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Exploring Consumer Behavior in the Context of Fast Food Industry in Dhaka City
Nadia Farhana* and Shohana Islam**
People in the Indian subcontinent have long been known for the delicious foodstuffs they prepare, serve, and eat. Times gone by suggest that they have used up a lot of their time, energy, and wealth to arrange their meals. But with the turn of the century, and changes in the socio-economic shape of the country, the scenario has changed; and people in Bangladesh, particularly busy city dwellers, now a day dont seem to be having that much time, and energy, if not wealth, available to devote them for such passion for eating. A number of eating out facilities particularly fast food chains came up to cater to this lucrative market. Assuming from the cultural background of people being keen on eating; in this research we have explored the overall consumers behavior towards fast food restaurants in Dhaka city. More particularly, our findings reveal that we have found out the relationship of customers attributes related perception, quality and value related perception and convenience related perception with income, age and overall customer service for fast food restaurants. Quality and value related perception is influenced by income. There is a relationship of attributes related perception and quality and value related perception with overall customer service. Moreover people are loyal to have their food in their favorite fast food restaurants in terms of price and they are interested to travel further for their favorite restaurants.
1. Introduction
The pressures of working life along with time constraints have resulted in an increasing number of consumers opting for fast food restaurant. One study of the market research and analysis group Packaged Facts revealed that around onethird of consumers felt they lacked the time to prepare healthy meals, resulting in food being consumed quickly at work or in the car. For this reason these same people have actually replaced many of their meals with snacks or quick meal. Consumers have changed. The consumer's attitude about the economy, their lifestyle, financial planning and shopping habits and eating behavior it has all changed. Why? Due to busier consumer lifestyles and dual-working families with children, emphasis is increasingly being placed on quick meal solutions (Atkins and Bowler, 2001).In the last five years rapid growth of the fast food restaurant in Dhaka city begin the necessitate of the study. The growth of the fast food market has been an effect of societal development. Like the western world, now a day, women in Bangladesh especially in Dhaka city do not stay at home carrying out household tasks, but rather prefer remunerated work in striving towards equality and economic independence. The meal, as a concept meaning the sharing of _____________________
*Nadia Farhana, Department of Business Administration, Stamford University Bangladesh.744, Satmosjid Road, Dhanmondi, Dhaka-1209. Email: nadiafarhana@gmail.com **Shohana Islam, Department of Business Administration, Stamford University Bangladesh.744, Satmosjid Road, Dhanmondi, Dhaka-1209. Email: shohanapq@gmail.com
2. Literature Review
Fast food has become very popular today. Eating habits are formed in early years and become the most unchangeable practice in life. Children learn everything from the family and society (Wesslen, Sepp, & Fjellstrom, 2002). This study only considered the food and nonfood item, did not consider the attributes that affect the perception of children. Children eat food when going out with their parents and learn about different types of food other than fast food. Family make the children familiar with the foods considering factors like nutrition, age, status, convenience, speed, money, taste, environment of the store because they influence the decision making process of entire family (Ekstrom,1995). The study stated the influence and participation of children in family decision making process and pointed out those children and parents are the major participants in decision making process. There are other factors that can change the family decision making process like income, age. When they grow up day by day they will take decision regarding food considering different factors that their parents gave them already. Attitudes of children change day by day as time passes and parent can influence less gradually. Fast food has been developed in the world economy over the past four decades. Literature on fast food were started to be published in ancient time in Rome. From the beginning of the 80s, somewhat a huge number of publications have been published on fast food industry. The early publications on fast food were basically about the positive and negative aspect of fast food and the attitudes of the customers as a whole. Mattsson and Helmersson mentioned (2007) that high school students knew the good and bad attributes of fast food. They also inscribed the difference in attitudes between male and female students. Female 108
Age of the respondents In this study the mean age of the respondents is
