Application of Service Marketing through the Restaurant Business - Assignment Example

Application of Service Marketing through the Restaurant Business The application of service marketing in the real-life context is the main goal of the study. The different aspects of service marketing was defined and analyzed. To see service marketing at work, a case study was employed with Nahm, one of the leading Thai-inspired restaurants in London, considered as a single unit for study. With the known information about service marketing, the Nahm’s service marketing was examined. This was done by both qualitative and quantitative ways such as the survey, usual means when case studies are used. It was determined that the service marketing done by the restaurant involved has been particularly good, thus its tremendous success. This implies that a good service marketing is one of the means to enjoy success in the restaurant business. Introduction: This paper is aimed to see service marketing at work in the restaurant business. Service marketing is used for the service industry to enlighten potential clients about the services being publicized. The process of case study was utilized to see on what level service marketing is applied to a real working business. The restaurant taken into consideration is Nahm, the restaurant in the famous Halkin at London. Nahm is considered as one of the famous restaurants in London. Background: Marketing, basically, is the process for making the goods and services flow from the producer or provider to the customers and clients. The goal is to make the product or service flow to the customers as often as possible (Berry & Parasuraman, 1993). Because marketing is concerned with both goods and services, there is a difference between product marketing and service marketing. Product marketing is the mode of marketing in which more people are familiar with. Service marketing is marketing used primarily for the service industry, particularly to inform the potential clients about the services being pitched and advertised. To be able to completely define and determine what service marketing is about and to apply its concepts, one has to first differentiate services from products. The characteristics between service and product have to be established (Hoffman & Bateson, 1997.). One of the characteristics that differentiate service from a product is the service’s lack of ownership. A service cannot be owned. Services are only utilized, or at the very least, hired for a specific period of time. Products, on the other hand, have owners. These owners can claim what they can claim as their ownership (Berry & Parasuraman, 1993). Another characteristic is its so-called consumability. Sure, products can be perishable but this is valid for only a small percentage of products. Some products can be stored for later use. This is not the case for service. There are time constraints for services and these are present for only a specific and limited time. And it is most often used and developed almost as simultaneously as it is availed of. Also a characteristic of service is its intangibility. It cannot be held nor touched, unlike products. However, despite the intangibility of services, it can still be felt and perceived. People, more or less, have an idea whether the services that they are getting is of standard and good quality. Because of its intangibility, services cannot be returned (Sherrington, 1999). Inseparability is also a characteristic of services, unlike products. Products are being sold by the manufacturers all the time, separating them. Services, on the other hand, cannot be separated from the providers. As stated earlier, service is made and delivered almost in the instant that it was availed. Literally, the service providers have to be there for services to be provided. Also a characteristic of service is the uniqueness of the service, its heterogeneity. Products usually are identical. It is very difficult for services to be completely identical. Circumstances present during the duration of the service make it difficult for services to be completely identical each and every time. Standardization is difficult, although it is done in some levels by placement of systems and procedures that guide the service. Similar to product marketing, service marketing involves areas such as place, price and promotion. These p’s are essential for marketing to succeed. The place should be appropriate for the service or the product to be a success. To prove this point, take an example. It would be useless to sell products such as coats in a place like the beach. Price is also necessary, especially for the product or service’s target audience. If the product or service is too expensive, the demand for it may decrease significantly. Promotion is also a good thing in offering goods and/or services. Without proper promotion, the target audience may not be reached and the possible clients are left untold of the benefits that they can get from the product/service. Also, all these factors can also go hand