Behavior Towards Fast Food Mcdonalds In Malaysia

Behavior Towards Fast Food Mcdonalds In MalaysiaChapter 1 inventionIntroduction1.1.1 The Nature of Fast FoodFrom French fries to Big mackintosh burger, flying sustenance for thought for thought dejection consider as one of the f ar types that growing in a unfluctuating mode (Goyal et al, 2007). jibe to B land uper and Bender (1995), betting fargon meant food that has limited choices in the menu which being created d bearstairs harvest-festivalion line technique. Besides, warm food in same carriage defined as food likes hamburgers, sandwiches, or pizza which argon food that supplier be likely to specialize (Davies et al, 2004). In simple words, spry food also being defined as food purchased by self- arrange well in counter and whence take the food to experience dining table with unwrap any assists by waiter (Association NR, 2003).The bell increase of riotous food move be traced back to the early 1900s when Automat all overt the first ever refrain food eat ing house which sell foods and drinks by victimization machines. Then white castle introduced hamburgers to immobile food outlets and this brings the polish until today. After nearly old age, the concept of debauched food is so attractive and prospered and this attracted almost(prenominal) companies much(prenominal) as McDonalds, KFC, Wendys and Burger King joined the close food persistence (Chavadi et al, 2008).Since the early st get on with of mid-seventies in US, disruptive food has become part and partial of Ameri fucks and the frequency of eating fast food has rapidly increased (French et al, 2000). Fast food outlets imbued almost either corner in the world, different fast food restaurants is in your eyesight (Jayna et al, 2009). National Restaurant Association claimed that at that place ar three out of ten nodes said that eating fast food is their own way of c areer and it is classical for their workaday life (National Restaurant Association, 2008).Moreov er, fast food successfully dominates outside-from-home food expenses during the last few decades (Sharkey et al, 2011). To add some(prenominal) on this, the trend of eating away from home is to a greater extent and more than common and the frequency of visits to fast food outlets even increase rapidly. In 1970, at that place is just nearly 25% of total outlay for away-from-home foods and the spending rocketed up to 53% for the total spending for away-from-home foods (Clauson A, 2000). This showed that more consumers prefer to eat fast food earlier than home cook foods.In addition, there are decelerating for the path of the manufacturing when the economy crisis hits the world with a low point of 3.1% two years ago. Nevertheless, there are sign of recovery for the manufacturing when there is expected accelerating of growth rates showed in the forecast period. The fast food grocery had $201.1billion of total taxation in 2009 which correspond to 4.8% of compound annual grow th rate (CAGR) for the year 2005 to 2009. In Europe, the markets raised intimately(predicate) 4.7% of (CAGR) piece Asias market grew about 6.1% of (CAGR) in 2009. The fast food market of Europe and Asia regard asively set about $34.2 billion and $71.6 billion. Furthermore, the market consumption volume is expected to increase to $248.7 billion at the end of 2014. The most profitable in the industry is QSR segment where it earned about $142.6 billion or 70.9% of the markets boilersuit value (Data Monitor, 2010).1.1.2 History of McDonaldsThe history of McDonalds began in 1940 when Dick and Mac McDonald started their business by opening McDonalds Bar-B-Que restaurant in California which offered large menu to customers. After that, they closed down the restaurant and reopen another(prenominal) restaurant which is a self helping dive in restaurant. This time, they only provide limited choices of foods for customers such as burger, coffee, fluffy drinks, potato chips and milk. In 1 949, the world well-known French fries were introduced and replaced potato chips on the menu. After a year, a sales individual called Ray Kroc met up with McDonald brothers and purchased the franchising right from them and planed to lick the restaurant. Few months later, Kroc receptive his first ever McDonalds restaurant in Illinois and the world illustrious Golden Arches also started to use as the symbol of McDonalds. History was made and new records to be created from time to time since McDonalds started its operation. Today, McDonalds is the world largest organization in the world with more than 32000 fast food outlets in 117 countries which serves more than 60 million customers everyday (About McDonalds.com, 2011 McDonalds Malaysia.com, 2011). McDonalds also the largest demoraliseer of materials such as potatoes and beef (Steyn NP, 2010). The brands mission is to be McDonalds customers favourite place and way to eat. Besides, the confederacy promises to supply Simple Easy Enjoyment to every customer when they visit to the restaurant and let customers get laid the feel of having meal there as well as like having meal in own sweet home. The guild hold tied to the value of serving role food, giving superior service and cleanliness of environment to delight every customer and hope customers were treated like VIP (McDonalds.com.my, 