Case Study
A Marketing Research Report

Executive Summary

The competition within food and beverages industry is intense. Even cafeteria with strategic location may not attract sufficiently huge amount of traffic due to the competitive industry structure. In this research, the student cafeteria, namely cafeteria XYZ in the Brunel Business School is investigated. The study concentrates on the customer satisfaction and perceptions on pricing structure of cafeteria XYZ by students studying in the business school. It is found that there are much more can be done by cafeteria XYZ to further improve the services offered by the cafeteria to further enhance customer satisfaction among the students.

Introduction

Today, particularly in country such as United Kingdom, which serves as the educational hubs or main attractions from overseas students, the student food service is a big and profitable market. However, it is also acknowledged that the food services, or more accurately can be defined as the food and beverages industry, is competitive. There are many substitutes available for the students in choosing their food and beverages consumptions habits or destination. Not only is that, it can also be easily observed that as the living of standards of the society improve, even students today are getting more demanding, and indeed, not easily satisfied with plain or traditional services.

In Brunel Business School, it can be seen that cafeteria XYZ is not getting the expected amount of students having meals or dining in the cafeteria, considering that the traffic flows of students are high around the location of the cafeteria. Precisely, the cafeteria is strategically located, and yet, it seems that the cafeteria is not capturing the ‘should be’ market share. Thus, it is necessary to understand or investigate the situation in greater depth. To do this, two crucial marketing dimensions, that has strong relationships to profitability, namely customer satisfaction and pricing is investigated.

Thus, the research objective in this report is to investigate the degree of customer satisfaction among students dining in cafeteria XYZ. Secondly, it is to investigate the student perceptions on the pricing structure of the cafeteria. Both of these research objectives are important because by understanding on the level of customer satisfactions and the perception of students on the pricing structure of the cafeteria, an overview of the performance of the cafeteria can be understood. When that is possible, then improvements can be made, to further enhance the level of customer satisfactions of the cafeteria.

Literature Review

In the context of business management, a lot of efforts are spent on investigating the key success factors of businesses. From successful companies with competitive advantage in the marketplace, scholars have been able to identify certain traits and clues, which contribute to the remarkable success of these high performing companies. The common theme of the success stories is often due to two key performance indicators, namely customer satisfaction (Kotler et. al., 2006) and low cost structure. It is not hard to discover successful firms that had achieved growth and admirable profitability through customer satisfaction and low costs structure. For example, as discussed by Helen (1996), the key success factor of IKEA in domestic and international context is due to low cost leadership and yet customer satisfaction in the furniture industry. Yet, according to Arnold (2002), the respectable success of Wal-Mart is due to customer satisfaction as well as low cost leadership in the retailing industry. Similarly, as discussed by Child (2002), the high growth of Tesco as well as its dominance in United Kingdom is due to customer satisfaction and low costs business structure. Not only is that, as asserted by Bailey et. al. (2009), the success of Southwest Airline, in perhaps the most competitive and unfavorable airline industry, is also due to customer satisfaction and low costs leadership in the airline industry.

There are many reasons that customer satisfaction and low cost leadership often contribute to the attainment of competitive advantage, growth and profitability in the competitive industry landscape. From the marketing management perspective, customer satisfaction is crucial because consumers are king (Ding et. al., 2011), and collectively, they are the main factor deciding the profitability of any profit oriented businesses. Any businesses should be managed in a customer orientation manner, and it is managerial imperative to provide best possible products or services to meet the customers’ needs and wants. Indeed, literature on customer satisfaction is never lacking. Researchers, scholar, and practitioners are all well aware of the importance of customer satisfaction to the performance of any business, and if the customers are not happy, they simply will switch the purchase of certain products to the competitors, or to find substitutes of the products or services they desire (Dominici et. al., 2010). From the other dimensions, low costs leadership or structure is important to ensure the operational efficiencies of a particular business. When a business able to achieve a low cost structure, the prices offered to consumers can be lowered, and thus, in the long run, may be able to drive out the competitors from the competition. It is not hard to observe that companies that able to secure the biggest market shares and reach the largest mass of consumers are often those that offer cheapest pricing to the consumers. Thus, the prices charged to the consumers can be complicated issues in terms of effective and profitable marketing management.

