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Exploring Consumer Perceptions of Green Restaurants in the US Franziska Schubert, Jay Kandampully, David Solnet and Anna Kralj Tourism and Hospitality Research 2010 10: 286 DOI: 10.1057/thr.2010.17 The online version of this article can be found at: http://thr.sagepub.com/content/10/4/286
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Research Paper
Exploring consumer perceptions of green restaurants in the US Received (in revised form): 14th July 2010
Franziska Schubert graduated from The Ohio State University with a Bachelors degree in Italian and Hospitality Management in 2006 and a MSc in Hospitality Management in 2008. Her areas of interest are consumer behavior and environmental issues. Currently, Franziska Schubert is undertaking F&B Management Training at The Ritz-Carlton, Berlin, Germany.
Jay Kandampully is a professor in services management and hospitality at The Ohio State University. He holds a PhD in service quality management. He is the author of the book ‘Services Management: the new paradigm in hospitality’ and the lead editor of the book, ‘Service Quality Management in Hospitality, Tourism and Leisure’. Jay has published over 100 articles and has presented numerous papers at international conferences on issues relating to services management and marketing, service quality, service orientation and service innovations.
David Solnet completed his PhD research in 2006. His doctoral research explored employee attitudes and service quality within the context of hotel re-brandings. Before joining the University of Queensland, David had been involved in the restaurant/club industry since 1985. In addition to his accomplished career in the hospitality industry, he continues to work as an advisor to a number of high-profile hospitality organizations in Southeast Queensland.
Anna Kralj recently joined the University of Queensland from a management career in the hotel industry and is undertaking her PhD in the area of service management, with a particular focus on internal service quality, employee attitudes and antecedent HR strategies in the international casino industry.
ABSTRACT Consumer attitudes and behavioural intentions towards environmentally sustainable practices in restaurants is an under-explored area in the hospitality literature, despite the growing ‘green’ trend. This article analyses data collected from 455 restaurant customers across five casual dining restaurants to gain insight into consumer attitudes towards, and willingness to pay more for, restaurants that engage in ‘green’ practices. The findings illustrate that there is an unfilled market niche for ‘green’ restaurants, as customers care about restaurants protecting the environment and would be willing to pay more to offset any additional costs associated with ‘green’ practices. Tourism and Hospitality Research (2010) 10, 286–300. doi:10.1057/thr.2010.17; published online 13 September 2010
Keywords: restaurants; ‘green’ practices; CSR; consumer attitudes Correspondence: Anna Kralj School of Tourism, University of Queensland, Building 39a, Cnr Campbell Rd and Blair Dve, St Lucia, QLD 4072, Australia E-mail:
[email protected]
© 2010 Macmillan Publishers Ltd. 1467-3584 Tourism and Hospitality Research Vol. 10, 4, 286–300 www.palgrave-journals.com/thr/
Perceptions of green restaurants
INTRODUCTION Global climate change issues and unprecedented natural disasters have become a prominent feature in the media, making environmental protection an issue of high topicality and relevance. Concomitantly, there is growing public acceptance that unmitigated economic development is not only environmentally harmful, but it can also be detrimental for society. As a result, the new ‘buzz’ phrase in business is corporate social responsibility (CSR). Companies across all sectors are developing new products and processes with the aim of minimizing negative environmental effects. Overtly, these developments are driven by socially responsible goals, although it is argued that the underlying stimulus for such action remains economically motivated (Choi and Parsa, 2006). Some companies recognize the marketing potential of ‘green’ initiatives and are working to establish themselves in a new niche for consumers with environmental concerns. The integrity of the surrounding natural environment is very often a key ingredient for hospitality and tourism businesses. Hotels located in natural areas, such as mountains or beaches, are especially dependent on the ‘healthiness’ of their sites. Accordingly, there are numerous examples of lodging businesses that have been engaging in ‘green’ practices and eco-tourism for several years. Restaurants, however, are often less dependent on such environmental factors and have consequently shown less concern for such issues. A restaurant can benefit from introducing environmentally friendly practices, principally through direct savings in operating costs. However, restaurants face difficulties when implementing such practices because of the low awareness of effective methods for food service practices and fear of increased costs. Compounding the restaurant industry’s hesitation to implement ‘green’ practices is the lack of knowledge available on customer attitudes and behavioural intentions regarding ‘green’ restaurants, including their willingness to pay more for such restaurants, if necessary.
