Consumer Behavior Research Paper:

Impact of culture on consumer behavior

while choosing restaurants in Kathmandu.

Kathmandu University School of Managmeent
Bijaya Thapa
Prasun Shrestha
Saujanya Acharya
Smarika Khatri
Proposal Submission

Introduction
Whether in a family or in a friends circle there are numerous occasions to dine out. There
are times in the year where we go out to eat for a celebration. And there are many
instances when we go out to eat just for convenience. Whether it is for celebration or for
convenience, we make a choice when we go out to eat. People make the choice of
restaurant out of their likes and dislikes.

In the market today, in case of Kathmandu, there are various types of restaurants in every
part of the city. Restaurant industry is one of the most booming industries in Nepal. And
because of such abundance of restaurants in Kathmandu, people are having more choices
of restaurants to choose out from. Hence, it becomes more important that as a marketer,
we try to understand what are the underlying factors that influence their choice of the
restaurant. The significance cannot be stressed upon more, as the success of the
restaurants will solely depend upon how much they match the requirements of peoples
choice.

Problem Statement
To what extent does cultural differences among the customers affect the consumer
behavior on selecting the restaurants for their place of dining.
Research Questions
- What is the major factor that influences the consumers attitude toward
restaurants?
- What are the factors that are affecting the culture?
- How does cultural variables intertwine with the factors affecting the consumers
attitude?
- What is the degree of correlation among the variables and the factors?
- How could the restaurants generate new services to better cater to the changing
target market?
Research Objective
- To identify what are the most important cultural factors that restaurants in
Kathmandu, Nepal should focus on.
- Identifying how the attitudes of consumers towards the restaurants are formed.
- To suggest the current market practitioners on service improvement to better cater
the target market.
- To create an awareness of importance of culture in restaurant industry in
Kathmandu for the future studies in the matter in more details.

Significance of the Study
Restaurant industry is one of the most thriving industries in Nepal, especially in
Kathmandu area. With the increasing per capital income in Nepal through inflow of
remittance and the cultural remittance of dining out culture, the demand for dining out is
increasing. Though the demand in the Nepali market has been increasing, greater increase
in the supply has been witnessed in the market as we can see a restaurants operating
under capacity even on the weekends. By studying the market in Kathmandu, we can
utilize the study in several other cities such as Pokhara where there is a similar
demographic as well as existence of the tourists.
The core service of restaurants is the same: providing hygienic dining service of a
good taste. However, restaurants that are popular in Kathmandu has been able to offer
more supplementary services on top of such core service. And the customers
appreciation of such service design has made them superior restaurants.
This study would be able to provide the market practitioners with the adequate
insights from the cases of the restaurants in Kathmandu in applying the concept of
cultural impact on the consumer behavior. We can see how the restaurants industry can
start considering for the cultural effect on consumers behavior to their advantage, and
provide the best service for their target customers in order to be the market leader.



Limitations
- The sample may not be representative of the population, as there are various
cultures within Nepal, and they may not be proportionately represented in our
survey.
- Since this will include a primary study, there is likely to be some level of response
bias in the study.
- It is difficult to truly understand the restaurant industry in Nepal, as there are no
set guidelines and regulations.
- There are numerous variables that need to be considered for when investigating
the effect of culture of consumer behavior, however we cannot investigate each
one of them.
- Cultural factors are difficult quantify in the most accurate manner, hence most of
the study will have to rely on the qualitative data.