in hand. For example, prices may be increased slightly if it is to be sold in an area wherein the people have a high level of purchasing power, given that the promotion for the product and the service is done well. However, some aspects of service marketing are not present in product marketing. One of these aspect is the service provider. The service provider is one of the key ingredients for good service marketing. Appropriate staff and people should be used. The recruitment of the right staff and personnel makes all the difference in service delivery. The staff and personnel should have certain characteristics such as good interpersonal skills and grasp of service providing knowledge. It is also essential for the company or organization providing the service if they want a competitive edge. As stated earlier, the clients can perceive if they are receiving quality service. Consumers perceive the service that they receive and they judge these same services, whether it was worth their time and effort, based on the personnel and the employee that provides the service. The process behind the service is also necessary for service marketing. An efficient system for getting the service done is apparent to the customers. Take the case of a person hoping to stay in a hotel for a day or two. If the process behind providing service is inefficient, the receptionist would have a hard time providing the person with a room. Valets would also present a problem. This would be apparent to the customers. One indication of this aspect of the service is the time it takes for the service to be provided. Such an example is in the restaurant business. If the food is served for a terribly long time, it could indicate that something has gone askew with either the service, such as the lack of waiters to serve the customers, etc. What makes service perceivable to the clients is primarily the physical evidence of the service. Physical evidence is, in a way, the tangible part of the service. This also helps in the customers’ judgement and analysis of the service provided by an establishment or organization, by being the glimpse of the service provision (Carmen & Langeard, 1980). This, in turn, helps in the feedback of the service and plays a part in the constant improvement of the service and changes in the ideal plan of service. Strategies are employed in marketing. One such is the innovation strategy. In this strategy, the companies or businesses come up with a new product or service and deals with innovating the business model. It is mainly for seeing if the company has the edge by being more advance in areas it deals with such as technology, food, etc. The main goal in using this strategy is to be the pioneers. It is best if the service provider is known as the best in its area as well as the frontrunner. Being a close follower, one who follows the trend, is considered as a better option if there is already a pioneer. Being late followers, or providers that come up with almost none, or at the very least few, innovations should be avoided (Sherrington, 1999). Another one employed in marketing is growth strategies. This strategy mainly deals on the growth of the service provision firm. This is usually done by diversifying the range the firm provides, instead of just focusing on what it already is good at. In service provision, offering new services is a way to show diversification. Another method of growth strategy is intensification wherein perfecting the already available services is done (Berry & Parasuraman, 1993). Maintaining or improving public relations and promotion is also a concern for marketing strategy. A good relationship with the target audience or customers plays a big role in the success of service providers. And this is done by thousands of different means such as providing the customers with a perfect service experience, keeping in touch with the customers by emailing them updates on the firm, etc; this would basically mean to do activities that will porject a good image for the service provider. This paper is aimed to see service marketing at work in the restaurant business. The process of case study was utilized to see on what level service marketing is applied to a real working business. The restaurant taken into consideration is Nahm, the restaurant in the famous Halkin at London. Nahm is one of the famous and acclaimed restaurants in London. It features the recipes and food of David Thompson, a celebrated Australian Chef. It is Thai inspired and features Thai cuisine, based on ancient Thai traditions. It features a menu palate available during lunch and dinner. A Look on Case Studies A case study focuses on understanding the dynamics present within specific settings. The case study is appropriate in new topics areas. Case studies usually involve multiple cases with various levels of analysis and they can provide a research design that combines qualitative and quantitative data collection (Yin 1994) A case study is also an experimental investigation that looks into an existing phenomenon. This is