To begin to address this gap in understanding, this study aims to explore customer perceptions of and attitudes towards eco-friendly food service establishments (that is, restaurants that engage in ‘green’ practices) and whether customers are willing to pay more for ‘green’ restaurants. The specific research questions to be addressed in this article are: RQ1: Do customers believe it is good that restaurants engage in ‘green’ practices? RQ2: Which of the three ‘green’ practice areas is perceived as most important by restaurant customers? RQ3: How much more are customers willing to pay to dine at ‘green’ restaurants? RQ4: Can restaurants use ‘green’ practices to attract customers away from ‘non-green’ competitors? In order to examine the research problem, the literature on CSR and environmentally responsible practices is first reviewed, followed by a review of ‘green’ practices in the hospitality literature. This provides the basis for the introduction of each of the research questions. Following this, the results of a survey of customers, conducted in five casual dining restaurants in Columbus, Ohio, are presented. The results are discussed in light of the existing literature and current research questions, and implications for restaurant operators, as well as future research opportunities, are suggested.
LITERATURE REVIEW CSR and ‘green’ practices Although a relatively recent addition to business literature, support for CSR is gaining ground, as studies have linked sound CSR practices to positive organizational results, such as reduced financial risk (Prakash, 2002) and improved customer attitudes and behavioural intentions (Creyer and Ross, 1996; Joyner and Payne, 2002; Mohr and Webb, 2005; MolinaAzorín et al, 2009). Carroll (1989) describes CSR as an approach to conducting business
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that encompasses not only the attainment of economic benefits but also the productions of socially desirable goods and services, in a manner which complies with the legal and ethical standards set by society. Maignan and Ferrell (2004) expand on this notion by including the discretionary responsibilities of business to ‘actively participate in the betterment of society beyond the minimum standards set by the economic, legal and ethical responsibilities’ (p. 459). Using a more definitive framework, Mohr (1996) outlines four dimensions of CSR: obeying laws and ethical norms; treating employees fairly; protecting the environment; and contributing to charities. Engaging in ‘green’ practices is one strategy that a business can implement in order to increase its level of CSR. For the purposes of this study, the terms ‘green’ practices and eco- or environmentally friendly practices are used interchangeably. Similarly, ‘green’ restaurant will be used to denote any restaurants that actively engage in ‘green’ practices, while ‘non-green’ will describe those that do not. In manufacturing, the concept of an ‘environmentally friendly product’ is well understood, that is, a product that has a reduced environmental impact. Like products, the delivery of services can also have a major impact on the environment, which should also be minimized. This can be done, for instance, by implementing practices such as purchasing energy saving equipment, reducing and recycling waste, purchasing locally produced materials, engaging in environmental protection programs, and paying to offset a business’ carbon emissions. Collectively, these practices are then referred to as ‘green’ practices. Choi and Parsa (2006) developed a conceptual framework for ‘green’ practices based on perspectives derived from CSR. The framework identified ten dimensions of ‘green’ practices that fitted into three broad CSR categories: environmental, health and social. Examples from the environmental category included environmentally friendly production processes, while the health category included
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such things as sustainable agriculture and the social category considered issues of philanthropic community involvement. The three perspectives identified by Choi and Parsa (2006) strongly correlate with the categorization provided by the Green Restaurant Association (GRA, 2007) in the United States. In developing practical environmental guidelines for restaurants, the GRA outlined three main areas of ‘green’ practices in which a restaurant can engage: ‘green’ action (energy and water efficiency, recycling, ‘green’ construction and so on), ‘green’ foods (organic and local) and ‘green’ donation (engaging with/donating to ‘green’ projects).