Income of the respondents In this study the mean Monthly Household income of the respondents is tk.133358.4906 (with sd=tk.109355.00848) Modal household income of the respondents is tk.150000.00. Minimum income is tk.10000.00 and the maximum income is tk.500000.00
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112
N
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The pressures of working life along with time constraints have resulted in an increasing number of consumers opting for convenience over price, taste and some instant food. Around 33 % of the respondents prefer to have the lunch at fast food restaurant and 31.1% of the respondents prefer to have midday snack at fast food restaurant (table 2). Table: 2 meals most likely to eat at fast food restaurant
Frequency Lunch Midday snack Breakfast Dinner Late night meal Total 35 33 14 12 12 106 Percent 33.0 31.1 13.2 11.3 11.3 100.0
Variations in consumer preference towards the different attributes can be summarized in the table: 3 given below. Consumer preference for cost is relatively better than other attribute. The mean value (4.2830) of consumer preference of cost is relatively higher than consumer preference for mood (4.1321).Consumer stress least preference for credit card acceptance (3.000) Table 3: attributes of choosing fast food restaurant Std. N Mean Deviation 1.68893 Preference for Cost 106 4.2830 1.96675 Preference for Mood 106 4.1321 1.44752 Preference for tried and true menu 106 3.7830 Preference for Convenience or Speed 1.53181 106 3.6415 Preference for Location Preference for Credit Card Acceptance 106 106
3.4623 3.0000 1.52549 1.87718
Scales used indicate - 6 is the most important and 1 is the least important.
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Percent
H1: Ready to travel further for favorite restaurant is not independent of loyalty to any particular restaurant. Relationship between loyalty to any particular restaurant and Ready to travel further for favorite restaurant: x2 = 8.491 (sig. at 99%) (phi coefficient) = 28.30%. So the relationship is found to be significant but moderately held. a 0 cells (.0%) have expected frequencies less than 5. The minimum expected cell frequency is 53.0. H2: Ready to pay more for favorite restaurant is not independent of loyalty to any particular restaurant. Relationship between loyalty to any particular restaurant and Ready to pay more for favorite restaurant x2 = 8.491 (sig. at 99%) (phi coefficient) = 28.30%.So the relationship is found to be significant but moderately held. A 0 cells (.0%) have expected frequencies less than 5. The minimum expected cell frequency is 53.0. Bartletts Test of Sphericity: Bartletts Test of Sphericity is a test statistics used to examine the hypothesis that the variables are uncorrelated in the population. In this case the null hypotheses related to the appropriateness of the factor analysis has been rejected. (As significant level is beyond the .05 level). So the data collected were found to be appropriate for the factor analysis. Sampling Adequacy: The sampling adequacy has been proved by statistical value of KMO (Kaiser-Meyer-Olkin Measure of sampling Adequacy) to examine the appropriateness of factor analysis. Here the value of KMO is . 691 (table:5.0). This indicates higher sampling adequacy for the factor analysis.
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Determining the Number of factor extracted: For the purpose of determining the number of factors to be extracted, the basic method followed here is eigenvalues greater than one. The principal component method using varimax procedure, reduce the 10 explanatory variables to 3 factors having eigen-values greater than 1. For the purpose of interpretation, each factor was composed of variables with factor loading 0.40 or higher on that factor. But the cumulative percentage of variance technique by combining all the factors was also taken into consideration. The rule of thumb is that the factors extracted should account for at least 60 percent of the variance. The required table:5.1and 5.2 is given in the following page (SPSS generated output). Table : 5.1-- Factor Analysis
Comp onent Initial Eigenvalues % of Varian Cumulative Total ce % 3.110 31.098 31.098 1.977 1.063 .855 .769 .596 .519 .477 .382 .254 19.766 10.633 8.548 7.686 5.958 5.194 4.766 3.815 2.536 50.864 61.497 70.045 77.730 83.689 88.883 93.649 97.464 100.000 Extraction Sums of Squared Loadings % of Varian Cumulative Total ce % 3.110 31.098 31.098 1.977 1.063 19.766 10.633 50.864 61.497 Rotation Sums of Squared Loadings % of Variance 23.475 22.540 15.481 Cumulati ve % 23.475 46.016 61.497
1 2 3 4 5 6 7 8 9 10
Here the number of the factors extracted was found to be three, and the cumulative percentage of variance explained by all these three factors accounts for more than sixty one percent (61.497) .The first factor can alone explain 31.098% of the total variability The second factor can alone explain 19.766 % of the total variability and the first two factors, in combination, can explain 50.086 % of the total variability. The third factor can explain alone 10.633% of the total variability and the three factors, in combination, can explain 61.497 % of the total variability.
