Consumer Psychology and Research in Hospitality Sector: Restaurants and Bars

This report discusses the external factors affecting the leisure sector, challenges faced by the industry, and background of restaurant and bars businesses. It also explores AIO analysis for The Botanist Broadgate Circle London and the impact of pandemic on the industry.

MODULE Consumer Psychology and
Research TOPIC Hospitality Sector
RESTAURANTS AND BARS

Table of Contents
Executive Summary ........................................................................................................................1
Introduction and overview...............................................................................................................2
External analysis of the environment in which leisure sector operates..................................2
Challenges faced by leisure industry......................................................................................2
Background of restaurant and bars businesses.......................................................................3
MAIN BODY...................................................................................................................................3
Part 1.......................................................................................................................................3
Part 2.......................................................................................................................................5
CONCLUSION................................................................................................................................6
REFERENCES ...............................................................................................................................8

Executive Summary
Customer research is an important perspective making an organization deal with needs of
customer and create structure for satisfying it. The competence make organization develop
products more effectively. Through this services within an organization become strong in terms
of marketing opportunities related to growth. PESTLE analysis made organization face external
factors making organization attain impact upon functions related to organization. In this various
kinds of factors like politics, economic, social, technological, legal and environmental are
covered. Aloes AIO analysis has been done in relation to various situations of market making
organization develop with long terms approach. In this file issues faced by an organization at the
time of CIOVID is explained.
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Introduction and overview
External analysis of the environment in which leisure sector operates
Political: The leisure sector is influenced by the government taxation policies on such businesses
as well as trade and tariff barriers regarding the raw material. In current scenario, the leisure
sector was greatly affected by government restrictions which were imposed upon businesses due
to pandemic.
Economical: The employment rate and inflation rates are some important economical factors
which affect the leisure sector. Demand and supply models as well as prices offered by
competitors is another major factor influencing the sector (George, 2021).
Social: The demographic trends and preferences of consumers keeps changing in restaurant and
bar industry which comprises of one of the major leisure sector. The growing pubs and bars are
providing wide alternatives to customers due to which their preferences are shifting.
Technological: These factors are affecting the restaurant and bar sector of leisure industry as the
businesses have to remain aware of any technical changes so that their performances are
improved in maintaining management of the operations.
Legal: The legal factors are influencing the leisure industry as businesses have to comply with
standards of food and beverage industry as well as ethical standards related to provision of
liquor. Bars have to maintain strict compliance while serving alcohol to underage individuals.
Environmental factors: the production processes involved in production of food and liquor is
consuming high levels of energy resulting in carbon emissions (BURKE, ROBINSON and Choi,
2020). In addition to this, leisure industries are promoting huge waste and is causing depletion of
water resources as well.
Challenges faced by leisure industry
After analysing the pestle factors, there are majorly three challenges which are identified
in context to the leisure sector as explained below:
Heavy competition: The level of competition is rising beyond the measure in leisure sector and it
is significantly growing in restaurant and bars. Restaurants along with bars have became a
primary go to place for individuals to catch up and also they are emerging as great place for
various informal business meetings. Thus businesses operating restaurants and bars are facing
tough rivalry in the market.
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Environmental issues: The leisure sector dealing in food and liquor is responsible for emitting
high levels of carbon emissions and thus is majorly contributing towards climate change.
Heavy losses due to pandemic: The pandemic has resulted collapse and downfall of various
restaurants and bars businesses due to bringing their commercial operations to a halt (Panzone,
Larcom and She, 2021).
Background of restaurant and bars businesses
One of the most prominent industry in leisure sector comprises of businesses dealing in
restaurants and bars. The food and liquor businesses are emerging at peak in United kingdom as
there are wide range of restaurants and bars located in every area or street. For the current report,
the chosen organisation in leisure sector is The Botanist Broadgate Circle London, which is a
restaurant cum night bar offering leisure dining and bar services to consumers. The businesses in
provision of food and liquor services is a prominent and highly demanded sector in UK
economy.
