iClean Final Research Report

Abilene Christian Unviersity

[Casey Duncum, Jodi Gaines, Lindsay Cranford, Makenzie Brown, Sarah Hamilton, Forrest Wilson]

Table of Contents Executive Summary 2 Introduction.. 3 Method 7 Results.11 Conclusions15 Appendix. 16

Executive Summary: Abilene Christian University provides a laundry cleaning service, iClean, to its students and faculty. iClean holds a partnership with Ingram Cleaners, a local laundry service, in which students and faculty can have laundry professionally cleaned, folded and delivered. The control of iClean has been handed to Luke Luttrell, who is looking to promote growth and revamp the service to be more useful for students. We focused on a discovery-oriented decision problem to find the reasons for the lack of awareness and knowledge of iClean across the ACU population.

Through our primary research, focus group, and deep analysis of our survey findings, the results show that the awareness within the market is near to none. Not only are the primary customers unaware of the service, they are unwilling to pay a practical amount for the service to make a profit. We approached the survey to find out if a potential customer knew of iCleans existence, then introduced the service and finally addre ssed what they would be willing to pay for a laundry service such as this. Out of the 180 participants, including students and faculty, 38% were very unfamiliar with the service and 33% were not willing to pay for it. Overall, the results came back with a negative outlook on what iClean has been for the past two years.

We recommend that this process be continued to find out how to implement an improved version of iClean if it is going to continue on the Abilene Christian University campus. The deterring factor is the price, and if the business will be able to continue to make a profit on campus that is worth the input. Our recommendation, according to the survey, is to end the service as it is done now. The service will not be worth the outcome that can come from the current iClean results. If including this service is still applicable and wants to improve in the future, we recommend stronger marketing toward the parents and iClean being offered as a concierge service to students living on campus.

Introduction: 3

Over the past two decades, America has become largely defined by consumerism. People are buying more food, clothes, and consequently, more detergent. At an earlier time, cleaning laundry meant washing the two dresses, stockings, and jeans owned by hand, then hanging it out to dry monthly. Now, people spend a day washing two weeks worth of clothes with six dresses, pants, stockings, and underwear in addition to options hanging in the closet. Young adults attending college are part of Americas larges t group of consumers, especially in the fashion and retail industry. Time spent changing majors, styles, and social groups is reflected in the clothes worn that, most of the time, will end up piled on a dorm room floor. Unfortunately, students dont spend nearly as much time worrying about washing their clothes as they spend living in them. All of a sudden, students find themselves with two tests, an essay, intramurals, and engagements with friends but no clean clothes to wear, nor the time to wash them. One might say students are on overload. Even in the office and workplace in this country, we are experiencing what we call the rise of the workaholic. With nearly three in five American women and men with four or more years of college education working 50 or more hours per week it is no doubt that people across the country are falling behind on chores and resorting to outsourcing their home cleaning and laundry services (Jacobs and Gerson 445). Today, 80% of attended coin laundry facilities offer wash/dry/fold services (Calma 10). After adding wash/dry/fold services to his self-service laundromat, Ralph Wagner saw a 25% increase in sales in only six months. Services in this industry should continue to see a steady incline as wash/dry/fold services will become a stronger revenue source for laundries [continuing] to build bigger, nicer, cleaner facilities (Calma 11). Industry: To adapt to this growing need, companies in the cleaning service industry have come to offer many types of cleaning services: residential, downsizing, estate, seasonal, carpet, and commercial (Morrow 23). These services have become extremely lucrative in the past decade, and cleaning companies are continuing to grow at a rate of 5% every two years (Barnes Reports: U.S. Carpet and Upholstery Cleaning Services Industry 201).

