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Floating Restaurants Are A New Phenomenon Marketing Essay

2864 words (11 pages) Essay in Marketing

5/12/16 Marketing Reference this

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Floating restaurants are a new phenomenon for dining out in Cairo, where customers can be provided not only with a meal but also an entertaining casual dining experience with unrivalled views of the Nile River. This study aims to identify customers perceptions of the floating restaurants sailing down the Nile River and also explores the different attributes that influence customer satisfaction with, and increase the intention of repeat patronage for, Sailing Floating Restaurants. Frequencies, means, Pearson correlations, cross tab and factor analysis were used for the data analysis. The results indicate that aspects such as parking spaces, healthy, and local dishes, along with rest-room cleanliness are pivotal attributes to create satisfied customers and to increase repeat patronage intentions. Floating restaurant managers should reasonably take into consideration the trip length, which contributes significantly to customers’ satisfaction and repeat patronage intentions.(Published in 2011).Likewise, if there are any local traditions when the behaviour of domestic guests may seem disturbing to uninitiated foreign guests, such as the rowdy “lutefisk” evenings in some Norwegian restaurants (Jensen and Hansen, 2007).

The study by Jensen and Hansen (2007) suggested that harmony is the most emphasized value among experienced restaurant consumers in Norway

.The findings of other studies on value and satisfaction provide support for linking value to satisfaction, not satisfaction to value (Babin, Lee, Kim, & Griffin, 2005; Jones, Reynolds, & Arnold, 2006).For example, studies show that neighborhoods composed of racial and ethnic minorities have more than twice the number of fast-food restaurants (Block, Scribner, and DeSalvo 2004; Ball).Such women may be more likely to encounter environmental barriers to healthy food choices, often living in neighborhoods with fewer supermarkets (Morland et al, 2002b) and more fast food restaurants (Block et al, 2004).Dining motivation may affect this relationship because it determines consumers’ evaluative judgments during their dining experiences (Park, 2004).Consumers expect safe food and demand information about the origin of their food (Van Rijswijk & Frewer, 2008).It has been found in many studies that restaurateurs are concerned with making lasting impressions, perpetuating a wonderful dining experience and creating an impressive ambiance for their customers (Cheng, 2006; DiPeitro, Murphy, Riviera, & Muller, 2007; Gupta, McLaughlin, & Gomez, 2007; Lacey, 2007; Oh, 2008; Ryu, 2005).If customers are satisfied with the food or service in a restaurant then they are more likely to re-visit it and thus increase its profits (Gupta et al., 2007).Several researchers controlled for the effect of advertising and promotions in their studies on customer loyalty because of their influence (Buckinx & Van den Poel, 2004; Chu et al, 2007; Gupta, McLaughlin, & Gomez, 2007).Service differentiation means enhancing perceived value by providing services or service attributes not provided by the competition” (Claycomb and Martin, 2001, p. 391).Here, a small number of studies note the importance of the congruence and compatibility between the perceived attitudes and behaviours of fellow customers within the service setting, that is, the extent to which patrons within the service environment behave in a manner that is deemed appropriate by other customers present (see Grove & Fisk, 1997; Martin, 1996).Park (2004) defined the consumer value of eating-out as the “value consumers derived from food, service, and restaurants when eating-out,” which suggests that customers do not pursue dining value only to satisfy their hunger.On the other hand, less restrictive zoning in low-income areas may have contributed to an abundance of unhealthy food options, particularly fast food (Block et al. 2004; Morland et al. 2002).Restaurants tend to be less active in preferred customer program unlike hotel or airline industry because restaurant customers favor immediate, necessary, and monetary gratification (Jang & Mattila, 2005).Convenience therefore becomes one of the main motivators for restaurant customers in choosing a restaurant (Jang & Mattila, 2005).Kivela (1997) segmented restaurant customers on the basis of preferred restaurant types, including fine dining/gourmet, theme/atmosphere, family/popular and convenience/fast-food restaurants

In the history of restaurant management, providing compelling sensory experiences to patrons has been critical for deriving patron satisfaction, and restaurants have thus invested large amounts of expenditure in interior/exterior decoration (Kivela, 1997; Law, To, & Goh, 2008) and food presentation (Kivela et al, 1999; Namkung & Jang, 2008; Raajpoot, 2002).Research conducted by Mona and Roy, (1999); Pettijohn, Pettijohn, and Luke (1997); Kivela (1997); Gregoire, Shanklin, Greathouse, and Tripp (1995); Auty (1992), and Lewis (1981) found food quality, including food safety and hygiene, to be either the first or second most important restaurant choice factor.In fast-food restaurants, price, convenience, and limited service are the basic characteristics, which have led to quality being one of the principal concepts of the marketing strategy (Baek, Ham, & Yang, 2006).The consumption of fast-food has also increased throughout the industrialized world in countries as diverse as Spain, Korea, the Philippines, and Australia (Baek, Ham, & Yang, 2006; Bryant & Dundes, 2008; Mohammad, Barker, & Kandampully, 2005).Previous studies have examined restaurant preferences associated with different groups such as origins of nationality (Barta, 2008; Gyimothy, Rassing & Wanhill, 2000), different meal purposes (Cullen, 2004; Koo, Tao, & Yeung, 1999), length of stay (Gyimothy et al, 2000), and age (Gyimothy et al, 2000; Yamanaka, Almanza, Nelson, & DeVaney, 2003).According to the study conducted by Cullen (2004), portion size is a more important attribute to young consumers.To date numerous studies have been undertaken seeking to address such selection variables including but not limited to customer loyalty (Kim and Han, 2008), ambience (Rowe, 2004), pricing strategy (Pedraja and Yague, 2001), location (Buchtal, 2006; Knutson et al, 2006), menu variety (Choi, Lee and Mok, 2010), food type and food quality within ‘occasion’ (Auty, 1992), consumer demographics (Bareham, 2004; Kim, Raab and Bergman, 2010), nutritional content (Wootan and Osborn, 2006) and service and/or product quality Fu and Parks, 2001)

