Factors Affecting Consumer Behaviour in Hospitality Industry

This report discusses the factors that affect consumer behaviour in the hospitality industry, including culture, social factors, personal factors, and psychological factors. It also explores the emerging trends in customer behaviour influenced by digital technology. The report further examines the consumer decision-making process and the different levels of decision-making. Finally, it discusses the views of hospitality consumers and the value of mapping a path for purchase based on the decision-making process.

Hospitality Consumer
Behaviour Insight

Table of Contents
INTRODUCTION ..........................................................................................................................4
TASK 1 ...........................................................................................................................................4
P1 Various factors affecting consumer behaviour in hospitality industry..................................4
P2 Emerging trends which influence customers behaviour........................................................5
TASK 2 ...........................................................................................................................................6
P3 Process and Levels of user in decision-making while availing hospitality goods or services
.....................................................................................................................................................6
P4 Views of hospitality consumers and value of mapping a path for purchase in accordance
with decision-making process.....................................................................................................8
TASK 3............................................................................................................................................9
P5 Different stage of decision making process...........................................................................9
P6 Various methods of market research in B2B and B2C style of business.............................10
TASK 4 .........................................................................................................................................11
P7 Marketers influence on different stages of decision-making process in hospitality field....11
CONCLUSION .............................................................................................................................12
REFERENCES .............................................................................................................................13

INTRODUCTION
Hospitality industry is a broad field, main focus is on providing leisure services rather
than basic needs. Hospitality industry works in various sectors like food&drinks, hotels&resorts,
travel&tourism, event planning and many other. Hospitality can also be defined as vast category
in service field providing luxury services to range of consumers. For this report, GLH Hotels id
chosen, it is a British based hotel company. GLH Hotel was founded in 2013 and it is a
subsidiary of Malaysian Hong Leong Group. This hotel is headquartered in London and serves
only in UK as it is a subsidiary(Sasmita and Mohd Suki, 2015). For organisation to survive in
hospitality world its required for them to serve best quality goods or services to guests, to be best
amongst others. Quality is must and an important aspect in service industry. Therefore, this
report coves range of levels, processes and models to learn about consumers and their decision
making ideas. Different factors influence the purchasing decision of individual a very broad
discussion is done to gain knowledge about consumer behaviour. Also, few approaches of
business are considered and seen how people behave in different conditions.
TASK 1
P1 Various factors affecting consumer behaviour in hospitality industry
Consumer Behaviour is a phenomena used to study individual or group of people about
how they make purchases or select products to fulfil their leisure desires. Consumer behaviour is
defined as decision process of people while they are buying any goods or services for need
satisfaction.
Factors that influence consumer behaviour
Culture element is most important while understanding consumer behaviour, it is one of
the most basic area which influence consumers needs and their decision-making criteria. It is
related to the value, perception, wants, likes or dislikes and region of a person. Every culture has
a sub-culture which involves religion, region, nationality etc. which gives them identities and
identical means to socialize(Sigala, 2018).
Social factors refer to social groups, status, family and other elements which affects
behaviour of people. This is sub-divided into:

 Reference groups- This factor has a strong potential effect on decisions taken by
individual or a group. This group usually has an leader who listen to opinion of people
and take any purchasing decision.
 Family- Individuals just not take their decision on basis of their needs or motivation,
family background also influence it. All values and principle they get from their family
members and their parents will have huge impact on their selection of any products or
services(Mohammed, Guillet and Law, 2015).
Personal factor includes age, occupation, lifestyle and financial conditions of consumers,
these are also very influential in nature. These are also divided into parts such as: Age and life cycle- Its an essential factors, consumers desires will be according to their
age and life cycle they are running in.
 Occupation- A persons occupation and their financial conditions will also have huge
effect on choices and purchasing decision. They won't and can't buy those products or
services which they can not afford at present.
Psychological factor include different aspects and which are as follows. Motivation- This is one element which rise and direct consumers toward their specific
goals which ultimately satisfy their needs.
 Perception- It is sensing the world and making decisions accordingly. This factor is one
which differentiate decision making ability of every individual.
Challenges faced by GLH Hotel to provide quality services in order to fulfil expectations of
guests
As GLH Hotel is dealing in hospitality field its essential for them to provide best quality
services to guests but they also face some issues in doing so:
 Knowing the needs of customers is foremost which is a very basic problem faced by all
organisation and so is with GLH Hotel they also having great difficulties in knowing
needs of their guests and what exactly they expect from them(Samoggia and Riedel,
2018).
P2 Emerging trends which influence customers behaviour
Many new trend are coming in with changing business environment and working styles
of different organisations. One of these new trend is brought in by digital technology, use of new
technologies is increasing day by day in lives of everyone. Nowadays people are becoming

