internal and external marketing for exotic restaurants

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Internal and External Marketing forExotic RestaurantsChin-Feng Lin a & Yu-Ying Lin ba Department of Leisure Management , National Pingtung Institute ofCommerce , Pingtung City, Taiwanb Standard Chartered Bank , Taichung City, TaiwanPublished online: 20 Aug 2010.

To cite this article: Chin-Feng Lin & Yu-Ying Lin (2010) Internal and External Marketingfor Exotic Restaurants, Journal of Foodservice Business Research, 13:3, 193-216, DOI:10.1080/15378020.2010.500243

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Journal of Foodservice Business Research, 13:193–216, 2010Copyright © Taylor & Francis Group, LLCISSN: 1537-8020 print/1537-8039 onlineDOI: 10.1080/15378020.2010.500243

Internal and External Marketing for ExoticRestaurants

CHIN-FENG LINDepartment of Leisure Management, National Pingtung Institute

of Commerce, Pingtung City, Taiwan

YU-YING LINStandard Chartered Bank, Taichung City, Taiwan

This study combines the service marketing triangle and means–end chain theory to uncover related content on internal andexternal marketing for exotic restaurants. This study further evalu-ated internal and external marketing according to six dimensions:satisfaction, trust, loyalty, commitment, involvement, and attrac-tiveness. The analytical results indicate that (1) managers of exoticrestaurants should integrate internal and external service market-ing to promote win-win outcomes and (2) such managers shouldunderstand both customer and employee means–end hierarchiesin developing suitable marketing and management strategies.

KEYWORDS attractiveness, loyalty, means–end chain, satisfac-tion

INTRODUCTION

The number of exotic restaurants in Taiwan has increased considerably inrecent decades. Because restaurant franchises from overseas countries aregradually launching in Taiwan, overseas cuisine has come to be widelyaccepted by Taiwanese. According to Sloan’s (1990) studies, economicgrowth generates diverse consumption and dietary habits. Furthermore,leisure websites, such as PCHome Online (2007), indicate that 58% of

The authors gratefully acknowledge funding support of this study from the National Science Council,Taiwan (No. NSC 95-2416-H-251-018-MY3).

Address correspondence to Professor Chin-Feng Lin, Department of Leisure Management,National Pingtung Institute of Commerce, No. 51, Minsheng E. Rd., Pingtung City, PingtungCounty 900, Taiwan. E-mail: [email protected]

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194 C.-F. Lin and Y.-Y. Lin

2,034 sample restaurants in Taiwan offer exotic cuisine. Clearly, the needfor a wide variety of foods has become a trend in Taiwanese society.Consequently, how restaurant owners can boost their competitive advan-tage by integrating internal and external service marketing has become animportant issue.

In 1984, Grönroos identified three types of marketing in service indus-tries, known as the service–marketing triangle (Kolter, 1997), arguing thatservice marketing requires not only external marketing but also internaland interactive marketing. Thus, the relationship of a company with itsemployees and customers becomes the focus of the service–marketingtriangle (Lings, 2004). To successfully achieve business objectives, man-agers should focus not only on their external customers but also ontheir internal customers, that is, employees (Chernatony, Cottam, & Segal-Horn, 2006). Therefore, via good interactions or relationships between acompany and its employees, the employees become willing to providegood customer service. This can be restated from the perspectives ofinternal marketing to say that work satisfaction and recognition influenceemployee attitude toward customers and customer service (Heskett, Jones,Loveman, Sasser, & Schlesinger, 2008). Customer perceptions of customerservice are derived directly from the service quality that employees pro-vide. Consequently, while employees are willing to trust in and committo the organization, they are highly involved in their work and providegood service quality in accordance with organizational requirements. Thus,customers perceive service quality as exceeding their expectations; thatis, they are extremely satisfied with the service experience and begin totrust in the organization, leading to the establishment of loyalty toward theorganization.

This study, which focuses on exotic restaurants, attempts to identifydifferent facets of loyalty formulation from two perspectives: customer andemployee. First, this study adopts the concept of internal marketing to clar-ify the various influences on employee loyalty. Subsequently, this studyanalyzes the various elements that influence customer loyalty toward aparticular exotic restaurant. Finally, this study determines whether increas-ing employee work satisfaction in a specific exotic restaurant improvescustomer satisfaction. The objectives of this study include (1) clarifyingthe connections and influences of various facets of employee loyalty, (2)clarifying the connections and influences of various facets of consumerloyalty, (3) clarifying the connections and influences between employeework satisfaction and consumer satisfaction, (4) clarifying the importanceof the means–end chain (MEC) theory for the theoretical development ofinternal and external marketing, and (5) providing restaurant owners andmarketers with useful information for operating and developing marketstrategies.

