Influence of Promotional Activities on Fast Food Buying

Dining out in Pakistan can be an exciting and wealthy experience. In Pakistan food has many different styles numerous great restaurants in every the major cities of Pakistan. Junk food trend is quite new in Pakistan. It had been presented in Pakistan about two or three decades ago which is growing very fast which indicates that type of food industry have a very smart future in Pakistan. Junk food is pre-prepared food or which can be quickly prepared when you order for it. Two major fast food restaurants having strong occurrence in Pakistan are Mc Donald's and Kentucky Fried Rooster (KFC). Fast food restaurants appeal to customers through different techniques where promotional tools are widely used. Our research is dependant on the hypothesis that several promotional techniques like coupons, new product, value bargains, price discounts and promotional discounts are having effect on fast food consumer's buying behavior or not. A research has been carried out which is based on the consumers respond to survey which engaged questions regarding several promotional techniques found in fast food.

CHAPTER I - INTRODUCTION

The concept of sales campaign could easily be grasped by considering this simple example "Suppose you visit the market to buy any product and there it is suggested to you that if you get two of that product then you will get an extra part according with their scheme. You'll be delighted to know that you will be saving money of that extra little bit of product given to you. That extra part can be a product used on a regular basis which you can keep for later use. They are the sales promotion techniques for increasing sales of a certain product which every business person desires for the sales of goods that he discounts in and he can use many various ways for this function. Some of these methods you might have heard about such as "Win a tour to Dubai", "20% extra on a sizable pack", "Scratch and win", "Freebies like lunch field, pencil box and shampoo sachet, "Buy one get one free" etc.

In every industry, promotions are key sources of increasing sales of products. Fast food industry is one of the market sectors which quite definitely rely on its foods promotion to improve the sales. For this purpose, it practices several techniques including price savings, coupons, new product and provide different deals to appeal to its customers.

Every organization wants a greater talk about of the total customer market and for this function it becomes very very important to organizations to learn their consumer's reactions and reactions towards their promotional promotions to be able to put into action them successfully.

Now we can look at fast food industry and its occurrence in Pakistan.

FAST FOOD RESTAURANTS

Fast food restaurants are those restaurants where no table service is provided. It's a personal service restaurant and food is ordered only at a counter-top. The term junk food is the term used for food which is well prepared and served very quickly with precooked ingredients.

Fast food restaurants stand for one of the largest segments of the food industry. A number of the largest players in this category include international giants like McDonald's, and Kentucky Fried Rooster (KFC).

FAST FOOD RESTAURANTS IN PAKISTAN

Fast food chains have become progressively more commonplace in nations surrounding the world. Many American established companies have widened into and are growing in the global market. The idea of fast food restaurants was presented in Pakistan in the first 1980s. There are many junk food chains functioning in Pakistan but two of them are very dominating. A brief release of these fast food chains is listed below.

MCDONALD'S

Mc Donald's was opened in 1940 by brothers by Dick and Macintosh Mc Donald in San Bernardino, California. McDonald's opened its doors in Pakistan in Sept 1998 at Lahore and currently operating in nearly every major city with a network of several restaurants in each city. McDonald's Pakistan has an aggressive intend to expand in all over Pakistan which is quickly growing with the passage of time. It has a strong occurrence in Pakistan with locations in Lahore, Karachi, Hyderabad and Islamabad.

KENTUCKY FRIED Poultry (KFC)

The company was founded as Kentucky Fried Chicken (KFC) by Colonel Harland Sanders in 1952. KFC has a solid existence in Pakistan. In Pakistan its locations include Lahore, Peshawar, Islamabad and Karachi. KFC opened its first outlet in Gulshan-e-Iqbal in 1997 and today KFC has several branches in main metropolitans throughout Pakistan such as Karachi, Lahore, Gujranwala, Sukkur and Murree with more than 60 retailers nationwide.