techno-friendly, they get everything on their smartphones or laptops like any kind of information
about anything. This aspect is playing huge role in hospitality industry too customers needs and
demand are changing with introduction of technology in world. They want everything on their
door steps which invented door to door food delivery services by restaurants and food joints.
Some of these factors of digital technology which impacted consumer behaviour are explained
below:
Brings ease and comfort: Digital technology brought ease and comfort to customer.
People nowadays are becoming very busy in their daily life and at some point they need some
comfort. For this companies have introduces online applications through which people can order
food and it will be delivered to their door step, they do not have to go through any hustle. This
way time of consumers is saved plus it bring more business to hotels, restaurants or food joint
owners(Gibson and O’Rawe, 2018). This way its a win win situations for both the parties,
consumers get what they desired to in no time just had to pay for the service provided by
company, which is helpful for them as they are diversifying and rising their business.
Helps individuals in evaluation and comparison: With use digital technology almost
all organisations or in case of hospitality field hotel and resorts have their presence on internet.
Every hospitality service provider be it hotels, resorts, restaurants or travel or event company,
have their official websites. These websites have whole information related to the company
present on it, through this people with some clicks can collect data which is required by them to
compare amongst similar service providers and chose best suited option according to their wants
and who they think can give them utmost satisfaction. This way its also beneficial for companies
as its another mean of increasing business and profitability(Gbadamosi, 2017).
In conclusion, digital technologies are beneficial for both the business entities and public.
TASK 2
P3 Process and Levels of user in decision-making while availing hospitality goods or services
Consumer decision-making process
It is a process by which guests of GLH Hotel identify their desires and make most
appropriate choice about the products or services available before them which will give them
maximum satisfaction. It involves five stages which are as follows:

Need recognition- This is basic step in any purchase decision consumer first identify their
needs, what exactly they want and in what way that product or service will be satisfactory to
them.
Information research- After knowing what is required by customer, now they will start
their research in relation with their need. Here, individual will start looking for several option
available in market in accordance with their desires. They will use some personal and
commercial sources to gather more relevant data which can satisfy their wants.
Evaluation of alternatives- The third stage is about evaluation and comparison of various
alternatives present, they will consider all advantages and disadvantages attach with different
products or services and develop an ideas about the brand(Varkaris and Neuhofer, 2017).
Purchase decision- Most important stage is this one where buyer make their purchasing
decision after analysing, evaluating several services and brand. They finally make purchase by
exchanging in favour of service or good.
Post-purchase decision- Most organisation skip this stage but it has huge impact on their
future. As by this step they get to know about future decision of guests in relation to services or
products they bought and if they are satisfied or not.
Levels of consumer decision-making
There are just three levels which are explained below:
Extensive problem-solving- This level buyer is highly involved in products or services
they require and conduct critical evaluation of it.
Limited problem-solving- On this level, consumer is only concerned with satisfying their
need so they just perform basic research from selected brands or company.
Routine response behaviour- At this level customers are very less involved in products or
services and chose any goods that will fulfil their needs.
After studying consumer decision making process and their levels it will be easy for GLH Hotel
to understand different criteria of various individuals about how they buy goods or services and
what factors influence their behaviour(Taheri and et. al., 2017). Through this they can attract
more and more guests attention towards them by giving what they actually expect.