Environmental impact of restaurants The case for restaurants engaging in ‘green’ practices is compelling. To begin, the number of restaurants operating in the United States and indeed, the entire world, is sizeable and eating out has become a common habit. The 2007 US Economic Census revealed that there are 566 020 food service and drinking places operating, which includes 217 282 full-service restaurants, 266 534 limited-service restaurants and many cafeterias, buffets and so on (US Bureau of the Census, 2009). Added to this, Americans consume on average 80 meals per year at a retail food establishment, while a further 61 per cent of Americans aged under 35 and 50 per cent of Americans aged over 35 years bring home takeout meals a minimum of once per week (Abbot and Byrd-Bredbenner, 2007). A leading market research company in the United States estimates this figure to be a lot higher – in the year to February 2009, Americans purchased an average of 204 meals at restaurants (NPD Group, 2009). Considering such high consumption rates, it is patent that unmitigated restaurant practices would contribute to the depletion of the natural environment. Such practices include: the construction of restaurant facilities that destroy the natural environment; excessive usage of resources such as water, electricity and gas;
© 2010 Macmillan Publishers Ltd. 1467-3584 Tourism and Hospitality Research Vol. 10, 4, 286–300
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usage of non-recyclable products and ineffective recycling procedures; usage of harmful chemicals products; the careless handling of resources and materials in general; and contribution to carbon emissions through the daily delivery of supplies as well as the transit of employees and guests to and from the restaurant site. As a rule, restaurants and commercial kitchens are very energy-intensive. As much as 80 per cent of the US$10 billion annual energy spend of commercial food-service businesses serves no useful purpose, as energy is ‘often wasted in the form of excess heat and noise generated by inefficient appliances, heating, ventilation and air conditioning systems, lighting and refrigeration’ (Enis, 2007, p. 34). These numbers alone give a glimpse of the significant impact the restaurant industry has on the environment, hence the urgency for restaurants to embrace the ‘green’ trend and implement environmentally friendly practices.
Consumer attitudes towards ‘green’ restaurants In the main, research into the benefits of engaging in ‘green’ practices in the hospitality industry has been limited, and most that has been conducted focuses on hotels. A few significant case studies, related to companies such as Scandic and Hyatt Regency, have demonstrated the success of ‘green’ practices in these hotels with regards to cost reductions, resource savings, customer retention, loyalty and improved employee morale (Goodman, 2000; Enz and Siguaw, 1999). Hotel operators’ attitudes towards, and adoption of, environmentally responsible practices has been the focus of some studies, with a common conclusion that a barrier to further adoption is the lack of hoteliers’ awareness and market research about consumer attitudes and behaviour towards ‘green’ practices (for example, Bohdanowicz, 2006; Le et al, 2006). This lack of awareness also extends to the restaurant industry, where even fewer studies have been conducted regarding the use of ‘green’ practices and associated consumer
attitudes. Vieregge et al (2007) explored consumer perceptions of eco-friendly behaviour in a fast food restaurant chain in Switzerland. They found that customers of the globally branded restaurant do appreciate the use of local products. Although not purely customerfocused, Choi and Parsa (2006) conducted a study of manager attitudes towards ‘green’ practices in the US restaurant industry, and concluded that engaging in ‘green’ practices can lead to strengthened customer relations and increased harmony with the community. Research into consumer attitudes towards restaurants that engage in ‘green’ practices is well overdue. As a preliminary step in the process of better understanding consumer attitudes, the first research question of this study is presented: RQ1: Do customers believe it is good that restaurants engage in ‘green’ practices? As outlined previously, there are three main areas of ‘green’ practices that a restaurant could engage in (‘green’ action/environmental, ‘green’ foods/health, ‘green’ donation/social). It stands to reason that consumers will rank the importance of these three areas of ‘green’ practice, and some practice areas will be more influential than others in creating a positive ‘green’ image of the restaurant in a customer’s mind. This notion is supported by a comparative study conducted by Dutta et al (2008) of restaurant consumers in the United States and India. They found that American consumers displayed a higher involvement in environmentally and socially responsible practices, while Indian consumers had a higher degree of involvement in health-related responsible practices. To explore this further in the context of the current study, the second research question is posed: RQ2: Which of the three ‘green’ practice areas is perceived as most important by restaurant customers?