FAST FOOD DEVELOPMENT IN PAKISTAN

Our nation has been denoting an easy food nation even as look around. We see them on street sides, shopping areas, petrol pumps and even in clinics whether is an international franchise of junk food or a lo al burger wala, people spend extra cash on burger and French fries as compared to other food; in an exceedingly small amount of time period our civilization has become faster paced and attracted to this style of dining out. Eating out can be an important part of your emerging lifestyle as compared to days gone by as it was considered as an unusual luxury. Children are also an important market targeted by fast food because they offer special value meals for them. The young technology who considers it faster is the actual high fat fast food consumers. The fast food environment is not considered only for eating but also for entertainment also today, keeping in mind the several activities utilized in fast food especially for children such as birthday, gather functions and other unforgettable events. Several promotional activities are utilized in order to appeal to the new customers and to retain the existing one.

Now let's check out some sales advertising approaches used by fast food restaurants.

COUPONS

A discount is a printed report that may be exchanged for decrease when buying something. Essentially coupons are issued by producer of a product which can be used as sales campaign method. Coupons usually get into three categories. (1) For free, (2) Reduced, (3) Buy one get something. These are often seen in newspapers and publications and packages.

PRICE DISCOUNTS

Price discount rates are incentives offered to consumers to be able to get their attention. Actually price savings is the effort which give consumers sense of obtaining some extra value by not paying a certain ratio of amounts of that product such as 10%, 20% or 50%. That is one of the very most frequently used ways to persuade customers to increase their purchases.

PROMOTIONAL DEALS

In the fast food industry, different discounts are offered to its customers better suitable for their needs and requirements as it is an instant service food. Such kinds of bargains are known as midnight discounts and lunch offers etc to provide value to customers.

VALUE DEALS

Value deals are those offers offered by fast food restaurants to their customers as value because of their money. Fast food restaurants produce these attractive ideas by offering a little extra amount of food with a difference of amount. For instance, upsizing the foodstuffs by paying extra less or getting 20% for the same price.

NEW PRODUCTS

Fast food chains such as Mc Donald's and KFC introduce new products to its consumers in various seasons to catch the attention of clients and keep your hands on the prevailing customers by offering/ adding something new in their menu.

STATEMENT IN THE PROBLEM

The objective of sales promotion is to advertise activities in order to add the essential value of a product or services which encourages people to purchase. As the fast food industry is growing in Pakistan and certainly the reasons are speed, convenience and price. Folks are now more drawn towards junk food with the advantages of different promotional offers which suits customers in several events and timings.

The immediate rate of which the junk food industry continues to include offers to its menu to catch the attention of its customers is as much a reflection of consumer interest towards those special offers itself. Therefore, with an emphasis on sales promotional activities, its impact on sales and consumer's replies towards them is likely to be analyzed.

The main reason for this research is to study the different self-employed variables which could encourage junk food consumers to dine in the junk food franchises. To research the consumer's tendencies/ response towards sales campaign in junk food industry, Consumers can have a positive or no response to sales promotion.

PURPOSE OF STUDY

The purpose of this research is to investigate the influence of promotional activities practiced in the junk food restaurants.

For this goal some important and most practiced promotional methods which are being used in junk food franchises are taken which receive below
  • Price discount
  • Coupons
  • Promotional deals
  • Value deals
  • New products

RESEARCH SCOPE AND LIMITATIONS

The scope of this research is to investigate the effect of several promotional activities employed in junk food restaurants.

These are some restrictions imposed on this study
  • Respondents are arbitrarily selected and generally were children and college/university students because they're more seduced towards junk food and particular users.
  • Access to fast food franchises was limited to be able to meet respondents inside because they did not allow.
  • The questionnaire was filled up by researcher from respondents beyond your franchises.
  • Lack of response from some respondents.

