Business Research Methods: Impact Of Psychographic And Demographic Factors On Consumer Choice

Demographic Factors and their Effects on Restaurant Selection

Due to development of the society lifestyle of the people has changed drastically such as living and eating habit, and there is an increasing number of various restaurants around every corner of each city. Furthermore, more and more people and families are likely to eat meals at restaurants in pace with the flourish of restaurants. Regarding restaurants, business studies have revealed that about 90% of the unsatisfied customer never returning to the establishment again (Sulek, 2004). Therefore, it is very important for restaurant business to clearly understand and create their consumer profile before investing on marketing and business plans. The compilation of demographic, psychographic and behavior information on the consumer helps the business to portray the picture of the ideal customer and, also provides competitive advantages to introduce the business in the community.

As known to all, there are many factors influencing people’s choice of restaurants to dine out. In this research, demographic factors will be focused on to illustrate their effects on making decision of choosing satisfied restaurants. Demographics affect business in many ways, and these traits can be used to determine product preferences or consumers’ buying behaviors (reference). By identifying customers based on these various traits, companies thus can target their key consumers with specific characteristics in their advertisements and promotions, which is necessary and helpful for companies to maximize sales and profits. In our research, Demographic factors in our research includes age, gender, household status, race, education, income and occupation which are collected and evaluated through data on people in a selected population.

From our research of various demographic factors, some key findings are achieved in terms of their effects on people’s choice of restaurants. Concerning the factor of age, young people are more likely to eat outside compared with the old, especially for those families having children aged 9-12 years old. Therefore, restaurants which can satisfy the demands of young parents and their children have a higher chance to be successful than others. Furthermore, families with higher incomes tend to choose upscale restaurants where healthy and nutrient food are accessible and served; while low-income groups prefer restaurants which sale cheap food such as fast food due to lack of money and pursuit of convenience of eating meals. In addition, the bigger the household size, the higher the probability of restaurant’s choice because of its convenience and relatively lower cost per person as compared to preparing meals at home when both of parents need to work and have no enough time to cook for their family.

All in all, demographic elements like age, gender, household income, household size are primary reasons for people’s choice of restaurants.

1. Research objectives
2. Literature review
3. Methods and analysis
   • Description of data gathering process followed
     • Samples

Total sample of the quantitative data has been collected from the responses of 400 consumers in various restaurants such as Magill Kitchen, Haveli Indian Cuisine, Jungle-Kent town Hotel, Meraki Greek cuisine etc. in South Australia by sending the hard-copied questionnaires to those target consumers to fill in. The sample size is important because it increases the reliability and accuracy of the data collected and the larger sample size also, the higher the rate of response (United for Sight, 2017). The sample of 400 respondents varies across all ages, household status, size and income with different occupations and employment status.

• Data collection process:

Sample and Research Methodology

The focus of this research strategy is to collect general information regarding to the research topic “Relationship of consumer profile on the choice of the restaurant”. To Pew Research Center (2017), survey allows the collection of a large amount of data from a considerable population and gives you more authority and control over the research process.

Before it is handed to the mass respondents including patrons to these above restaurants, the drafted questionnaires were piloted within our study group from different demographic backgrounds to ensure the questions cover all the research objectives, and then feedback was given before the final and complete questionnaires were set and distributed to the larger sample. The reasons why this research method of questionnaires was chosen, not any other else are:

Firstly, the researcher is able to collect the most updated and relevant information from 400 respondents within a short period of time i.e. a month. Secondly, the collected data are relatively easy to analyse because most of the questions are structured into single response questions, multiple-choice questions, forced ranking and multiple ranking list scales. Moreover, the questionnaire has several open-ended questions to limit the bias taken into the study.

Thirdly, the answers are gathered in a standardised way and anonymously so this research method is objective.

• How many usable questionnaire:

There are totally 27 questions in the survey, including the last seven questions of demographical figures such as age, gender, household size, status and income which might affect restaurant choice. The variables for restaurant choice and “eating out” behaviours line in the other twenty questions which evaluate the frequency of outside dining, types of preferred date in a week, food, places, meal for eating out, expenditure on the restaurant purchase per eat per person, the diversity of restaurant purchase, the main purpose of dining out etc. All of the data are coded into Excel spreadsheet with the detailed descriptions of each variable.

The number of questionnaires that are relevant to the research topic are question 19 and 20 asking the respondents to determine the extent they believe that the restaurant characteristic influence their restaurant choice and their ranking of preference on those characteristics, with the last seven demographic questions such as age, gender, employment status, household size, household status, household income (refer Appendix A: Survey Questionnaires). By that, we can critically analyse the consumer behaviour based on their age, gender and income, which satisfy our research questions.

