‘Servicescapes’: Why are fast-food restaurants renovating their interiors?

Q: We’re a group of graduating marketing students. We took two extra marketing courses this summer and one of them was in marketing research. For our marketing research term project, our group of four took up this topic: “Why are fast-food restaurants renovating their interiors?”

We picked Kenny Rogers in Katipunan as the fast-food resto to study. We did a fairly extensive research including counting daily customers by day parts, observing how mostly student customers came either as solo or with companions, how long they stayed, and what food and beverage menu items they ordered. We also interviewed a sample of customers to find out how they compared their current frequenting and eating behavior at Kenny Rogers versus those before its extensive renovation. After writing and presenting our report, we were all confident of a very high if not the highest grade. We got only a “high” grade, not “very high” and certainly not the “highest.”

We asked our professor for a feedback so we can understand what happened. He just said we didn’t answer the question. We disagreed and told him we did. We showed how the renovation increased three revenue components: the amount of order per customer as well as their frequency of visit and the number of customers. Our professor said these were not answering the question but “begging it.” The true answer lies in explaining why the renovation increased what we claimed it increased. He refused to elaborate. Will your column please help us understand?

A: We believe we have a fairly good idea what your so-called professor had in mind. We said “so-called” because not to close a case but just to leave it hanging does not speak well of a responsible professor. A true leader and manager of the students’ learning process behaves otherwise. So here’s our version of the answer that your so-called professor won’t count as “begging the question.”

It’s helpful to start with the decision to invest in the renovation and ask: “What’s an alternative to this investing that would serve just as well in attaining the revenue objective?” One option that immediately comes to mind is “new product innovations.” For a fast-food resto, those can be new breakthrough menu items, improved or redeveloped menu items or relaunched old deleted menu items that’s been re-invented.

Service marketing

Taking this analysis approach brings you squarely to the basic question of: “What in the first place are you marketing in a resto service business?” Your basic services marketing textbook will tell you that there are four: (1) the tangible product base or in a restaurant, the menu items, (2) the service staff, (3) the service venue, and (4) the service processing. The acid test for a “service” is right there in the costs equivalents of these four elements. You can be certain that you are in a resto service marketing if the price charged for a menu item consists of 20-30 percent food cost and the rest are the costs of the remaining three service components.

Marketing a performance

On the part of the marketer, in resto service marketing you are marketing a “performance.” From the perspective of your customer, however, you are marketing an experience. In a restaurant, that’s the eating experience and the experience of eating in the resto venue, now referred to as the “servicescapes.” It was professor Mary Jo Bitner who in 1992 coined this term and defined it as: “The style and appearance of the service outlet’s physical surroundings where customers and service providers interact.” In other words, that’s where the experiencing of the eating experience happens. So there are two customer experiences taking place at the same time: the experiencing of eating of the ordered menu items and the experiencing of that eating experience. The latter experience is the servicescapes experience.

The Kenny Rogers renovation was directed at enhancing the customer satisfaction with the servicescapes experience. The observed chain of customer behavior after satisfaction is repeat store visit with likely increase in the amount ordered and in visit frequency and therefore revenue rise overall. However, the explanation should not end here. You must also answer the accompanying question: “How exactly does renovation enhance customer satisfaction of the servicescapes experience?”

Servicescapes

This depends on what were the objects of the renovation. For example, inside that Katipunan Kenny Rogers resto, you will see murals of product shots and murals of roasting party or celebration scenes. Which of these two servicescapes’ renderings of its “physical surroundings” is more experience enhancing for the customers? One way of gauging this is by observing customer behavior. For example, behind which mural do they like taking pictures? In almost all cases, it’s with the background of the celebration scenes and not the mural of product shots. But aren’t they there for the eating experience? That’s correct but that is why it’s important to distinguish those two experiences: the eating experience and the experiencing of that eating experience in the servicescapes.

The eating experience is satisfied by the actual eating of the ordered menu item and not so much by the murals of the product shots.

Satisfaction of the servicescapes experience is enhanced by “the style and appearance of the service outlet’s physical surroundings.” In the Kenny Rogers’ resto, that’s the murals of the roasting party or celebration scenes. As you can see, it’s important not to confuse the customer satisfying role that each of the two experiences play.
Keep your questions coming. Send them to us at [email protected] or [email protected]. Advanced Happy Father’s Day! God bless!