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Internal and External Marketing 195

LITERATURE REVIEW

Internal and External Marketing

Grönroos (1984) posited that service marketing requires the implementationof external, internal, and interactive marketing. External marketing describesthe normal work performed by companies to prepare, price, distribute, andpromote services to customers. Meanwhile, internal marketing describes thework done by companies to train and motivate their employees to servecustomers well (Kotler, 1997). Thus, companies should treat employeesas customers. When employees are satisfied by their work, they becomecompetent as modeled, displaying a caring attitude and promptly resolvingproblems. These customers judge service quality not only based on firmtechnical quality but also on its functional quality. The continuing interac-tions between employees and customers influence service outcomes (Lings,2004). Thus, Kotler (1997) stressed the importance of the service–marketingtriangle because this triangle is directly related to firm success.

To measure the effectiveness of internal marketing, researchers havegenerally adopted employee work satisfaction as a measurement. Heskettet al. (2008) proposed the service profit chain to illustrate how employeesatisfaction produces organizational loyalty and how organizational loy-alty influences customer perceptions of service quality, leading to customervalue satisfaction and loyalty. Furthermore, Jones and Sasser (1995) believedcustomer satisfaction to be an antecedent of customer loyalty. Improvingcustomer loyalty depends on customer trust in the organization and com-mitment to maintaining a long-term relationship with the organization.Accordingly, trust and commitment can be considered as related variables tocustomer satisfaction and loyalty (Garbarino & Johnson, 1999). Some stud-ies in the marketing literature have demonstrated the relationship betweencustomer satisfaction and trust (Berry, 2000; Singh & Sirdeshmukh, 2000).Besides the relationships between customer satisfaction and trust, the rela-tionships of product involvement and loyalty also have been examined,and it has been confirmed that product involvement positively influencescustomer loyalty (Iwasaki & Havitz, 1998; Quester & Lim, 2003).

Wernimont (1972) observed that employees are willing to reach orga-nizational goals and objectives when they have high work satisfaction.Work satisfaction strongly influences employee service quality (Bowen &Schneider, 1985); that is, satisfied employees should lead to satisfied cus-tomers (George, 1977). Several researchers have indicated that organizationalcommitment, loyalty, and service quality are assumed to be significantlyrelated (Caceres & Paparoidamis, 2007; King & Grace, 2008; Malhotra &Mukherjee, 2003). Furthermore, enhanced internal customer (employee)satisfaction may lead to improved external customer satisfaction. If employ-ees are strongly committed to their organization, it is easier for them to

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have high organizational loyalty and provide customers with high qualityservice (Fulford & Enz, 1995). Rotter (1980) stressed that increasing organi-zational commitment requires enhancing employee trust in the organization.Employee trust is crucial for influencing loyalty and involvement at work.Therefore, satisfaction, trust, commitment, and involvement are the keyinfluences on internal and external customer loyalty.

Attractiveness and MEC Theory

Attractiveness is a characteristic strength yielding a pull effect that attractscrowds to a given destination or place (Getz, 1991). Hu and Ritchie (1993)further noted that consumer perceptions and judgments regarding attrac-tiveness are highly dependent on their satisfaction with specific productsor services provided by a particular organization or place. Consequently,restaurants can be considered a destination, attracting people based on apromised dining environment experience. To understand the elements ofattractiveness, it is necessary to survey numerous consumers regarding theirpreferences and consumption habits and to use that data to identify link-ages or connections among these elements. Such linkages or connectionscan display consumer cognitive structures (Holbrook, 2002).

In marketing literature, the MEC analysis developed by Gutman (1982)is the main method of analyzing perceived self-relevance (Olson & Reynolds,1983; Walker & Olson, 1991). MECs are based on taxonomy of con-sumer product/service knowledge including three key concepts: attributes(A), consequences (C), and values (V). In MEC theory, the key con-cepts are linked hierarchically via a cognitive structure. Restated, MECanalysis assumes that a reasonable aggregated chain can be constructedusing data from a set of respondents, even if the set includes individ-ual respondents capable of articulating only some of the steps in a chain(Reynolds & Gutman, 1988). In MEC methodology, product attributes canbe further divided into concrete attributes, such as price and color, andabstract attributes, such as quality and style (Snelders & Schoormans, 2004).Consequences are post-consumption feelings, which can be positive or neg-ative. Positive feelings represent consumer perceptions of benefits; negativefeelings represent product consumption costs or risk perception, whichstrongly influence consumer repurchase willingness (Goldenberg, Klenosky,O′Leary, & Templin, 2000). Therefore, several researchers have proposedusing benefit to replace consequences (Holbrook, 2002; Lin, 2003; Vriens &Ter Hofstede, 2000; Woodside, 2004). The benefit variable is not onlylinked to the product (or service) attributes preferred by consumers, butcan also stimulate consumer feelings regarding product quality (Lin, 2003;Snelders & Schoormans, 2004). Lages and Fernandes (2005) also adoptedservice quality as an intermediary variable linking product attributes withconsumer value satisfaction. Orsingher and Marzocchi (2003) further noted

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that consumers generally employ product perceptions based on consum-ing these product attributes in appraising product quality. Product qualityis expected to be equivalent to the prices consumers pay to obtain theproduct. Thus, analyzing the linkages among product attributes, benefits,and values can help researchers better understand consumer perceptionsof product consumption rather than merely analyzing a single servicevariable.

