A Study On Factors Governing Consumers Choice Of Fast Food A Multivariate Approach

Rahela Tabassum*
The advent of the concept of fast food restaurant in India is relatively new. Due to globalization several fast food retail outlets have been established across India. Presently the hospitality sector is booming and fast food restaurants are experiencing the same trend. This paper tries to find out the factors governing the choice of fast food restaurants based on field surveys. It intends to throw light on the consumer behavior patterns regarding fast food restaurants that in turn help in decision-making on different aspects of fast food retail outlets. A Multivariate tool Factor Analysis has been employed to identify the factors which consumers give due importance while selecting a fast food restaurant.
Introduction the future. As a result, fast-food markets will offer greater growth opportunities for marketers. Adams (2005) paper outlines the bases for establishing fast food industry responsible for obesity as articulated in litigation against fast food chains in US. Anita Goyal and N.P. Singh (2007) Research paper seeks to estimate the importance of various factors affecting the choice of fast food outlets by Indian young consumers. The study estimated Consumer acceptance of food served by fast food outlets is critically important for the future growth of fast food outlets in any economy. Though the rating of fast food outlets attributes under study is very high but still consumers visit fast food outlets for fun, change or entertaining their friends but certainly not as a substitute of home made food. Consumers demand more and more information related to hygiene issues and nutritional values of the products of fast food outlets. Brown et al. (2000) emphasized the need for nutritional awareness and fast food preferences of young consumers during adolescent years. Davies and Smith (2004) have analyzed the importance of nutritional values of fast food and also information printed/disclosed by the fast food providers in London. Chu-Mei Liu and Kuang-Jung Chen (2000) in their study tried to develop a productmarket structure of the fast-food restaurants in the Philippines. Using the concept of hierarchical clustering based on substitution-in-use, the influence of three categories of situational influence were used to modify the original choice market mix relationship at every clustering stage. Changes in the importance of the individual components of the product-service mix served as the basis of the link-up among competing fast food restaurants. Kara et al. (1995) has presented the consumers perceptions of and preferences for fast-food restaurants in the US and Canada. According to their study, the consumers in the age of 12 to 24 years look for variety, price, delivery service and location in America and for price and novelties in Canada. In the age group of 46 years to above 55 years cleanliness, nutritional value, quality and taste are considered by Americans and preference is given to nutritional value and seating capacity by Canadians in identifying fast food restaurants. In the middle age group of

ne of the effects of urban development is the increase in sale of ready cooked food. The growth in IT sector and the entry of women in the job market has made the environment conducive for opening of many Fast food restaurants. These restaurants are also known as Quick service restaurants. The popularity of Fast food is tremendous in west. Fast food does not only include burger and pizza, but it includes a wide range of food items. Though burger, pizzas, frenchfries and chicken nuggets are common food items in fast food category in U.S, the kebab houses are the common fast food restaurants in the Middle East. These kebab houses are especially popular in Turkey and Lebanon. They are also common in New Zealand, Australia and Europe. However they are less common in U.S. The most famous Fast food restaurants all over the world are McDonalds, Subway, Dominos, Burger king etc.

Review of Literature Ali Kara, Erdener Kaynak and Orsay Kucukemiroglu (1997) studied on the major food consumption trend in the USA and Canada and analyzed that more people are eating meals outside their homes. It is predicted that this trend will accelerate in

*Associate Professor, Amjad Ali Khan College Of Business Administration (Osmania University)

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25 to 45 years, Americans preferred for speed and friendly personnel whereas Canadians looked for speed, quality and service. Saavedra (1983) cited various menus being offered by fast food restaurants as the main reason, aside from excellent service and ambience that make ones meal truly worthwhile. Objectives The main objective of the study is to examine the consumers perception and preference for fast food items. The detailed objectives of the study are as follows: 1) 2) To study the profile of consumers of fast food outlets in Hyderabad. To study the factors governing the consumers preference for fast food outlets in Hyderabad on parameters like price, quality, taste, convenience, services etc. To get an insight about the preference for each item in fast food. To assess consumers preference in terms of extent of liking towards fast food.

Data Collection Techniques Sources of Data The study makes use of both primary as well as secondary sources of data. Primary Data The Primary data is collected from consumers who visited the selected fast food restaurants in Hyderabad through a questionnaire. The questionnaire was administered to 150 customers coming out from the selected fast food restaurants. Out of which the researcher could get 125 completely filled questionnaires. Survey Instrument Questionnaire The data is collected by drafting a questionnaire. The questions are devoted to elicit information about the factors which the consumers consider are important in selecting a fast food restaurant in Hyderabad. Secondary Data

Data Analysis The structured questionnaire comprises of different questions from multiple choice to open ended. The questionnaire also has attitude scales to measure the customers evaluation of services. Averages with percentages for each question in the questionnaire have been tabulated and analyzed detailed interpretation wherever necessary has been given. Statistical tools such as , mean score, factor analysis have been used for data analysis using SPSS package wherever necessary. Limitation of the study 1. Since the study is a sample based and locationally limited to Hyderabad, the findings may have the limitation of generalization to the whole population. There is a possibility that the consumers and managers may fail to articulate their feelings and responses. Therefore the error of in articulation may creep into the study. The size of the sample selected for the study constitutes only a small segment of the population. Hence the findings may have limitations pertaining to the size of the sample.