The cleaning industry itself provides three major benefits to investors, managers, and clients: easy to follow business models, steady cash flows, and a replenishable amount of capable employees. Business models in the cleaning industry are attractive because they can be managed out of the owners home and have start up costs around or below $3000. Furthermore, most people already have experience in the industry, despite any experience as a professional cleaner (Morrow 16). Commercial cleaning industries are the most secure industries to join and have a market more robust and recessionresistant than others. Paid with franchises like Maid2Clean that give franchisors proven training and branding comprehensive packages [that] provide ongoing, residual income, the cleaning industry is proving to be successful on a variety of platforms (Maid This Way 3). One platform that has seen incredible success by implementing cleaning services is the college campus. After discovering that students at The University of Miami (UM) were dissatisfied with dorm cleaning and laundry services, UM employed its Department of Industrial Engineering to conduct research that would aid in improving the schools services. In their research, they found that students were demanding service of the laundry room at a much higher rate than expected. They also found that poor communication between outsourced service providers, students, and residence life faculty was a detriment to the student dorm experience. By implementing new technology that alerts students about laundry and cleaning and promotes communication between students and residence life faculty, the UM returned a student satisfaction rate increase of 50% concerning the overall dorm experience (Iakovou and Ortiz 254). Other campuses that have amped up their services include private universities such as Baylor and TCU. Baylor offers its students laundry services that pick up, wash, dry, fold, and deliver their laundry directly to their dorm room. Even more surprising, TCU students have their dorm rooms dusted, vacuumed, and mopped biweekly as a part of their pre-paid dorm services. This allows for upkeep in the dorms and for students to remain focused on their studies without worrying about the hassle of a messy dormitory.

Not many college students are prepared for the responsibilities and choices they are expected to perform when entering college. Students quickly become tested by freedom, [introduced to] the temptations to not do anything at all or do everything at the last moment. Recognizing this, a student writes: This is where the burden of trials starts. It includes having to count your money and your first tiresome loads of laundry [Soon youre] in such a bad mood that you feel like running away and hiding somewhere (Emelianov 55). The blame for children being ignorant of how to perform basic chores is often defaulted to the parents for not providing appropriate training during the adolescent years (Dunlop, Rishma). Despite whoever is to blame, college campuses are recognizing a need and responding. It cannot be ignored that the amount of satisfaction students obtain from campus services is greatly related to the success and return rate of second year students (Astin 14). The Client: In order for ACUs service to remain competitive with other schools, it is important that we offer services that are reliable, priced appropriately, and make adjustment to college life easy for incoming students. ACU currently provides a wide range of services for its students including a First-Year Program, which offers students guidance through their first year of college, mail services, the Writing Center, the Speaking Center, Team 55, numerous academic services, and more. Yet, we would argue that a need still exists for a well-run laundry service for ACU students and faculty. Our team has compiled intimate research of laundry service and residential life industries that will provide our clients with the information necessary in determining the best solutions and practices to eliminate iCleans problems.

iClean is a laundry service for ACU students and faculty that began doing business in 2011. Through a partnership with Ingram Cleaners, customer laundry is transported to an Ingram location off campus, where it is professionally cleaned and folded. Customers can register for iClean online or through the campus store. Customers are provided with two purple iClean bags in which they can fill their dirty laundry. iClean picks up laundry twice a week from all iClean drop off stations and returns cleaned laundry on Mondays

or Thursdays. In addition to these services, iClean offers dry cleaning services for its customers.

These high quality services, accompanied with research conducted on cleaning industries and college student lifestyle/attitudes, would lead one to assume that business at iClean is booming. Unfortunately, the opposite is true. iClean currently serves less than thirty customers. In addition, feedback gleaned from a focus group conducted on campus showed that hardly any students were even aware of iCleans services. The majority of students who were aware of iClean had been informed during their Passport sessions on campus and were never followed up with or asked to sign up for iClean after Passport or upon moving into the dorms.

Our goal is to respond effectively to decision and research problems clearly indicated by low amount of subscribers to this service. We anticipate that these decision problems can be resolved and interpreted through descriptive and causal research.

iClean provides a solution for those without time for laundry by offering clean/dry/fold services to ACU students and faculty. Unfortunately, students and faculty registered for this service only total up to twelve. Fortunately, we believe this problem to be one associated with lack of knowledge rather than a disinterest in iCleans services. Our project is designed to investigate student and faculty awareness of iCleans services, find what can be improved and promoted to attract customers to iClean, and offer pricing solutions that will engage more customers. Before we dug too deep into our research process, we conducted a focus group for our secondary source of data. Instead of collecting observatory data, we concluded that a communication method would be more beneficial to our research. The focus group consisted of a group of participants that were asked a series of questions by Luke Luttrell, the manager of iClean. The sample of participants included eight freshman and two sophomores. This sample represented the on campus audience for ACU, which consists of about 2,000 students. Luke, who led the focus group, chose on campus participants because they are the preferred client. Eight open-ended questions were 7