While many previous studies were also conducted in an actual restaurant setting (Jang & Namkung, 2009; Kivela, Inbakaran, & Reece, 2000); the uniqueness of this research is that the notion of Gestalt was adopted, and the interactive effects of perceived congruency and individuals’ pleasure or arousal on satisfaction were being tested.The perception that a restaurant has a reputable, “green” operation adds a value that is a little more intangible, but definitely important, in the customer’s mind. Just ask Chipotle how in the world they get away with selling an $8 burrito in a fast casual environment. Customers recognize the value of their green practices and locally sourced ingredients. There are hundreds of ways to make your restaurant more green, and advertising your practices to your customers add value. (Greg McGuire , 2012).Another top restaurant trend is portion sizes. Reduced portion sizes allow customers to spend less or pick and choose more than one dish. This is also a hot trend because the perceived value for the customer is that they have options, and not all of them require a lot of money. (Greg McGuire , 2012)

Restaurant Marketing: Using the Internet to Create Customer Value

By Rohit Verma, Executive Director, Cornell Center for Hospitality Research

Co-authored by Glenn Withiam, Executive Editor, Cornell Hospitality Quarterly

Customer value extends far beyond the table or the restaurant itself. Restaurateurs have the opportunity to create customer value from the first contact, whether that means a telephone reservation or an electronic order or reservation. The restaurant operator’s decision of whether to permit electronic ordering or to accept reservations via the web depends on numerous factors, including balancing guest preferences against the cost of participating in third-party reservation sites. Studies of consumers who have made electronic reservations find that those who prefer the web tend to be younger customers who dine out more frequently than others.

The age-old principle of customer value for the restaurant industry is to put the value where the customer can see it. Putting the value on the plate, is essential and that concept hasn’t changed in many years. But the customer value chain for restaurants starts long before the guest is seated. Given heavy competition and ever-expanding marketing channels, a restaurateur may never get the chance to demonstrate the value of the plate on the table-if guests book a different restaurant. The battle begins in just getting the guest to the table in the first place. In this article, we offer a roadmap to electronic reservations and distribution, based on several studies of guests’ use of electronic food ordering, flash deal couponing, and third-party reservation applications. We frame this discussion in terms of customer value for the simple reason that guests seek value throughout the experience, and they will not become involved where they do not see value. This is particularly true in terms of flash deals. While guests may try a restaurant once using a daily deal coupon, they will not do so twice if value has not been received.

The presence of social media and web commentaries seems to have altered customers’ decision process as they decide which restaurant to book. In the usual process, guests have in mind a set of potential restaurants, and then they apply their own criteria to choose one of those restaurants. The way social media affect this process is that would-be customers who read online reviews may add new restaurants to their choice set during the decision process. Thus, the “winning” restaurant might well be one that was suggested by the review of a perfect stranger, rather than one that was originally under consideration.

Daily deal offers also exert considerable influence on the process. A study by Cornell Professor Chekitan Dev found that an astonishing 70 percent of purchases for travel experiences were made within 15 minutes of receiving an offer from the group coupon firm LivingSocial. In this instance, the decision appears to be a function of price, rather than one of brand. As we’ve discussed previously, daily deals must be carefully crafted to ensure that the offer is successful for both the restaurant and the purchasers.

If you are reading this in a location where social media have not yet penetrated, you may have the luxury of preparing for a time when the internet gains increasing power in your distribution process. While some of our discussion here focuses on restaurants that use reservations, it’s also true that social media influence the decision process for restaurants that take only walk-ins and use a queue to control table occupancy, rather than reservations. Beyond that, there may come a day when guests will expect to be able to view your queue on the web, and thus determine whether they want to wait in that queue or choose another restaurant. It’s easy to foresee a possible marketing approach of letting guests know that your queue is only 15 minutes long if they come immediately to the restaurant.