Research Methods

In this research, quantitative methods will be used. In order to conduct the student, the typical 7-scale Likert type questionnaires will be used to investigate the students’ opinion on their satisfaction level and pricing structure of the cafeteria. The questionnaires used to conduct the study will be adapted from Xi and Shuai (2009). Xi and Shuai (2009) had conducted a study to investigate the customer satisfaction in student food services in student cafeteria in Norwegian School of Business Administration and Economics. According to the authors, a total of five questions can be used to investigate the degree of customer satisfaction in cafeteria. Besides, three questions were also used by the authors to investigate the perceptions of pricing structure of the cafeteria.

The five questions used to investigate the degree of customer satisfaction among the students include: (a) I am pleased with the school cafeteria overall, (b) I am pleased with the food offered, (c) I am pleased with the what I get for what I pay, (d) I am pleased with the ambience of the cafeteria, and (e) I am pleased with the staff of the cafeteria. On the other hand, the three questions employed to investigate the student satisfaction include: (a) prices are reasonable for the portion served, (b) I consider the food’s prices as acceptable, and (c) I usually accept changes in prices. From the list of questions, it can be found that the level of customer satisfaction can be investigated from various dimensions, namely: the foods, the pricing, ambience as well as the staffs. The perceptions of students on the pricing of the foods, however, are investigated from three dimensions, namely, the reasonability, acceptability and reaction to price changes.

In order to conduct the research, random sampling methods are used. All the research participants selected must be student studying in Brunel Business School, and they are interview or asked to complete the questionnaires designed when they are found to having lunch in the cafeteria. Except Saturday and Sunday, the sampling process will be conducted for a total period of 4 weeks. This means that a total of 20 days are used to conduct the survey. In each of the day, a total of five randomly selected students will be requested to complete the questionnaires distributed to them. Thus, a total of 100 set of completed questionnaires were obtained. After the completed answers from students are compiled, the data findings will be tabulated into Excel spreadsheet. Then, statistical packages such as SPSS will be used for analysis purposes. In order to judge the degree of customer satisfaction among the students, the answers from all research participants will be summed, and the means of the value will be calculated. Higher average value indicates that the students interviewed are more satisfied.

Limitations of the Research

Firstly, it can be observed that the research concentrate only in investigating the degree of customer satisfaction as well as the perceptions of students on the prices charged by the cafeteria. Other may be equally important marketing dimensions, such as services quality, the food quality, the branding or reputation, the promotional activities and others are not researched. Thus, this study is not really a comprehensive research on the various marketing dimensions or achievement of the cafeteria. Secondly, the study is conducted over a short period of time. From time to time, the consumer perceptions may change, depending on the macroeconomic environment, or the emergence of new competitors around the location of the cafeteria. Thirdly, this study is quantitative in nature, and the research findings are subjected to the scope of the questions asked to the research participants. However, in the real scenario, students interviewed may have other more important opinions which they never mention to the researcher. Many of the feedbacks may be possible ferreted through open-end questions, through a qualitative interview on the students. Considering the various limitations of the study, readers are advices to use the results findings in a conscious manner. Perhaps more researches should be performed in the future to better analyze the marketing management and factors affecting customer satisfaction of the students dining in cafeteria XYZ.

Research Findings

In this section, the research findings from the completed questionnaires will be presented. In the following table, the descriptive statistics for all of the questions are presented (Table 1). For explanation purposes, the questions, the respective short hand as well as the exact questions used in the research design will be presented in Table 2.

 

table-1

 

Overall, as shown in the descriptive statistics, the customer satisfaction of the cafeteria is somehow above average (i.e., a score of 4.62, from the 7-scale Likert scale rating). On deeper investigation, it is found that the most satisfactory dimensions of the cafeteria are about the prices charged to the students (with an average score of 4.79). The second dimensions receiving satisfactory or good score is about the staffs (with an average score of 4.39). Apparently, the students are somehow satisfied with the services provided by the staffs. Thirdly, the students are pretty satisfied with the ambience of the cafeteria as well (an average score of 3.31). From the research findings, it is discovered that the most unsatisfactory dimensions is about the food provided by the cafeteria. The students are not happy with the food provided, causing it to yield the lowest average score from the research study, as low as 2.77 from the 7 scale Likert style questionnaires.

