Strategic Service Evaluation of Subway and Nandos Restaurants - Case Study Example

Strategic Service Evaluation of Subway and Nando’s Restaurants Introduction In recent years, the increasing competition within each industry provided consumers plenty of options and the right and privilege to control the demand for specific products. Service marketing has also made an appearance in the consciousness of conducting business because of its different nature. In its inception stage, the main issue that had been put forward is that the reality of services in the marketing realm which bears different characteristics than products. Services include all economic activities whose output is not a physical product or construction, is generally consumed at the time it is produced, and provides added value in forms (such as convenience, amusement, timeliness, comfort or health) that are essentially intangible concerns of its first purchaser (Quinn, Baruch and Paquette, 1987 as quoted in An Introduction to Services Marketing, n.d.). Especially in industries such as restaurants, hotel, airline, etc where service marketing is an integral part of the business, it becomes imperative to focus the company’s entire initiative on delivering the required customer satisfaction, not only by the frontline employees but also by the back stage personnel and the business’ support system. Because of these, other concepts and model such as servuction, servicescapes and servqual had been put forward to provide the framework for the entire service marketing of an organization. As such, they have also been used to be the guidelines in measuring and evaluating the strategic service marketing of companies. Strategic Service Evaluation In the restaurant industry, the uniqueness of service marketing is the almost equal blend of tangible and intangible products (Jeon and Jeong, 2009, p 1). “Consumption experience is subjectively felt and individually experienced and can only be credibly reported by informants who are in the setting (Caru and Cova, 2003 as cited by Venkatraman and Nelson, 2008, p 3). Thus, the quality of service could only be expressed by the consumers during the actual dining experience. Because of this context, Bitner put forth that the entire service quality is also dependent on other factors that goes beyond the mere consumption of products, which is food in the case of restaurant. He introduced the concept of servicescapes which expresses that the customer’s behaviour is influenced by many factors including the physical setting and the behaviour of the other personnel, customers and elements that affect the delivery of the service (Jeon and Jeong, 2009, p 1). Servicescape had been elaborated to include not only its significant influence on consumers’ cognitive, emotional, and physiological states but also their behaviours (Bitner, 1992; Namasivayam & Lin, 2008 as cited by Jeon and Jeong, 2009, p 1). Thus, it is imperative to manipulate servicescape in order to provide the optimum customer satisfaction and encourage loyalty (Jeon and Jeong, 2009, p 1 cited from Namasivayam & Lin, 2008). The context of customer’s perceived quality as against their expectations had been taken into consideration and the gaps between the two had been looked into. This has been the concept of servqual and one of the ways to effectively close the gap is to do blueprinting which deals with the total mapping of the organizations processes that contribute to the over all service delivery. All these could be traced using the servuction model which is the total understanding of the consumer’s experience (Valdez, 2000, p 1; Gronroos, 2006, p 322). Background of Service Providers The two similar service providers that will be evaluated for their strategic service are Nando’s and Subway restaurant. Both are from the restaurant industry and offer food as products which are consumed at the point of purchase, thus servicescape play an integral role in the overall expectation and perception of the quality of service. Subway is an internationally franchised restaurant with more than 31,000 branches all over the world. It was begun in 1965 as a submarine sandwich business but as the popularity of the restaurant grew, it extended its geographical branches not just in the United States but in the different continents all over the world (Subway website). Its philosophy and core values include its promise to its customers to seek total customer satisfaction through high quality food, exceptional service and good value. It also does not neglect its role in the community as well as the importance of its personnel’s individual and team capabilities to work towards their assurance of customer satisfaction. Nando’s on the other hand is classified as a fast casual restaurant unlike the fast-food classification of Subway. It has built its name and reputation from offering a different dining experience with the peri-peri flavour novelty. It offers its customer’s a different dining experience which they attribute to not only the uniqueness of their products but also on their health benefits. To top all this, they promote that their secret to the quality of their product is the pride and passion that each employee has contributed towards the entire process of delivering the food to the customer. Subway It has been reported time and again that one of the culprits for the burgeoning problem on health and obesity in today’s generation is the proliferation of unhealthy food from fast-food restaurants. Subway