2011).Furthermore, the annual trace of McDonalds for the year of 2010 reported that the company earned about $24,075 million in 2010 which higher 6% of the sales compared to the earlier year which earned about $22,745 million. The revenues of the company in US for year 2009 and 2010 are positively increased because of the high strainment in new outputs, iconic core products and high-priced focus on everyday value of the company. Additionally, the continually increasing of currency telephone exchange in Europe, sales increased in UK, Russia and French, as well as the ripe expansion achieved in Russia had driven the rev enues raised (Annual report, 2010).1.1.3 McDonalds in MalaysiaIn December 1980, McDonalds Corporation, USA approved and gave license to Golden Arches Restaurants Sdn Bhd to run McDonalds restaurants in Malaysia. The first ever McDonalds Malaysia restaurants was heart-to-heart at Jalan Bukit Bintang, Kuala Lumpur which is in the heart of the big city on 29 April 1982. Now, there are 204 restaurants find out nationwide and currently there are about 20 to 25 restaurants leave behind be opened annually as it is expanding steadily. Moreover, McDonalds employed almost 10,000 local citizens in different states to success the restaurants and 120 back staffs at its head office to handle day-to-day operation of the McDonalds business (McDonalds, 2011).So, it is obvious that McDonalds is very successful company and leader in the fast food industry in Malaysia which attracts million of customers visits to the restaurants everyday. Thus, this research is essentially about the consumer mann er towards fast food especially McDonalds.Objective of the researchTo discover the factors that influence consumer style to choose fast food as their meal.Research QuestionWhat are the factors that influence consumers to choose fast food as their meal?Hypothesis 1There is a relation amid service qualities towards consumer carriage.Hypothesis 2Place factor has family relationship towards consumer behavior.Hypothesis 3Price factor has relationship towards consumer behavior.Chapter 2 Literature ReviewAccording the report of Technomic about the status and future of fast food, the perceptions of consumers towards fast food take over been changed. Now, consumers think that fast food is no longer limited to quick service, fast food restaurants, or drive-thru restaurants. Instead, there are risen of dual concept which formed the traditional fast food concept and the new concept of food fast which food stomach be served speedily with a superior shade, flavor, taste and ambiance. The report also claimed that consumers are seeking for faster, convenient, better and quality foods and run from all type of food service organization (Restaurant News Resource, 2010). Moreover, the report findings showed that about 49% among 2000 consumers generate visit to fast food restaurant at least once in a hebdomad (Technomic, 2010). The new concept of perceptions tout ensemble impart affect the consumer behavior towards fast food including McDonalds.In addition, Kara and Kucukemiroglu bring on studied about the consumer perceptions and dearies for fast food restaurants in USA and Canada. The research showed that the girlish consumers between the age of 12 to 24 hunt for different type of foods, better delivery service, lower price and good location in USA while Canadian teenagers look for novelties and price. Then, for the middle age group of consumers who are 25 to 45 years old, Americans looked for better service and better speed of serving food while Canadian consider ed quality, service and speed. More to the point, consumers above 46 years old to 55 years old, American preferred taste, cleanliness, quality and nutritional value whereas Canadian adults wanted better services, food quality and speed. Furthermore, young consumers have to be concerned and to be taught of the nutritional awareness and fast food predilections during the teenager years (Brown et al, 2000). In London, Davies and Smith have listed down the importance for the nutritional value for fast food and fast food companies also printed the information of the value in its restaurants.2.1 Consumer Behavior AnalysisAccording to Solomon, consumer behavior can be defined as a study of selected consumers either in individuals or groups in buying, using or disposing of products, ideas, services or experience to satisfy own desires and ask. The propitiation of desires and necessarily are nearly related to hunger, personal status and thirst to love as well as spiritual fulfillment ( Solomon, 2007). Consumer behavior has been defined as the the dynamic interaction of affect and cognition, environment, and the behavior from human beings conduct the exchange aspects of their lives (Peter et al, 2008). More on this point, during the consumption processes, the action performed, feeling and thought of own experience by consumers allow affect the consumer behavior. every(prenominal)thing that surrounds the consumers and environmental factors such as advertising, product appearance, comments from friends, price information and packaging totally will influence the consumer behavior (Peter et al, 2008). There is for sure that consumer will buy something after they have a good prevision and satisfy