Academic journal article Business: Theory and Practice

The Dimensions of Customer Preference in the Foodservice Industry

Academic journal article Business: Theory and Practice

The Dimensions of Customer Preference in the Foodservice Industry

Article excerpt

Introduction

In the ever changing market environment, today's foodservice operators must place a high priority on understanding the market in order to retain and sustain strategic advantage in the highly competitive foodservice industry. This industry is considered to be the fastest growth industry in the global market, and it is described by players of the industry as being in the middle of a perfect storm (Haas 2008). However, recent economic uncertainty restricts spending which affects the foodservice industry thus foodservice operators have to reduce prices or offer promotional deals in order to enhance business performance.

During the economic downturn, a constant challenge for foodservice is to find the right mix of attributes that could assist in the repatronage decision (Mohsin 2005). Foodservice has to remain competitive by lowering prices or offering promotional deals in order to lure customers. Hence, economic recessions influence customers to opt for cheaper foodservice. In addition, most of the promotional activities are the introduction of children's menus and value for money menus which are targeted at price conscious foodservice customers. Hence, the study of the foodservice industry is important as the literature has indicated its vulnerability to changes in customer preference in relation to economic trends.

It is important to note that the foodservice industry is influenced by fast-changing customer preferences (Kara et al. 1995; Waldfogel 2008). While preferences can be regarded as an individual's attitude towards a set of objects, customer preference is about choices among valued options with acceptance indicating a willingness to tolerate the status quo (Fife-Schaw et al. 2007). Studies of customer preference for foodservice attributes are very limited thus further research is obviously needed. Likewise, changes in customer preference will make existing strategies no longer valid for the operators within the foodservice industry. Therefore, these operators must be prepared to identify and meet changing customer preferences resulting from changes in the demographic, technological, societal, legal, cultural or ethical characteristics of the industry. Furthermore, most studies of customer preference were conducted in developed countries, such as the United States (Blum 1996; Kim et al. 2009), and Europe (Clark, Wood 1998; Tokuc et al. 2009). There are only a few studies based in the Asia Pacific (Park 2004). Thus, any attempt to generalize the findings of these studies would be pointless as there may be differences in environmental setting that influence customer preference in different ways in different contexts.

Previous research showed that the most important attributes determining whether a customer will return to a foodservice establishment was the quality of service, and the least considered factors were place and ambiance (Bojanic, Shea 2007). On the contrary, Knutson (2000) contended that price was one of the top-ranked influences with regard to foodservice establishment choices. Literature also showed that price was a concern when customers took their families and the least concern when consuming business meals (Koo et al. 1999). Customers searched for information about a foodservice outlet, especially where

there were price differences among outlets.

Offering good food and good service is not enough to attract consumers and foodservice outlets should provide meals with good value in a favourable ambience or place. Previous studies showed that attractive decor and atmosphere influenced customer choice of where to dine out. The most important attributes were design and concept of the place and the least important thing was the food. Past work has shown descriptive names improved sales and improved expectations related to the food and the foodservice outlet, and a positive relationship between brand and foodservice establishment performance (Wansink et al. …

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