belongs to this category and does not offer any unique positioning compared with its competitors namely, McDonald’s, Burger King, Wendy’s, Taco Bell, KFC, Quiznos Sub, Blimpie and Arby’s (Subway website). Even looking at the core values and philosophy that it upholds, it is no different from the other fast-food in the industry. Everything is just straightforward as high quality food, exceptional service and good value which are generic goals and visions. As there are many competitors within the industry, it has become imperative for Subway to be innovative in terms of its service delivery taking into consideration the entire servicescape of each particular outlet. It has set up its internal support system with the different departments functioning specific roles in order to deliver a dining experience that could be perceived by its consumers as uniquely Subway’s. They have streamlined their operations from the business development group which has the tasked of mapping out new areas for expansion to the creative team which recreates the overall store layout to the design of each store. The marketing, advertising and public relations group creates what should the customers expect in a subway experience, the operations ensure that service delivery is according to the set standards while the customer care personnel builds relationships with the customers. With regard to the service delivery, they have properly set up their organization according to the needs and demand of the consumers. Their servuction model traces the contribution of the entire system in order to deliver their brand of sandwiches at their promised level of service for customer satisfaction. However, there had been no pronounced difference from the other competitors which also labour to innovate and improve their system just to gain competitive advantage. What sets it apart from the others is its brand of sandwiches wherein they to have “more than two million different sandwich combinations available on the Subway menu” (Subway website). This is a far cry from the usual limited menu of fast-food outlets which is really designed because of their thrust towards fast service delivery. However, their breakthrough came in the form of Jared who became an integral cog of their service marketing. Jared was the man who became popular because of his own successful weight loss program which he was able to accomplish through Subway sandwiches. Because of this one man’s testament on the reliability of the sandwiches’ healthy promise, the entire model for Subway had been built upon this man’s success story. At the present time, the company has evolved its image according to the promise of how healthy their products are. They have built their blueprint upon the script of satisfying the clamour of health conscious individuals for healthy food even in a fast-food set up. Subway started with promoting health sandwiches but it was Jared’s initiative that propelled the differentiation from the other fast-food restaurants that they are enjoying now. Somehow, the gap in terms of delivery of service and expectation was more on the customer’s belief of how the product could help him in his weight loss program. Ultimately, he was able to prove the health claim of Subway. After the story had been made known, both to the company and to the public, Subway had been more aggressive in pushing the nutrition benefits of their products as they recognized the potential of the Jared’s story to their positioning and market segmentation. They started with blueprinting their service taking off from what Jared was able to accomplish for them. They started with the fact of the diet concept and nutritional benefit of their products and streamlined their entire system based on this customer’s expectation and perception. Their entire production has been focused in offering this benefit. The entire support system of the company is also geared towards this strategy. All advertisements and marketing efforts are also about these benefits. They have also used Jared and the Jared story to promote the health and diet potential plus the nutritional benefits of their products. Even their online presence bear witness to how they promote the image and consequently stress to customers an expectation of promoting healthy products as they went to the extent of including the nutritional information about their products as well as those of the competitors. They had been aptly rewarded as one survey reported that there are 24.2 percent of consumers who trust their claimed nutritional benefits (Oches, 2010). Nando’s Nando’s deliver many different aspects of service that makes it above the regular service of fast-food restaurant but at a lesser price than a full service restaurant. It’s fast casual set up already offers a unique service delivery compared with fast-food restaurants as unlike the latter, they have more contact points with their customers during the consumption of the product. Although Nando’s had been known for unusual and unconventional advertisements, it labours to fulfil a promise of optimum dining experience satisfaction through a satisfying customer’s experiential aspect inside their restaurants. Their vision includes promotion of an internal culture where personnel adhere to the “same values of pride, passion, courage and integrity, spreading the fire and developing a culture unique to Nando’s” (Nando’s website). They traced their servuction model towards building a people-centric organizational