towards the product. Nevertheless, researcher has to go deeper and questioning consumer in which circumstances and what reason for buying a product (Blackwell et al, 2001).According to Peter, the consumer behavior consider as dynamic because the changes of perception, feelin gs and activities of individual purchaser or a group of consumers. There are various type of marketing strategies is the answer to the question of consumers response. This doubt is constantly being answer by using the stimulus-respond type (Refer to Appendix 1). Furthermore, researchers have to find out from the buyers pitch blackness box which is the essential point that other actors and companies in the market wants to know (Kotler, 2007).Determinants of Consumer Behavior AnalysisConsumers have to analyzed by focusing to three objects which is behavior, environment, affect and cognition and thusly about their relations between each other. Every single aspect can affect other aspects and all of the aspects must be considered when planning for the marketing strategy (Peter et al, 2008).Consumer affect and cognition represent different type of the mental responses from consumers raise toward particular stimulus and event around them. Affect refers to the feeling of consumers whe ther they like or hate a product. For example, affect includes strong personal emotion of anger or love, moods of happy or sad and feelings of defeat or gratification. As a result, marketers should build up suitable strategies to create positive affect among consumers about their brands and products to become consumer first choice to purchase. On the other hand, cognition is about the thinking of consumers or their persuasion towards a product. It involved consumers perception, understanding and interpreting the events and stimuli. Consumers extend to their familiarity, beliefs and experience from their daily life and this will suspensor them to be more sensitive and alert when buying a product so that it will be a good buying decision (Peter et al, 2008).2.1.2 Consumer MotivationSolomon claimed that motivation is the processes that bring pile to behave themselves when there is a regard generated that they hope to satisfy. Consumers will find their way to attempt to decrease or to get rid of the inevitably. Once consumers successfully end the desire, then consumers goal is achieved. Consumer behavior is started up by motivation and directs to achieve goals. Normally, a motivated person will be involved more to an activity compared to unmotivated person (Solomon, 2007).2.1.2.1 Maslow Hierarchy of NeedsMoreover, during the last few decades, psychologists have studied about the motivation and its essential towards consumer behavior in different ways. The most famous and familiar ideas is propounded by Abraham Maslow in year 1943 (Kotler, 2007). Maslow initially created this onset is to know about slew personal growth and the accomplishment of some difficult tasks. After some time, marketers adapted this theory to understand the consumer motivation. Then, Maslow developed a hierarchy which is the combination of psychogenic and biogenic inescapably which specifies on different level of postulate by people (Solomon, 2007). In the pyramid of needs, there are at least five sets of basic needs which are physiological, resort, social, esteem and self-actualization needs. The order of needs in the pyramid structure is fixed and authorized level must be obtained before go for the next. Maslow believed that people is aspire to become self-actualization (Stephens, 2000).The hierarchy is started from physiological drives which are the basic needs of human such as water, food, air or sleep. For instance, a person who is hungry definitely will craving for food much stronger than anything else (Stephens, 2000). After the physiological was fulfilled, the safety needs will be demanded by people. People needs a place that is safe and security for them to have meal, rest or enjoy. When both of the physiological and safety needs are perfectly gratified, the third needs which are social needs to be considered. Social needs are included love, friendship, parents or acceptance by public. Human have to build up their own relationship with others so that their life will be better and successful (Stephens, 2000). Furthermore, everyone hope to have respect and high military rank from others toward self-esteem. People may seek for self satisfaction when they are promoted higher billet in their company, attaining the educational distinction, or being honored by government. This level of needs basically is about people feeling of self-confidence and satisfactoriness. The last needs is self-actualization which is about to know ones potential and this level of need will never be satisfied because there are new challenge and opportunities to come crossways when people growing up (Stephens, 2000).In addition, physiologist Sigmund Freund claimed that people will not aware of their buying behavior which is formed by own physiology. Everyone have different dream and wishes which are hope to be fulfilled, however, some of the wishes are cause of incited which brought to negative effect. For example, a person said that he enjoy the wind w hen thrust is the main reason that he buys a sport car. On the other