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Using Conjoint Analysis and Perceptual Map

Submitted By Group 5-

Name PRN
Aratrika Mallick 16020841006
Siddhesh Gandhi 16020841136
Anshuman Bhardwaj 16020841005
Amiras Shashtri 16020841150
Aryaman Sanganeria 16020841158
Apeksha Garse 16020841099
Table of Contents

S.No. Topic Covered Page No.


1 Introduction 3
2 Objectives 6
3 Literature Review 7
4 Research Methodology 10
5 Steps of multi-attribute model 11
6 Data Analysis 14
7 Conjoint Analysis 15
8 Perceptual Map 16
9 Results and Discussion 17
10 Conclusion and Recommendation 18
11 References 18

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ABSTRACT, KEYWORDS
Fast food becoming popular day-by-day in India with globalization. Prior study identified
customer attitude towards fast food restaurants. The study was conducted amongst the
students of SIBM Bengaluru to figure out their preferences and what influences their
decisions when they decide to eat out. Primary data was collected by using survey method
(n = 60). To achieve the objective of the study salient beliefs taker were price, dcor and
Cuisine type. Fishbein multi-attribute was used to test customers belief and evaluation
towards these fast food restaurants. Five point likert scales was used in the questionnaire.
Statistical tool used was Conjoint Analysis and Perceptual Map for understanding
customer attitude towards each type of restaurants individually.

Keywords: Fast food, Customer attitude, Fishbein multi-attribute model, Salient beliefs,
Paired t-test, Descriptive Statistics, consumer attitude, salient belief

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INTRODUCTION
Pattern of food consumption may vary due to the differences in culture, climate,
socioeconomic status, etc. In fact, the habit of taking food among the inhabitants of a
country may change due to several factors. Thus globalization, economic and income
growth has lead to increased amount of fast food consumption in Bangladesh like any
other Asian country. Today fast food restaurant industry is a highly growing sector in
Bangladesh (Islam & Ullah 2010). Originated at USA in 1916, fast food restaurants are now
dominating the world (Bareham 1995). As the industry is growing, the question of
consumer attitude towards the fast food restaurants has become a significant aspect of
research. Thus it is a necessity to identify the attitude of the fast food consumers towards
the restaurants. Attitudes are evaluative statements, which can be either favorable or
unfavorable concerning any object, people, or events (Alam & Iqbal 2007). The attitude
towards a product or service can be a vital influencer in buying behavior. In fact favorable
attitude can cause favorable buying decisions.

There are various motivations for eating out; economizing, efficiency, fun, taste, and
social interaction. Eating out gives consumers experiential values. The restaurant is a
place where we experience excitement, pleasure and a sense of personal well being
(Finkelstein, 1989). Ritzer (2001) argues that consumers are increasingly coming to value
efficiency, calculability, predictability and control, due to changes in lifestyle,
demographic factors and technology in restaurant consumption. Values represent
important and desirable end goals. A general view of values guided this research,
recognizing both (1) a utilitarian outcome resulting from the conscious pursuit of an
intended consequence and (2) an outcome related more to spontaneous hedonic
responses (Babin et al., 1994). The former is called a utilitarian value and the latter a
hedonic value. Utilitarian consumer behavior has been described as task-related and
rational (Batra and Ahtola, 1991). The hedonic value is more subjective and personal than
its utilitarian counterpart and results more from fun and playfulness than from task
completion (Holbrook and Hirschman, 1982). People eat out because of the benefit they
derive from food and restaurants. Consumer values of eating-out can be defined as value
consumers derive from food, service, and restaurants when eating-out. Consumers pursue
these values to satisfy their hunger, and need for convenience, pleasure, entertainment,
social interaction, and the mood transformation. Visiting a restaurant for its functional
values-such as satisfying ones hunger, enjoying convenient food, or economical eating
is a goaldirected behavior; by contrast, recreational and experiential visiting are hedonic
orientations. Thus, the utilitarian value of eating-out is defined as a value related to