Bourne and Jenkins (2005) adopted a laddering technique to analyzevalue perceptions of management to understand the cognitions of manage-ment toward specific organization activities. In fact, value perceptions areclassified into various systems. Lin (2003) considered the most widely usedvalue system to be the list of value (LOV) proposed by Kahle (1986) in theapplication of MEC methodology. Moreover, Lages and Fernandes (2005)agreed that the LOV is suitable for analyzing consumer product/service cog-nition. Scholderer, Brunsø, and Grunert (2002) and Brunsø, Scholderer, andGrunert (2004) stressed that consumer lifestyles and personal values influ-ence the relationships among lifestyles, consumer behaviors, and personalvalues. Generally, attributes, consequences (benefits), and values incorpo-rate the MEC theory. This concept can effectively analyze the contentsof consumers’ product preferences and provide marketers with valuableinformation for devising segmentation, branding, and advertising strategies(Bourne & Jenkins, 2005; Vriens and Ter Hofstede, 2000).

METHODOLOGY AND HYPOTHESIS

Hypothesis

This study combined internal and external marketing to assess the per-spectives of customers and employees using six dimensions—satisfaction,trust, loyalty, commitment, involvement, and attractiveness (see Figure 1).Although attractiveness is widely used to describe sightseeing points of aspecific destination (Getz, 1991), this study considered a restaurant to bean attractive destination that attracts large numbers of people. Throughmeans–end laddering, the attribute-consequence-value (A-C-V) chains ofattractiveness can be identified from both the consumer and employee per-spectives. Smith (1983) believes that customers who are attracted by certaindestination characteristics develop a loyalty to that place.

Heskett et al. (2008) proposed a service–profit chain to demonstratehow satisfied employees develop firm loyalty, how they can achieve goodproductivity for serving customers, and how employee loyalty influencesthe outcome of customer perceptions of service quality, leading further tocustomer value satisfaction and loyalty. Customers who simultaneously per-ceive good service and quality and have strong satisfaction will be loyalto the company (Schneider & Bowen, 1985); thus, businesses should focus

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EmployeeSatisfaction

OrganizationalTrust

OrganizationalCommitment

AttractivenessAttractiveness

Internal

Marketing

External

Marketing

H9

H11 H4

ConsumerSatisfaction

Consumer Trust

ConsumerCommitment

H3

Business

Employee Loyalty

Consumer Loyalty

Involvement Involvement

H15

H2

H1

H5

H6

H7

H13

H14

H10H8

H12

FIGURE 1 The conceptual framework.

all their efforts on satisfying their customers to retain their customers andmake profits. Several researchers have further indicated that customer sat-isfaction is an antecedent factor of loyalty in a competitive environment(Jones & Sasser, 1995; Reichheld & Sasser, 1990). Furthermore, trust andcommitment exert different influences on customer satisfaction and loyalty(Berry, 2000; Garbarino & Johnson, 1999; Lee and Back, 2008; Sirdeshmukh,Singh, & Sabol, 2002). The possibility of long-term retention and repurchaseincreases with a higher commitment degree. Table 1 lists the hypothesesregarding patrons of exotic restaurants.

In the current crowded marketplace, the challenge facing businesses isto increase loyalty and productivity and decrease attrition. Before attempt-ing to serve customers well, businesses should first train and satisfy theiremployees (internal customers; Dick, 1995; Kotler, 1997; Wernimont, 1972).Employees with high work satisfaction will commit to their company andattempt to achieve firm goals of serving customers. In short, work satis-faction will influence employee attitudes with regard to customer service(Bowen & Schneider, 1985). George (1977) believed that satisfied employees(internal customers) satisfy external customers, and clarifying the impor-tance of internal marketing. Researchers have further indicated that higheremployee commitment is associated with a greater possibility of provid-ing high service quality and having high loyalty; meanwhile, trust is theantecedent factor of commitment (Namasivayam & Zhao, 2007; Rotter, 1980).

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TABLE 1 Consumer Hypothesis

Consumer hypothesis Literature

Hypothesis 1 Consumer’s satisfaction of eating in therestaurant positively influences loyalty.

Reichheld and Sasser(1990)

Hypothesis 2 Consumer satisfaction positively influencesconsumer trust toward the restaurant.