hand, in psychological level, he might just want to show off or want to let others respect him (Kotler, 2007).2.2 Factors that bear on Consumer Behavior2.2.1 Service QualityIn 1984, Gronroos defined service quality as the judgement from consumers evaluation of the service they received. He also proposed that service quality can be divided into technical quality or what is done and functional quality or how it is done. Then, the service quality also being hike explained as two dependent variables which are perceived service and expected service. Expect service is referred to the consumers previous experience with a service which might influence the consumer behavior while the perceptions of consumer towards the service itself is called perceived service.In fast food industry, good service quality is very essential for every fast food company because it is one of the fundamental determinants of consumer satisfactio n which directly influence the success of the company in the industry (Huam et al, 2011). At the present time, every fast food company has pay more focus on their service quality by different ways in order to boost up the satisfaction level of consumers and then raise the intention of purchasing as well as loyalty towards the fast food restaurant (Qin et al, 2008 Gillbert et al, 2004). Organizations that provide superior services to consumers also achieve the greater level of consumer satisfaction and favorable word-of-mouth (Gillbert et al, 2004). Once the restaurants successfully attain or go beyond the anticipation and expectation of consumers, definitely consumers will be satisfy with the services that provided (Huam et al, 2011). For instance, Fast food giant likes McDonalds, Burger King and KFC are attempting to present exclusive, unusual and special services to attract and to keep their consumers. As for some(prenominal) well operating(a) companies, great service quality is a cornerstone to gain competitive advantage in the industry to increase sales. From times to times, the fast food industry had been forced to change from product-centric approach to customer-centric approach payable to the high expectation from consumers and disceptation from other companies (Huam et al, 2011). For example, the fast food companies in Malaysia also experiencing the transformations and challenging from tilt (Yap et al. 2007).2.2.1.1 Measurement of Service Quality (SERVPERF Model)Since the service quality is very crucial for the fast food business, then the service quality measurement has to be done frequently and in a timely manner to obtain an accurate current level of service quality provided by the fast food industry in order to increase the customer satisfaction as well as to encourage the customer purchase intentions towards the restaurants (Gilbert et al, 2004).Besides, Zeithaml and Bitner recommended that consumers judge the service quality based on their o wn perceptions towards the provided technical issuing, the process of delivering the outcome and the quality of environment by delivering the service. Before this, there are researchers believe that quality is naturally tricky to be determined and measure, so there will be better if there is a yard measure for consumer to measure their own service quality for certain things. Then, a standardized and better model called SERVPERF model was developed. Nonetheless, this model is a very wide-ranging concept and its modification is recommended to capture the framework in certain study (Olorunniwo et al, 2006 Andaleeb et al, 2006). Audrey stated that this model is created to give a substitute method to measure the perceived service quality and the important relationship between the service quality, purchase intentions and consumer satisfactions. This instrument contained five places which aretangibleness The condition of physical parts of the fast food restaurants, the equipments and utensils that serve the consumers as well as the physical environment of the restaurants (Yuksel, 2001). Moreover, it also educeed the arrangement and decoration of the restaurants layout which included the cleanliness of environment, nice design of the facilities, and the convenience offered to consumers (Subhash et al, 2000). reactivity According to Fetus et al, responsiveness is meant that willingness and readiness showed by employees to help consumers when there are problems occurred and offer flying service directly to consumers (Festus et al, 2000). .Reliability The capability and attitude of performing the promises service truthfully and sincerely which can motivate consumer and gain confidence to the fast food restaurant. Furthermore, this also referred to the trustworthiness in business process, trustable, and the energy as well as the ability to fix or improve anything that goes the opposite way (Yuksel, 2001).Empathy This dimension is about consumers being cared and individualized attention by employees. This dimension consists of few components which are (a) Access availableness or friendliness and ease of contact.(b) Communication communicate with customers with languages that they can understand and comfortable with and patiently find out to what consumers express.(c) Understanding Customers put effort to know, understand and sensitive towards what consumers needs and expectations (Huam et al, 2011).