ABSTRACT
This study investigates the consumer preferences regarding their visits to the pizza hut branches. This research has brought out the significant factors that have an impact on consumer decision making. For this research sample size was 164 respondents that have taken randomly on convenience basis. Respondents can be any person who visit pizza hut. Results obtained from statistical analysis corroborate using the cross tabs and correlation as a statistical tool. Proposed hypothesis indicated that quality of the food, location, ambiance and size of the branch has positively related to the consumer preferences. Finally, conclusions were drawn to provide insights to professionals and practitioners to better prepare and plan to develop changes in order to attract more customers towards the branches.
CHAPTER 1
INTRODUCTION
Background
In human life, Food is the most important element and it constantly plays an elementary role whether we live to eat or eat to live. Right from the start of this world, the food considered as the vital part for the necessity of the human body. The importance of food cannot be showy from the physiological perspective only but at the same time food provides human nourishment and also classified as a basic need of life. Food can also be differentiated as an item for consumption used to explain self actualization. Thus, an individual can wrangle that the food plays a multiplicity of roles mutually at individual and group level.
Introduction
This research focuses on consumer preferences in the restaurant industry and identifies the impact of different attributes on preferences of consumers in restaurant branches. The attributes include the branch location, ambiance, size, customers’ type and the services given to the customer by the management of that particular restaurant. These branch characteristics have been used to analyze the reason of consumer’s preferences to visit to a certain branch of any fast food restaurant. Basically the restaurant industry based on valuing to customer and their wants should be met. The general concept of dining experience is most critical while considering influential factor cause it’s not necessary the review research focused on all factors which are treated as dining factors.
Restaurants focus not only quality food and service but to retain the level of satisfaction and like to delight the customer. However for this purpose customer’s wants should be met and this way customer will feel satisfied and willing to come again in restaurants. In this dynamic environment meeting customer’s requirements and make the setting of the restaurant in such a way that attracts the customers is a very difficult task as it varies from consumer to consumer.
While considering the dining practice, dining attributes has large number of factors that influence the customer’s demands and satisfaction and in review of research there is food, service, ambience and convenience in corporate as part of research and that to be in need of success of restaurants it’s very important for the manager of the restaurant to study the customer preferences and meet the customer requirements and demands should be fulfill as per customer’s perceptions in a particular branch. Dining practice is a combination of quality and service provided by restaurants providers. Achieving the customer satisfactions will leads towards market share as well as loyalty towards your restaurants. Restaurant is like a brand in hospitality industry and to maintain the progress of brand it’s necessary to keep the effective measure in terms of customer demands and fulfillments.
The purpose of study fold in two parts: one proposes that what are the consumer preferences of choosing a branch of pizza hut restaurant and the second part proposes the branch characteristics that attract and motivate the customers to visit any specific branch restaurant. Moreover, this has been proved and observed that the customer satisfaction leads to the loyalty of customer towards the restaurant whenever the branch attributes meets the customer’s desired level. This is important to know the role of dining attributes, preferences and customer satisfaction because by this way the customer intentions can be determined and also give the better idea that the customer would visit those restaurant branches again or not.
Pizza Hut in Pakistan
Pizza Hut was first launched in Pakistan in 1993. Manzar Riaz from Lahore was the first franchisee. Unlike in India where the pizza has become widely popular pizza in Pakistan is only popular and well known in the provinces of Punjab, Sindh and Kashmir. Pizza is still virtually unknown in the provinces of North-West Frontier Province with the exception of Peshawar which has a Pizza Hut and Baluchistan. Spicy chicken and sausage based pizzas are very popular as they cater to the local palate.
They are approximately 36 branches of Pizza hut in all over Pakistan of which 19 are in Karachi and only 12 of them provide dine-in facility. During the past four decades Pizza Hut has built a reputation for excellence that has earned the respect of consumers and industry experts alike. Building a leading pizza company has required relentless innovation, commitment to quality and dedication to customer service and value. The qualities of entrepreneurship, growth and leadership have characterized Pizza Hut’s business through more than four decades of success. Through the strength of its heritage, its culture and its people and franchisees, Pizza Hut looks forward to more success in future.