Berry (2000);Sirdeshmukh et al.(2002)

Hypothesis 3 Consumer trust toward a specific restaurantpositively influences his/her loyalty of thatrestaurant.

Berry (2000)

Hypothesis 4 Consumer trust toward a specific restaurantpositively influences commitment.

Anderson and Narus(1990)

Hypothesis 5 Consumer commitment toward a specificrestaurant positively influences his/her loyaltyof that restaurant.

Frederick and Phil(2000)

Hypothesis 6 Consumer involvement of a specific restaurantpositively influences his/her loyalty of thatrestaurant.

Proposed by this study

Hypothesis 7 The attractiveness of a specific exotic restaurantpositively influences consumer loyalty.

Proposed by this study

Furthermore, work attitude and behavior strongly impact work involvement;that is, employees with positive attitude or loyalty toward their work havehigher job involvement (Jewell & Reitz, 1979; Morgan & Hunt, 1994). Table 2lists the employee hypotheses of this study.

Based on the previous discussion, researchers believe that employeework satisfaction is closely related to customer satisfaction. Only when

TABLE 2 Employee Hypotheses

Employee hypothesis Literature

Hypothesis 8 Work satisfaction of employees positivelyinfluences employee loyalty.

Wernimont (1972)

Hypothesis 9 Work satisfaction of employees positivelyinfluences employee trust.

Proposed by thisstudy

Hypothesis 10 Employee trust positively influences loyaltytoward the restaurant.

Rotter (1980)

Hypothesis 11 Employee trust positively influencescommitment.

Rotter (1980)

Hypothesis 12 Employee commitment positively influencesloyalty.

Morgan and Hunt(1994)

Hypothesis 13 Employee involvement positively influencesloyalty.

Jewell and Reitz(1979)

Hypothesis 14 Restaurant attractiveness positively influencesemployee loyalty.

Proposed by thisstudy

Hypothesis 15 Employee satisfaction positively influencescustomer satisfaction.

Koys (2001)

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employees are satisfied will they focus solely on serving customers andsatisfying their needs. Consequently, this study assumes that employee sat-isfaction positively influences customer satisfaction, and Hypothesis 15 fromTable 2 is now restated:

Hypothesis 15: Employee satisfaction positively influences customersatisfaction.

Variables

In this study, variables (except for MEC analysis) were directly adopted fromthe literature (see Table 3). The three key variables for MEC analysis areattributes, consequences, and values. Through focus group and in-depthinterviews, attribute (A) and consequence (C) variables were extracted fromthe perceptions of the interviewed customers and employees of exoticrestaurants. Value (V) variables were adopted from Kahle’s LOV (1986). TheAppendix lists the attribute, consequence, and value variables. To confirmthe independence of all dimensions in Table 3, this study used the mean ofthe variables within the belonging dimension to conduct related testing. Thetest results demonstrated the insignificance of the correlation coefficients.Clearly, the independence of the dimensions is suitable for the structuralequation modeling (SEM).

Samples

According to the information provided by the City Guide published on thePCHome website (2007), the categories of exotic restaurants used in thisstudy were based on the top five ranking of customer preferences, includingJapanese, American, Thai, Korean, and European styles. The present sampleof the European category includes French and Italian cuisine. Employeesand experienced customers of exotic restaurants were selected from theTaichung metropolitan area of Taiwan.

In the pilot interviews, 82 valid samples out of 100 were obtainedfrom interviewing customers, and 36 valid samples out of 50 were gath-ered from interviewing employees. The reliability of Cronbach’s α for eachdimension exceeds the standard of 0.7 defined by Hair, Anderson, andTatham (1998). Consequently, these two questionnaires were further usedto interview experienced customers and employees of exotic restaurants,respectively. In selected exotic restaurants, if employees agreed to be inter-viewed, a sample of customers was also interviewed. A total of 369 validcustomer samples were obtained after eliminating 31 questionnaires con-taining incomplete data Furthermore, 208 of 250 employee samples weregathered by eliminating 42 questionnaires containing invalid data.

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Analytical Methods

This study used SEM to clarify whether the customer and employee modelingproposed in this study are acceptable and whether the hypotheses listed inTables 1 and 2 are supported. Furthermore, cluster analysis was employed toclassify high-involvement (HI) versus low-involvement (LI) groups. Throughthe classification of HI versus LI groups, the differentiated preferences of theproduct’s A-C-V chains in different levels of involvement can be clarified.Boote (1981) indicated that a scale consisting of five labeled points is moreappropriate for use in psychographic segmentation studies than any of theother scale formats; therefore, this study used a 5-point Likert scale in askingrespondents to express agreement or disagreement.

