Impact of Customer Satisfaction with In-flight Catering to Airline Reputation and Profit - Research Proposal Example

Impact Satisfaction with In-flight Catering to Airline Reputation and Profit Introduction In-flight catering is one of the major services that have been associated with flights for a long time. This and other on-board services have been provided to long distance flight customers since the beginning of air passenger flights decades ago (Ostrowski, 1993). In recent years, in-flight catering has come under increasing scrutiny by customers and the media with perceptions about meal quality being given greater attention (Chayphan, 2008). As acknowledged by Caruana (2002), customer satisfaction with airline service depends on their total travel experience of which on-board service plays a significant role. Customers generally expect, and in some cases demand better in-flight meal quality to feel that they are getting value for their money particularly with the recent air ticket price increases over the last few years (Saha and Theingi, 2009). In most airline markets, different types of services are operated to cater for different kinds of customers. The services are largely differentiated in terms of cost and distance of flight (Tiernan et al., 2008). According to King (2001), budget airlines and low-cost carriers offer limited on-board catering reminiscent of the flight costs of the airlines; customer expectations about catering service quality are therefore lower than in long-haul flights. Long distance flights continue to offer significant on-board services including catering (Sultan and Simpson, 2000), these are open to customer scrutiny with regard to quality and in-flight catering is one of the services that has clearly affected airline ratings over the years (Charoensettasilp and Wu, 2013). Customer satisfaction is well recognized as one of the factors that affect airline ratings, competitiveness, and profits; therefore unsatisfactory in-flight catering services may significantly affect airline reputation among customers and affect profits. In all airline markets, it is recognized that onboard food and drink rates lower in customer concern rankings than most other significant factors like ticket prices and time (Richard and Zhang, 2012). However, customers have sometimes characterized airline food as being uninspiring and tasteless. With current competition levels it is evident that customers are increasingly taking notice of airline catering when choosing flights; this may have a bearing on airline reputation and profits over time. Literature Review In all businesses, customer satisfaction is central to business success and profitability of the business. The service industry is significantly more sensitive to customer satisfaction as it is characterized with more rapid changes in customer attitudes and perceptions about services (Schiffman and Kanuk, 2007). In the air transport industry, like in most service industries, company reputation is affected significantly by customer satisfaction (Fitzgibbon and White, 2005). Airlines are generally evaluated by the quality of their services and customers now go for the airlines that they think offer greater quality for the least cost (Lee and Cunningham, 1996). Customer satisfaction influences aspects such as customer loyalty and airline reputation, these are key towards profitability and every airline in the highly competitive contemporary airline market strives to achieve them (Babbar and Koufteros, 2008). Over many years, customer attitude about in-flight meals and drinks has been significantly poor with most customers being generally resigned to the fact that airline food is of low quality. However, recent trends indicate that the stiff competition in the long haul airline markets all over the world has resulted to substantial improvements in in-flight services (Lee and Cunningham, 1996). Product and service differentiation alone has not been able to guarantee airlines success and profitability; many airlines now base their business strategy on improving service quality of a range of services including in-flight catering (Lee and Cunningham, 1996). This move is aimed at improving reputation and enhancing profitability. Airline in-flight catering has a long history and is based on the need to satisfy the basic human need of food and drink. In the industry, the principle service/product is to move people and goods to their destinations. This implies that the most important success factors include availability of the services, reliability, safety, comfort and punctuality (Lorenzini and Lewis, 2004). Although in-flight catering is not one of the original services by airlines, the necessity to provide food and drinks to customers on long haul flights made it an important aspect of the whole flight package (Johnson and Gustafsson, 2000). Since its introduction, on board food service has become a tradition of the airline industry. While short haul domestic flights mostly serve snacks to their customers, long haul international flights need to provide solid meals to their passengers which correspond to the major meal times including breakfast, lunch and dinner; this may be complex depending on time zones and cultural backgrounds of the customers but the airlines have to try and satisfy the needs of majority of the customers (Lorenzoni and Lewis, 2004). Due to increasing competition in the airline industry over the years, in-flight catering services and other services have been increasingly been incorporated as part of airline relationship marketing strategies to improve customer rating and company reputation (Schiffman and Kanuk, 2007). Airlines regularly carry out surveys to gauge customer attitudes and satisfaction levels so as to come up with innovative solutions to their customers’ catering needs (Lorenzoni and Lewis, 2004). This is in recognition of the importance of airline reputation to profitability and growth. As a result many innovative ideas with regard to airline catering have come up over the years leading to impressive quality of services in many airlines. According to (Chayphan, 2008), in-flight catering is significantly enhanced now to incorporate other aspects different from food and drink. Most airlines now have catering services that include delivery of commissary items, gifts, and toiletry. Various different new trends are now evident in airline catering services; all of them are informed by the need to provide customer with greater quality for their money at affordable costs so as to satisfy their needs. Customer satisfaction and better attitude of the in-flight catering service is supposed to enhance airline reputation and thus contribute to the bottom line by increasing ticket sales (Chayphan, 2008). One of the most evident trends is that fierce competition has led to cuts in the catering budgets of most airlines while in most of them the service has altogether been outsourced to catering companies (Charoensettasilp and Wu, 2013). New global food trends also play a role in in-flight catering, pre-packaged food is increasingly being used in in-flight catering and most customers seem to have embraced it due to its convenience (Schiffman and Kanuk, 2007). In the case of snacks and drinks, bought-in branded items are used therefore reducing the need for the flight kitchens to do anything other than distribute them to customers. However, the diminishing importance of hot meal services and value added food is also having significant negative influence on airline reputation as customers have poor attitude about consumer-pack foods (Schiffman and Kanuk, 2007). Statement of Research Objectives This research is grounded on the assumption, borne out of review of literature, that airline catering is one of the significant factors that influence airline reputation and profitability. Being an established fact that businesses exist to make profit and create value for investors, it follows that all airline companies aim towards growth and profitability. The current high competition levels in the airline industry there call for good strategies that can give airlines an edge in the market. Customer satisfaction through better quality of catering services is one of them. The main objective of this study therefore is to establish the impact of customer satisfaction with airline catering services to their attitude on airlines and how it shapes reputation. Reputation is associated with airline profits in this study. Data will be collected and systematically analyzed to answer the following research questions; 1) What is the general attitude of customers towards airline catering services? 