Problem Statement
For any restaurants main success factor is not only to attract customers but also to retain the existing customers. For this purpose it’s very essential to understand the characteristics which affect the decision of customers to select a particular restaurant and in that a particular branch. Our main purpose of this study is to understand those particular factors.
Objectives of Study
To understand the consumer preferences for choosing a branch of Pizza Hut restaurant
To identify the branch characteristics that attracts the customers to visit any specific branch restaurant.
To find out relationship between different branch characteristics and customers of different income groups.
To analyze the impact of branch location upon customer preference.
Limitations
Almost every respondent selected the option that he/she has visited Pizza Hut. May be some of them have not visited but feel reluctant to mention it.
We have collected the data only from SZABIST students. So results may be biased toward certain income or age group.
We have collected the data by convenient sampling only from 164 respondents. It may not represent the whole population.
Scope
This study is not only helpful for Pizza Hut management but for all branch restaurants operating in Karachi. They can get the idea from this study that what branch characteristics have major impact upon consumers. This study helps them to analyze the relationship between different characteristics and customer preference and improve their own restaurants braches. It will enhance their sales and help them to retain customers by providing them what they want.
Assumptions
Students of SZABIST represent all income group and different residential areas of Karachi.
All Pizza hut consumers are well educated and they can easily understand and respond a questionnaire in English.
CHAPTER 2
Literature review
Without access to supermarkets, which offer a wide variety of foods at lower prices, poor and minority communities may not have equal access to the variety of healthy food choices available to nonminority and wealthy communities, Whereas individual factors are traditional explanations for the inability of some people to change dietary habits, Compared to the poorest neighborhoods, large numbers of supermarkets and gas stations with convenience stores are located in wealthier neighborhoods. The most prevalent type of food service place is the full-service restaurant; on average three to four full- service restaurants are located in each neighborhood. Fast-food restaurants are more prevalent in the low- medium and medium-wealth neighborhoods and are less prevalent in the highest-wealth neighbor- hoods. (Kimberly et al, 2002)
In terms of price people are all statistically different among all different ` `purpose” subgroups. Consumers are more concerned with price when they take family meals. They are least concerned with price when taking business meals. This is understandable as most business meals are paid for by their employers. while In terms of service people prefer to get better service for family meals than business meals. Western food is more preferred for business meals than family meals. The dining practice is the part of hospitality industry which is very complex as in term of customer satisfaction and expectation meet. This difficulty is due to the level of customer participation in the service procedure (Koo et al, 1999).
A vast majority of people favor immediate, necessary, and monetary grati”cation. This behavior is consistent across restaurant types (fast-food versu casual dining). Although savings is the most sought-after bene”t, intangible bene”ts such as quality and convenience also received high ratings. Casual dining customers, in particular, seemed to be highly motivated by exploration and entertainment-type bene”ts. Although the rate of preference increase slightly with higher reward requirements, the vast majority of people prefer necessary or monetary rewards over more hedonic rewards such as a facial massage or a bottle of wine.(Dongsuk & Anna,2005)
Service guarantees should be used with caution. The cost of offering such guarantees can exceed any positive utility that they deliver to consumers. Therefore, consumer perceptions of service guarantees should be thoroughly researched by a service provider before utilization.Ultimately, successful implementation of a service guarantee is dependent on matching the guarantee to the needs and perceptions of the customers. Service guarantees are not a panacea for service providers. The offering of such guarantees will not necessarily offer the service provider a competitive advantage over other firms. As with virtually any consumer offering, it is not reasonable to expect that consumer reactions will be uniform. Reaction to a change in the offering will be tempered by the interaction of that change with all other elements of the marketing mix. In this instance, a change in the guarantee component of the extended product produces favorable consumer reactions under some circumstances and unfavorable ones under other circumstances. (Louis & James,1997)
An indescribable service delivery element is not astonishingly the most remarkable constructs influencing customer affect to restaurants branches are food and service, staff, and convenience. Tangible service quality in restaurants branches on its own might have a weaker influence and result on behavior. It facilitates in creating feelings and develops sense of affection towards the particular branch restaurant resulting in a stronger influence on consumer behavior towards the branch. Restaurants strive for instructive affirmative feelings to their brand name by stage management tangible attributes. Customers craving high quality products suitably prepared and will reward branch management with their devotion and loyalty. The consumption of seasonal foodstuffs, awareness of existing trends in menu offerings and preparation, and the audacity to initiate new techniques of preparation of conventional stuff are some implication for management (Grimes, 1998).