done within a real-life setting, especially for the phenomena’s environment (Yin 1994). This real-life context is chiefly used when the boundaries between the incidents and trends and the context are not clearly evident. It is also employed when different sources of evidence are used. Data collection methods and sources of evidence reinforce the theory by means of the reiteration of evidence (Patton 1991, Yin 1994), and provide stronger validation of concepts and hypotheses. In developing a case study, all data about the case is gathered. Data may come in different forms, including documents such as records, interviews, surveys and observation. These collected data is organized so that it becomes an approach in highlighting the central theme of the study after which, a case study narrative is developed. The commonalities and differences in the comparison might highlight information that is necessary to shed light on the focus of the study (Patton 1991). A case study utilizes a unit of analysis. It involves collecting detailed and thorough information on the units of analysis, usually over a specific period of time. After which, in-depth knowledge about the topic can be obtained. There are three characteristics for case studies: 1. The research and the case study should aim to investigate certain phenomena and understand those concepts within an exact framework. 2. The research originally does not originate from a set of queries and ideas about the limits of the study 3. The research uses several methods of data collection. Those data obtained and used may either be qualitative or quantitative or both (Yin 1994). The case method has an advantage when questions regarding the “how” and the “why” on a phenomena are asked about, especially within a real-life context. This is also accurate when relevant behaviours cannot be directed and controlled by the researcher (Yin 1994). This is the situation in this research. A case study research is appropriate in the research on the topic, if simply to provide a new viewpoint and perspective to an already studied topic. However, much of the information collected is retrospective data, recollections of past events, and is therefore subject to the problems inherent to memory (Berger, 1991). The Nahm Nahm has received a Michelin Star and has been named by the Zagat Guide as the Best Thai in London in 2007. It is filled with huge arched windows with lights emanating from different parts of the restaurant. Wooden slated screens surround the place as well as pale gold walls for decoration (Como Hotels and Resorts, 2008). Simple dining is available in the restaurant and walk-ins are serviced if possible. Dining in private rooms, separate from the restaurant proper is also possible. But the restaurant also allows private hiring of the restaurant on request. It is highly encouraged, however, that customers book a reservation prior to dining in the restaurant, especially if the customers make up a group of several members (Como Hotels and Resorts, 2008). For private rooms, sliding wooden panels separate these rooms from the restaurant itself. These rooms have become a popular choice for cocktails and social occasions involving a small group of people, ranging from 30 to 50 people, depending on the day and room that has been requested. This provides a cosier and more intimate atmosphere for the customers (Como Hotels and Resorts, 2008). As for renting the entire Nahm, the restaurant can be rented for special events such as wedding receptions or launches. In this case, the restaurant is combined with the adjacent dining rooms for creating a great experience for the diners. Given this, 60 to 100 people can be fitted within the restaurant and the rooms, depending on the circumstances for the renting of the restaurant and rooms (Como Hotels and Resorts, 2008). The Nahm claims to feature personnel that are gracious and pre-empt every need. The restaurant claims that the staff and personnel know when to assist, stand back and are attentive and trusted. The staff and employees are clad in Georgio Armani clothing and are sophisticated and has a sense of intelligence and poise (Como Hotels and Resorts, 2008). The restaurant is open for Lunch during the weekdays, from 12noon to 2:30 in the afternoon. It is open for dinner the entire week, 7 to 11 in the evening from Mondays to Saturdays and from 7 to 10 in the evening during Sundays (Como Hotels and Resorts, 2008). Discussion: As for the case study, the research was done by asking people who have experienced dining in the restaurant. These people were asked to answer a survey regarding the restaurant and asked to write comments regarding the restaurant, particularly the service. The survey was tailored so that it may give insight regarding the service practices of the restaurant. Given the answers in the survey, it was apparent that most of the people tried the restaurant mainly because of the rave reviews that it got and from referrals of their friends or people that they know. 32% of the respondents tried the restaurant