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Results from studies that have investigated consumer willingness to pay for green products are mixed. Some report that consumers are hesitant to pay a premium for environmentally friendly products (for example, Kasim, 2004; Lord et al, 2004) while others report that the majority of customers would be willing to pay extra for ‘green’ products and services (Choi and Parsa, 2009). Peer-reviewed, hospitalityspecific studies into customer willingness to pay more for ‘green’ products are infrequent. In their study of Indian hotels, Manaktola and Jauhari (2007) found that despite the positive attitude or behaviour towards ‘green’ practices, only 15 per cent of respondents were willing to pay extra for environmental initiatives, while the remaining consumers felt that costs should either be paid for by the hotel or shared. In their comparative study conducted in restaurants in the United States and India, Dutta et al (2008) found that around half of the sample would pay up to 3 per cent above regular menu prices if the restaurants were to engage in green practices, and almost 15 per cent of respondents would pay as much as 10 per cent more than regular menu prices. Further, American customers were more willing to pay for green practices than their Indian counterparts. While the results of this isolated study are somewhat heartening, in order for restaurants to make sound marketing decisions, it is necessary to explore restaurant customers’ willingness to pay for green restaurants in a variety of different contexts. To this end, the third research question is proposed: RQ3: How much more are customers willing to pay to dine at ‘green’ restaurants? Employing and marketing ‘green’ practices could help restaurants to establish a new niche for environmentally concerned customers and potentially sustain long-term sales and profits. This idea is supported by the work of Manaktola and Jauhari (2007), who found that Indian hotels demonstrating eco-friendly behaviour have an opportunity to differentiate themselves from ‘non-green’ competitors, as 22 per cent
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of their sample deliberately sought information on ‘green’ hotels and used this information when making their purchasing decision. The typology of ‘green’ consumers presented by Hanas (2007) includes: ‘True Greens’ who regularly buy green products; ‘Light Greens’, who buy ‘green’ products sometimes; and ‘Never Greens’. According to Hanas’ study, 12 per cent of Americans are ‘True Greens’ (68 per cent are ‘Light Greens’) but even the most committed do not buy ‘green’ all the time. This is in part attributable to the lack of ‘green’ products to cover all categories of consumer purchase. This is particularly true in the restaurant industry, where obviously ‘green’ restaurants are not always present in the market. However, given the large number of consumers who are very or moderately interested in making ‘green’ purchases, it is reasonable to assume an unmet need for such restaurants. This is supported by the finding of the recent survey that found that 72 per cent of Americans would choose a product labelled organic over a regularly labelled product (Prewitt, 2007). If such a high percentage of consumers care for organic products, the interest in ‘green’ restaurant practices might well be as high. Indeed, it is our contention that there is a latent demand for restaurants that exhibit strong interest in environmental issues and actively participate in eco-friendly practices. Such ‘green’ restaurants could distinguish themselves from their ‘non-green’ competitors and potentially create a significant competitive advantage. This could not only lead to the attraction of new customers, higher satisfaction and positive word of mouth, but also to increased loyalty and accordingly, increased sales into the long term (Kassinis and Soteriou, 2003). In this vein, the final research question to be considered in this study is presented: RQ4: Can restaurants use ‘green’ practices to attract customers away from ‘non-green’ competitors? To explore the four research questions presented above, data was collected from 455 customers across five casual dining restaurants in Columbus,
© 2010 Macmillan Publishers Ltd. 1467-3584 Tourism and Hospitality Research Vol. 10, 4, 286–300
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Ohio. Statistical analysis of the responses to a quantitative survey along with a qualitative examination of open-ended answers, presented in the following sections, will be used to provide insight into the areas of interest of the current study.
METHODOLOGY Sample and procedure This research was designed as an exploratory study of consumer perceptions of ‘green’ restaurants in Columbus, Ohio, in the Midwest of the US. Columbus is known for being ‘normal’ in terms of consumer behaviour and has therefore often been used as a test market for many companies (BNET, 1998). Columbus has just over 2100 restaurants, which collectively employ over 80 000 people, serving over 80 000 meals a day, making it the largest private sector employer in the city (Baker, 2008). Several casual dining restaurants were asked to participate with the help of the local restaurant organization, Central Ohio Restaurant Association. Five restaurants agreed to participate. Casual dining restaurants were chosen because they are frequented by the most diverse group of customers as opposed to quick or fine dining restaurants. Furthermore, participating restaurants were located in different areas of the town. This was important to obtain a heterogeneous sample from which generalizations to a broader population can be drawn. In order to ensure the largest possible sample with the least amount of administration, a convenience sampling procedure was selected. Although this method of sampling has certain limitations, such as the possibility that the sample drawn is not representative of the population, it is a commonly used technique in exploratory research, when subsequent research will be based on a probability sample (Zikmund, 1996). Accordingly, there are numerous examples of published exploratory studies that use convenience sampling (for example, Gu and
Chi Sen Siu, 2009; Manaktola and Jauhari, 2007; Carr, 2006). The sample frame for the study was drawn from diners at five casual dining restaurants in Columbus. Data were collected directly by the primary researchers over a 4-week period, or when researchers were not present, customers were encouraged by the restaurant staff to complete a questionnaire. During the research periods conducted by the researchers, all customers of these restaurants were approached and an estimated response rate of 90 per cent was obtained. The final sample consisted of 455 customers from the five restaurants. Sample characteristics are presented in Table 1.