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Attribute related perception Perception for price Perception for atmosphere Perception for payment method Perception for menu Health quality perception for past 3 years Price value perception for past 3 years Environment quality perception for past 3 years Food quality perception for past 3 years Overall impression of customer service Perception for location .6777 Extraction Method: Principal Component Analysis. Rotation Method: Varimax with Kaiser Normalization. * Value greater than .50 were retained Cronbachs Alpha .830 .739 .663 .607
.814 .689
.645
Reliability analysis allows studying the properties of measurement scales and the items that make them up. The reliability analysis procedure calculates a number of commonly used measures of scale reliability and also provides information about the relationship between individual items in the scale. The reliability of used measurement scales was tested using Cronbachs alpha coefficients lead to the conclusion that the applied measurement scales exhibit satisfactory levels of reliability. Ranging from acceptable to excellent. SPSS generated output of Cronbachs alpha coefficient is given in the above table 5.2. H3: The attribute related perception is influencing the frequency of eating fast food in a week. Relationship between frequency of taking fast food in a week and attribute related perception: In order to test the statistical significance of the relationship between frequency of taking fast food in a week and attribute related perception a regression analysis was conducted. It is found (table: 6) that the relationship is not statistically significant.
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H4: The Quality and value related perception is influencing the frequency of eating fast food in a week. Relationship between frequency of taking fast food in a week and quality and value related perception: In order to test the statistical significance of the relationship between frequency of taking fast food in a week and quality and value related perception a regression analysis was conducted. It is found (table: 7) that the relationship is not statistically significant. Table: 7 Relationship between frequency of taking fast food in a week and quality and value related perception --ANOVA (b)
Model 1 Sum of Squares .302 370.462 370.764 Df 1 104 105 Mean Square .302 3.562 F .085 Sig. .771(a)
H5: The convenience related perception is influencing the frequency of eating fast food in a week. Relationship between frequency of taking fast food in a week and convenience related perception: In order to test the statistical significance of the relationship between frequency of taking fast food in a week and convenience related perception a regression analysis was conducted. It is found (table: 8) that the relationship is not statistically significant. Table: 8 Relationship between frequency of taking fast food in a week and convenience ANOVA (b)
Model 1 Sum of Squares 1.331 369.433 370.764 df 1 104 105 Mean Square 1.331 3.552 F .375 Sig. .542(a)
H6: The attribute related perception is influencing by Age H7: The Quality and value related perception is influencing by Age H8: The convenience related perception is influencing by Age 117
Table: 9 relationship of attribute related perception, quality and value related perception and convenience related perception with age Dependent Variable A_P (Attribute related perception)
QV_P(quality
F
2.501 1.447 .149
Sig.
.117(ns) .232(ns) .701(ns)
C_P(convenience
H9: The attribute related perception is influencing by Income H10: The Quality and value related perception is influencing by Income H11: The convenience related perception is influencing by Income Relationship of dependence(with income as independent variable): In order to test the statistical significance the relationship of attribute related perception, quality and value related perception and convenience related perception with income a regression analysis was conducted. It is found that the relationship with quality and value related perception is statistically significant shown in table: 10 Table: 10 relationship of attribute related perception, quality and value related perception and convenience related perception with income Dependent Variable A_P (Attribute related perception)
QV_P(quality
F
.069 5.816 2.002
Sig.
