Academic journal article European Journal of Tourism Research

Gen Y Consumers' Perceptions of Quick Service Restaurant and the Mediating Role of Purchase Intentions - A Case Study of McDonald's in Singapore

Academic journal article European Journal of Tourism Research

Gen Y Consumers' Perceptions of Quick Service Restaurant and the Mediating Role of Purchase Intentions - A Case Study of McDonald's in Singapore

Article excerpt

Introduction

The food services business is one of the most diverse and fastest-growing segments of the hospitality industry (USDA, 2010). According to the United States Department of Agriculture (USDA), the food service sector encompasses full service restaurants, limited service eating places, foodservice operators in education institutions, lodging, recreational and other outlets. Quick Service Restaurants or QSRs (also referred to as fast food restaurants) are characterised by limited menu selections, prompt service, low prices, self-service facilities and product homogeneity within each fast food brand (Thomadsen, 2007). They can operate as independent businesses, local or international chain stores directly by the company or by franchisees. As the industry is highly competitive, QSRs try to differentiate their products in a variety of ways from their competitors to attract customers.

QSRs predominantly target the time- constrained value-seeking market and they serve what is widely known as convenience food. The food that QSRs sell is generally considered as low-involvement product; as such, customer's perception is an important element in their consumption and decision- making behaviour. In a recent MasterCard global survey on dining out, it was reported that Singaporeans ate at QSRs approximately seven times a month, second only to food courts and hawker centres (Lim, 2013). Evidently, the top three industry players in the local fast food industry include McDonald's, Kentucky Fried Chicken and Burger King (GoodFood.SG, 2012). As one of the world's largest QSR chains (QSR Margazine, 2012), it is not surprising that McDonald's is the market leader in the Singapore fast food industry in terms of outlet count. McDonald's operates 140 outlets in Singapore, followed by Kentucky Fried Chicken and Burger King as distant second and third QSR, with 68 and 42 outlets, respectively (GoodFood.SG, 2012).

According to Kurtz (2012), McDonald's astounding success is attributed to their core principles of quality, service, cleanliness and value. Some work needs to be done to further our understanding of QSR attributes which are perceived to be motivating factors to customers in Singapore. The purpose of this paper is to examine consumers' perceptions of QSR in terms of location (including ambience), food quality, product menu, service crew and collectibles. Generation (Gen) Y consumers are the market segment selected for this study. People in Generation Y are frequent diners, particularly in fast food outlets, and they eat out more than any other generation (Gale, 2007). Given the exploratory nature of this study, we seek to investigate the relationship between Gen Y perceptions of QSR attributes and their purchase intentions in the context of McDonald's in Singapore. If these attributes motivate them to patronise McDonald's, their behaviour can lead to customer loyalty over time. Hence, we also aim to investigate the mediating role of purchase intentions in the relationship between QSR's attributes and brand loyalty.

Literature review & hypothesis development

Past research on Gen Y consumers in the foodservice industry is scarce. Hence the literature review is drawn from a mix of studies on QSR attributes and consumers' perceptions not necessarily related to Gen Y. Previous research has found that motivational factors for consumers to visit QSRs include location, ambience, convenience, service quality and product offerings. Consumers' perceptions of these factors can influence their intentions to purchase fast food products, which in turn can encourage re-patronage. Some studies have identified the dimensions of fast food demand and their implications on customer satisfaction and/or brand loyalty (see for instance Jain, 2008; Min and Min, 2011; Reich et al, 2010; Thomadsen, 2007). The literature review of the QSR attributes of interest underpins the formulation of hypotheses for the current study.

Location

In the marketing and consumer research literature, locational convenience typically involves consumers' perceptions of time and effort saving to reach the product/service provider (Berry et al, 2002; W u, 2011). …

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