areas of current relevance for the Michelin star system can be identified as follows: -

An international standard for measuring haute cuisine.

With the exception of the limitations mentioned in terms of transparency and country bias, the guide and star system, with the proper factors of quality, standards and control in place, could become a global standard for measurement within the restaurant and hotel industry.

A promotional aid for chefs and their businesses

Certainly the Michelin system is relevant in terms of its promotional value to chefs, particularly those who use it to enhance the transition of their brand across a range of external industry sectors, such as the media, publication and other product endorsement and promotion.

As a reference for certain defined segments of the consumer population

Certainly, for the corporate and special events market segment, as well as that consumer group which is segmented within the higher income brackets, the star system is still relevant as these sectors still rely more heavily upon professional opinions than other sources of information, and the Michelin organisation has this level of expertise.

4.2 Where the Michelin star system is not relevant.

Conversely, there are also areas within the marketplace where the Michelin star system is no longer considered relevant.

A dated system

At present the system is dated in its approach in terms of the methods by which it collects and publishes the information gathered. If it wishes to maintain its impact upon the consumer market, it needs to advance its web presence and interaction facilities in this respect.

Exclusivity of establishments and culinary content

Although Michelin has extended its range of establishments to include Public Houses, the concentration is still upon establishments that are at the higher end of the restaurant sector, which excludes many good quality establishments that don't operate within this price range and a number of consumer segments that cannot afford to partake of the dining experience at that level

General consumer market

Insufficient attention is being given in the content of the quality and standards criteria to the core elements of consumer behaviour and satisfaction determinants. Therefore, it can be seen that the Michelin star system has become industry rather than consumer focused, which devalues its relevance to the market sector that it was originally introduced to serve.

Chapter 4 Recommendations

Based upon the research conducted for this project, together with the findings, discussions and conclusions that have been drawn from this data, the following recommendations are considered appropriate.

The Michelin star operation

For the Michelin Corporation it is recommended that the business needs to revisit the corporate strategy to decide which element of the market place. If this is to be the chefs and establishments operating within the restaurant industry, then it has to address the issues that have been raised by many of those within this sector. Alternatively, if the system is to remain consumer focused, the concerns related to transparency, bias and consumer needs has to be incorporated within the design measurements used for quality and standards.

Future research

To validate the conclusions reached within this research, and to add value to the findings, it is recommended that the following additional research be undertaken. In the first instance, to assess the extent to which the industry is concerned with the current performance of the Michelin system primary research by way of questionnaires and interviews across an extensive number of chefs and establishments needs to be conducted. Secondly, a similar primary research process within consumer segments would also be beneficial in further determining the level of relevancy that the Michelin star system has in this area.


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