Food Ordering

With that background, let’s examine how the internet is affecting food-service purchases and restaurant reservations. Considering that the internet is a logical method for ordering food deliveries, Cornell Professor Sheryl Kimes examined the use of the websites for ordering food for carryout or for delivery. While about half of the 470 people surveyed had used some form of electronic ordering, the number-one channel remains the telephone call, which was used for 53 percent of the orders in this study. This study covers U.S. residents, so the proportions may be different elsewhere. Nevertheless, the web’s impact continues to rise everywhere.

While there’s no indication that the telephone will be eclipsed any time soon, electronic ordering is growing steadily. Just over 38 percent of the survey respondents had placed an electronic order, mostly using the restaurant’s own website. The number-one benefit that customers cited for electronic ordering was accuracy. They also liked websites that were convenient, gave them strong control, and made ordering easy. It’s worth noting that convenience in this case also extended to offering delivery of the food once it was ordered. On the other side of the coin, customers who avoided the web for food ordering preferred personal interaction-they wanted to talk to someone. There was also a current of technological anxiety among those who didn’t use the web to order food.

A comparison of the demographics and purchase patterns of technology users and nonusers provides reasons for restaurants to offer as many ordering channels as possible. Respondents who made electronic orders tended to be younger than those who did not, and the technology users also patronized restaurants more frequently. An earlier study by Technomic found that 60 percent of people between 18 and 34 years have ordered online, but for people over 35 that figure falls to 35 percent.

Restaurant operators in the United States are not oblivious to this trend. Just under one-fourth of the 326 largest U.S-based chains offered online food ordering. While we do not have figures for other nations, the direction of the trend is clear. For this study, the type of food ordered most frequently is Italian-style food, particularly pizza.

Electronic Reservations

If your restaurant accepts reservations, chances are they are being made by telephone. Just as the phone remains the top channel for ordering food, the same is true for restaurant reservations. However, what is not clear when the phone rings is how your guest found you. In this study of 474 U.S. consumers, Professor Kimes (working with co-researcher Katherine Kies) again found a steady growth in the use of websites and mobile phone apps for making restaurant reservations. What she also found was a trend that connects electronics and the telephone. Guests would use the web or a mobile app to locate a restaurant, and then they would complete the reservation on the telephone. More on that in a moment.

Respondents to this survey had similar feelings about internet reservations as they did about electronic food ordering. Those who made reservations on the phone preferred the personal touch. Once again the online group is noticeably younger than the telephone-only group, and the web users have a tendency to visit restaurants more frequently than do other customer groups. So, once again, the online crowd appears to be an attractive demographic.

One of the difficult decisions for restaurateurs is whether to use a multiple-restaurant reservation site. The decision is not always a simple one, even though reservation sites are growing in popularity, because they do incur an expense. Most reservation sites charge a monthly fee, plus a per-diner fee. Signing an agreement with one of these sites also removes a certain amount of control over the reservation process. Perhaps the greatest concern regarding these sites is the possibility that they do not provide incremental business. That is, a restaurant could very well be paying for an electronic reservation that would have been made anyway, by telephone or on the restaurant’s own website. Even if the reservations do represent incremental business, restaurants’ thin operating margins also raise questions about the value of third-party reservation sites.

Balanced against the concerns regarding reservation sites is their undeniable popularity among some would-be restaurant guests. About 60 percent of the respondents who had made an electronic reservation used a multiple-restaurant site for their transaction. Two favorable considerations are that using the web reduces the need to have someone answering the phone for reservations and theoretically the restaurant can promote itself by its presence on the reservation site. The sites also provide an electronic reservations book and offer certain table management tools, as well as capturing customer data.

The top reason for choosing a restaurant given by this survey’s respondents was their previous experience with the restaurant, following by recommendations of friends. However, when this question was posed to those who use multiple-restaurant sites, social media became entwined in the decision process, as we described at the beginning of this article. While experience and cuisine had strong influence, the users of multiple-restaurant sites were significantly more likely to rely on online reviews in choosing a restaurant. Regardless of how they placed the reservation, the most important element, according to these respondents, is the ability to get the time and date they wanted. Reservation accuracy was also important. This group was relatively not concerned about personal contact.

The study found that website users do more than just place reservations through the multiple-restaurant sites. They also use these sites to check table availability and to locate a particular restaurant. Additionally, the would-be guests also use websites to find a new restaurant. It is this finding that raises the possibility that restaurant operators should consider the theoretical marketing value of being listed on a multiple-restaurant site. Having located a restaurant, about one-third of the respondents completed the reservation using the telephone. The rest either continued with the reservation on the multiple-restaurant site or they switched to the restaurant’s own site.

In conclusion, the decision of how to connect with your customer depends on your knowledge of how to create value for your customer. It may be that being listed on a multiple-restaurant site or offering delivery for electronic orders is an ideal fit for your restaurant. On the other hand, the cost of third-party reservation sites may not be justified by either the incremental reservations or marketing value. Moreover, for the restaurant industry, personal contact through the telephone is still important. By remembering that the creation of customer value begins with the first contact, you can ensure an excellent experience that puts the value where the customer can see it.

http://hotelexecutive.com/business_review/3133/restaurant-marketing-using-the-internet-to-create-customer-value

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