(V) Assurance Defined as the knowledge and courtesy of employees and their skill to convey trust and gain confidence from consumers. Assurance consists of three main components which are(a) Courtesy kindness, consideration, respect, and friendliness of every employee towards every customer.(b) Credibility Employees show that they are honest, trustable and believable towards every customer.(c) pledge Customers feel safe when having meal without any risk of danger or doubt (Festus et al, 2000).Consumer Behavior merrimentService Quality2.2. 2 Product QualityProduct quality is a means of advancing peoples life expectancy and cut down the jejunity and mortality rate of society (Iwarere, 2011). As high competition and environmental influences rise internationally, obviously there are a lot of hard work of fast food companies on quality improvement and cost scrimping in order to satisfy consumers and defend consumer behavior as well as increasing the organization profit and value (Iwarere, 2010). According to Iwarere, quality management is being judged as competitive weapon which can show the competitive advantages to consumers to attract more business. Product quality totally will influence the company profit since the quality of product reverberate out the reputation of the company (Dominici, 2009). The relationship between product quality and profit of company is that product quality that being enhanced will increase the reliability and production of certain product. Besides, the increasing in product reliability cau ses the price of the product being boosted up (Iwarere, 2011). Product quality is very important to a company and this can be showed from a study on brand preference of soft drinks in rural place to determine the factor influencing the rural consumers towards the soft drink. From the study, they found out that the product quality was ranked at the first place and then followed by price (Nandagopal, 2003).There is a group of quality assurance team in the restaurants and at suppliers for every stage of production which in charge in observing and examines the quality of McDonalds products. There is a specific process set by McDonalds to check and make sure every ingredient that they use is high quality and safe. The team will have a tight observation towards supplier manufactures and will take some samples of stock from distribution centers to undergo the quality checking. Every McDonalds outlets will only receive the delivery of materials and ingredients after quality and safety chec king by the outlets employees. Every employee will be given complete training in hygiene, quality assurance, food safety, and procedures of food preparation (Vignali, 2001).In McDonalds, they intends to create the standardized the food items which still the same taste in most of the country likes Malaysia, Singapore, South Africa, and most of the Europe country. Although they know that there are considerable cost saving by undergoing the standardization, being able to adapt to the environment and market will ensures success of the company in the country. Obviously, McDonalds has successfully adopted the concept of think globally and act locally into its marketing strategies to (Vignali, 2001).Moreover, there are a lot of reasons for necessity of adaptation such as the taste or preference of local people, local culture and laws as well as local traditions. There are many cases happened in different country where McDonalds change their menu to adopt for the local preferences and laws (Vignali, 2001). For instance, the famous Big Mac was served without cheese in few of their restaurants in Israel and in some of the kosher restaurants, the meat products and dairy products is on an individual basis placed. Plus, recently, McDonalds Israel launched a new hamburger which to improve the nutrition and taste of its famous product. The Big Mac in Israel is 30% fewer calories compare to Big Mac in US (Ron Friedman, 2010). In addition, in India, McDonalds serve vegetable McNuggets and a mutton-based Big Mac which called Maharaja Mac. Additionally, in Malaysia and Singapore, McDonalds also put effort on their product which is free of pork products and the outlets must apply for the halal certificate to run the restaurants, which means is totally out of pork products and acceptable for Muslims consumers.In addition, good product quality also includes the taste of the foods. Every consumers want to eat tasty foods is consider as a general motive to satisfy their needs toward s food and increase their appetite. Furthermore, the taste of foods also has to localize to suit the local taste and fulfill the needs of consumers (Gordan Chu, 2009). For instance, the taste and flavor of McDonalds French fries is magnificent and marvelous for a lot of consumers (Schlosser, 2001). There are various other examples of the successful of McDonalds adopted in different countries which has unique and special perspective and culture as well as local taste in order to satisfy the needs and preferences of consumers. For example, beer was interchange in Germany as McCroissants, espresso coffee and pasta is on the menu in Italy and there are chilled yogurt drinks in McDonalds Turkey as well as in tropical countries, guava juice was the favorite