Table 1: Sample demographics Variable
Frequency
Percentage
Gender Male Female
224 208
51.9 48.1
Age (years) 18–25 26–35 36–45 46–55 56–65 Above 65
90 154 91 59 35 9
20.5 35.2 20.8 13.5 8.0 2.1
Income ($)a < 20 000 20 000–39 000 40 000–59 000 60 000–79 000 > 80 000
56 55 76 73 148
13.7 13.5 18.6 17.9 36.3
Dining out frequencyb 1–2 3–5 6–10 11–15
158 198 55 6
37.5 47.0 13.1 1.4
4
1.0
16 + a
Annual household; b Per week.
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Measures Lack of comparable studies necessitated the development of an original questionnaire. After initial rounds of pilot testing and expert opinion analysis, the final version of the questionnaire included four sections. Questions were rated on a 7-point Likert-type scale from 1 (strongly disagree) to 7 (strongly agree). The first section asked customers to rate the importance of the three areas of ‘green’ practices, with two questions provided for each ‘green’ practice area. Sample items included: ‘It is important for me that restaurants reduce energy and waste’ (‘green’ action); ‘It is important for me that restaurants serve locally grown food’ (‘green’ foods) and ‘donate to environmental projects’ (‘green’ donation). The second section explored customers’ beliefs and attitudes towards ‘green’ restaurants. Three questions were asked regarding their beliefs about ‘green’ restaurants, as well as a question about their attitudes regarding the restaurants’ environmental protection practices. Sample items for salient beliefs and attitude included, respectively, ‘Dining at green restaurants will help to protect the environment’ and ‘It is good for restaurants to protect the environment’. Also included in the second section was an open-ended question for respondents to
indicate what percentage, if any, they would pay extra to dine at ‘green’ restaurants. The third section requested information regarding demographics and dining frequency, while the final section of questionnaire solicited openended comments from respondents regarding their opinions and attitudes towards anything ‘green’.
Data analysis To explore RQ1 (whether customers believe it is good that restaurants engage in ‘green’ practices), respondents’ beliefs and attitude towards ‘green’ restaurants were summarized in Table 2. Not only does a significant majority of respondents believe that dining in green restaurants helps to protect the environment (71 per cent), but they also believe that it is good for restaurants to protect the environment (70 per cent). To investigate whether any significant differences in beliefs and attitude towards ‘green’ restaurants existed across demographic groupings, independent samples t-tests were conducted. Beliefs and attitude towards ‘green’ restaurants were compared across male and female respondents, those aged above or below 35 years of age, and those with an income less or greater than $59 000 per year. The results
Table 2: Summary of respondents’ beliefs and attitudes Strongly disagreea
Dining at ‘green’ restaurants will help to protect the environment Dining at ‘green’ restaurants will be more expensive Dining at ‘green’ restaurants will be healthier for me It is good for restaurants to protect the environment
Disagreeb
Neutralc
Agreed
Strongly agreee
Freq.
%
Freq.
%
Freq.
%
Freq.
%
Freq.
%
28
6.2
22
4.9
82
18.1
118
26.1
202
44.7
27
5.9
33
7.2
85
18.6
144
31.6
167
36.6
17
3.7
26
5.7
84
18.5
107
23.6
220
48.4
12
2.6
10
2.2
30
6.6
82
18
321
70.5
a Respondents who chose 1 or 2 on Likert scale; b respondents who chose 3 on Likert scale; c respondents who chose 4 on Likert scale; d respondents who chose 5 on Likert scale; e respondents who chose 6 or 7 on Likert scale.