P4 Views of hospitality consumers and value of mapping a path for purchase in accordance with
decision-making process
Consumers holds different views while purchasing any product or services which will
impact their purchase and these views are elaborated in next section briefly.
Economic view- This model has taken assumption that buyers has a very rational
behaviour and do not take any decisions in hurry or impulsively. Consumer compares, evaluates
and then make any decisions, it can either to buy a good or service or to search more for better
satisfying goods.
Passive view- In this model assumption is that the person who wants to buy any good or
service is not very rational. This is exact opposite of the above economic view, individual will
not make any efforts in researching rather then look at promotional and sales advertisement
strategy used by company. They make purchase according to attractiveness of the promotional
events entities takes(Jauhari, 2017).
Cognitive view- Best view amongst the four model as it refers to those situation where
customer makes their decision according to their interest and understanding of product or
service. They do not buy things in accordance with their rational behaviour or promotional
activities used by company, they judgement on the basis of their knowledge.
Emotional view- It states that the buyers make purchasing decision emotionally and
impulsively buy services when they gets connected to it. They judge according to their emotions
rather then any other criteria.
After, effective analysis of processes, levels and views which are influencing decision-
making and behaviour of consumers now its important for marketers of GLH Hotel to map a
path. According, to these three tools it will become easy for marketers to make analysis of
consumer behaviour and map a path of towards GLH Hotel in order to fulfil needs or desires or
guests and to be productive plus profitable. In today's conditions of market it is becoming very
obvious that rising competition will lead to influence behaviour of individuals and ways in which
they make buying decision(Gibson and Parkman, 2018). So, it is necessary for marketers of GLH
Hotel to be very evaluative while researching about behaviour of buyers and make plans in
relation to that. This way GLH Hotel will be able to gain attention of more people, satisfying
needs of more number of guests. The more number of satisfied guests, the better customer base
bringing consumer loyalty in company and it operations.

TASK 3
P5 Different stage of decision making process
There are two approaches to business one is Business to Business (B2B) and another is
Business to Consumer (B2C).
Business to Business (B2B) is style of business or business transactions taking place between
two businesses. It means that one entity is buying any goods which is needed by them to
complete their operations and business objectives or serve further to end users of that goods or
service. GLH Hotel is using this style of business to buy raw material and converting them into
finished goods to serve its guests. For example raw material of kitchen for preparing food for
their customers.
Business to Customer (B2C) is that business that approach of doing business in which entity
directly sell products or services to the end user or to ultimate consumer. This types of
businesses make direct relations and contact with buyers providing them their required level of
satisfaction. GLH Hotel is offering several services to its guests in order to satisfy them and to
stand beyond or at least on their expectations(Altinay and Taheri, 2019). They are in direct
contact with their guests providing everything they can to maximize their experience with
staying in GLH Hotel. Staff of hotel is just one call away from customers giving them everything
they need.
Difference between B2B and B2C
Basis B2B B2C
Decision-making In B2B style decisions are
made for companies,
organisations or enterprises
which serves further to other
customers.
In B2C approach buying
decision is made by persons
themselves and their decision
are not influenced by others.
Size Purchase size is huge as
companies buy in bulk.
Size of purchase id small in
comparison to B2B as buyer is
an individual.
Decision period Most of the times
organisations take lot of time
Purchasing decision period is
often very small and taken