Literature Review
Cultural Dimension
This study focuses on the influence of the culture on the consumer behavior.
Consumer behavior is affected by the attitude that a certain individuals or a group hold
toward certain products or services. This in turn is shaped by the perception, and how the
cultural factors filters out to form a unique perception. For example, when we show a
picture of a juicy steak to an American, such stimuli could create salivation where a
Nepali could be offended. Hence, the cultural filter is a significant aspect of consumer
behavior. In the empirical study conducted by Furrer, Shaw, Liu and Sudharshan (2000)
discusses the relationships between cultural dimensions and its interaction with each of
five dimensions of perception. Since the study is directed toward the analysis of
interaction between two factors culture and perception following framework is being
utilized.
Furthermore, from the cross-cultural study of Hofstede (1980), four national
culture dimensions have been established: power distance (PDI), individualism (IDV),
masculinity (MAS) and uncertainty avoidance (UAV). I would be important to categorize
the South Asian Finally, from the study conducted later, Hofstede (1991) suggests long-
term orientation (LTO) to be an integral dimension of a cultural impact on formation of a
consumers attitude.
Customization may be an important factor which may influence the consumer buying
decision. Customization (ordering system) was the main difference that Korean ESL
customers found difficult (Kim). Most of the Korean customers find customization to
become difficult for them. So restaurant owners should think about this aspect before
serving a Nepali customers as well because they may have different reaction to the
customization.
Some cultures also encourage or discourage different food according to the stages
in the life of the people. The consumption of different foods at different stages of life
may be actively encouraged or discouraged (Dindyal). The stages of life may be the age
for e.g. most of the hindus who are highly religious consumer too much meat when they
get old.
Power distance is also an important factor which might affect the consumer
buying behavior. Korean ESL customers find it different and even unpleasant that
American servers treat their customers as equals (Kim)Since Korean customers have a
high power distance so they feel awkward when waiters/front line employees treat their
customers in a friendly way.
Cultural differences may also lead to difference in Cognitive reactions. Emotional
responses that ESL Korean customers experienced most frequently were anxiety, fear,
and embarrassment. They were anxious due to a lack of knowledge such as not knowing
the type of food, or not knowing what to answer when servers asked questions (Kim).
Nepalese consumers may have such attitudes so the restaurant owners should be aware
about this fact.
Religion
Religion is a set of belief that people have towards the gods they worship. Religion could
be an important factor in the buying behavior of the consumers. Religion plays one of the
most influential roles in the choices and subsequent selection of foods consumed in
certain societies (Dindyal). Food consumption in restaurant is affected by religion of the
customers still many brahmins in Kathmandu dont consume Buff.
Service Scape
An upscale restaurant offers a full menu, full table service, quality food and personalized
service. Fine dining is regarded as the upper end of this sector which offers high quality
food, dcor and service and charges high prices. Promotional factor, restaurant internal
factor, situational factor, pricing factor, image factor and deluxe factor have major impact
on the dining experience of the customers. The dining experience of the customer is
subjective to their culture as their behaviors are the result of the culture they inherit.
It is also said that satisfied customers tell an average of five people, while
dissatisfied customers share their bad experiences with ten people (Brockway, Mangold
and Miller, 1999) and consumers generally expect restaurant service employees to be
attentive, courteous and possess a good knowledge of the menu (Hensley and Sulek,
2004).
The study shows that promotional factor, restaurant internal factor, situational
factor, pricing factor, image factor and deluxe factor mostly influence the selection of
upscale restaurant. In case of promotional factor, it is observed that many upscale in
Dhaka city. The result can vary if the research is conducted in American society or any
other part of the world because of the cultural difference.
A service script is generally defined in the service literature as a written set of
scripted actions that prescribe specific steps for handling customer service situations
(Solomon et al., 1985) and provide descriptions of commonly held assumptions about
what "people think" about the quality of and their satisfaction with circumstances that
require social interaction. (cf. Harris et al., 2003; Wierzbicka, 2003). There is a direct
relationship between service script effectiveness and customer satisfaction with a service
encounter because a service script is effective when it helps the customer to clearly
interpret these behavioral aspects of the service employee and that interpretation falls
within his/her zone of acceptance (Erasmus, Boshoff, & Rousseau, 2002).
Likewise the study says that, the greater the perceived or real cultural differences
that exist between the customer and the service employee, the greater will be the impact
of these differences on service script effectiveness. The service script will be more
effective when perceived or real cultural differences between the customer and the
service employee are small. And, the service script will be less effective when perceived
or real cultural differences between the customer and the service employee are large.
Cultural identity strength moderates the effects of cultural differences on service script
effectiveness. Differences on service script effectiveness will be less than when the
customer identifies strongly with her/his culture. Hence, culture is an important aspect
when designing effective service script.
Music
Music tempo has a significant effect on consumer behavior in a restaurant. Music tempo
refers to the speed or rate at which the rhythm progresses. According to C. Caldwell and
S. Hibbert (1999), customers spend more time to dine in a restaurant which plays slow
tempo music compared to the ones playing fast tempo music. The same study also
showed that when the music is slow customers tend to spend more on food and drinks in
comparison to the conditions when the music is fast paced.
Those revelations from the study helps to chose the suitable music to be played in
a restaurant during various hours of the day. When the restaurant is quiet with few
customers, playing slow tempo music can serve to retain those customers longer and lead
them to spend more money. Whereas, when the restaurant is full of customers and there
is a faster turnover of tables, playing a faster music will serve to reduce the average
amount of time spent by the customer at a table thus giving chance to other customers.
Health
As people are becoming more and more health conscious, there are many customers who
prefer to visit smoke free restaurants only. The government of various countries has
issued ordinance requiring smoke free restaurants. In order to see if such ordinance
negatively affects the restaurants, a study was conducted in some states of USA by
Stanton A., Glantz, PhD and Lisa R.A. Smith (1994). It shows that there is no significant
relationship between the ordinance requiring smoke free restaurants and restaurants sales;
meaning that making the restaurant smoke free does not affect the sales of the restaurant
adversely.
Theoretical Framework