RESULTS AND ANALYSIS

Sample Description

Males comprised 43.6% of the respondents for the customer interviews.Interviewees ranged in age from 20–50 years old, and 43.1% of respondentswere aged from 20–25 years old. Junior college educated customers andthose who were university graduates comprised 36% and 40.7%, respec-tively. Approximately 37% of respondents had monthly income betweenNT$20,000 and $30,000 (US$ to NT$ conversion is 1:33). For the employeeinterviews, 47.1% of respondents were male, and 56.3% were 20–25 yearsold. Furthermore, 54.3% and 23.6% were university graduates and juniorcollege educated, respectively. Approximately 47.1% and 24.5% of restau-rant employees had monthly incomes in the ranges NT$10,000–20,000 andNT$20,000–30,000, respectively.

SEM

This study performed SEM by using confirmatory factor analysis to con-firm the suitability of variables adopted from the literature for the modeland whether the variables can be reduced. The consumer and employeedata were examined separately, and the modeling of the two sets of datawas shown in Figures 2 and 3. Table 4 listed the fit statistics of SEM. Thegoodness-of-fit indexes of consumer modeling were acceptable, except forthe RMSEA. In the employee modeling, while the RMSEA and AGFI did notmeet the criteria, both were still acceptable (Jöreskog & Sörbom, 1996).

This study, based on the concept of Heskett et al. (2008), believes thatsatisfied employees promote consumer satisfaction and, thus, boost con-sumer loyalty. Consequently, the consumer–employee modeling combinedthe perspectives of customers and employees, as shown in Figure 4, and thefit statistics are listed in Table 4.

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mitm

ent

Org

aniz

atio

nal T

rust

Invo

lvem

ent

Em

ploy

ee L

oyal

ty

.78*

*

.98*

*

Ove

rall

satis

fact

ion

Perf

orm

ance

syst

em

Job

orie

ntat

ion

Job

invo

lvem

ent

Attr

ibut

eC

onse

quen

ceV

alue

Non

-sw

itchi

ng

Firs

t cho

ice

Eff

ort t

rust

Goo

dwill

trus

t

Ret

entio

nco

mm

itmen

t

Val

ueco

mm

itmen

t

Eff

ort

com

mitm

ent

.93*

*.8

3**

.93*

*

.84*

*

0.84

**

0.87

**

.85*

*.9

8**

.84*

*

.93*

*

.93*

*

.90*

*

.86*

*

.63*

*

.45*

*

.81*

*

–.38

**.2

8**

.55*

.60*

*

.64*

* .11*

*Sig

nifi

cant

at p

<.0

5

**Si

gnif

ican

t at P

<.0

1

FIG

UR

E3

Em

plo

yee

model

ing.

204

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TABLE 4 Fit Statistics of Each Modeling

Index CriteriaConsumermodeling

Employeemodeling

Consumer–employeemodeling

χ 2 362.81 170.362 32.38Degrees of freedom 80 67 32χ 2-significance P � 0.05 0.000 0.000 0.448χ 2/d.f. <5.0 4.54 2.54 1.01RMSR (Brown &

Cudeck, 1993)<0.08 0.068 0.049 0.046

GFI (Jöreskog &Sörbom, 1988)

�0.9 0.882 0.907 0.921

AGFI (Jöreskog &Sörbom, 1988)

�0.9 0.821 0.855 0.865

NFI (Bentler, 1990) �0.9 0.871 0.941 0.914TLI (Tucker & Lewis,

1973)�0.9 0.860 0.949 0.998

RFI (McDonald &March, 1990)

�0.9 0.828 0.919 0.879

IFI (Bollen, 1989) �0.9 0.896 0.963 0.999CFI (Bentler, 1990) �0.9 0.895 0.963 0.999RMSEA (Schumacker &

Lomax, 1996)<0.05 0.099 0.086 0.013

Table 4 reveals that the values of the fitness indexes for consumers andemployees, as well as the overall modeling, are acceptable, thus confirmingthe reliability of the concepts of the three models. In Figure 2, consumersatisfaction positively and significantly affects loyalty and trust, meaningHypothesis 1 and Hypothesis 2 are supported. Surprisingly, customer trustdoes not positively and significantly affect loyalty, meaning Hypothesis 3is not supported. Meanwhile, customer trust positively and significantlyaffects commitment, meaning Hypothesis 4 is supported. Furthermore, cus-tomer involvement and attractiveness of an exotic restaurant positively andsignificantly affect loyalty, meaning Hypothesis 5 and Hypothesis 6 aresupported. On the other hand, as shown on Figure 3, work satisfactionpositively and significantly affects employee loyalty and trust, meaningHypothesis 8 and Hypothesis 9 are supported. Additionally, employeetrust positively and significantly affects loyalty and commitment, meaningHypothesis 10 and Hypothesis 11 are also supported. However, employeecommitment does not positively and significantly affect loyalty, meaningHypothesis 12 is not supported. Meanwhile, employee involvement posi-tively and significantly affects loyalty, meaning Hypothesis 13 is supported.Moreover, restaurant attractiveness is demonstrated to positively and sig-nificantly affect employee loyalty, meaning Hypothesis 14 is supported.As expected, the analytical results of Hypothesis 15 indicate that satisfiedemployees lead to satisfied customers, meaning Hypothesis 15 is supported.Table 5 summarizes the analytical results.