THESIS STRUCTURE

This thesis contains four chapters. Section 1 discusses the situation about which the research was completed and on the whole about the junk food industry and its own opportunity in Pakistan. Chapter 2 is approximately the books review. In Chapter 3, researcher describes the methodology implemented including resources of information and data collection methods are mentioned. In chapter 4, the experiential data accumulated through questionnaire is examined and email address details are concluded on the basis of a survey. Conclusions are attracted and necessary tips are advised.

CHAPTER II- Books REVIEW

In today's competitive environment it is very important for marketing professionals to utilize the entire variety of marketing combine tools to attain maximum final result and one of the marketing tools is sales campaign which has been very important in the meals retail division(Sue Peattie; 1998). Nowadays several promotional tools such as coupons, bonus packs, free samples and sweepstakes are incredibly commonly utilized activities provided by manufacturers to its consumers but the next step which is the buyer response to these activities has not been comprehended well in this regard (Chem L. Narayan and P. S. Raju; 1985). So remember the value of consumer's reactions and response towards promotional campaigns of organizations to be able to implement these promotional activities effectively, the influence of the promotional activities on sales and consumer decision is going to be analyzed. Promotional campaign is an try to influence the buyer buying decision; and promotional strategist is an operating behavioral analyst who sees the nature of the response towards any promotional activity and significantly weighs up the reality and support provided by the respondents via behavioral research to be able to achieve extreme results and efficient conclusions (Peter L. Wright; 1973). The impact of advertising on the purchasing behavior of the buyer has been recognized in the marketing literature while the impact of promotional activities has given lees concern (Deborah L. Owens, Michael Hardman, Bruce Keiller). Advertising has a much shut relationship with sales promotional tools. Sales campaign is contain short term bonuses to encourage purchase or sale of a product or service while advertising offers reasons to buy something or service. Sales promotion offers reasons to buy now (Kotler, Ideas of Marketing). Recently the use of promotional activities has availed noticeably increased attention because of the effectiveness of easily measurable and manuscript promotional advertising campaign as compared to advertising campaign. This research has been intended to assist managers of marketing and sales departments to be able to put into action various consumer offers successfully in a combined marketing program.

The use graph of sales deals has truly gone up significantly in couple of years and one of the major known reasons for this is the fact effectiveness of sales campaigns is very much easier to calculate than the potency of advertising campaign (Deborah L. Owens, Michael Hardman, Bruce Keiller). There are a few inner factors and external factors which contribute in the expansion of sales promotional activities. The primary inside factor is the popularity of sales promotion as a powerful sales promotion strategy by the merchandise managers because they face higher pressure by top management to increase their current sales while external factors include large number of brands and then your increasing competition among them seeing that the rivalling brands are less differentiated. Third, advertising efficiency has dropped because of changing economical conditions, rising costs and press disorder (Philip Kotler), (Chem Narayan and P. S. Raju; 1985). Given the importance of sales promotional techniques the main decision for marketers is to find the mixture of appropriate sales promotional activities (Philip Kotler), (Chem Narayan and P. S. Raju; 1985).

The modern junk food uprising in essence was started in the united states in 1950's and since that time this form of delicacies has captured depends upon. Fast food sometimes appears as a symbol of globalization and post-modern society and the world is attracting to this design of food (Yasser Ibrahim, Claudio Vignali; 2005). The fast food industry is more global now and international junk food expenditure continues on to improve in acceptance (Ali Kara, Erdener Kaynak, Orsay Kucukemiroglu; 1997). Inside the developing countries a very little research has been done on fast food and its consumers thus a very little is known about fast food consumers. Timothy J. Richards and Luis Padilla in 2007 has found that promotional activities improve the market share of the business and also develop the fast food demand generally. This implies that promotional activities influence the buying decision of fast food consumers due to price change. Campaigns obviously contain a great impact on buying decision. What's important to keep clear is the procedure by which consumers act in response to these offers. This understanding is very important for successful scheming of promotions as well for assuring the minimum harmful factors behind other communication elements (Meryl P. Gardner, Roger A. Strang).