asked, all of which were relevant to our research problems. Students did not respond to an actual survey but simply to the questions asked in the focus group, which took approximately one hour to conduct. The focus group was very helpful in providing information relevant to the research problems. The group, hesitant and reserved near the beginning, opened up after the first few questions were asked. Typically one person would respond to the question and the rest would agree/disagree with their response. It developed into an open conversation at times, and most everyone in the group would share their opinion. The relevant information to our research included feedback on several different areas. The first area was relevant to the awareness of iClean and what information the participants already knew. The next area the focus group touched on was helpful to our research problem questioning the structure behind pricing iCleans services. The preference of the customer is crucial when making pricing decisions. The last example of information we received relevant to our research was pertaining to implementation. We believe it is important to discover the students opinions on what the easiest method to use iCleans services would be. The conversation addressing this concern was detailed and offered ideas to consider such as implementing a new pricing structure and offering more convenient pick up/drop off locations. Overall the focus group was a success in helping supply us with information we can use for our research. Decision Problem: Disappointed by the apparent lack of student awareness that was determined by the focus group, we have focused our main concern on identifying why students arent utilizing iClean services. This is a discovery oriented decision problem that has arisen from a lack of knowledge of iCleans services by the majority of ACUs student body and faculty. Research Problems: In order to determine why students are not utilizing iCleans services we have formulated what we believe to be the main concerns for iClean. First and foremost, we believe investigating ACU students awareness of iCleans presence is paramount. By questioning students upfront about their knowledge of iClean, we will be able to 8

determine the root of iCleans main problem. Secondly, we want to discover the ease at which students/faculty can implement iClean. A main concern of iClean lies in the question of whether it is faster and more efficient for students to send their laundry out to be done or do it themselves. Experimental testing and questioning the students and faculty who are currently using iClean will help us address this concern and better understand the target markets attitude towards iClean. Another major concern for iClean is that students may be deterred from using the service solely based on the price. A survey conducted last semester discovered that the maximum price students and faculty would be willing to pay for a laundry service was $400 per semester, and the current price to utilize iClean is $360. The survey raised an important question: does the price have anything to do with why more ACU students are not members of iClean? The focus group taught us that many students would prefer an alternative payment method such as a pay per load or pay per week type service. Therefore, we wo uld like to implement new payment options for iClean because some students may benefit from a laundry service that offers occasional help for a smaller fee rather than a set price for a full semester. The next two Research Problems are also important but not our primary focus. We want to determine if the brand name iClean is confusing or too ambiguous. Luke has mentioned concerns about iCleans brand name not conveying the services that are provided by iClean through ACU. Other questions we would like to address include: are off campus students likely to utilize iClean? Because all laundry drop off locations are on campus, are off campus students who have access to personal washers and dryers interested in utilizing iClean? Is there a more convenient way to drop off and receive laundry?

Method: There are two sources of data that we used for our discovery-oriented research. Both of these sources were through communication methods. Our primary source was a survey, and secondary source was a focus group. In the survey we desired to reach a number of 250 students from our population of 4,600 students. Our TSE calculation (see appendix C) determined the need to distribute the survey over a population of 682 students. This means that in order to reach our desired sample size of 250 participants, we needed to distribute the survey to a much larger group of people in order to compensate for the non-response error, those never reached, and other sampling errors. In order to obtain the list of emails to send our survey we visited with the registrar administrators of ACU. They privileged us with our request of the full list of emails including all current staff and students. The survey was sent to a randomly generated sample of 700 emails from the list we received. Unfortunately the results boiled down to only 130 participants that completed the survey. This was far too short of what our goal was and considered to be too small to represent the entire population. The decision was made to send the survey out to the same sample a second time. There was only one difference between the first email sent to our sample and the second. The title of the email was changed to be more attractive in an attempt to encourage more respondents. The second attempt yielded more participants in the same sample to respond the second time around resulting in a total of 179 participants. The response rate was just over 25%. Indeed this was still a shortcoming of our initial goal of 250 participants, but our research team felt this was enough to apply our sample to the entire population and begin our analysis. Example questions from survey:

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The first example was our most relevant to the research problem concerning price of the service. The current price is $360 and we used this question to reveal what our customer is actually willing to pay.