Hypothesis
H
0
: Music does not have an impact on the consumer behavior in selection of restaurants.
H
1
: Music has an impact on the consumer behavior in selection of restaurants.
H
0
: Health does not have an impact on the consumer behavior in selection of restaurants.
H
1
: Health has an impact on the consumer behavior in selection of restaurants.
H
0
: Service Scape does not have an impact on the consumer behavior in selection of
restaurants.
H
1
: Service Scape has an impact on the consumer behavior in selection of restaurants.
H
0
: Power Distance does not have an impact on the consumer behavior in selection of
restaurants.
H
1
: Power Distance has an impact on the consumer behavior in selection of restaurants.
H
0
: Religion does not have an impact on the consumer behavior in selection of
restaurants.
H
1
: Religion has an impact on the consumer behavior in selection of restaurants.

Research Design
This research is an exploratory research that aims to find factors that are important in the
consumer behavior while making a selection of a restaurant to dine out at. In this study,
we aim to explore how much of cultural factors are integral in such consumer behavior.

Data Collection
This study will be relying on the primary data, which will be collected by taking a survey.

Bibliography
Hopkins, Shirley A. , Winter Nie, and Willie E. Hopkins. "Cultural Effects On Customer
Satisfaction With Service Encounters ." Journal of Service Science 2.1 (2009): 218-230.
Print.

Tinne, Wahida S.. "Factors Affecting Selection of Upscale Restaurants in Dhaka City."
ASA University Review 6.1 (2012): 127-138. Print.
Dindyal, S. D. (n.d.). How Personal Factors, Including Culture And Ethnicity, Affect The
Choices And Selection Of Food We Make.
Kim, E. E. (n.d.). The Impact of Language Barrier & Cultural Differences on Restaurant
Experiences:.
Clare Caldwell and Sally A. Hibbert (1999) ,"Play That One Again: the Effect of Music
Tempo on Consumer Behaviour in a Restaurant", in E - European Advances in Consumer
Research Volume 4, eds. Bernard Dubois, Tina M. Lowrey, and L. J. Shrum, Marc
Vanhuele, Provo, UT : Association for Consumer Research, Pages: 58-62.

Stanton A., Glantz, PhD and Lisa R.A. Smith (1994 ), "The Effect of Ordinances
Requiring Smoke-Free Restaurants on Restaurant Sales", American Journal of Public
Health. Vol 84. No. 7