A hardly any work has been done before related to consumers perceptions and tastes for fast food industry. Previous studies done on junk food industry have been limited by the top features of junk food consumers in conditions of demographic and socio-economic factors while an extremely little attention has been directed at study the behavior and frame of mind of junk food consumers (Ali Kara, Erdener Kaynak, Orsay Kucukemiroglu; 1997). Consumer tendencies is expected to be found fairly different when compared with the developed countries in view to the fact that these countries are mainlyinfluenced by social, political and monetary conditions (Raju, 1995). It could be forecasted that the concept of fast food in expanding countries is different than developed countries and their perceptions and behaviour differ as compared to international junk food industry in the industrialized countries (Brady and Robertson; 1999; Watson; 2000; Eckhardt and Houston; 2002). It has been acknowledged that marketing professionals and strategist should have sufficient knowledge and knowledge of consumer's perceptions and preferences of dining out in fast food restaurants and exactly how they can be diverse across cultures and countries. This understanding will help in concentrating on countries and their different ethnicities in order to advertise fast food culture and also to improve and modify the perception of junk food restaurant there to improve the demand of the consumers (Ali Kara, Erdener Kaynak, Orsay Kucukemiroglu; 1997).

Fast food restaurants practice various kinds promotional activities throughout the year where coupons will be the most used promotional tool. Coupons have grown by more than 500% in the last decade which shows the value of coupons (Chakravarthi Narasimhan1984) and coupons will be the consultant among other promotional tools like new product offers, promotional deals and price special discounts etc. It is well acknowledged in the marketing books that coupons have immediate effects on sales (Jeongwen Chiang 1995). Junk food restaurants offer consumer an assortment of tangible and intangible elements. Here the purpose of the analysis is to examine the impact of promotional activities on consumer decision in fast food industry. Several big fast food giants are involved in gratifying consumer needs and Kentucky fried poultry (KFC) is the leading junk food franchise satisfying its consumer needs accompanied by Mc Donald's, Subway and Mr. Burger.

CHAPTER III: METHODOLOGY

DATA COLLECTION

Two types of options are used in data collection for just about any research function that are primary and secondary data. With this research study, both types of sources are operated. Secondary data is from the catalogs, articles, research journals, and internet while key supply of data is dependent on questionnaire survey. According to the necessity the researcher is dependent on both sources for academic and experimental data. We are extremely much relying on the questionnaire survey results for empirical data because limited information is available on promotional activities and its own impact on consumer buying habit in Pakistan.

RESEARCH AND Examining INSTRUMENTS

Questionnaire has been used for studies because of this research and then for testing purpose SPSS has been used as a testing tool. Through the analysis of data in SPSS researcher has used approach of one sample T- test.

FEEDBACK FORM

For the purpose of data collection about different promotional tools and its effect on consumer buying patterns in the fast food restaurants a questionnaire has been used. Information about the effect of different promotional activities offered in fast food restaurants on consumer buying action is availed by knowing the satisfaction and arrangement level with every promotional activity separately offered in junk food.

QUESTIONNAIRE TESTING

T o identify weaknesses in the device a questionnaire tests was conducted. Relating to Malhotra (2003), pre-testing identifies the trials of the questionnaire on a small test of respondents to recognize and to be rid of likely trouble. For such goal the researcher done 10 questionnaires from fast food consumers. Burns up and Bush (1998) suggested that a pre-test of 5-10 representative questionnaires is usually satisfactory to spot the problems in a questionnaire.

SAMPLING

For this thesis, the impact of different promotional activities on consumer buying behavior was carried out through a study of consumers of chosen junk food restaurants. A questionnaire was filled out from 100 respondents in a good environment to avoid any hustle and weakened response.