MAIN BODY
Part 1
In context to restaurants and bars, the leisure sector is considered to be an effective and
emerging sector which helps in providing opportunities at both the global and local level. In
relation to the Botanist Broadgate london, the consumers of the UK organisation are likely to use
the leisure sector and in order to have a brief knowledge and discussion, it is very important for
the organisation to use frameworks for the purpose to analyse the target customers that comprises
of motivation(Maglio, S.J., 2020).
AIO Analysis : It is basically a framework which is used by the marketer researchers for
the purpose to construct the individual's psycho graphic profile in their research. In addition to
that, when combined with the demographics data, the AIO framework helps in providing a lot of
insights to the companies in relation to the target consumers (Ozanne, J.L., Davis, B. and Ekpo,
A.E., 2022). This analysis is based over perspectives like activities, interests and opinion which
is related over person's characteristics used by market researchers for constructing profile with
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research. It has been used over developing better understanding about survey done in relation to
market. In context to Botanist Broadgate London, this framework helps in better understanding
of the market where the organisation operates its functions. In context to organisation, the AIO
framework facilitates better understanding of the needs, attitudes, perception and motives in
relation to the brand or product or a brand based on the opinions, activities and interests of the
opinions. In context to AIOs, the most common applications comprises of the advertising and
market segmentation that will help the organisation in targeting its customers in a better manner.
Activities
In context to organisation, the concept of activities basically focuses on the hobbies and
daily routine of an individual. For example, an individual who rides their bicycle to plays sports
and work on the weekends is likely to have different purchasing patterns than an employee who
is driving a car to work and watching a lot of movies. In relation to the activities, it comprises of
various activities such as vacations, social events, club memberships and also providing
marketers clues in relation to the activities of the consumers (Haugtvedt, C.P., Herr, P.M. and
Kardes, F.R. Eds., 2018).
Interests: In context to individual interests, it basically comprises of the ideals and concepts that
drive their passions. In context to organisations, a consumer may have a varied interests that
comprises of gardening, coin collecting, shipbuilding, fishing and much more. With the help of
identification of the targets consumer, it helps the organisation in better identification of the
things appealing to them.
Opinions: In context to organisations, the consumers and opinions are not different. In context to
marketers they are like to know the opinions in relation to the individual opinions, television
shows, public figures, actors and politicians. In context to marketing agencies, it is important to
have better understanding about the opinions of the consumers in relation to the stores, brands
and products. In context to AIO, the framework basically helps in creation of the psychogrpahic
profile of the consumer within the goal of targeting advertising to various types of the individuals
(Kardes, F.R. and Herr, P.M., 2019).
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Part 2
 Competitive rivalry: The leisure sector is an emerging industry and it is facing tough
competition as the market is full of potential rivals in this sector. In context to The
Botanist Broadgate, the restaurant and bar faces competition from night bars and upscale
restaurants of the London, majorly located in nearby situations. The tough competition in
the industry can compel the restaurant to reduce their prices or improve their quality in
order to increase competitive edge in the market. The growing level of competition
increases the threat of high availability of substitutes due to which it gives consumers a
wide range of alternatives (Du and et.al., 2021). Due to wide options available to
consumers, they are tend to switch preferences every now and then in order to explore
other bars and restaurants. To sustain in a industry where massive number of competitors
are operating, it becomes quite challenging for bars and restaurant to normally carry their
operations and earn huge amounts of profits without offering any specialised services.
 Climate change: The production processes and consuming patterns of the individuals are
giving rise to various environmental issues which are leading to climate change and
leading a crisis for the planet. Producing food, specially meat produce which is an
emerging trend among consumers of UK, is releasing heavy concentration of carbon
emissions and thus is promoting climate change to a massive extent. The production of
food items and liquor promotes burning of fossil fuels to a large extent and thus is using
high amounts of energy producing emissions. The processing of food release heavy
amounts of carbon emissions at every level from their farming to packaging and finally
cooking and serving processes (Thees, Zacher and Eckert, 2020). Moreover, this industry
is contributing heavily in wastage of food and water resources as people throw out
leftover food. The environmental issues arising by leisure sectors are also disproved and
discouraged by people as environmental communities highly oppose their contribution
and this is resulting in negative reviews by general public.