because of the rave reviews and 42% because of referrals. This shows that the reputation of the place is good. This also indicates a lot about the service of the restaurant. A rave review and referrals from people would only be given if the people had a good dining experience in the restaurant. Even if the food was great, yet the service is appalling, referrals and reviews would not turn out to be so great. This data alone, however, is insufficient to conclude that Nahm has been applying good service marketing strategies. But this shows that Nahm has been employing good service marketing strategies for their public relations and promotions. The good reviews and high referrals shows that the marketing strategy related to their public relations, especially with their customers, is a success. In the yes-or-no questions of the survey, the service in the restaurant proved to be a hit with the customers. The following shows the percentages of the customers that answered yes or no per question. 1. Did you feel that the service given to you was inappropriate? 2. Did you feel that the service lacked standards? 3. Were you harassed, meaning if you were disrespected, aggravated, etc during your stay in the restaurant? 4. Did you feel that the service in the restaurant is exceptional? 5. Upon first entering the restaurant, were there any evidences that the restaurant would be providing you good service (such as a clean surrounding, polite valet, etc)? The pie graphs show that a huge percentage of customers give high regards to the service being provided by the restaurant. This shows that the service marketing of the restaurant is an effective one. Basically, the customers think that there are good standards regarding the services of the restaurant. As for the statements regarding several aspects of the restaurant, the following shows the averages of the answers from the customers. Statement Average The restaurant provides a cosy and appropriate atmosphere for dining 5.98 The restaurant has waiters that are courteous and well-mannered. 6.5 The restaurant is located in a convenient area for diners 5.7 The restaurant features services unique to the restaurant alone. 6.54 The over all quality of service in the restaurant is good. 6.82 The price set by the restaurant is reasonable 5.98 These averages further testify to the quality of the service of the restaurant. The 6.54 rating for the restaurant with regards to the uniqueness of the place is a good thing for the service marketing of the place. As mentioned before, services are hardly identical. One experience regarding a service in one place is hardly identical to another. This, however, does not necessarily indicate a bad thing. A service could turn out to be better as time passes by and more services are availed. But it could also mean that the services are getting worse per service provision (Hartman & Lindgren, 1993). But given the case of the Nahm and the results of the answers of the survey, it appears that the uniqueness of the experience in the restaurant brings an edge to the place. One of the respondents noted that the private rooms brought a pleasant surprise to the dining experience. This shows that Nahm is investing in a marketing strategy said earlier – the innovation strategy. By coming up with new ideas, Nahm can be considered as innovating itself. As Nahm is one of the first Thai-inspired restaurants located near a hotel in London (Como Hotels and Resorts, 2008), it has shown to be a pioneer. But to have an edge over the competition, it has come up with several ideas which is innovating the dining experience. Mentioned by one of the respondents, the private dining rooms separate from the main restaurant proved to be a good experience, something unique and innovative coming from Nahm. And the high score of this criteria shows that the innovation marketing done by Nahm is working for them. The 5.98 rating for the atmosphere provided by the restaurant shows that the atmosphere is preferred by a lot of people. However, some people wrote on the comment section that the aura sometimes is not conducive and it feels stuffy, particularly with the restaurant being part of a hotel. Also, one of the respondents, a native from Thailand, mentioned that he was not particularly keen on the design of the place since it did not give off a Thai feeling that he was accustomed to. This particular statement was for the physical evidence part of the service marketing. A cosy atmosphere for the customers could help in the perception of the service provision of the restaurant. The 6.5 shows the high regard for the staff of the restaurant. This statement focuses on the service provider. Since this is an important factor in service marketing, the personnel have to focused upon on. The customers noted in the comments section that the waiters were especially polite and courteous most of the time. The appearance of the service providers was also noted. The clothing that they wore made the providers and personnel look particularly professional and it made the customers