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Em

ploy

eeSa

tisfa

ctio

n0.

74**

0.52

**

Con

sum

erL

oyal

ty

Non

-sw

itchi

ng

Ref

erra

l

Firs

t cho

ice

0.76

**

0.93

**

0.86

**

Em

ploy

eeSa

tisfa

ctio

n

Perf

orm

ance

syst

em

Em

ploy

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oyal

ty

Ref

erra

l

Firs

t cho

ice

Non

-sw

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ng

0.41

**

0.77

**

0.68

**

Con

sum

erSa

tisfa

ctio

n

Ove

rall

satis

fact

ion

Exp

ress

ion

0.88

**

0.86

*

.88*

.85*

.28*

FIG

UR

E4

Consu

mer

-em

plo

yee

model

ing.

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TAB

LE5

Res

ults

ofH

ypoth

eses Hyp

oth

esis

Res

ults

Hyp

oth

esis

Res

ults

Hyp

oth

esis

1Consu

mer

’ssa

tisfa

ctio

nofea

ting

inth

ere

stau

rantposi

tivel

yin

fluen

ces

his/her

loya

lty.

Supported

Hyp

oth

esis

8W

ork

satis

fact

ion

ofem

plo

yees

posi

tivel

yin

fluen

ces

emplo

yee

loya

lty.

Supported

Hyp

oth

esis

2Consu

mer

satis

fact

ion

posi

tivel

yin

fluen

ces

consu

mer

trust

tow

ard

the

rest

aura

nt.

Supported

Hyp

oth

esis

9W

ork

satis

fact

ion

ofem

plo

yees

posi

tivel

yin

fluen

ces

emplo

yee

trust

.

Supported

Hyp

oth

esis

3Consu

mer

trust

tow

ard

asp

ecifi

cre

stau

rantposi

tivel

yin

fluen

ces

loya

ltyofth

atre

stau

rant.

Notsu

pported

Hyp

oth

esis

10Em

plo

yee

trust

posi

tivel

yin

fluen

ces

loya

ltyto

war

dth

ere

stau

rant.

Supported

Hyp

oth

esis

4Consu

mer

trust

tow

ard

asp

ecifi

cre

stau

rantposi

tivel

yin

fluen

ces

his/her

com

mitm

ent.

Supported

Hyp

oth

esis

11Em

plo

yee

trust

posi

tivel

yin

fluen

ces

com

mitm

ent.

Supported

Hyp

oth

esis

5Consu

mer

com

mitm

entto

war

da

spec

ific

rest

aura

ntposi

tivel

yin

fluen

ces

his/her

loya

ltyof

that

rest

aura

nt.

Supported

Hyp

oth

esis

12Em

plo

yee

com

mitm

entposi

tivel

yin

fluen

ces

loya

lty.

Notsu

pported

Hyp

oth

esis

6Consu

mer

invo

lvem

entofa

spec

ific

rest

aura

ntposi

tivel

yin

fluen

ces

his/her

loya

ltyof

that

rest

aura

nt.

Supported

Hyp

oth

esis

13Em

plo

yee

invo

lvem

entposi

tivel

yin

fluen

ces

loya

lty.

Supported

Hyp

oth

esis

7The

attrac

tiven

ess

ofa

spec

ific

exotic

rest

aura

ntposi

tivel

yin

fluen

ces

consu

mer

loya

lty.

Supported

Hyp

oth

esis

14Res

taura

ntat

trac

tiven

ess

posi

tivel

yin

fluen

ces

emplo

yee

loya

lty.

Supported

Hyp

oth

esis

15Em

plo

yee

satis

fact

ion

posi

tivel

yin

fluen

ces

cust

om

ersa

tisfa

ctio

n.

Supported

207

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TABLE 6 Extended Path Analysis

Consumer path RelationPath

coefficientP

value Employee path RelationPath

coefficientP

value

Satisfaction →involvement

+ 0.30 0.000 Trust →involvement

+ 0.64 0.000

Attractiveness →involvement

+ 0.53 0.000 Attractiveness →satisfaction

+ 0.11 0.037

Attractive →trust

+ 0.42 0.000 Attractiveness→commitment

+ 0.60 0.000

Attractive →commitment

+ 0.22 0.001

Note: “+” represents that the positive relation exists between two dimensions.