SAMPLE SIZE

The test size of research is 100 respondents. It includes the next
  • Male/ Female
  • Age group: 20 years or above
  • Employed/ unemployed
  • Fast food consumers
  • Karachi based

HYPOTHESIS

h3= Price special discounts influence purchase decision of fast food consumers.

h3= Coupons affect purchase decision of junk food consumers.

H3: Promotional offers influence purchase decision of fast food consumers.

H4: Value discounts effect purchase decision of fast food consumers.

H5: New product effect purchase decision of fast food consumers.

CHAPTER IV: RESULTS AND DISCUSSION

In our finding the statistical test which has been applied is the one sample t-test. One test t-test compares the mean value of a sample (computed from a set of observed principles) with the hypothesized mean value so this is easy and simple test to understand and determine the chance or the difference between sample rating and hypothesized values.

Following is the end result of our research. We compared the mean degree of our outcome to a known test value of 4 because 4 is our contract level.

First start to see the descriptive statistics.

The mean in our samples are the following

Price discounts = 4. 0

New products = 3. 9933

Coupons = 3. 9767

Promotional deals = 3. 9033

Value offers = 3. 8767

The above mean principles are best to the test value of 4. Price discount rates is having the highest mean value 4 which is add up to the test value of 4 and then services have mean value (3. 9933) and accompanied by coupons (3. 9767), promotional deals (3. 9033) and then value offers (3. 8767).

Now, start to see the results in our one sample t-test
Our T-value for every observation is

Price discount rates = 0. 000

New products = -. 111

Promotional bargains = -1. 219

Value offers = -1. 559

Coupons = -. 306

The cut point of T-value is 1. 5. If the T-value is higher than 1. 5 then your significant value becomes lower and would go to significant level.

We have 99 degrees of freedom.

Our significance values are

Price discount rates = 1. 000

New products = 0. 912

Promotional bargains = 0. 226

Value offers = 0. 122

Coupons = 0. 760

It means that the mean difference is not significant and the test value which is (4) "Agreement level" is equal to the mean value of price discount rates, services, promotional deals, value offers and coupons and there is absolutely no significant difference between the test value and the mean principles of the sample.

ACCEPTED HYPOTHESIS:

Following hypothesis has been accepted

h3, h3, H3, H4, H5

Based on statistical ensure that you results of above table, pursuing hypothesis has been accepted and it was found that these factors affect the consumer buying patterns in fast food restaurants.

h3= Price discount rates influence purchase decision of junk food consumers.

h3= Coupons impact purchase decision of junk food consumers.

H3: Promotional deals effect purchase decision of fast food consumers.

H4: Value bargains effect purchase decision of fast food consumers.

H5: New product effect purchase decision of junk food consumers.

CONCLUSION

A hardly any research has been done up to now on fast food consumers and their buying tendencies as well as promotional activities utilized by junk food restaurants and its own influence on consumer buying decision. Towards the best of my knowledge, the study work done so far of junk food outlet stores have been limited to the reason of the characteristics of the fast food consumers in terms of demographic and socio-economic factors plus some work is performed on the restaurants brand collateral and their competitiveness while a very few factor has been related to the junk food consumer's behavior and attitude orientation. Research conducted by Syed Mehdi Raza and Tariq Jalees in 2005 steps the brand equity of junk food chains functioning in Karachi. Timothy J. Richards and Luis Padilla believe fast food advertising is a significant cause of the overweight.

The purpose of the learning is to comprehend the effect of promotional activities on the buying tendencies of fast food consumers. For results we apply the main one Sample T-test to check the significant impact of all selected variables, it was found that the all parameters (Coupons, Price savings, Promotional offers, value offers and services) significantly effect the buying action of junk food consumers.

The results of the analysis show very optimistic response from junk food consumers for the influence of promotional activities in fast food restaurants. Consumers think and appreciate that promotional activities affect their dining out decision in junk food restaurants, it also impact their occurrence of eating out in junk food and they feel that promotional activities should be provided by fast food restaurants.

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