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© 2010 Macmillan Publishers Ltd. 1467-3584 Tourism and Hospitality Research Vol. 10, 4, 286–300
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Table 3: Respondents’ beliefs and attitudes t-tests Femalea
Belief/Attitude
Dining at ‘green’ restaurants will help to protect the environment Dining at ‘green’ restaurants will be more expensive Dining at ‘green’ restaurants will be healthier for me It is good for restaurants to protect the environment
Maleb
df
P-value
Mean
SD
Mean
SD
5.26
1.36
5.07
1.57
1.30
425
0.19
4.98
1.39
4.96
1.37
0.09
429
0.93
5.41
1.35
5.15
1.45
1.94
428
0.05*
6.04
1.25
5.83
1.31
1.73
429
0.08
t-statistic
df
P-value
Age ⭐ 35c
Dining at ‘green’ restaurants will help to protect the environment Dining at ‘green’ restaurants will be more expensive Dining at ‘green’ restaurants will be healthier for me It is good for restaurants to protect the environment
t-statistic
Age > 35d
Mean
SD
Mean
SD
5.20
1.44
5.10
1.53
− 0.67
431
0.50
4.95
1.41
4.98
1.32
0.19
435
0.85
5.44
1.40
5.07
1.40
− 2.70
434
0.01**
5.95
1.32
5.91
1.23
− 0.39
434
0.70
t-statistic
df
P-value
Income ⭐ $59 000e
Income > $59 000f
Mean
SD
Mean
SD
Dining at ‘green’ restaurants will help to protect the environment Dining at ‘green’ restaurants will be more expensive Dining at ‘green’ restaurants will be healthier for me
5.28
1.37
5.12
1.50
− 1.09
401
0.28
5.05
1.34
4.87
1.42
− 1.32
405
0.19
5.45
1.43
5.19
1.37
− 1.85
404
0.07
It is good for restaurants to protect the environment
5.99
1.26
5.91
1.27
− 0.64
404
0.52
a
n=208; b n=223; c n=243; d n=193; e n=187; f n=220; *significant at 0.05 level; **significant at 0.01 level.
are presented in Table 3. The only significant differences that were found were related to the belief that dining at ‘green’ restaurants would be healthier. Females and those aged less than 35 years were more likely to believe that dining at ‘green’ restaurants would be healthier. RQ2 was aimed at identifying which ‘green’ practice area is perceived as most important by restaurant customers. Sample means of the six
examples of how restaurants can engage in ‘green’ practices are displayed in Table 4. The two ‘green’ action (environmental) practices were rated as most important with identical means (5.73). The area of ‘green’ foods (including the practices of using organic and locally grown foods) also rated highly, with both means scoring 5.00 or higher. ‘Green’ donation was considered the least important ‘green’ practice area, with
© 2010 Macmillan Publishers Ltd. 1467-3584 Tourism and Hospitality Research Vol. 10, 4, 286–300
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Table 4: Importance of green practice areas It is important for me that restaurants …
N
Mean
SD
… reduce energy usage and waste … use biodegradable or recycled products … use organic products … serve locally grown food … donate to environmental projects
454 454 454 455 454
5.73 5.72 5.00 5.22 4.40
1.30 1.35 1.48 1.52 1.57
… pay fees to reduce their ecological footprint
451
4.04
1.67
both of the practice areas covered by this question (donations to environmental projects and paying fees to reduce ecological footprints) only scoring slightly higher than neutral, on average. To investigate whether any significant differences in the importance of ‘green’ practices areas existed across demographic groupings, independent samples t-tests were conducted. The perceived importance of ‘green’ practice areas were compared across male and female respondents, those aged above or below 35 years of age, and those with an income less or greater than $59 000 per year. The results are presented in Table 5. Interestingly, although the ‘green’ donation was considered least important by respondents overall, female respondents rated this practice area as significantly more important than did male respondents. When considering the male respondents alone, the practice area of paying fees to reduce ecological footprints was rated negatively on average (mean = 3.76). Significant differences also existed across age groupings for two of the six ‘green’ practice areas: using organic foods and paying fees to reduce ecological footprints. Those aged 35 years or less were more likely to rate this two areas as more important than their older counterparts. A further significant difference was found between income groupings: those earning $59 000 or less were more likely to rate paying fees to reduce ecological footprints as more important than those who in the higher earnings bracket. This is probably correlated to the similar finding from the age t-test, as it is