The Behavior of the customer in restaurants can be exaggerated by the ambiance in diverse ways. Researchers consider ambiance, which is an attention creating means that can make eating place suspicion. The interest is based on the combined belongings of those indications on customers’ characteristic through sound, design motion, and color. As an attention creating means, the location gives discriminative inspiration to customers that make possible to them to recognize a restaurant’s difference of opinion as a basis for select that particular restaurant. For illustration, soft lighting, snowy white table cloths and crystal chandeliers of a restaurant communicate the service level and a food type to consumers that make a fine dining experience (Bitner, 1992).
The main cause in this industry are the entry barriers that are generally low and any one can by far enter due to low investment required. Whenever consumer is satisfy from the arrangement by the management, the food quality give by the restaurant employee with the affirmative approach than this may increase the constancy towards the particular restaurant increases in the business revenue the word of mouth publicity of the particular restaurant (Cullen, 2004).
Consumers compare service quality with cost to determine service value with one branch to another. Service cost is basically what consumers have to give up or sacrifice to obtain a desired service. Since it has a negative impact on consumers’ budgets, it would have a negative influence on their perceptions of service value. The concept of cost can be extended to include nonmonetary cost such a service time. Service time is the amount of time during which a service is provided. Since most customers would like to have faster services, service time would affect perceived service value in the same way monetary cost would (Wakefield, 1996).
It was found that customers have an intellectual checklist or preferences through which they contrast an branch quality. The most significant factor evaluating whether a consumer will revisit to the restaurant was the food quality. On the other hand, the least measured factors were place and setting of restaurant. Taste is the most used features to compute consumer preference in choosing a branch restaurant. Consumption of food is more exaggerated by the customer’s psychosomatic rather than physical necessitate which explicate a dining experience with psychosomatic preferences leads customers to revisit to the restaurant (Alpert, 1990).
Food for deciphering one’s hunger does not gratify the customers who have elevated degrees of wants and desires. Appetizing and healthy meals linked to the customers’ desire to cosset in tasty foods and urge to eat healthy food led customers to testing with different spices and herbs. More people in recent times become conscious of healthy food that has a direct relation to their physical fitness. Most of the consumers have been interested in eating fresh food that is free of chemical additives and also high in carbohydrates. Usually consumers are not looking for junk food (Flynn, 1994).
CHAPTER 3
RESEARCH METHODOLOGY
This study finds the effects of branch characteristic on consumer branch preference for a fast food restaurant.
Research Design
This study is a quantitative research. We have collected numerical data from Pizza Hut customers through questionnaires.
Population
For this research, our population was all consumers living in Karachi who go to Pizza Hut.
Sample & Sampling Method
For this research we have selected a sample of 164 consumers. We used convenience sampling method. We selected all of the respondents from SZABIST students base upon the assumptions that SZABIST students represent almost all income groups and residential areas of Karachi.
Procedure of Data Collection
Data was collected through questionnaire from students of SZABIST. Questionnaires were given to the students which are a personal way of collecting data.