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functional and economical aspects of eating-out while the hedonic value represents
consumer fun, entertainment, absorbing, and novelty. Consumers are believed to view a
service such as a restaurant meal in terms of a set of attributes: (i.e. characteristics that
make it desirable), ascribing different levels of importance to each attribute (Johns and
Pine, 2002). Consumers weigh the overall value of an offering in terms of the degree to
which each attribute is present and the importance they see the attribute as having
(attribute-value theory). When consumers consider the convenience and price of an
eating place, the utilitarian
value of eating-out plays an important role in restaurant evaluation and selection.
Therefore, attributes of quick service, price, location, and cleanness may be more
important than hedonic attributes like mood, employee service, interior, and variance of
menu. Pettijohn et al. (1997) also found quality, cleanliness and value to be the three most
important attributes in fast food restaurants, while atmosphere and menu variety were
relatively unimportant.

MULTI ATTRIBUTE MODEL: Fishbein in 1967proposed a model known as Fishbeinsmulti


attribute model. Formally, themodel proposes that:
A0= Bi Ei
i= 1
Where,
A0= attitude toward the object
Bi = strength of the belief that the object has attribute i
Ei = evaluation of attribute i
n = number of salient beliefs about the object

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Salient Beliefs
towards a
particular
object and its
eveluation

Attitude
towards
that object

Probability
that an object
has its vital
attributes

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OBJECTIVES
The purpose of this research is to measure consumer values of eating-out utilitarian and
hedonic valuesand to explore the relationships between consumer values of eating-out and fast
food restaurant consumption. The importance of attributes restaurant and consumer buying
behaviors in fast food restaurant may be different according to the values of eating-out. We
assume that the utilitarian value of eating out is more related to consumption in fast food
restaurants.

The broad objective of the research is to explore the consumer attitude towards the fast food
restaurants in India through comparative evaluation among the selective restaurants. More
specifically, the objectives are (i) to identify the salient beliefs associated with fast food
restaurants, (ii) to measure the overall attitudes towards each restaurant individually, (iii) to find
out any differences in consumer attitudes towards the restaurants, and (iv) to identify the
differences among the evaluation of consumer beliefs regarding fast food restaurants.

We have tried to understand how the customers perceive various fast food chains in India with
help of a Perceptual Map. These are the reasons why we chose to undertake Perceptual Mapping:
To monitor the impact of various competitive offerings over time.
To see how the target customers perceive the various offerings by the major fast food industry
players.
To provide information that will further help us in understanding different market segments
within the industry.
To track any changes in the customer needs and preferences.

Weve also undertaken a Conjoin Analysis. These are the reasons why we chose to undertake
Conjoint Analysis for a better understanding:

Conjoint analysis is able to obtain information regarding brand strength or popularity compared
to specific product prices and features.
Conjoint Analysis is one of the best techniques to measure the benefits as seen by buyers. It is
possible to measure the sensitivity of prices that may vary with respect to the brand name as well
as the other attributes.
Brand and price are attribute interactions. When applying conjoint analysis, it can be easier to
calculate these attribute interactions, which can be included without increasing the complexity of
research design.