2) How have customer satisfaction levels with airline catering services affected their reputation over the last 15 years? 3) How have customer satisfaction levels with airline catering services affected their reputation over the last 15 years? 4) What strategies are being employed by airlines to improve customer satisfaction with their airline catering services? Hypotheses On the basis of the research questions this study aims to answer, two hypotheses have been developed which should be tested on the basis of the findings of the research questions: H0: Customer satisfaction with airline catering services influences company reputation and profits. H1: Customer satisfaction with airline catering services does not influence company reputation and profits. Research Methods Research Philosophy This study will assume a positivist approach. This approach is based on knowledge development through positive gathering of observable information to verify experience (Cohen and Crabtree, 2006). According to Cohen and Crabtree (2006), “scientific methods of experimental testing are the best way of achieving this knowledge.” The positivist approach works under a number of presuppositions; that there is an objective reality that people can easily know, and that this objective reality can be explained with the application of symbols. This study will apply scientific statistical methods of gathering and analyzing data to reach the reality about customer perception on airline catering services and how the perceptions affect airline reputation and profits. Methods of Data Collection and Analysis The positivist approach preferred for this study is grounded in the belief that there is an existent objective truth that can be found through scientific research. This approach significantly relies on experimental and manipulative methods (Cohen and Crabtree, 2006). The approach generally tries to emphasize objective reality and avoid any kind of subjective bias on the part of the researcher. It largely involves generation of hypothesis and testing them. This study has generated a null and alternative hypothesis, together with a number of research questions which will be answered in an objective way through systematic collection and analysis of valid and reliable data. The main strategy that will be used in this study will be a survey involving respondents working in the airline industry. Research Population and Sample The population for this study includes all the participants in the airline industry, this includes employees and managers in the air travel industry and customers who utilize airline services. This population is targeted because it is the most relevant population to give valid responses on the topic being researched. The study targets a sample of 60 respondents. According to Saunders et al. (2007), in a survey a sample of 30 individuals is sufficient to produce statistically significant or reliable findings. The sample of 60 respondents will therefore provide sufficient responses to make valid and reliable conclusions based on the findings. This sample will be broken down in the following order: Airline employees working in catering departments: 30 (10 employees from one company for 3 companies. Managers in airline catering departments: 3 (1 manager per airline company) Airline customers/ travellers: 27 respondents. Data Collection This study will employ three methods for data collection: Open and closed ended questionnaires: a total of 57 open and closed ended questionnaires will be administered randomly to airline travellers and airline catering staff. Semi-Structured interviews: This will be carried out with the three sampled managers working in the catering departments of the airlines included in the study. According to Saunders et al. (2007), “qualitative interviews are effective research instruments for obtaining insights into how respondents experience, feel, and interpret the phenomena under investigation.” Document analysis: a document provides information about the issue under investigation but is independent of the influence of the researcher. Documents obtained from the airline industry in general as well as from the three airline companies that will be involved in this study will be analyzed for information about trends in catering services. Data Analysis Data will be analyzed both qualitative and quantitatively to create wider knowledge and information from it. Qualitative methods will include description, explanation and drawing of inferences from the data obtained through open-ended questionnaires and document analysis. Data obtained through closed-ended questionnaires will be analyzed statistically with the help of SPSS and Microsoft excel. Time Table Activity Date Time Cost Literature review and preparation of research tools and instruments, including obtaining of necessary research authorization documents Contacting of target respondents (Airline companies and the appropriate managers) with request for research permission and booking of interviews Collection of secondary data: Information from company websites and the company databases with help from company staff (If possible) Collection of primary data: Interviews with managers; administration of questionnaires to staff; administration of questionnaires to customers Data organization and analysis of findings Report writing Practical Considerations Practical Issues This study will be affected by a number of practical issues that may impact its conduct and outcome. Firstly, the researcher needs to obtain necessary consents to participate in the study from three airline companies. This consent will include issues such as the willingness of the companies to share data or to allow their staff to participate in the interviews and surveys. This may take time and may have its challenges depending on the company policies. Secondly, the researcher will have to identify respondents from the company who will be willing to participate in the survey and collect their e-mails for purposes of mailing the questionnaires to them. Some respondents may not be comfortable with that particular method of questionnaire administration and therefore appointments will be sought for physical administration of the questionnaires. Alternatively, new respondents may be sought to replace those that opt out of online questionnaires. Ethical Issues The main ethical issues that will be considered in this study will include use and divulgence of information, and respondent identity. As per research ethics practice, the identities of all respondents will not be sought beyond the verification that they are the right respondents. Any personal information divulged by respondents by error will be omitted from the analysis and report. With respect to the disclosure of the identity of airlines involved in the study, their consent will be sought. Only company identity will be revealed with permission, any other company information will be presented anonymously. The report emanating from this study will be presented as the academic work of the researcher and any use of it will be permitted through the necessary lawful process. References Abdullah, M., Al-Nasser, A.D., and Husain, N. 2000. Evaluating functional relationship between image, customer satisfaction and customer loyalty using general maximum entropy. Total Quality Management, 11(6), pp.826–829. Babbar, S. and Koufteros, X. 2008. 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