Instrument
Questionnaires were used as an instrument for data collection and this instrument is in the form of closed ended questionnaire.
The section A describes the consumer perception about branch characteristic i.e. the branch they prefer to go and section B would tell us about the demographics of the respondent.
Variables
Branch Location
Branch Ambiance
Branch Size
Branch Crowd
Branch Service
Branch Location In this research location of the branch is the place where pizza hut is located and tried to find out the relationship of consumer preferences with the location of the pizza hut branch.
Branch ambiance is the setting and the environment of the branch that attracts the customer for dining. Research has conducted to find out that how branch ambiance can make an impact on the consumer preferences of selecting the branch.
Branch size is the covered area of the branch of pizza hut. Research has conducted to find out the dependability on consumer preference regarding the size of the branch.
Branch crowd are the customers visited to the branch of Pizza Hut. It includes type of people visited to the specific branch. Research has conducted to find the relationship with the branch crowd while selecting the customer.
Service quality means the service given by the management of the branch. Consumer preference to visit to the entire branch where service quality is better than other branches either it is strongly associated with the preferences of the customer or not.
Research Hypothesis
H1: Location of Branch has a positive impact on a branch preference.
H2: Quality of food has a positive impact on a branch preference.
H3: Ambiance of restaurant has a positive impact on branch preference.
H4: Services of waiters have a positive impact on branch preference
H5: High income groups give more importance to branch characteristics
Statistical Tool Used
In this research cross tabs and correlation analysis was used. The reason of using this statistical tool was that this shows the impact of customer preferences of selecting branch.
CHAPTER 4
ANALYSIS AND FINDINGS
For this study we have used SPSS to analyze the results. We developed cross tabs between different variables to know how they are changing in relation to each other.
Cross Tabs
which branch of pizza hut is visited most frequently by the respondent
Respondent would choose the preferred branch of Pizza Hut because branch location is
Not Responded
Zamzama Branch
Tariq Road Branch
Shaheed-e-Millat
Gulshan Branch
Saddar Branch
North Nazimabad Branch
Not Responded
Better then others
Same like others
Worse than others
4
0
1
1
0
0
0
21
44
16
6
9
3
11
2
11
4
2
4
2
3
0
1
0
0
0
0
0
Total
27
56
21
9
13
5
14
In this table we made a cross tabulation between the preferred branch of Pizza Hut and the impression of that branch in minds of consumers in comparison to other branches in terms of Branch location. We have found that out of total 164 respondents, 56 (34.14%) respondents prefer Zamzama Branch over other branches and 44 (78.5%) of them told that this branch is better than others in terms of branch location while 19.64% think its similar to other branches in terms of Branch location and only 1.78% respondents think that this branch is worse than other branches in terms of branch location. 9.79% respondents prefer Tariq road branch and out of them 76% think its location is better than others.
which branch of pizza hut is visited most frequently by the respondent
Respondent would choose the preferred branch of Pizza Hut because branch ambiance is
Not Responded
Zamzama Branch
Tariq Road Branch
Shaheed-e-Millat
Gulshan Branch
Saddar Branch
North Nazimabad Branch
Not Responded
Better then others
Same like others
5
3
5
1
3
1
1
14
29
10
1
8
1
6
8
24
6
7
2
3
7
Total
27
56
21
9
13
5
14
In this table we made a cross tabulation between the preferred branch of Pizza Hut and the impression of that branch in minds of consumers in comparison to other branches in terms of Branch ambiance. We have found that out of total 164 respondents, 56 (34.14%) respondents prefer Zamzama Branch over other branches and 29 (51.78%) of them told that this branch is better than others in terms of branch ambiance while 14.63% think its similar to other branches in terms of Branch ambiance. 12.8% prefers Tariq Road branch and 47.6% of them think its ambiance better than others. In same way just 5 (3.04%) respondents prefers Saddar branch and only I of them think its ambiance is better than others.
