Antecedents and consequences of perceived customer value in the restaurant industry

Vincent M Thielemann,Robert James Harrington,Michael C Ottenbacher

doi:10.1108/ihr-06-2018-0002

Vincent M Thielemann, Robert James Harrington + Show 1 more

Open Access

https://doi.org/10.1108/ihr-06-2018-0002

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Abstract

PurposeThe purpose of this paper is to identify the antecedents of perceived customer value, such as the perceived quality and perceived sacrifices, and the effects on customer satisfaction and customer loyalty (CL) in the restaurant industry.Design/methodology/approachBased on an extensive literature review, a research model and questionnaire were designed. To assess the hypothesised relationships, data were collected in a field survey. Partial least squares regression (a variance-based regression analysis of SEM) was selected to analyse the relationships within the research model.FindingsThe findings of this study indicate that the perceived monetary sacrifice (PMS) and perceived service quality were found to be antecedents of perceived value (PV), whereas PMS was the major precursor of PV. Further, PV was found to have a substantial influence on customer satisfaction and CL.Originality/valueThe study provides a better understanding of the price–value–satisfaction–loyalty relationships in the restaurant context in a more holistic sense and recommendations to move this research stream forward.

Highlights

Most companies have relied on the supremacy of their products or services to distinguish themselves from competitors and determine prices based on their costs or based on the prices of their competition
Customer satisfaction had the strongest effect on customer loyalty (CL) and considering the indirect effects of perceived value (PV) on CL, it can be argued that the major influence of PV on CL is mediated through customer satisfaction
The literature revealed that PV is a subjective evaluation and a cognitive trade-off of what is customer value given and what is received

Summary

Introduction

Most companies have relied on the supremacy of their products or services to distinguish themselves from competitors and determine prices based on their costs or based on the prices of their competition. Many companies have been looking for new ways to distinguish themselves with more focus on customers rather than only their products, services or competition (Rao and Kartono, 2009). Of all the marketing decisions, the determination price is the major decision that directly affects revenue and yield. In customer-centric pricing (value-based pricing), the customers’ value perceptions are in the focus. The delivery of value has evolved to become the primary goal of businesses, rather than generating profit (Reichheld and Teal, 1996). The question is not whether but how companies compete in delivering value (Harrington et al, 2017)

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