The second example question was designed to aid our research problem concerning the pricing structure. iClean currently can only be purchased for a semesters time period, which we believed was a problem. We felt the need to validate our survey so our team decided to seek revision by Ryan Jessup, a man far beyond average in market research with high level of experience, and made the suggested changes from his helpful insight. Improvements to the accuracy of the data were among the several changes made. In addition we also spoke with Tim Graham, a research coordinator at Zachary Associates, and also selected friends to gain feedback on the quality of our survey and effectiveness of the layout. There were several shortcomings in our methods of obtaining data. One, which has already been expressed, the number of participants in the survey being lower than our initial goal of 250. The second, was a mistake made during the development of the survey. It would have been beneficial to our research to include a question asking if our participant had previously used iClean or were currently using iClean. Though it would have been beneficial to include this data our team still doubted its affect overall considering the low amount of customers to iClean.

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Results: Throughout this report, a significance level of .05 was used. To begin, we randomly selected a sample of 700 ACU email addresses. On two separate occasions, we emailed surveys to each email address in our sample in order to decrease the nonresponsive error. Of the 700 possible completions, we received 179 completed surveys, showing our TSE estimates were somewhat accurate (see Appendix C). Our general response rate was 25%. We expected more underclassmen and more females to respond to the survey. Out of our 179 respondents, 63.5% were female, and 36.4% were male. Of the 179 respondents, 52% were underclassmen, 31% were upperclassmen, 11% were faculty and staff, and .05% were classified as other. We expected a low number of respondents to be aware of iClean and its services. The results confirmed our assumption. Out of 179 respondents, .06% were Very Familiar with iClean, 29% were Somewhat Familiar, 17% were Somewhat Unfamiliar, and 47% were Not Familiar.

Classification
100 80 60 40 20 0

Classification

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Gender

Female Male

Data Analysis of Decision Problems Our clients particular interest was determining student and faculty/staff awareness of iClean. We expected a low number of respondents to be aware of iClean and its services. The results confirmed our assumption. Out of 179 respondents, .06% were Very Familiar with iClean, 29% were Somewhat Familiar, 17% were Somewhat Unfamiliar, and 47% were Not Familiar. We created a Pivot Table to compare awareness across the classification spectrum, and the lack of knowledge of iClean is evenly distributed.

Awareness

Underclassmen Upperclassmen Faculty/Staff Grand Total 24 6 18 4 52 8 2 8 1 19 69 29 49 9 156

Very Unfamiliar 37 Somewhat Unfamiliar Somewhat Familiar Very Familiar Grand Total 21 23 4 85

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Our first major finding read loud and clear. Our tests revealed that the majority of respondents were generally unaware of iClean. Before creating our Pivot Table, we ran a Chi Square Test of Independence to determine if the difference between classifications would affect the level of familiarity or awareness. (The p-value was 0.455 so we do not reject our null hypothesis that the ACU campus is generally unaware of iClean).

We next wanted to see if the pricing structure (a one time, per semester price) was deterring potential customers from using iClean. For this analysis, we ran a one sample t-test. We compared the average of responses to an average of 3 (the actual price per semester, $301-$400) and determined that the average was significantly lower, meaning respondents were unwilling to pay the going price per semester. To make the results even clearer, 77.2% of respondents said they were only willing to pay between $0-$100, which doesnt fall into a feasible or profitable range for iClean. (We determined a p-value of 1.22276658686047E-92). Next, we wanted to see if students and faculty would utilize iCleans services if they could pay per load and how much they would be willing to pay. Out of 179 respondents, 78.6% said that they would pay only $0-$10 per load and less than half of respondents said they would actually use iClean if they could pay per load. We ran a Chi Squared Test to see if there was a difference between classification and the price per load they would pay. Once again, the conclusion confirmed that the majority of respondents, despite classification, are only going to pay the minimum price, if at all.

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Column1 $0-$10 $11-$20 $21-$30

Underclassmen Upperclassmen Faculty/Staff Grand Total 66 16 3 43 10 1 18 1 127 27 4

$31-40 4 4 Would Pay Per Load Underclassmen Upperclassmen Faculty/Staff Grand Total Grand Total 85 53 17 155 FALSE 43 30 14 87 TRUE Grand Total 44 87 24 54 5 19 73 160

All other statistical tests run became irrelevant, since respondents showed there isnt a high enough demand for iClean at the price it would cost to run a profitable business.

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Conclusions and Recommendations:

Based on the results of our research, we have concluded that the market for iClean is small, if not obsolete. We believe these results to be indicative of the surveyed students budget and mindset. Some limitations of this survey may be that we did not focus on a forgotten market of iClean, parents of the students. Had we put more focus in determining the best price for iCleans services, we may have found that parents would be willing to pay for iClean where students see it as unnecessary.