items in the menu. There are vegetarian hamburgers sold in Netherlands while teriyaki burgers were the famous hamburger in Japan. In Thailand, the most well-known burger in McDonalds was called Samurai Pork Burger which serves with sw eet sauce. Moreover, in Norway, grilled salmon sandwich which called McLaks are sold while hamburger with poached egg are top of the menu in Uruguay (Vignali, 2001). So, there are different products being introduced by McDonalds to adopt in the international food market. Some of the products already became the symbolic food of McDonalds for the local people.2.2.3 PromotionPromotions normally are created by marketers to tell information about their products or service in order to attract consumers to buy them. The promotion strategies normally experienced by consumers which might influence consumer behavior due to the social and physical aspects from the environment factor. Every products and brands become famous and successful because of promotion strategies that developed to generate competitive advantage against competitors while show out the unique of the products and brands. There are four types of promotions which are advertising, publicity, personal selling and sales promotion s (Peter et al, 2008 Ivy, 2008).McDonalds always put more effort to promote them as a global image and they concern about the people from the market they are entering. McDonalds has different types of advertising campaigns in different countries and globally to suit the culture and society of people from different background. For example, UK McDonalds appointed England legendary footballer Alan Shearer to promote their products while in French they used French world cup winner goalkeeper Fabien Barthez (Vignali, 2001).Besides, McDonalds also concern about the public relationship with customers which can know and understand more about consumers. For instance, Beijing McDonalds relies greatly on individual interaction with consumers in restaurants. There are at least one public relations employee workings in every outlet to help and answer customers questions. Moreover, there are five to ten female staffs being appoint to every outlet to take care of consumers children and to commun icate with parents (Vignali, 2001). This can help to improve the service level and to advance the management of customer portfolio (Fjerstad et al, 2003 O Learly et al, 2004). Another example is in 1997, McDonalds had broadcasted that they will corporate with Walt Disney which allowed them to pct special marketing rights from food to films for the following ten years. This is the beginning of the producing toys which include in their happy meals for films likes flirt Story, Madagascar, Alvin and the Chipmunks and the latest is the young justice series of superhero from Marvels. Furthermore, McDonalds, UNESCO and Walt Disney corporate together to launch a program called millenary Dreamers Global Childrens recognition program which allowed young people from the whole world have the chance to express their dreams, ideas, and plans as well as hopes in the future (Vignali, 2001).2.2.4 PlaceAccording to Kotler, place defined as the location where products and services being distributed for purchase by consumers. It can contain every physical stores and virtual(prenominal) stores on the internet. The choice of place has always an important factor to be considered when operating a store. For instance, fast food restaurants mostly being set up in place where there is a meaning(a) in number of moving people (Hossain, 2003). Normally, company location decision depends on few factors such as total cost, supplier, proximity of customers, and infrastructure (Chase, 2004).Currently, there are more than 32000 McDonalds restaurants in 117 countries all over the world. The company effectively manages its capital expends by strategic expansion in every country. Every year, McDonalds operate hundreds of new restaurants globally to undergo strategies that create a gap between its competitors in term of availability and convenience to consumers (Jekanowski et al, 2001). In the annual report of the company in year 1994, McDonalds had launched a strategy called aggressive strate gy. In the report stated that McDonalds wants to have a site wherever people live, work, play, or gather. Our gizmo Strategy is to monitor the changing lifestyles of consumers and intercept them at every turn. As we expand customer convenience, we gain market share. (McDonalds USA annual report, 1994). This is because McDonalds understand that consumers prefer to go nearby to buy food for saving time and cost. So, McDonalds wants that there are their outlets everywhere in the world which can bring convenience to consumers to buy foods. Moreover, most of the McDonalds outlets operate 24 hours everyday to serve their consumers and people may taste the foods of McDonalds whenever they want to (Jager, 2007). In addition, McDonalds also provide delivery service to consumers home which bring convenience to consumers who do not like to queue up in the crowed restaurants but prefer to eat in home while doing their works (Church et al, 2000). Drive-thru system also being introduced by McDon alds in most of the outlet to serve consumers who plans to take away the food (Fitzgerald, 2004).