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LITERATURE REVIEW
Tabassum and Rahman (2012) discussed about four fast food restaurants. Among these
fast food restaurants he found that consumer attitude was more favorable for Pizza Hut
because of its quality and environment and consumer rated KFC at second position due
to its price and quick service and rest two i.e. Helvetia and Western Grill were lest rated.
Huda and Hossain (2009) stated that consumer prefer fast food more than regular food
because of food quality, atmosphere, proximity to work place, reasonable pricing and
variety in food menu and stated that corporate sector consumer highly prefer fast food
restaurant than regular food restaurant due to short span of time. Ibrahim and Vignal
(2005) found consumer behavior towards international fast food industry, restaurants
were chosen for the study located in Cairo, Egypt. By usingAjzen and Fishbein, 1980model
author revealed that demographic features such as age, income, education and gender
highly influenced the consumer behavior fast food restaurants. He stated that older
consumers were least influenced than younger ones.
Goyal and Singh (2007) mainly focused on the factors which were affecting the choice of
fast food restaurants among Indian youth. They found that Indian youth prefer to go fast
food restaurants just for fun and they were very much conscious about hygiene and
nutritional value of food and author suggested that fast food restaurants also focus on
food quality and customer behavior. Priyadharsini S. (2014) found what were the
marketing strategies McDonalds adopted in India and the reason why Indian consumer
were attracted towards the fast food. Researcher revealed that because of trend of nuclear
family, raise in income level, raise in employment level of women and advertising were
the strategies which leads Indian consumers to get attracted towards fast food.
Mohammad Al-Saai and Zeitun (2013) pointed out that demographic and life style
variables which were not so significant than occupation. Occupation leads to regular
consumption of fast food according to the author.
Thakkarand Thatte (2014) focused on the variables variety of products, speed of service,
accuracy in service, price, taste of products, ingredients, packaging, staff attitude,
location, additional information, customer service and opening hours. The study was
conducted in Thane city of Maharashtra state author revealed that the taste and food
quality affected consumer behavior most towards fast food restaurants. Haque, Rahman
et al (2011) observed the effect of advertisement in Malaya consumer of Malaysia towards
fast food restaurants. They focused on print media, commercial advertisement and
internet advertisement and suggested that Malaya consumers were very much influenced
by all the three mode of advertisement. Van Zyl, Steynand Marais (2010) focused on
young adults from different socio-economic areas in Johannerburg, South Africa. He

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found that the consumption of fast food was more in males as compared to female. And
they also predicted that time limitation (58.9%), convenience (58.2%) and taste (52.5%)
were the main reasons which were affecting consumer while selecting fast food and they
also found that television was the most effective way of influencing their choices towards
fast food.
Islam and Ullah (2010) focused on attributes such as nearness and accessibility, similarity
in taste, cost and quality relationship, discount and taste, clean and hygiene,
salesmanship and decoration, fat and cholesterol, and self-service. They worked at Dhaka
city, Bangladesh and found that consumer of Dhaka city mainly focused more on brand
reputation, nearness or proximity and accessibility, cost, quality, discount and taste, so
authors suggested to fast food producers or distributors of Dhaka city to focus on those
factors which consumers prefer more than rest. Samsudin, Jusoff et al (2011) pointed out
that in present scenario consumers were very much health conscious and nutritious food
they consume and they perceived icon based nutritional value positively. Singam,
Karunagaran et al (2014) suggested that advertisement was one of the important variables
which attract the customers attention towards fast food restaurants and in advertisement
also color attracted the most than other dimensions.
Kita and Hasan (2010) objective of authors study was to determine consumers behavior
pattern regarding fast food nutrition in Solvakia. They came up with the concept of
sensory marketing and they stated sensory marketing as one of the most powerful tool
which engages in determining consumers senses which affects the consumers behavior
and which in the end affects the decision making process of consumers of Solvakia.
Farhana and Islam (2011) identified that customers of Dhaka city prefer quality food and
ready to pay for it and pay for the cost which suits their income level and also found that
there was a positive relationship towards food quality and convenience and also
determine that food quality and cost were more closely related with overall customer
service. Singh Chib (2012) focused on two variables namely customer satisfaction and
service quality; he found that KFC provided much better customer satisfaction and
service quality to the customers than McDonalds.
Zafar, Iqbal andSaifAbbasi et al (2002) the study was conducted in Faislabad city; authors
emphasizes on socio-economic (age of the respondents, education, profession, household
income per month, family size) characteristics plays a very crucial role while selecting any
of the fast food restaurants. From which education was the most important feature due to
which income level raises. And many of them were young, well-educated and belongs to
nuclear families hence most of them preferred eating food outside just to save time and
for taste as well. Therefore, it was necessary to educate people for choosing a balance diet.
Salami and Ajobo (2012) stated that customers prefer quality food, cleanliness,
consistency and staff attitude and also suggested that by improving nutritional value

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homemade meal restaurants gain customers trust. Shaharudin, Mansor et al (2011)
pointed out that Malaysian customer mainly more focus on attributes like freshness,
presentation and taste of the product and less emphasis on innovative products which
affects their buying decision.