which branch of pizza hut is visited most frequently by the respondent
Respondent would choose the preferred branch of Pizza Hut because branch size is
Not Responded
Zamzama Branch
Tariq Road Branch
Shaheed-e-Millat
Gulshan Branch
Saddar Branch
North Nazimabad Branch
Not Responded
Better then others
Same like others
Worse than others
7
3
5
0
3
0
0
10
25
5
2
5
3
5
9
25
9
5
5
2
9
1
3
2
2
0
0
0
Total
27
56
21
9
13
5
14
This is a cross tabulation between the preferred branch of Pizza Hut and the impression of that branch in minds of consumers in comparison to other branches in terms of Branch size. We have found that out of 56 (34.14%) respondents who prefer Zamzama Branch over other branches 25(44.64%) of them are of opinion that this branch is better than others in terms of branch size while 44.64% think its similar to other branches in terms of Branch size. Whereas 5% believe its size is worst than other branches. About Tariq Road branch and Gulshan branch 5 respondents are of opinion that its size is better than others. Least people prefer the Saddar branch their number is 5 and out of those 5 respondents 3 think branch size is better than others.
which branch of pizza hut is visited more frequently by the respondent
Respondent would choose the preferred branch of Pizza Hut because branch crowd is
Not Responded
Zamzama Branch
Tariq Road Branch
Shaheed-e-Millat
Gulshan Branch
Saddar Branch
North Nazimabad Branch
Not Responded
Better then others
Same like others
Worse than others
6
1
3
0
2
0
1
10
31
11
5
4
2
3
10
22
7
4
7
3
9
1
2
0
0
0
0
1
Total
27
56
21
9
13
5
14
This is a cross tabulation between the preferred branch of Pizza Hut and the impression of that branch in minds of consumers in comparison to other branches in terms of Branch crowd. We have found that out of 56 (34.14%) respondents who prefer Zamzama Branch over other branches 31 (55.35%) of them are of opinion that this branch is better than others in terms of branch crowd while 39.2% think its similar to other branches in terms of Branch crowd. Whereas 3.57% believe its crowd is worst than other branches. About Tariq Road branch 52% of those who prefer this branch over others feel its crowd better than other branches. 5 respondents think Shaheed-e-Millat branch and 4 think that Gulshan branch has better crowd than others.
which branch of pizza hut is visited more frequently by the respondent
Respondent would choose the preferred branch of Pizza Hut because branch service is
Not Responded
Zamzama Branch
Tariq Road Branch
Shaheed-e-Millat
Gulshan Branch
Saddar Branch
North Nazimabad Branch
Not Responded
Better then others
Same like others
Worse than others
8
3
2
0
1
0
0
9
25
8
5
6
3
4
8
26
9
3
6
1
10
2
2
2
1
0
1
0
Total
27
56
21
9
13
5
14
This is a cross tabulation between the preferred branch of Pizza Hut and the impression of that branch in minds of consumers in comparison to other branches in terms of service quality. We have found that out of 56 (34.14%) respondents who prefer Zamzama Branch over other branches 25 (44.64%) of them are of opinion that this branch is better than others in terms of service quality while 46.4% think its similar to other branches in terms of service quality. 2 of the respondents think the service quality of Zamzama branch as well as Tariq Road branch is worse than others. 5 respondents are in favour of Shaheed-e-Millat branch and 6 respondents are in favour of Gulshan branch in terms of better service quality.
Descriptive Statistics
Importance of Branch Characteristics
N
Minimum
Maximum
Mean
Std. Deviation
Branch locations
164
.00
5.00
4.3720
1.10856
Branch ambiance
164
.00
5.00
3.8902
1.32467
Branch size
164
.00
5.00
3.4573
1.40704
Branch crowd
164
.00
5.00
3.6768
1.40086
Branch service
164
.00
5.00
4.2683
1.32507
Other factors
164
.00
5.00
.3293
1.20383
Valid N (list wise)
164
To identify the importance of branch characteristics in view of customers we as ked consumers to selection an option out of 5 choices. We used Likert scale for this purpose. Where “5″ is Highly important and “1″ is Highly unimportant. From the results we conclude that mean for Branch location is 4.37 which shows this factor lies between important and highly important and thus it seems to be most important factor. Another important factor is Branch service which shows a mean of 4.268 which also lies between highly important and important. Other 3 factors also seem important as all having mean value above neutral value of 3.