2.

3) 4)

3. Secondary data is collected from different journals of management and hospitality, magazines, reports etc. The secondary data was also collected by interacting with the officials of various fast food restaurants to get the internal information. Scope of the study The study is confined to examining the consumer preferences of a sample of respondents who visited the selected fast food restaurants in Hyderabad. The scope of the study is confined to study the perceived quality of services offered by selected fast food restaurants in Hyderabad. Period of study The primary data for the study was collected during 2010-2011. However for the secondary data, information is taken preceding 5 years from 2009-2010.

RESARCH DESIGN The present study makes use of judicious mix of, both, primary and secondary sources of data that complements the research efforts. Exploratory research design was used to gain insight into the consumers preference and epicurean habits of people residing in Hyderabad. The various sources of information used were Journals and magazines. Freelance search using various search engines. Descriptive research design was used gain insight into the factors for preferring a particular fast food restaurant. The source of information included the consumers who visit the fast food outlets located in Hyderabad.

Fast Food Its a fast paced world we live in. Thanks to the Internet, information is available in an instant, stocks can be traded in real time with the click of a button and you can buy just about anything you can think of on the spot (with overnight delivery). Digital cameras render crystal clear photographs ready for viewing in a single second. Phones put us in touch with anyone we want nearly instantly. Young Hyderabadis simply dont like to wait. The same can be said for how they eat. The most famous of the junk food relished by Hyderabadis include. Burger Pizza Dounuts Chicken Nuggets French fries KFC Noodles Journal of Marketing & Communication

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Findings The information relating to preference for

each item in fast food is furnished be

Preference For Each Item in Fast Food Items Burger Pizza Dou nuts Chicken Nugget French fries KFC noodles 5 22.6% 29.0% 16.1% 12.9% 38.7% 40.3% 27.4% 4 25.8% 24.2% 21.0% 29.0% 27.4% 16.1% 17.7% 3 17.7% 9.7% 30.6% 19.4% 12.9% 8.1% 16.1% 2 19.4% 21.0% 17.7% 9.7% 11.3% 6.5% 21.0% 1 14.5% 16.1% 14.5% 29.0% 9.7% 29.0% 17.7% Mean Score 3.225 3.290 3.064 2.870 3.741 3.322 3.161 Ranks 4 3 6 7 1 2 5

Majority of the respondents preferred French fries (3.741) and KFC (3.322).The next priority is given to pizza (3.290) and burger (3.225).Least preferred items in the fast food

are dounuts (3.064) and nuggets (2.870). Extent Of Preference Towards Fast Food: There is a change in epicurean habits of Extent of Liking Towards Fast Food

people of Hyderabad. The information regarding the extent of liking towards fast food is furnished in the following table.

S.No 1 2 3 4 5

Extent of liking Strong Dislike Dislike Neither like nor Dislike Like Likes very much Total

percentage 16.1 16.1 17.7 22.6 27.4 100.0

Twenty seven percent of the respondents have shown their strong liking towards fast food which clearly indicates the change in

epicurean habits of people. Reasons For Liking Fast Food: The Reasons For Liking Fast Food

information relating to reasons for liking fast food is depicted in the following table.

S.No 1 2 3 4 5 6 7 8 9 10

Factors Taste Freshness Hygiene Fast service Westernized image Less spicy Friendliness of a person Delivery of service Novelty for children Variety of Menu

Percentage 41.93 35.48 37.09 30.64 33.87 20.96 22.58 32.25 20.96 27.41

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Forty two percent of the sample respondents prefer fast food for taste followed by hygiene, freshness and westernized image with thirty seven percent, thirty five and thirty four percent respectively. Factor Analysis There are number of factors which the respondents consider in selecting a fast food restaurant. Factor analysis is a statistical tool which is primarily used for data reduction and summarization. In research, there may be large number of variables which are corelated and which must be reduced to manageable level. Factor analysis is used in following circumstances1. To identify the underlying dimensions

or factors that explains the co-relation among the set of variables. 2. To identify a new smaller set of uncorrelated variables to replace the original set of correlated variables in subsequent multi variant analysis.