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RESEARCH METHODOLOGY

Primary Data:
We have adopted a survey method for collecting the primary data for fulfillment of the
research objective. We surveyed 58 respondents regarding their perception and expectation
towards a particular type of restaurant.

Secondary Data:
For the partial fulfillment of the research objective we have used literature review of the past
research papers. Apart from that we have taken macro information from various websites on
the internet.

Tools Used:
To arrive to a conclusion and to analyze the collected data we have incorporated conjoint
analysis with the help of an analytical tool named SPSS and to plot the perceptual map to
understand the consumer perception towards a particular type of restaurant, we have used
Excel as a tool.

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Steps of multi-attribute model - 4 step process involving primary

survey and secondary data analysis


1. Which attributes define a product (category)?

Product category attributes are dynamic product attributes that can be defined at the category
level and apply to all products associated with the category and potentially its subcategories. In
other words, these are category-specific product attributes.A product can have values for product
category attributes when it is categorized into a category containing product category attributes
specs.

Using a primary survey (attached in appendix) we set out to find the most important attributes
that define the restaurant industry. Any normal restaurant service can be defined by the following
attributes

S.No Attribute Levels Assigned Numbers for


each level attribute
1 Restaurant_Cuisine Fast Food 1
Fine Dine 2
Cafe or 3
Bistro 4
Food Truck
2 Restaurant_Decor Sporty 1
Convenience 2
Comfort 3
3 Food_Type Indian 1
Chinese 2
Continental 3
Italian 4
4 Diet_Type Veg 1
Non-veg 2
5 Food_Price Less Than 1
100 2
100-250 3
250-400 4
Above 400

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2. How much of each attribute a brand possesses?
The level of attributes that each brand possesses explains how consumers may combine
their beliefs about product attributes to form their attitude about various brand
alternatives. A brand which forms the best attitude is chosen. Consumers go through a
standard hierarchy of effects sequence, AIDA Model (Awareness-Interest-Desire-Action)

Here we seek information on the importance of brand attributes, belief about the
presence or absence of those attributes in brand alternatives and also information on
their combined effect in alternative evaluations.

Process: First the attributes are chosen then the weight ages are assigned to them, then
the importance of these ratings are decided on a 1 to n scale as shown, then a b gives the
value for each attribute. This model fails to consider that often consumer attitude does
not equate with behaviour.

Now, coming to the restaurant industry, we see that many brands try to differentiate
themselves by excelling in and selling the attributes. The attributes are chosen depending
on the factors of

Geography
Local Competition
Customer Preferences and psychographics
Brand Identity
Future trends and aspects

To make it more clear, some brands like Dominos bank on quality and customer service,
while some bank on ambience e.g. Starbucks or Dcor e.g. T.G.I.F.

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3. How much is 'importance weight' for each attribute?
Conjoint analysis is a survey-based statistical technique used in market research that
helps determine how people assign weights to different attributes (feature, function,
benefits) that make up an individual product or service.

We ran the conjoint analysis from the 60 responses we received. However, the conjoint
requires an orthogonal design, and so we had to cure the data accordingly to fit the
model. The required inputs are shown in the tables below:

Figure 1 Variable view in SPSS

Figure 2 Customer preferences in SPSS

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3. How to combine the information - heuristically?
A heuristic is a rule or method that helps you solve problems faster than you would if
you did all the computing. It sounds fancy, but you might know a heuristic as a "rule of
thumb." .To put the heuristic model formally we have the following utility levels for
different attributes and sub-attributes. This is the exact formula that calculates the overall
customer need depending in change in sub-attributes
Utilities