have an impression that they are indeed going to enjoy their restaurant experience. The high rating for the location of the restaurant is also a good sign for the marketing of the services. It shows that it is in a good location. Although a respondent noted that his rating of the location as a good place is mostly because he was staying at the hotel at the time being that he dined at the restaurant. The most important statement, the one regarding the overall service quality, almost obtained a perfect score. This reiterates that most of the customers think highly of the service provided by the Nahm. This after all, is the main goal of service marketing. Service marketing is aimed at making the customers feel that the service they are getting is of high standards. It can be said that the particular strategy that Nahm has employed in the above stated areas is intensification for growth strategies. As Nahm has been around for a long time, Nahm has had plenty of times to keep on improving the services it has offered. Because of the almost perfect score of Nahm on several different criteria pertaining just on its service, it can be deduced that Nahm has invested a lot on the services it is providing and is inching its way on providing perfect services in each and every customer relation. The staff rating agrees with this. To have a high staff rating is indicative of the training and the standards being kept by the restaurant. This shows intensification. Another proof is the whopping majority of people that felt that dining in Nahm was a good experience (as shown by the pie graphs). Another statement is regarding the prices in the restaurant. Prices in a restaurant are not just because of the food in it. It is also because of the services that are available to the customers. The statement that the price is reasonable got a relatively low rating however (Hoffman & Bateson, 1997). This may be due to, as several respondents noted, that the prices seem to be focused on the hotel occupants and not on the local people. Diversification can also be seen as a strategy being done by Nahm. Instead of simply just a restaurant wherein people walk-in, or reserve a table, and dine, Nahm has diversified by catering to special events such as wedding receptions and the likes. From simply serving a few people, it has widened its range by serving to as much as 100 people. A good marketing strategy of Nahm is its cooking classes (Como Hotels and Resorts, 2008). It has also offered special cooking classes. This is atypical to restaurants. The concept alone of offering cooking classes shows the ingenuity of the marketing strategy of Nahm. It is innovative as it offers a great experience to the diners. It also shows diversification since it shows that Nahm is not just for serving food; it offers ways for a person to prepare food the Nahm way. And it is also shows growth strategy via intensification. In each class, there are only around 8 students (Como Hotels and Resorts, 2008) to ensure that each and every student gets focused on by the chef/teacher. The service offered via the cooking class is being ensured and perfected. Conclusion: Looking at the big picture, it can be concluded that Nahm is enjoying a success. This is especially true considering that it has already garnered awards and is getting excellent reviews. But this is particularly true regarding the service that it is providing its customers. Service marketing involves several factors and the restaurant has been able to do good on most of the factors needed for service marketing to be a success. The place of the restaurant appears to be convenient, especially since it is in a hotel and can cater to the hotel residents. The price has appeared to be reasonable to the customers. The promotion that it has been getting appears to be from the reviews and referrals. This would indicate that the customers are enjoying both the food and the service in the place. Also, the people that provide the service, particularly the personnel and staff, have shown to be well-trained and sensitive to the customers’ needs. And more importantly, the Nahm has given the customers the impression that they would indeed enjoy their stay in the restaurant because of physical evidences regarding their service. These have become proof of their good marketing strategies – innovation, diversification, intensification. Considering all these points in service marketing that has to be taken care of and the way that service marketing was handled by Nahm, it shows that a good service marketing is essential in the restaurant business (Murray, 1991). At the very least, it gives the restaurant the well-deserved success that it is basking in on. Recommendations: Based from the success of the restaurant, it only has to continue on doing what it is practicing at present. The service marketing of the restaurant has presented to be good enough for the restaurant to enjoy a good customer base and so far, it has been able to please a good majority of its customers. If ever the restaurant plans to improve on