Kmo And Bartletts Test Results

Kaiser-Meyer-Olkin Measure of Sampling Adequacy. Bartletts Test of Sphericity Approx. Chi-Square Df Sig. .5233

1.623E3 78 .000

The study explores the important factors which affect consumer choice of restaurant. Principal component analysis is used, as it is exploratory factor analysis. A set of attributes are listed on which the respondents were asked to rate the importance of primary attributes in selecting a fast food restaurant on a likert 5 point scale with 1 being extremely unimportant and 5 being extremely important .Factor analysis is used to understand the interdependence among the attributes.

Communalities Attributes Location Initial 1.000 1.000 Extraction .651 .590

Factors Affecting The Customer Choice Of Fast Food Restaurant

Attributes Location Availability of variety of items Value for money Image Ambience Service Hygiene Taste Quantity Parking Food safety Waiting Time Popular for specific food item Mean 3.66 3.44 4.32 3.42 3.53 3.92 4.06 4.11 3.26 3.40 3.42 3.50 3.31 Std. Deviation 1.283 1.352 .858 1.290 1.074 1.083 1.015 1.065 1.244 1.225 1.351 1.280 1.352 Parking Food safety Waiting Time Popular for specific food item 1.000 1.000 1.000 .806 .723 .235 Hygiene Taste Quantity 1.000 1.000 1.000 .723 .743 .729 Image Ambience Service 1.000 1.000 1.000 .549 .703 .772 Availability of variety of item Value for money

1.000

.730

The value of KMO suggests that degree of common variance is middling and the values of the Barletts Test are indicative that the sample inter correlation matrix is an identity matrix. The Kaiser-Meyer-Olkin (KMO) measure of sampling adequacy and Barletts Test of Sphericity has been executed to test the validity of data for factor analysis. High

values (between 0.50 to 1.00) indicate factor analysis is appropriate (source: Marketing Research: An applied orientation by Naresh K Malhotra, Ch 19, Pg No 566,567).The present study shows the KMO value to be 0.5233 and the chi-Square value of Barletts test of sphericity as 1.623 at 78 degrees of freedom .This shows that the factor analysis test is appropriate with a significance value of 0.000.

1.000

.822

Extraction Method: Principal Component Analysis

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After the standards indicated that the data are suitable for factor analysis, principal component analysis is employed for extracting the data, which allowed

determining the factor underlying the relationships between a numbers of variables. The total variance explained suggest that it extracts one factor which Total Variance Explained

accounts for 67.493 percent of variance of relationship between the variables.

Component Total 1 2 3 4 5 6 7 8 9 10 11 12 13 2.060 1.733 1.363 1.274 1.226 1.118 .989 .797 .713 .567 .424 .421 .314

Initial Eigenvalues

Extraction Sums of Squared Loadings % of Variance Cumulative % 15.847 13.330 10.485 9.803 9.431 8.596 15.847 29.177 39.662 49.465 58.896 67.493

Rotation Sums of Squared Loadings Total 1.824 1.629 1.480 1.388 1.240 1.212 % of Variance Cumulative % 14.032 12.533 11.386 10.679 9.539 9.323 14.032 26.566 37.952 48.631 58.170 67.493

% of Variance Cumulative % Total 15.847 13.330 10.485 9.803 9.431 8.596 7.605 6.131 5.486 4.363 3.265 3.240 2.416 15.847 29.177 39.662 49.465 58.896 67.493 75.098 81.229 86.715 91.079 94.344 97.584 100.000 2.060 1.733 1.363 1.274 1.226 1.118

Extraction Method: Principal Component Analysis. Scree Plot For Attributes

Essence of Scree plot A scree plot is a plot of the Eigen values against the number of factors in order of extraction. The shape of the plot is used to determine the number of factors. Typically the plot has a distinct break between the steep slope of factors with large Eigen values and a trailing off associated with the rest of the factors. This gradual trailing off is referred to as the scree.Experimental evidence indicates that the point at which the scree plot begins denote the true number of factors.Loading on the factors can be positive or negative. A negative loading indicates that this variable has inverse relationship with the rest of the factors. The higher is the loading the most important is the factor. The component Matrix is shown in the following table.

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Component Matrix
Component Attributes Location Availability of variety of items Value for money Image Ambience Service Hygiene Taste Quantity Parking Food safety Waiting Time Popular for specific food item 1 .321 -.085 .021 .111 -.417 .788 -.278 -.675 -.225 .005 .746 .041 .029 2 .603 .478 -.358 .693 .290 -.229 -.293 .169 -.327 -.049 .025 .405 .090 3 .197 .317 .604 .046 -.151 -.005 .669 .109 -.297 .326 .108 .202 -.356 4 -.219 .259 .431 -.218 .375 .266 -.227 .455 -.302 -.441 .306 -.072 .264 5 .164 -.254 .024 .055 .316 .126 .228 .195 .259 .586 .242 .025 .674 6 .265 .349 .222 -.062 -.426 -.107 .094 -.039 .570 -.399 -.045 .150 .402

Extraction Method: Principal component analysis.

a. 6 components extracted. The rotation of factors is designed to give an idea how the factors initially extracted differ from each other and to provide a clear picture of which item loads on which factor.