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likely that those who are younger are also earning less than those who are older. To shed light on RQ3 (how much more are customers willing to pay to dine at ‘green’ restaurants), Figure 1 summarizes the frequencies of responses. Eighty-five per cent of respondents would be willing to pay some amount more if they were to dine at ‘green’ restaurants. Of those, 20 per cent would be willing to pay 10 per cent extra or more for ‘green’ practices in restaurants. These figures are sizeable, indicating an over-riding acceptance among the respondents that costs incurred from ‘green’ practices can be passed on to the consumers that create demand for restaurants. The data analysis conducted to investigate the first three research questions goes some way in exploring the final research question, that of whether ‘green’ restaurants can use ‘green’ practices as a differentiation tool to lure customers away from ‘non-green’ competitors. A large percentage of customers believe it is good for restaurants to protect the environment, ‘green’ action is considered the most important practice area, and a sizeable majority would even be willing to pay a premium to dine in ‘green’ restaurants. To explore the final question further, openended comments were reviewed. Most people who left a comment were in favour of the survey and interested in ‘green’ issues. They supported the notion of ‘green’ restaurants and felt that a survey is a good way to raise awareness among people. Among those respondents, a common notion however was the confusion
© 2010 Macmillan Publishers Ltd. 1467-3584 Tourism and Hospitality Research Vol. 10, 4, 286–300
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Table 5: t-tests of importance of green practice areas It is important for me that restaurants …
… reduce energy usage and waste … use biodegradable or recycled products … use organic products … serve locally grown food … donate to environmental projects … pay fees to reduce their ecological footprint
Femalea
Maleb
Mean
SD
Mean
SD
5.77 5.78 5.06 5.29 4.62 4.31
1.21 1.23 1.44 1.44 1.42 1.50
5.70 5.64 4.91 5.15 4.20 3.76
1.38 1.46 1.53 1.60 1.70 1.79
Age ⭐ 35d
… reduce energy usage and waste … use biodegradable or recycled products … use organic products … serve locally grown food … donate to environmental projects … pay fees to reduce their ecological footprint
Age > 35e
Mean
SD
Mean
SD
5.77 5.76 5.14 5.24 4.43 4.21
1.33 1.40 1.49 1.53 1.55 1.67
5.66 5.63 4.78 5.19 4.33 3.78
1.27 1.31 1.46 1.51 1.63 1.66
Income ⭐ $59 000f
Income > $59 000g
t-statistic
df
P-value
0.62 1.05 1.00 0.92 2.80 3.40
428 425c 428 429 423c 420c
0.54 0.29 0.32 0.36 0.00** 0.00**
t-statistic
df
P-value
− 0.90 − 1.00 − 2.51 − 0.36 − 0.63 − 2.64
434 434 434 435 434 431
t-statistic
df
P-value
0.37 0.32 0.01* 0.72 0.53 0.01**
Mean
SD
Mean
SD
… reduce energy usage and waste … use biodegradable or recycled products … use organic products … serve locally grown food … donate to environmental projects
5.82 5.77
1.26 1.28
5.68 5.66
1.32 1.39
− 1.05 − 0.83
404 405
0.29 0.41
5.12 5.32 4.51
1.38 1.46 1.53
4.91 5.16 4.30
1.50 1.50 1.58
− 1.42 − 1.06 − 1.34
405 405 404
0.16 0.29 0.18
… pay fees to reduce their ecological footprint
4.35
1.63
3.76
1.65
− 3.65
402
0.00**
a
n=208; b n=223; c Equal variances not assumed; d n=243; e n=194; f n=187; g n=220; *significant at 0.05 level; **significant at 0.01 level.
about which restaurants in the area are ‘green’. As there are no truly ‘green’ restaurants in Columbus as yet, this is an understandable issue. It shows however that restaurants that do engage in ‘green’ practices should also market themselves this way, thereby using their ‘green’ practices as a competitive edge. The responses clearly showed that if people knew which restaurants were ‘green’, they would consider visiting those.
An important caveat to this was also discovered by analysing the open-ended comments. A large number of customers made it clear that the quality of food, that is taste and freshness is most important to them. They are not willing to compromise quality for ‘green’. This means that while a restaurant can engage in ‘green’ practices to obtain a competitive edge, these practices must neither compromise food quality nor comfort of the guests. In other words,
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Willingness to pay more for dining at a green restaurant.
recyclable products are only welcomed when they display the same functionality, and local or organic foods are only a ‘plus’ when they taste at least equally as good or better.