the service marketing, strategies on how to improve the atmosphere of the restaurant should be of priority. Continuously reinventing the place, or adding a touch of uniqueness to the restaurant would also prove to be good, based from the study. The very least that the restaurant should do is to keep up with the service marketing that it is currently doing and the best that they must do is to raise the stakes higher in terms of their service provision. Appendix: Survey used for the study: Hi. I am carrying out a survey regarding the restaurant business and service marketing industry. This is done to study and understand some perceptions and attitudes. Please answer the questions freely. Thank you for participating in this survey. Please note that the information gathered will be treated as confidential. In what materials have you heard about the restaurant?  television  newspapers  magazines  restaurant reviews  on the world wide web  others such as referral of friends Have you read review about the restaurant? If yes, would you say that the review/s are good? Has it encouraged you to try and experience what the restaurant offers? ___________________________________________________________________ ___________________________________________________________________ Please answer the following questions with a yes or no. 1. Did you ever felt that the service given to you was inappropriate? 2. Did you felt that the service lacked standards? 3. Were you harassed, meaning if you were disrespected, aggravated, etc during your stay in the restaurant? 4. Did you feel that the service in the restaurant is exceptional? 5. Upon first entering the restaurant, were there any evidences that the restaurant would be providing you good service (such as a clean surrounding, polite valet, etc)? Please read the following statements and indicate your level of agreement or disagreement according to how you feel about each of them. Circle 1 for Strongly Disagree 2 for Disagree 3 for Slightly Disagree 4 for Neutral (but not for no comment) 5 for Slightly Agree 6 for Agree 7 for Strongly Agree The restaurant provides a cosy and appropriate atmosphere for dining [ 1 ] [ 2 ] [ 3 ] [ 4 ] [ 5 ] [ 6 ] [ 7 ] The restaurant has waiters that are courteous and well-mannered. [ 1 ] [ 2 ] [ 3 ] [ 4 ] [ 5 ] [ 6 ] [ 7 ] The restaurant is located in a convenient area for diners [ 1 ] [ 2 ] [ 3 ] [ 4 ] [ 5 ] [ 6 ] [ 7 ] The restaurant features [ 1 ] [ 2 ] [ 3 ] [ 4 ] [ 5 ] [ 6 ] [ 7 ] The over all quality of service in the restaurant is good. [ 1 ] [ 2 ] [ 3 ] [ 4 ] [ 5 ] [ 6 ] [ 7 ] The price set by the restaurant is reasonable [ 1 ] [ 2 ] [ 3 ] [ 4 ] [ 5 ] [ 6 ] [ 7 ] What other comments do you have about the restaurant? What comments do you have about the service provided in the restaurant? ______________________________________________________________ ______________________________________________________________ ______________________________________________________________ ______________________________________________________________ ______________________________________________________________ ______________________________________________________________ ______________________________________________________________ References Berry L.L. and Parasuraman, A.A. 1993. ‘Building a New Academic Field - The Case of Services Marketing’. Journal of Retailing, 69, 1, 13 - 60 Berger, A. A. 1991. Media research techniques. Newbury Park, Calif.: Sage Publications. Carmen J.M. and Langeard E. 1980. ‘Growth Strategies of Service Firms’, Strategic Management Journal, 1, 7 – 22 Como Hotels and Resorts. 2008. Halkin – Como Hotels and Resorts – Nahm. Available from: < http://halkin.como.bz/default.asp?section=186> [08 May 2008] Como Hotels and Resorts. 2008. Halkin – Como Hotels and Resorts – Private Events. Available from: < http://halkin.como.bz/default.asp?section=186&page=277> [08 May 2008] Como Hotels and Resorts. 2008. Halkin – Como Hotels and Resorts – Exclusive Hire of Nahm. Available from: [08 May 2008] Como Hotels and Resorts. 2008. Halkin – Como Hotels and Resorts – Service. Available from: < http://halkin.como.bz/default.asp?section=244> [08 May 2008] Donnelly J.H. Jr. 1976. ‘Marketing Intermediaries in Channels of Distribution for Services’, Journal of Marketing, 40 , 55 – 70 Hartman D.E. and Lindgren J.H. Jr. 1993. ‘Consumer Evaluations of Goods and Services -Implications for Services Marketing’, Journal of Services Marketing 7. 2, 4 - 15 Hoffman, K.D. and Bateson, J.E.G. 1997. Essentials of Services Marketing, Orlando, Florida: The Dryden Press Murray, K. B. 1991. ‘A Test of Services Marketing Theory: Consumer Information Acquisition Activities’, Journal of Marketing 55, 10-25 Patton, M. 1991. (2nd ed. )Qualitative Evaluation and Research Methods. Sage Publications, Beverly Hills, California, USA. Sherrington, P. 1999. What Communicators Must Know About the Marketing of Services and Intangible Products. Canton, MA: Techmar Communications Yin, R. K. 1994. Case Study Research: Design and Methods. Berverly Hills: Sage. Read More