To make the model just-identified, the researchers further examinedeach pair of variables and identified pairs of variables that were not linkedby a path or correlation. As shown in Table 6, consumer satisfactionand involvement are positively related. Customer involvement increaseswith customer satisfaction with the services offered by exotic restaurants.Furthermore, involvement, trust, and commitment increase with attractive-ness of exotic restaurants. Meanwhile, employee involvement in their workincreases with their trust in a restaurant. Employee satisfaction and commit-ment to a restaurant are likely to increase with restaurant ability to attractemployees.

Involvement of Consumers and Employees

According to the mean value of each dimension, consumers and employeeswere clustered and divided into HI or LI groups. Only 164 of 369 consumersbelonged to the HI group, with the remaining 205 consumers belonging tothe LI group. In contrast, up to 137 of 208 employees belonged to the HIgroup, while the remaining 71 employees belonged to the LI group. Table 7shows that HI customers or employees have higher mean value in eachdimension (loyalty, satisfaction, trust, commitment, and attractiveness) thando LI customers or employees.

This study examined whether the A-C-V chains of MEC theory differbetween HI and LI groups. MEC analysis (see Table 8) indicates that HIcustomers think that “ordering and delivering speed (A)” provides “qualityof life (C)” consequence and, thus, satisfies their “sense of belonging (V)”and “self-respect (V)” value demands. Meanwhile, LI customers prefer “spe-cial cuisine (A),” yielding to “joy (C)” and “experiencing (C)” consequences.Such consequences further result in their “warm relationships with others(V),” “fun and enjoyment of life (V),” and “security (V)” value satisfaction.Furthermore, employees with high involvement believe that attributes suchas “menu variety,” “service attitude,” ”environmental hygiene,” and “facility

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TABLE 7 Mean of Each Dimension after Clustering

Customer Employee

Dimension HI (164) LI (205) P value HI (137) LI (71) P value

Loyalty 3.37 2.95 ∗ 3.78 2.53 ∗Satisfaction 3.55 3.26 ∗ 3.69 2.60 ∗Trust 3.64 2.96 ∗ 3.66 2.88 ∗Commitment 2.98 2.32 ∗ 3.80 2.78 ∗Attractiveness Attribute 3.96 3.59 ∗ 4.35 3.32 ∗

Consequence 3.69 3.26 ∗ 3.92 3.50 ∗Value 3.43 3.00 ∗ 3.78 3.25 ∗

Note: “∗”represents P value > 0.05; the parenthetic figures represent sample size.

and decoration” can result in “economy,” and further yield to various valuesatisfaction such as “sense of belonging,” “being well respected,” and “secu-rity.” However, employees with low involvement stress the importance of“food quality (A)” and “ad promotion (A),” because these attributes produce“quality of life (C)” and “comfort (C)” benefits and, thus, satisfy their “self-respect (V)” and “self-fulfillment (V)” value demands. The A-C-V chains ofMEC analysis can help restaurant owners devise differentiated strategies tomeet the different demands of customers and employees.

CONCLUSION AND SUGGESTIONS

This study applies concepts of internal and external marketing to explorethe implications of loyalty and identifies differences in recognition betweencustomers and employees of exotic restaurants. Based on the MEC theory,the perception hierarchies of customers and employees provide marketers ormanagers with useful information for designing marketing and managementstrategies.

Theoretical Developments

Although some hypotheses in this study were obtained from a literaturereview as listed in Tables 1 and 2, this study integrated the MEC the-ory and the concept of internal and external marketing, as illustrated inFigure 1, to demonstrate the psychologically cognitive structures of cus-tomers and employees of exotic restaurants. Such structures derived fromthe MEC theory can not only clarify customer and employee preferences,but can also identify the key elements of internal and external marketing inencouraging customers and employees to actually implement their thoughts.Applying the MEC theory to discuss the service–marketing triangle can help

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TABLE 8 MEC Results of HI and LI Between Customers and Employees

Consumer Attribute (A) Consequence (C) Value (V)

HI � Environmentalhygiene

� Quality of life � Sense of belonging

� Food quality � Appetite satisfaction � Self-fulfillment� Ordering and

delivering speed� Comfort � Self-respect

LI � Environmentalhygiene food quality

� Appetite satisfaction � Warmrelationships withothers

� Special cuisine � Joy � Self-fulfillment� Comfort � Fun and enjoyment

of life� Experiencing � Security

Employee Attribute (A) Consequence (C) Value (V)

HI � Menu variety � Economy � Sense of belonging� Service attitude � Experiencing � Self-respect� Environmental

hygiene� Warm relationships

with others� Facility and

decoration� Being well

respected� Fun and enjoyment

of life� Security� Sense of

accomplishment

LI � Food quality � Quality of life � Warm relationshipswith others

� Ad promotion � Appetite satisfaction � Sense ofaccomplishment

� Comfort � Fun and enjoymentof life

� Experiencing � Self-respect,self-fulfillment

Note: Words in bold represent the important A-C-V linkage variables.

researchers to clarify issues of consistency and disparity between internaland external marketing, and also to understand the connections betweeninternal–external marketing elements.