 The consequences of pandemic: The impacts of COVID-19 were major on hospitality
sector and leisure industry has suffered a great deal from the consequences of pandemic.
The major impacts of the pandemic has coerced many restaurants and pubs to close their
businesses permanently and this sector has drastically influenced by pandemic. In context
to Botanist Broadgate, the restaurant and bar had faced losses due to termination of
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commercial operations on temporary basis and it bought a great deal of disturbance in
overall management of the organisation. The impacts of covid-19 were major on the jobs
and employment of the personnel as it promoted high rates of employment turnover.
Employees were fired due to the inability of the organisation to provide them with
competent salaries while they were not serving the enterprise (Strauss, 2020). In post
pandemic period the organisation has to face challenges on hiring new workers and train
them which also increased opportunity costs of the restaurant. The pandemic has declined
the consumer confidence and footfall to a major extent.
Conclusion and Recommendations
In context to Botanist Broadgate London, there are various recommendations which
could be followed for the purpose to carry out effective strategies in carrying out various
decisions. In addition to that, it is recommended to the leaders and managers of the restaurant to
use the model of ELM. In context to ELM model, it is known as the elaboration likelihood model
(ELM) of persuasion to understand the changing attitude of the customers. In context to the
model, it was developed by Richard E Petty and John Cacioppo in 1980. In addition to that the
model basically aims at explanation of the various ways in order to process stimuli and outcomes
on attitude change (Cohen, J.B. and Wilkie, W.L., 2022).
In addition to that, it is also recommended to the leaders and managers for the purpose to provide
offers and discounts and overcoming the challenges.
CONCLUSION
From the above discussion, it can be concluded that customer and market research plays a
really significant role in having deep understanding about the various kind of aspects which
helps in improving the conditions of the organization. In addition to that, it helps in deeper
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understanding about the framework of AIO analysis that helps in understanding the various
perspectives of the market. In addition to that it helps in deep understanding of the External
environment of the organizations that helps in improving the influence of the external factors. In
addition to that it comprises of the various issues and challenges which are faced by the
restaurant with support of further recommendations. In addition to that, it helps in deeper
understanding of the attitudes and behaviour of the consumers.
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REFERENCES
Books and Journals
BURKE, K., ROBINSON, P. and Choi, M., 2020. Developing meta-strategies for hospitality
experiences. Managing Hospitality Experiences, p.141.
Cohen, J.B. and Wilkie, W.L., 2022. Consumer psychology: Evolving goals and research
orientations.
Du, J. and et.al., 2021. To be or not to be: Negotiating leisure constraints with technology and
data analytics amid the COVID-19 pandemic. Leisure Studies, 40(4), pp.561-574.George,
R., 2021. The Tourism and Hospitality Marketing Environment. In Marketing Tourism
and Hospitality (pp. 183-219). Palgrave Macmillan, Cham.
Haugtvedt, C.P., Herr, P.M. and Kardes, F.R. eds., 2018. Handbook of consumer psychology.
Routledge.
Kardes, F.R. and Herr, P.M., 2019. Experimental research methods in consumer psychology.
In Handbook of research methods in consumer psychology (pp. 3-16). Routledge.
Maglio, S.J., 2020. Psychological distance in consumer psychology: Consequences and
antecedents. Consumer Psychology Review, 3(1), pp.108-125.
Ozanne, J.L., Davis, B. and Ekpo, A.E., 2022. Research pathways for societal impact: A
typology of relational engagements for consumer psychology research. Journal of
Consumer Psychology, 32(1), pp.127-144.
Panzone, L.A., Larcom, S. and She, P.W., 2021. Estimating the impact of the first COVID-19
lockdown on UK food retailers and the restaurant sector. Global Food Security, 28,
p.100495.
Strauss, S., 2020. Some emerging hypotheses on the economic opportunities and challenges of
the post-pandemic world. Available at SSRN 3633391.
Thees, H., Zacher, D. and Eckert, C., 2020. Work, life and leisure in an urban ecosystem-co-
creating Munich as an Entrepreneurial Destination. Journal of Hospitality and Tourism
Management, 44, pp.171-183.
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