Utility Estimate Std. Error


Restaurant_Cuisine Fast Food -3.013 1.046
Fine Dine 1.395 1.046
Cafe or Bistro -.711 1.046
Food Truck 2.329 1.046
Restaurant_Decor Sporty -.675 .805
Convenience 3.423 .944
Comfort -2.748 .944
Food_Type Indian -2.592 1.046
Chinese -1.776 1.046
Continental 3.000 1.046
Italian 1.368 1.046
Diet_Type Veg .921 .604
Non-veg -.921 .604
Food_Price Less Than 100 .742 .540
100-250 1.484 1.080
250-400 2.226 1.620
Above 400 2.968 2.160
(Constant) 6.814 1.492

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DATA ANALYSIS
The data analysis was done through the following syntax code that links the input
responses file and the orthogonal design file that gives us the required output.

Figure 3 Syntax for Conjoint analysis in SPSS

The figure below summarizes the data analysis and results

30

25

Restaurant_Cuisine
20
Restaurant_Decor
15 Food_Type
Diet_Type
10 Food_Price

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Perceptual Map
Dcor Vs Cuisine:
In the given perceptual map we have tried to take Dcor and Cuisine as major
attribute affecting the consumer perception towards the type of restaurant. By the
map, we can say that the consumers who are willing to pay a premium for food,
give more importance to the dcor and cuisine than the customers who are willing
to pay lesser for the food.

Type of restaurant Dcor (Highest 1-Lowest 6) Cuisine (Highest 1-Lowest 6)


Cafe/Bistro, Sporty Decor, Indian
Food, Price less than 100 5 5
Fine Dine, Convenient Decor,
Italian, Price b/w 250-400 4 3
Food Truck, Sporty Decor, Chinese,
Price b/w 250-400 3 4
Cafe/Bistro, Fine Dine, Continental,
Price above 400 1 2
Food truck, Convenient Decor,
Indian, Price less than 100 6 6
Fine Dine, Sporty Decor, Chinese,
Price above 400 2 1

Decor Vs Cuisine

11
Cafe/Bistro, Sporty Decor, Indian
Food, Price less than 100
9
Fine Dine, Convenient Decor,
Italian, Price b/w 250-400
7
Food Truck, Sporty Decor,
Decor

Chinese, Price b/w 250-400


1 5 10
Cafe/Bistro, Fine Dine,
Continental, Price above 400
3
Food truck, Convenient Decor,
Indian, Price less than 100
1
Fine Dine, Sporty Decor, Chinese,
Price above 400
-1
Cuisine

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RESULTS AND DISCUSSION
The conjoint analysis gave the following results:

30

25

Restaurant_Cuisine
20
Restaurant_Decor
15 Food_Type
Diet_Type
10 Food_Price

Importance Values
Restaurant_Cuisine 26.241
Restaurant_Decor 28.338
Food_Type 26.710
Diet_Type 8.557
Food_Price 10.153
We see that in the increasing order of significance; Cuisine, dcor and food type.
Also, we see that a Continental Fine Dine restaurant for vegetarians has the
maximum utility and price as such is not a deciding factor. Indian is preferred the
least
More people prefer veg food, suggesting that there are already plenty of options for
non-vegetarian food around. Also, the atmosphere of the restaurant should be
convenient, which is in line with the average young age of the student community
members.

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CONCLUSION AND RECOMMENDATION
We see that a Continental Fine Dine restaurant for vegetarians has the maximum utility
and price as such is not a deciding factor. Indian is preferred the least.

So for a restaurant, looking to rebrand itself, it should take into consideration these
market demands

REFERENCES
Multi Attributes Choice Models - Wisdom Jobs. (n.d.). Retrieved from
https://www.wisdomjobs.com/e-university/consumer-behaviour-tutorial-
94/multi-att
Marketing 817 Coursepaper.com. (n.d.). Retrieved from
https://www.coursepaper.com/marketing-817/

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