Reinforcing Customer and Employee Loyalty

Work satisfaction, trust, and involvement exert a positive influence onemployee loyalty. Employee perceptions of restaurant attractiveness stronglyimpact employee willingness to commit to providing good customer ser-vice. Surprisingly, the analytical results showed that employee commitment

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and loyalty are not positively related; these findings contradict those ofMorgan and Hunt (1994). Furthermore, employee satisfaction has a pos-itivel impact on customer satisfaction, but the analytical result indicatedthat the extent of impact is not significant. The reason for the contradic-tion may be the small size of most exotic restaurants. Owing to the smallscale of exotic restaurants in Taiwan, restaurant owners typically hire onlypart-time staff to control their operational costs. Consequently, how to pro-mote employee welfare and provide a comfortable working environmentto attract part-time employees is a major issue for restaurant owners todayin Taiwan. The restaurant owners may design a profit sharing and stockownership plan tailored particularly for loyal employees. These employ-ees may see the restaurant they are working in as their own business.Consequently, they are willing to strive to satisfy their customers. On theother hand, customer satisfaction, commitment, and involvement are closelyassociated with customer loyalty. However, such loyalty may not guaran-tee that customers frequently patronize the exotic restaurant. In Taiwan,the prices charged in exotic restaurants are significantly higher than inlocal restaurants. Customers are often attracted to an exotic restaurant outof curiosity. In the price consideration, customers relying on curiosity toselect an exotic restaurant would like to try a new one where they havenever been. Thus, it is difficult for restaurant owners to maintain long-termcustomer relationships. This may explain why customer trust in particularrestaurants does not mean that customers have loyalty for the restau-rant. Consequently, restaurant owners must do more than simply providegood food and high-quality service to make their restaurants trustworthy,and instead must maximize interaction between employees and customers.Restaurant owners may provide their employees with discretion to givediscounts to loyal patrons or can periodically promote their restaurant orprovide different types of membership cards for customers with differentdegrees of loyalty.

Adhering to the Needs of HI and LI Groups

According to the MEC analysis, customers see “environmental hygiene” and“food quality” attributes as extremely important (see Table 8). Consumerswith high involvement further stress the importance of “speed of orderingand serving.” To target this group of customers, restaurant owners shouldfocus on methods of accelerating ordering and delivery. For LI customers,restaurants should focus offering “special cuisine” to attract customers. Onthe other hand, regarding employee perspectives, HI and LI employees havecompletely different views toward the restaurants for which they are work-ing. Consequently, restaurant owners should boost employee cohesion toenhance working morale.

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This study integrates the MEC theory (Gutman, 1982) and related con-tent on internal and external marketing to provide restaurant owners withuseful information regarding consumer and employee psychology. Futurestudies can consider the following issues:

1. Internal, external, and interactive marketing are three key concepts inthe service triangle theory (Grönroos, 1984; Kotler, 1997). This studyadopted the concepts of internal and external marketing to examine theperspectives of customers and employees regarding specific exotic restau-rants; this study did not consider the concept of interactive marketing.Consequently, future studies can further apply the concept of interactivemarketing to examine similarities or differences in recognition betweenconsumers and employees.

2. This study only conducted short-term research. However, customers andemployees require a long period of time to develop trust in or commit-ment to an organization. That is, the dimensions of trust and commitmentrequire long-term examination to establish more compelling relationsamong them. Consequently, future researchers may consider conductinga lengthy investigation of the relationships and interactions among thesedimensions.

3. In the consumer modeling of Figure 2, consumer satisfaction to involve-ment, attractiveness to consumer commitment, and attractiveness toinvolvement are revealed as positive corrections, meanwhile organiza-tional trust to involvement, attractiveness to employee satisfaction, andattractiveness to organizational commitment are also demonstrated to bepositive corrections in the employee modeling of Figure 3. Future studiescan consider using the dyadic model of internal and external marketingto test mediators and moderators related to understanding the interactionbetween internal and external marketing.

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APPENDIX

Dimension Variable Dimension Variable Dimension Variable

Attribute � Price Consequence � Fashion Value � Sense ofbelonging

� Menu variety � Quality of life � Excitement� Service attitude � Appetite

satisfaction� Warm rela-

tionshipswith others

� Location � Economy � Self-fulfillment

� Environmentalhygiene

� Status symbol � Being wellrespected

� Facility anddecoration

� Curiositysatisfaction

� Fun andenjoymentof life

� Food quality � Personaldemandsatisfied

� Security

� Food quantity � Joy � Self-respect� Special cuisine � Gaining

knowledge� Sense of

accomplish-ment

� Ad promotion � Value added� Ordering and

deliveringspeed

� Comfort

� Experiencing

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internal and external marketing for exotic restaurants

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