Rotated Component Matrix

Component Attributes Location Availability of variety of items Value for money Image Ambience Service Hygiene Taste Quantity Parking Food safety Waiting Time Popular for specific food item 1 .147 -.101 .207 -.013 -.051 .843 -.261 -.316 -.334 .039 .834 -.033 .243 2 .766 .538 -.105 .652 -.030 -.135 .020 .000 -.179 .085 .136 .513 .091 3 -.146 .116 .036 .078 .812 -.208 -.081 .744 -.292 .062 -.067 .010 .286 4 -.068 .277 .814 -.307 -.172 .010 .662 .264 .030 .050 .058 .044 -.063 5 .076 -.436 -.105 .101 .097 .004 .458 -.104 .036 .889 .023 -.011 -.023 6 .106 -.104 -.036 -.112 -.020 -.019 -.005 .088 .706 -.016 .024 -.015 .818

Extraction Method: Principal Component Analysis. Rotation Method: Varimax with Kaiser Normalization. a. Rotation converged in 8 iterations.

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A six factor solution resulted. The six factors emerged to explain (67.493) variation . The total variation explained by factor 1 is 15.487 percent, followed by factor 2 (29.17) percent, factor 3 (39.662) percent, factor 4 (49.465) percent, factor 5 (58.896) percent, factor 6 (67.493) percent. The factor loading indicates that service (.843) and food safety (.834) correlates (loads)

high on factor one which is labeled as (service delivery dimension). Location (.766), availability of variety of item (.538), image (.652), and waiting time (.513) on factor 2 is labeled as (popularity dimension) Ambience (.812) and Taste (.744) on factor 3 is labeled as (quality dimension). Results of Factor Analysis

Value for money (.814) and hygiene (.662) is labeled as (assurance dimension). Parking (.889) on factor 5 is labeled as (facility dimension). Quantity (.706) and popularity for specific food item (.818) on factor 6 is labeled as (performance dimension).

Serial No

Factor Name

Eigen Value

Cumulative % of variance

Variables

Loadings

Service delivery dimension

2.060

15.847

Service Food safety

.843 .834

Popularity dimension

1.733

29.177

Location Availability of multiple cuisine Image Waiting time Ambience Taste

.766 .538 .652 .513 .812 .744

Quality dimension

1.363

39.662

Assurance

1.274

49.465

Value for money .814 Hygiene .662 Parking Quantity Popular for specific food .889 .706 .818

5 6

Facility Performance

1.226 1.118

58.896 67.493

Conclusions The fast food restaurant marketers can make the menu attractive by keeping innovative names to the dishes in the cuisine. The restaurateurs can make an attempt to increase revenues by introducing special menu offers like kids menu, senior citizen menu, weight
References

watchers menu. Apart from this a separate menu can be designed for people with lifestyle diseases like blood pressure, diabetes etc. Fast food restaurant diners give importance to value for money and hygiene. Therefore value for money is another important factor in differentiating a business from its competitors. Restaurant operators

should particularly pay special attention to the hygiene of the outlets and food to enhance customer confidence and satisfaction. This apparently is very important for the fast food restaurant business.

Ali Kara, Erdener Kaynak and Orsay Kucukemiroglu (1997), Marketing strategies for fast-food restaurants: a customer view, British Food Journal 99/9 pp.318324. Anita Goyal and N.P. Singh (2007), Consumer Perception about Fast food in India. An exploratory study, British Food journal, Vol. 109 No. 2, pp. 182-195. Chu-Mei Liu and Kuang-Jung Chen (2000) A look at fast food competition in the Philippines, British Food Journal, Vol. 102 No. 2, 2000, pp. 122-133. Gronroos C., (1990),Service Management and Marketing, Lexington Books, Lexington, M.A. Parshuraman.A,Zeithmal, V.A and Berry, C.C., (1990) Delivering Quality service, The Free Press, New York.NY. McNeal, J.U., Stem, D.E. Jr and Nelson, C.S. (1980), Consumers nutritional ratings of fast-food meals, The Journal of Consumer Affairs, Vol. 14 No. 1, p. 165. Rampal M.K and Gupta S.L (2000),Services Marketing concepts Application and cases,Galgotia Publishing company-New Delhi. Tull and Hawckins (2000),Marketing Research,4th Ed,Tata McGraw Hill.

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