culture with the thrust that it promotes and retains excellent employees who will deliver the exemplary service to their customers. Unlike in the other organizations which focused their service models on the scripts provided by the customers, Nandos built their blueprint through focusing on their employees satisfaction first and later on their customers requirements. They believed that their internal customers are the best emissaries of the quality of their products on their way to delivering their objectives. They used the internal marketing approach that specifies that satisfied employees result to satisfied external customers (Valdez, 2000, p 2; Mok, n.d., p1). Their initial focus is on the uniqueness of their products. They developed their product around the peri-peri flavour to make them different from the others. They also promoted the health benefits of their products establishing the healthy practices in processing their products. The way the chicken are cooked and the potential health benefits of the ingredients have been at the core of their promise to their customers (Nando’s website). Another aspect of their quest for closing the gap between customer’s expectation and perception is the unique feature of the customer’s ability to customize the product. They also worked on the unique ambiance of each outlet that speaks of warmth, friendliness and informal comfort which they claim to be the same in all their outlets worldwide (Nando’s website). Nandos take on the position of a different kind of chicken experience for the customers. They target the adventurous types who would go for more than the ordinary by seeking other ideas such as spicy food. This has been the basic platform of their blueprint. They promoted this image to the customers and tried to capture the expectations of their target market with an additional concept of experential eating. This has been done by creating a unique ambiance and comfortable feel in each restaurant that they wanted to promote as trademark of their service. This image building has been supported by all the aspects of their organization; from the frontliners who radiate with the passion of their unique brand of service, to the back stage actors who labor to offer the promise of a Nando’s experience and the company’s support system who tailorfitted all the in-store decor and advertisement towards this same image of comfort, fun and traditional family gathering. Thus, instead of taking their blueprint from the customer’s preference, they built their own image and unique brand and encourage the customers to experience it for themselves. However, in every interaction with the customer, it is important that the customer’s perception satisfies their initial expectation for the image building to be successful. Otherwise, Nando’s would not have been enjoying what it has accomplished. The gap that they tried to bridge was the created expectation in the customers due to the image building they have built for Nando’s and the perception based on the actual dining experience. Unlike the usual model that encourages going back to the customer and tailorfit their blueprint according to the customer’s preference, they tried to recreate and build a different experience for the customer. In the end, the loyalty of their satisfied employees to their food has become their proof of the delivery of their promise. The culture they promote within their organization has become their own brand of service that the external customers experience in each dining encounter in a Nando’s restaurant. Summary Each service provider looks for their own strategic service marketing mix in their quest to gain competitive advantage in a highly competitive restaurant industry. With Subway, despite the almost parallel servicescape framework and servuction model as everyone within the tight industry labour to close the gap between customer’s expectations and perception, they were able to find their own unique selling proposition. The healthy fast-food model had become their battle cry to rise above, not just the competition but also the increasing negative publicity about unhealthy fast-food products. They have built their service models along this concept and so far, a recent study has confirmed the positive customer assessment of their service delivery. Nando’s on the other hand started their model within the framework of promoting a unique culture that is embraced by everyone in the organization. This collective mindset afforded them a streamlined pursuit towards their goal of their trademark service delivery to their customers. The loyalty of their employees to their products had been their testament to their exceptional claims about them. Their thrust to build internal customers eventually became the avenue for their success of convincing their customers about their claims for their brand of service delivery towards the ultimate satisfaction of their customers. Bibliography An introduction to services marketing. Athens University of Economics and Business. Available at : http://www.aueb.gr/users/esaopa/courses/part2.pdf. Accessed 13 March 2010. Bitner, M.J., 1990. Evaluating service encounters: the effects of physical surroundings and employee responses. Journal of Marketing, 51 (April), 69–82. Bitner, M.J., 1992. Servicescapes: the impact of physical surroundings on customers and employees. Journal of Marketing, 56 (April 1992), 57-71. Booms, B.H. and Bitner, M.J., 1981. 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