.793(ns) .018(a) .160(ns)
C_P(convenience
H12a: Attribute related perception will influence the overall impression of customer service H12 b: Quality and value related perception will influence the overall impression of customer service Examining joint effects of attribute related perception, quality value related perception on overall impression of customer service: In order to examine the 118
Model 1
Df 2 103 105
F 7.244
Sig. .001(a)
b Dependent Variable: Overall impression of customer service Table: 11.b attribute related perception, quality value related perception and overall impression of customer service Coefficients (a)
Unstandardized Coefficients Model 1 B (Constant) A_P QV_P 1.374 .238 Std. Error .585 .125 .180 Standardized Coefficients Beta T B 2.349 1.913 2.836 Sig. Std. Error .021 .059 .006
Table: 11.c attribute related perception, quality value related perception and overall impression of customer service Model Summary
Model 1 R R Square Adjusted R Square .106 Std. Error of the Estimate .95209
Overall impression of customer service QV_P (Quality and value .27 t= 2.836(b) 99% related perception)
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Table: 12.b quality value related perception and overall impression of customer service Coefficients (a)
Unstandardized Coefficients Model 1 B (Constant) QV_P 2.155 Std. Error .425 Standardized Coefficients Beta T B 5.075 3.249 Sig. Std. Error .000 .002
Table: 12.c quality value related perception and overall impression of customer service Model Summary
Model 1 R .304(a) R Square .092 Adjusted R Square .083 Std. Error of the Estimate .96419
So the developed bivariate regression model is overall impression of customer service= a+b (QV_P) t=3.249(.002) 4.2 Summary of the Findings of Research Hypotheses Research hypotheses H1: Ready to travel further for favorite restaurant is not independent of loyalty to any particular restaurant. H2: Ready to pay more for favorite restaurant is not independent of loyalty to any particular restaurant. H3: The attribute related perception is influencing the Frequency of eating fast food in a week H4: The Quality and value related perception is influencing the Frequency of eating fast food in a week H5: The convenience related perception is influencing the
5. Conclusion
Our study indicates that people like to eat fast food in the restaurant and they have a tendency to consume fast food. Mostly they take meal outside at the time of lunch and midday considering cost, mood, availability of different types of food, the convenience of taking food outside, and location. They also have a preference to eat at a particular restaurant and like to travel and pay more to the restaurant to have meal. That shows the loyalty status and brand preferences of the customers. Consumers have a positive perception regarding attributes, quality of food and convenience of taking food in the restaurants, but have strong attributes related perception. They basically perceive quality product if that is supported by their income level. There is a relationship of consumers attributes related perception and quality and value related perception with overall customer service. But quality and value related perception is more closely related with overall impression of customer service. In future research health related perception can be considered. Confirmative factor analysis can be conducted and validity can be tested in future basing on this research. The findings of the study can not be generalized without reservation because of practical limitations. The following limitations are noteworthy: 1. Non probability sampling technique was used in the absence of formal sampling frame 2. Some respondents showed a tendency to give biased information by giving all positive responses because they wanted to finish filling up the questionnaire. 3. Inclusion of more brand/junk food might lead to better generalization of the findings.
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Farhana & Islam Appendix Exploring Consumer Behavior in the Context of Fast Food Industry in Dhaka City (Questionnaire: For an Academic Survey)
Age: . Gender: a. Male Occupation a. Service holder
b) . Female
b) House wife
c) Student
Average monthly household income: 1. How many times in a week do you eat fast food? 2. What meal are you most likely to eat at a fast-food restaurant? a) Lunch b) Dinner c)Breakfast d)Midday snack e)Late night meal / snack 3. Do you frequently visit, or are you most loyal towards, one fast-food restaurant over others? 4. a)Yes b) No 5. If you had to travel further to eat at your favorite restaurant, would you do so? a) Yes b) No 6. If you had to pay more to eat at your favorite restaurant, would you do so? a) Yes b)No 7. Please rank the importance of the following attributes when choosing a fastfood restaurant, where 6 is the most important, and 1 the least important. a) What I'm in the mood for b) Cost c) Convenience / Speed d) Tried and true menu e) Particular restaurant location f) Credit card acceptance Please show your level of agreement regarding the following statement. The given numbers indicate the following levels of agreement: 1= strongly disagree, 2= Disagree,3=Neutral,4= Agree, and 5= Strongly agree
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