Our suggestions for iClean are this: cut iClean or make it free. Though these both seem like drastic options, we believe that they are the best way for iClean to prove its worth for ACU and its community.

The results suggest that student inclination to pay or use iClean is obsolete because it is not worth any of the spending money that students have. The results indicate that 33% would not pay more than $100 per semester for iCleans services. Another area of interest from our findings reveals that location has little to do with potential customers acceptance of iClean. The price was already deterrent enough that location affected no decision on if a student would choose to use iClean. As mentioned earlier, by surveying the students of parents we may have discovered what ACU student parents are willing to pay for iClean. Parents of ACU students may have been more willing to pay for iClean services if they felt that iClean could benefit their childs productivity. We found that overwhelmingly, students are not willing to pay for a service that they can do themselves. We, however, do not believe that our research results reveal that iCleans services are irrelevant to ACU students. Potential follow up research should be conducted to discover what level of interest students have in using iClean as a concierge service of ACU, rather than a service to be paid for. It will be important to gauge the students mindset on if iClean is a good idea in general, regardless of cost. If the results of this survey are positive, ACU should consider offering iClean as an imbedded element of the ACU dorm life experience, similar to ACUs unveiling of the popular mobile initiative.

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Appendix A: Data Collection

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Appendix B: Cover Letter

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Appendix C: Technical Index TSE Calculation Chart SS: 250 BCI: 5% Ineligible: 1% Refusals: 40% Cant be contacted: 35% =250/(1-.05)(1-.01)(1..40)(1-.35) = 681.5 Codebook
Column(s) 1 2 Codebook for iClean Data Analysis Variable Name Description TIMESTAMP Time and date of response to survey WASHLOCAT Where does your laundry get washed? On Campus Residence (1-5, "Always"-"Never") WASHLOCAT Where does your laundry get washed? Off Campus Residence (1-5, "Always"-"Never") WASHLOCAT Where does your laundry get washed? Cleaners (1-5, "Always"-"Never") WASHLOCAT Where does your laundry get washed? Laundromat (1-5, "Always"-"Never") LOADSPMON How many loads are washed per month? 0 = 0-1 loads 1 = 2-4 loads 2 = 5-7 loads 3 = 8+ loads DRYCLEAN How many items are drycleaned per month? 0 = 0 items 1 = 1-4 items 2 = 5-10 items 3 = 11+ items FAMILIAR Familiarity with iClean 0 = Not Familiar 1 = Somewhat Unfamiliar 2 = Somewhat Familiar 3 = Very Familiar SERVICE iClean services provided 0 - Unsure 1 = Everyday Laundry 2 = Dry Cleaning 3 = Dorm Room Cleaning 4 = Electronic Services

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PRICE1

13 14

TRUST USE

5 = iPhone Repair Maximum per semester price 0 = $0-$100 1 = $101-$200 2 = $201-$300 3 = $301-$400 4 = $401-$500 Trust laundry service with clothes (0-4, "Strongly Agree"-"Strongly Disagree" Use iClean under pay-per-price 0 = True 1 = False Maximum price per load 0 = $0-$10 1 = $11-$20 2 = $21-$30 3 = $31-$40 4 = More than $40 Sex of respondents 0 = Male 1= Female Classificiation on Campus 0 = Underclassmen (Freshman & Sophomores) 1 = Upperclassmen (Juniors & Seniors) 2 = Faculty/Staff 3 = Graduate Student

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PRICE2

17

GENDER

18

CLASS

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Dunlop, Rishma. "Laundry."Canadian Woman Studies, 18.1 (1998): 56.

Emeianov, V.V. "How Students Feel About Adapting To Life In College." Russian Education & Society 45.1 (2003): 55. Academic Search Complete. Web. 30 Oct. 2013. Iakovou, Eleftherios T., and Olga L. Ortiz. "Reengineering Of The Laundry Service At A University Campus: A Continuous-Improvement QualityManagement Methodology." Quality Engineering 16.2 (2004): 245-255. Business Source Complete. Web. 30 Oct. 2013. Jacobs, Jerry A., and Kathleen Gerson. "Who Are The Overworked Americans?." Review Of Social Economy 56.4 (1998): 442-459. Business Source Complete. Web. 29 Oct. 2013. "Maid This Way." www.businessfranchise.com. Business Franchise Magazine, . Web. 06 Nov. 2013. Morrow, Beth. How to Open & Operate a Financially Successful Cleaning Service. Ocala, FL: Atlantic Pub. Group, 2008. Print.

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