• Description of coding approach
  • Categorical variables (Male =1, Female=2)

The 400 survey answers were filled and collected, the questionnaire answers are coded into numerical data into Excel file. The purpose of data coding is to facilitate the organisation, retrieval and interpretation of data for further interpretation of the survey results and data analysis (Saldaña, 2015).

Regarding the process of data coding, for single-response questions like 1, 2, 7, 8, 9, 12 and 16, the variables are coded using numbers starting from 1. As the answers are mutually exclusive, the input results for those types of single-response answers must be one single number only within the defined numerical ranges (refer Appendix B: Codebook).

• Multiple responses possible

Data Coding

For those multiple-choice questions like question 3, 4, 5, 6, 11 and 18, each answer is listed as a variable with the codes of 1 or 0, meaning Yes or No consecutively. For example, in question 3, the respondents might choose to eat or buy from restaurant more than one day per week, therefore, they will select more than one option and for each question selected, this variable is coded with 1, and when they did not select, 0 is coded. For this type of question, each possible answer is set as a variable like: Q3_Mon, Q3_Tue … till Q3_Sun.

• Information regarding demographic distribution:

Of the total 400 respondents, there are 52% of the total sample are male (210 people), and 48% are female (190 people) with the ratio of male: female is 1.11 : 1.00, which is quite close to the gender distribution of South Australian population with the ratio in 2016 of 0.97 male per 100 female (Australian Bureau of Statistics, 2016).

Among 400 customers, the largest proportion of respondents is in the age range of 18-25 and 26-35, accounting for 28% and 42% of the sampling respondents. Whereas the median age of South Australians are 40 (Australian Bureau of Statistics, 2016), the majority of people in the survey is considered to be in young age groups.

Table 1: Coding and Frequency of respondents according to Age

Variable	Categories	Code	Frequency	Percentage
Age	18 – 25	1	113	28%
26 – 35	2	166	42%
36 – 45	3	68	17%
46 – 55	4	32	8%
55+	5	21	5%

Chart 1: Consumer profile by Age

Table 2: Coding and Frequency of respondents according to Gender

Variable	Categories	Code	Frequency	Percentage
Gender	Male	1	210	53%
Female	2	190	48%

Chart 2: Consumer profile by Gender 

Table 3: Coding and Frequency of respondents according to Income

Variable	Categories	Code	Frequency	Percentage
H-Income	Below $20,000 p.a.	1	85	21%
$20,001 to $40,000	2	90	23%
$40,001 to $60,000	3	54	14%
? $60,001 to $80,000	4	34	9%
? $80,001 to $100,000	5	31	8%
? $100,001 to $150,000	6	27	7%
? Above $150,000	7	14	4%
? Do not want to disclose	8	65	16%

Chart 3: Consumer profile by Income

• Descriptive and statistical analyses

Based on the variables for restaurant choice, the Pivot tables are inserted into the Excel dataset to draw the main restaurant characteristics that the respondents select based on their perception of the level of importance to them.

Table group 4: The restaurant characteristics that influence restaurant choice based on the level of importance to the respondents

Restaurant characteristics/number of respondents selected	Code	Quality of food	Menu variety offered	Rich taste	Vegetarian choices	Vegan choices	Special meat-halal	Cannot prepare at home	Portion size	Authentic cuisine
Very low importance	1	1%	2%	1%	34%	43%	40%	18%	7%	3%
Low importance	2	0%	7%	3%	20%	23%	17%	14%	14%	12%
Medium importance	3	8%	32%	21%	24%	21%	13%	32%	36%	32%
High importance	4	28%	35%	33%	14%	7%	9%	21%	27%	30%
Very high importance	5	63%	25%	43%	9%	6%	21%	15%	17%	24%

Table group 5: The most five important restaurant characteristics influence restaurant choice:

1^st rank:

Row Labels	Number of selection	Percentage
Grand Total	400
Quality of food	216	54%
Rich taste	39	10%
Hygiene and cleanliness	33	8%
Special meat-halal	21	5%
Value for Money	20	5%
Menu variety offered	14	4%
Convenience of location	13	3%
Authentic cuisine	6	2%
Employee Friendliness	6	2%
Vegetarian choices	5	1%
Efficient customer service	4	1%
Interior design	4	1%
special service	4	1%
Convenience of parking	3	1%
Food presentation	3	1%
Reputation/word of mouth	3	1%
Portion size	2	1%
Value for money	1	0%
Loyalty program	1	0%
Online booking	1	0%
Service novelty	1	0%

2^nd rank:

Row Labels	Number of selection	Percentage
Grand Total	400
Rich taste	74	19%
Quality of food	49	12%
Hygiene and cleanliness	48	12%
Menu variety offered	32	8%
Value for money	24	6%
Portion size	22	6%
Convenience of location	20	5%
Authentic cuisine	18	5%
Convenience of parking	18	5%
Efficient customer service	18	5%
Special meat-halal	17	4%
Cleanliness of rest-rooms	8	2%
Food presentation	8	2%
Ambiance	6	2%
Cannot prepare at home	6	2%
Employee friendliness	5	1%
Reputation/word of mouth	5	1%
Employee appearance	4	1%
Vegetarian choices	4	1%
Interior design	3	1%
Sales promotions	3	1%
Loyalty program	2	1%
Online booking	2	1%
Vegan choices	2	1%
Service novelty	1	0%
Special services	1	0%

3rd rank:

Row Labels	Number of selection	Percentage
Grand Total	400
Hygiene and cleanliness	57	14%
Convenience of location	38	10%
Portion size	35	9%
Value for money	35	9%
Rich taste	27	7%
Efficient customer service	25	6%
Quality of food	22	6%
Special meat-halal	22	6%
Employee friendliness	21	5%
Cleanliness of rest-rooms	15	4%
Food presentation	14	4%
Authentic cuisine	13	3%
Menu variety offered	12	3%
Convenience of parking	11	3%
Reputation/word of mouth	10	3%
Ambiance	8	2%
Cannot prepare at home	8	2%
Interior design	6	2%
Sales Promotion	4	1%
service novelty	4	1%
Vegetarian choices	3	1%
Loyalty program	2	1%
Special services	2	1%
Vegan choices	2	1%
Vegetarian choices	2	1%
Employee appearance	1	0%
Online booking	1	0%

4^th rank:

Row Labels	Number of selection	Percentage
Grand Total	400
Value for money	49	12%
Hygiene and cleanliness	45	11%
Efficient customer service	34	9%
Convenience of location	28	7%
Convenience of parking	26	7%
Reputation/word of mouth	24	6%
Quality of food	23	6%
Employee Friendliness	22	6%
Rich taste	17	4%
Cleanliness of rest-rooms	16	4%
Cannot prepare at home	14	4%
Authentic cuisine	12	3%
Portion size	11	3%
Service novelty	11	3%
Interior design	10	3%
Food presentation	9	2%
Menu variety offered	8	2%
Ambiance	7	2%
Special services	7	2%
Employee appearance	5	1%
Food novelty	5	1%
Online booking	5	1%
Sales promotions	5	1%
Special meat-halal	3	1%
Loyalty program	2	1%
Vegetarian choices	2	1%

5^th rank:

Row Labels	Count of Q20_5	Percentage
Grand Total	400
Efficient customer service	42	11%
Value for money	37	9%
Reputation/word of mouth	35	9%
Employee Friendliness	30	8%
Hygiene and cleanliness	30	8%
Convenience of location	26	7%
Cleanliness of rest-rooms	23	6%
Convenience of parking	21	5%
Rich taste	18	5%
Menu variety offered	14	4%
Quality of food	14	4%
Authentic cuisine	12	3%
Food presentation	11	3%
Portion size	11	3%
special service	11	3%
Online booking	10	3%
Loyalty program	9	2%
Ambiance	8	2%
Cannot prepare at home	7	2%
Employee appearance	7	2%
Service novelty	7	2%
Food novelty	6	2%
Vegan choices	4	1%
Special meat-halal	3	1%
Sales promotions	2	1%
Interior design	1	0%
vegetarian choices	1	0%

Findings and discussion

According to the study the maximum customers had an annual income in the range of $20,001 to $40,000 which account for 23% of the population. The minimum customers at the restaurants had an income above $150,000 which again accounted for 4% of the customers.

Further according to the survey 63% of the customers gave very high importance to the quality of food. Thus the relevance for the quality of food at the restaurants was a matter of concern that influenced the choice of restaurant.  

Moreover while 35% of the customers gave high importance to the menu variety offered by the restaurant. 32% of the 400 customers believed that menu variety has a medium importance in deciding on a restaurant. It was seen that only 2% thought that the menu variety has very low importance in the selection of a restaurant.  

The study found that for 43% of the customers the rich taste of food at the restaurant has a very high importance in picking a restaurant.

Survey Results

The choice of vegetarian food offered by the restaurants had very low importance for 34% of the customers whilst selecting a restaurant for dinning. Similarly vegan choices had a very low importance for (43%) majority of the customers in the selection process. Vegan food had a very high importance for 9% of the 400 customer’s surveyed.  Likewise vegan choices had very high importance for 6% of the customers in selecting a restaurant.

According to the survey halal meat also had very low importance for the majority of the customers in opting for restaurant. 40% of the customers were least concerned whether the meat is halal or else when selecting a restaurant.  

The survey found that Hygiene and Cleanliness had a very high importance for 55% of the customers in the selection of restaurant. Moreover for 34% of the customers hygiene and cleanliness was very important in choosing a restaurant.

Among the 400 customers, 35% of the customers reported that the convenience of location of a restaurant had a high importance in the choice of restaurant.