In order to provide more clear graphical representation on the research findings. The histogram of the research results are presented in Figure 1 to Figure 5 (one histogram for each of the questions). In Figure 1, the research findings for the first question (i.e., I am pleased with the school cafeteria overall) is presented. It can be seen graphically that most of the student are somehow satisfied with the overall services or foods provided.

 

f1

 

In Figure 2 below, the research findings for the second question (i.e., I am pleased with the foods offered) is presented. It can be seen that more than half of the students are not happy with the food served in the cafeteria. This truly deserve further investigation on the reason to which students do not think that the food served is nice, or  perhaps the students are not happy on the choices, variety, flavor or types of the foods provided. It could also be that the students have too high expectancy on the types of food to be provided. From another dimension, it could also be due to the strategic location of the cafeteria, the management of the cafeteria is not taking seriously on providing or improving the tastes and variations of the foods sold in the cafeteria.

 

f2

 

In Figure 3 below, the research findings for the third question (i.e., I am pleased with the what I get for what I pay) is presented. It can be seen that the most of the student somehow think the price charged is reasonable.

 

f3

 

In Figure 4 below, the research findings for the fourth question (i.e., I am pleased with the ambience of the cafeteria) is presented. Overall, it seems that the students have no strong opinion on the ambience of the cafeteria. Perhaps that is due to their expectation that any school cafeteria should only be looking so and so. Perhaps they think that the cafeteria is normal from their usual observation on school cafeteria.

 

f4

 

In Figure 5 below, the research findings for the fifth question (i.e., I am pleased with the staff of the cafeteria) is presented. It can be observed graphically that most of the students satisfied with the services of the staffs. Only a smaller portion of the students interviewed perceived that staffs working in the cafeteria unsatisfactory.

 

f5

 

Recommendations

Overall, the research findings successfully found that the key issues dealing with the cafeteria is due to the food provided by the cafeteria. The students are found to be pretty satisfied with the price charged, the staffs working in the cafeteria as well as the ambience of the cafeteria. However, there are more to be researched. The study presented in this report may best serve only as the preliminary study to investigate the customer satisfaction dimensions of the cafeteria. For example, concerning the issue that the students apparently are not truly satisfied with the food provided in the cafeteria, more research or study should be performed. For example, in terms of foods served by any restaurants or cafeteria, it can be investigated from several dimensions, as follow: the food variety, the quality of the food, the types of foods or even the presentation of the foods (Xi and Shuai, 2009). It is also possible, from common sense that the students may already feel bored with the foods, after years or dining or eating in the cafeteria (which, this could be not easy issues to be solved by the management of the cafeteria). Otherwise, it could also be that the foods served outside the campus are nice, and had actually lifted the expectations of the students. Apart from that, from another dimension, the ambience of the cafeteria can be surveyed from several dimensions, such as cleanliness, having places to sit during peak hours, quiet environment, decorations of the cafeteria, comfort of the seats, as well as the general atmosphere of the cafeteria (Petruzzellis et. al., 2006). In this report, the big picture is identified and discuss, but in order to formulate better and more focused solution or strategic moves to revitalize the services or foods provided by the cafeteria, it is necessary to conduct more in-depth research on the dimensions found to be less satisfactory reported in this study.

Conclusion

Overall, this study is useful as it contribute our understandings on the customer satisfaction of the cafeteria XYZ. The research is practical as the research findings can be readily applied, or be used as the base for further investigation on how to enhance the customer satisfaction of the cafeteria. Besides, such a research can also be duplicated in investigating the customer satisfaction of other restaurants or cafeteria. The structure and nature of the research is useful in helping the management of any restaurant to better understand the various dimensions (either strengths or weaknesses) of the respective restaurants in the competitive business landscape.

References & Bibliography

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