Correlations
Income of the respondents
In the respondent’s opinion Branch Locations is important for choosing that branch to visit
Pearson Correlation
0.168*
Sig. (2-tailed)
0.031
In the respondent’s opinion Branch Service is important for choosing that branch to visit
Pearson Correlation
0.088
Sig. (2-tailed)
0.262
In the respondent’s opinion Branch Crowd is important for choosing that branch to visit
Pearson Correlation
.167*
Sig. (2-tailed)
0.032
In the respondent’s opinion Branch Size is important for choosing that branch to visit
Pearson Correlation
0.089
Sig. (2-tailed)
0.257
In the respondent’s opinion Branch Ambiance is important for choosing that branch to visit
Pearson Correlation
.249**
Sig. (2-tailed)
0.001
In the respondent’s opinion Other Factors are important for choosing that branch to visit
Pearson Correlation
0.145*
Sig. (2-tailed)
0.065
N
164
*. Correlation is significant at the 0.05 level (2-tailed).
**. Correlation is significant at the 0.01 level (2-tailed).
In this table we have calculated the correlation between income groups and importance of branch characteristics in view of consumers. We made 5 categories of income groups. We divided these income groups with numbers ranging from 1 o 5 with “1″ assign to lowest income group and “5″ assign to highest income group above Rs. 100,000 per month.
As per our finding there is a positive correlation between branch service quality and income group which is 0.088 at 26.2% of significance level. Which shows that service quality becomes more important as income level rises as there is positive correlation between two factors. Branch ambiance is the factor which shows highest correlation with income group as its correlation is .249. After ambiance, other most important factors include branch location with 0.168 and branch crowd with 0.169 correlations.
CHAPTER 5
CONCLUSION AND RECOMMENDATIONS
This research was focused on the consumer preferences in the pizza hut and identifying the impact of different attributes on preferences of consumers in restaurant branches. The attributes includes the branch location, ambiance, size, customers’ type and the services given to the customer by the management of that particular branch of pizza hut. These branch characteristics have been used to analyze the reason of consumer’s preferences to visit to a certain branch of any fast food restaurant.
From this research we have concluded that as the income level of customers increase they give more preference to branch ambiance and branch size. Now it depends upon management of a certain restaurant that to whom they want to target. If a manager opens a restaurant branch to target high income group then he/she must be careful about ambiance and size of branch. On other hand if he/she going to target low income group then there is no need to spend huge amount on ambiance and small size branch will be enough.
Research has shown that Consumers like settings and restaurant environment when they dining out in pizza hut. Branch location of the pizza hut branches indicates that the consumers prefer branch location and it has strong association with the consumer preference. Branch Size has not much impact on the customer choice of selecting branch of pizza hut. Branch service has a week impact on the choice of branch in case of pizza hut due to the standardization of the service in each branch. Branch crowd has a moderate impact on the customer choice of selecting branch of pizza hut.
Dining practice is a combination of quality and service provided by restaurants management. Achieving the customer satisfactions will leads towards market share as well as loyalty towards your restaurants and to maintain the progress which is necessary to keep the effective measure in terms of customer demands and fulfillments. It was found that quality of the service has a better indirect effect on the significance of the apparent excellence to get the loyalty effect in consumer mind that is considered as a chief element to keep in the consumers and the business.
The impact of location of pizza hut has a positive association with the consumer preferences due to the daily tough routine of the people, customer prefer going to the branch located nearer to their locations.