Similarly, of the 400 customers, 43% of the customers reported that value for money had a very high importance in the choice of restaurant. The value for money was also high importance for 31% of the customers when selecting a restaurant.

The survey analysis showed that 40% of the customers of the restaurants placed high importance to efficient customer service. Another 32% of the customers gave very high importance to the efficiency of customer service.

According to the survey, the reputation of a restaurant is highly important for 36% of the customers. In addition for another 30% of the customers the reputation of the restaurant is very highly important.

The survey found that authentic cuisine for majority of the customer had only medium importance. 32% of the customers gave medium importance to authenticity of the cuisine when choosing a restaurant.

The presentation of food at the restaurant played a high importance for 36% of the customers. In addition for another 19% of the customers food presentation had very high importance while selecting a restaurant.

The characteristic of food novelty had a medium importance of 43% in the choice of restaurant.  

The ambience played medium importance for 42% of the customers surveyed when selecting a restaurant. Similarly when choosing a restaurant the ambience had medium importance for 41% of the customers.  

The study also found that the loyalty of the restaurant had an approximate equal distribution of customers in importance scale whilst selecting a restaurant.

The most important characteristics that influenced the choice of the restaurant for the customer revealed that the quality of food mattered to 54% of the 400 customers. The rich taste of the food at the restaurant food was important for only 10% of the customers. The hygiene and cleanliness at the restaurant was important for 8% of the customers.

The second most important characteristics that had an impact on the choice of restaurant were the rich taste of the food.  For 19% of the customers the rich taste of food was second most important defining factor in selecting a restaurant.  12% of the 400 customers surveyed found that the quality of food and hygiene and cleanliness at the restaurant to be the second most important feature which influenced the choice of restaurant.

For 14% of the 400 customers at the restaurant’s the third most important defining characteristics was hygiene and cleanliness of the restaurant. The convenience of location of the restaurant was important for 10% of the customers. 9% of the customers surveyed said that the portion size as well as the value for money was the third most defining characteristics.

According to the study 12% of the customers at the restaurant the value for money is the fourth most important characteristic which defines the choice of a restaurant. Hygiene and cleanliness and Efficient customer service was important for 11% and 9% of the customers respectively.

Finally, the efficient customer service at the restaurant was the fifth most important characteristic for 11% of the customers which influenced the choice of restaurant. In addition for 9% of the customers the value for money and Reputation / word of mouth of the restaurant was equally important.

Conclusion

The lifestyle of the people has changed with the development of the society. As a result of the change people have changed their eating habits. Thus there is an increase in families eating out in restaurants. The analyses of the survey shows that equal number of customers from both sexes love to eat and dine out. In addition the younger generation is more interested in eating out. This can be corroborated from the income of the customers.

The analysis of the survey showed that the most important factors in selecting a restaurant are the quality of food (Pizam et al 2016). Other important factors which influence the choice of restaurant are the rich taste of the food at the restaurant, the hygiene and cleanliness (Park et al. 2016), value for money and the efficient customer service at the restaurant (Swimberghe and Wooldridge 2014).  

Reference

Australian Bureau of Statistics, 2016. 3101.0 – Australian Demographic Statistics, Jun 2016. [Online] Available at: https://www.abs.gov.au/ausstats/[email protected]/0/1CD2B1952AFC5E7ACA257298000F2E76?OpenDocument [Accessed 30 May 2017].

Sulek, J. J. &. H. R. L., 2004. The relative importance of food, atmosphere, and fairness of wait: The case of a full-service restaurant. Cornell Hospitality Quarterly, 45(3), pp. 235-237. 

Saldaña, J. (2015). The Coding Manual for Qualitative Researchers (3rd ed.). New York: SAGE Publications Ltd.

Pew Research Center (2017). Collecting survey data. [Online] Available at: https://www.pewresearch.org/methodology/u-s-survey-research/collecting-survey-data [Accessed 31 May 2017].

United for Sight (2017). The Importance of Quality Sample Size. [Online] Available at: https://www.uniteforsight.org/global-health-university/importance-of-quality-sample-size [Accessed 31 May 2017].

Park, H., Almanza, B.A., Miao, L., Sydnor, S. and Jang, S., 2016. Consumer perceptions and emotions about sanitation conditions in full-service restaurants. Journal of Foodservice Business Research, 19(5), pp.474-487.

Swimberghe, K.R. and Wooldridge, B.R., 2014. Drivers of Customer Relationships in Quick-Service Restaurants The Role of Corporate Social Responsibility. Cornell Hospitality Quarterly, p.1938965513519008.

Pizam, A., Pizam, A., Shapoval, V., Shapoval, V., Ellis, T. and Ellis, T., 2016. Customer satisfaction and its measurement in hospitality enterprises: a revisit and update. International Journal of Contemporary Hospitality Management, 28(1), pp.2-35.