in making purchase decision. very promptly by buyer.
Users intent Here buyers are interested in
business entity who has good
brand value, as to increase
their productivity and
earnings(Mariani and et. al.,
2018).
Purchaser are looking for
personal satisfaction of their
needs without making any
compromises in quality of
services availed.
Prices Pricing strategies for this type
of business if highly variable.
Price structure are made
according to buying company.
Prices are fixed in this type of
transaction. As sale is being
made to end users prices are
made fixed inclusive of all the
related costs and taxes.
P6 Various methods of market research in B2B and B2C style of business
Research methods are different for every style of business and in next section those
methods are highlighted in context of GLH Hotel. Marketers can collect data from range of
sources about the market in which GLH Hotel is running its operations.
Research approaches in B2B
These sources are broadly categorised as Primary and Secondary sources and for B2B
style secondary sources are used. Some of these methods for B2B are mentioned: Search for company- The buyer can search for entity, its working patterns and how it
operates on the official website of that organisation with the help of digital technology.
Marketers can also read corporate blog and go through social media accounts of that
company. Third party review- Companies can also go through the reviews posted by third party
about the other entity. Like any private agency making comments on the company on
radios or on any online portal(O'Rawe and Gibson, 2017).
 Financial accounts- Marketers or researcher of GLH Hotels can go through and do some
analysis of company's financial statements available in market. This way can be useful to
understand position of entity and to see if they are suffering from any inefficiency or loss.

Research approaches for B2C
Primary sources are used by marketer for researching and gathering information about the
customers and their thinking about GLH Hotel. These methods are as follows: By feedbacks- GLH Hotel can ask for feedback from its existing guests or from their
regular customer through emails. In that email they can make a humble request to fill the
attached feedback form and send it back to company's official mail. By interviewing- Marketers can make small teams of professionals and send them to
different locations for interviewing general public by asking question related to GLH
Hotel and their experience if they have visited to hotel for any purpose.
 Survey- Researchers can conduct surveys from anonymous people about the hotel,
services they provide and about how satisfied and happy they are with the company. This
type of data will be more credible and trustworthy as no factor of bias behaviour is
involved in it(Bruwer, Chrysochou and Lesschaeve, 2017).
From using the above means marketers can collect enough data for making any purchase
decision if dealing in B2B style. Also, can gain idea about the guests, their thinking about GLH
Hotel and how individuals behave while buying any Goods or services.
TASK 4
P7 Marketers influence on different stages of decision-making process in hospitality field
Marketer is a professional who are entitled to conduct research of market for
organisation they are working for. Their research is based on some basic requirements of
company which is needed for making effective plans for smooth running of business operations.
Duties of researcher involves various tasks, foremost in them is to identify needs, desires and
wants of public and to put effective marketing plans in place on companies behalf.
There are many activities performed by marketer which can impact on consumers behaviour: Economic Conditions- Spending power of buyers are mostly influenced by economic
conditions of the market. It has two aspect positive economic conditions in which
customers are confident and willing to spend on services provided by businesses. On the
other hand, negative economic conditions also exist in which economy is in downfall,
people buy only those goods which are required to fulfil their basic needs, they do no
think about availing any luxury products or services until its really very essential.

 Personal preferences- Choices of individuals are also affected by their personal
preferences. Consumers behaviour is mostly dependent on factors like the most and what
is preferred by them like their values, morals, likes and dislikes etc. therefore, to
influence customers companies has to provide products or services which match
preferences of people(Hellwig, Belk and Morhart, 2017).
Marketers of GLH Hotel should keep these small points in their minds while researching market
and giving suggestion to company for development of services. GLH Hotel has to be very careful
and attentive towards research results acquired by their marketers for achieving expectations of
guests and to provide best quality services in order to satisfy their customers desires.
CONCLUSION
Report above is summarising, that consumers behaviour plays a vital role in making
purchase decision. Consumer behaviour is the way buyers make their choices and select services
according to their needs. Behaviour of customers can be studied by using various process, model
and views which can help marketer to make their research effective and provide good results to
organisation. Companies then make use of outcomes of research to develop services as this
report is about hospitality industry. Marketers can influence decisions of public using different
methods of promotions and advertisement. Their are many style of business through which
entities can do business, highlighted above are B2B and B2C styles. Market research approaches
are also used to analysis market before making any decision of purchase.

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