DISCUSSION AND CONCLUSION The results of this preliminary research demonstrate that there is a potential market niche for ‘green’ restaurants. A large number of respondents believe that restaurants can and should help to protect the environment, and are willing to spend more on ‘green’ restaurant products. Of the three areas of ‘green’ practices, ‘green’ action (actively engaging in environmental protection) is where restaurants will gain most customer traction from their environmentally aimed efforts. Although it was clear respondents would not be willing to sacrifice quality and comfort for ‘green’, if the quality of the food and service remains at least equal to ‘non-green’ restaurants, being a ‘green’ restaurant could create a competitive edge. However, the study also highlighted the lack of information available to potential customers regarding restaurants and the ‘green’ practices they engage in. Indeed, restaurants face some ‘green’ challenges that are different
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from those faced by other sectors of the hospitality industry. For example, while in hotels, consumers can actively involve themselves in environmental practices through energy or water saving initiatives in their rooms (Goldstein et al, 2008). In contrast, most restaurant product and process activities are hidden from the customer, as they take place back-of-house (Kassinis and Soteriou, 2003). The old adage ‘out of sight, out of mind’ certainly applies here. These invisible ‘green’ practices, such as recycling or sustainable waste disposal, go unrecognized by the customer. Notwithstanding, these ‘green’ practices may result in increased employee satisfaction and commitment, which in turn may lead to better services and increased customer satisfaction, although admittedly not as a direct result of the ‘green’ practices. Furthermore, the inclusion of locally sourced foods (defined by the Green Restaurants Association as whole, nonprocessed foods sourced within a 100-kilometer radius of the restaurant) can be leveraged as a positive contribution to the economic sustainability of the local community. As a result, engaging in ‘green’ practices could have a positive financial benefit for a restaurant, above and beyond the premium that might be charged to customers.
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This study found that nearly all respondents would be willing to pay more to dine in ‘green’ restaurants, and around 20 per cent of the sample would be willing to pay up to 10 per cent more. This result supports the findings of some previous studies (for example, Choi and Parsa, 2009; Dutta et al, 2008), yet contradicts the findings of others (for example, Kasim, 2004; Lord et al, 2004). Interestingly, the studies with findings aligned with the current study are more recent than those that are in contrast – this is possibly an indication of changing consumer attitudes as a result of the heightened salience of environmental issues in contemporary society. However, the differences could also be a result of contextual factors, such as the cultural background of respondents or the particular hospitality sector in which studies have been conducted. Indeed, Dutta et al (2008) found a significant difference in the willingness to pay more for ‘green’ products of Indian versus US respondents, with US respondents more willing to pay a premium. It would be insightful to conduct more studies that compare results from a variety of geographic locations (for example, Europe, Asia and North America), as well as different sectors of the hospitality industry (for example, hotels versus restaurants, and even across different types of restaurants, such as casual, fine and quick dining). Some differences were also found in the views of different demographic segments of the respondents. Female respondents were more likely than males to consider the ‘green’ donation practices area as important, and younger respondents (aged 35 years or under) were more likely than their older counterparts to consider using organic foods and reducing the ecological footprint of the restaurant as important. Understanding the demographic composition of a restaurant’s customer base, and how this impacts of their ‘green’ views, can provide insight into which ‘green’ practice areas are the best ones for a restaurant to target and highlight through their marketing.
Implications for practice Several important implications can be drawn from the results of this research. First, while there is evidence of a market niche for ‘green’ restaurants, filling the niche will require significant communication with customers regarding the ‘green’ practices (and associated environmental benefits) that the restaurant engages in. As it stands at the moment, customers lack the necessary information to make informed decisions about ‘green’ restaurant purchases. Given the ‘invisibility’ of a restaurant’s ‘green’ practices, communicating these practices and making them ‘visible’ to the customer would need to be a focus of restaurant marketing activities. One way to do this is through the use of eco-certification schemes. A number of these exist for the hospitality industry, such as Green Globe 21, the Green Restaurants Association (for restaurants in the United States and Canada), Qualmark (a New Zealand-based scheme) and the Rainforest Alliance, to name but a few. Restaurants that engage in such certification schemes not only receive assistance in becoming more environmentally sustainable, but can also receive accreditation for complying with a range of environmentally friendly practices. Such accreditation can lead to improved customer awareness of a restaurant’s environmental efforts and can be leveraged as a source of competitive advantage over those restaurants that do not engage in eco-certification schemes. Second, ‘green’ restaurants should focus their efforts on engaging in, and communicating the positive results of, ‘green’ action practices, which are perceived as the most important practice area by customers. Overall, respondents were barely on the positive side of neutral in terms of their opinions of the importance of ‘green’ donation (although female respondents did consider this more important that male respondents). While it might be philanthropic and commendable to engage in all three practice areas, marketing efforts will achieve a higher return on investment when focused on the ‘green’ actions that are most important to customers.
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A further implication is that restaurant managers should not be afraid to charge a premium for their restaurant’s ‘green’ practices. Only a very small minority of respondents indicated they would not be willing to pay extra to dine at ‘green’ restaurants, and it is not possible to please every type of customer in the one restaurant. There is certainly interest in the concept of ‘green’ restaurants, and a sizeable portion of customers would be willing to absorb at least some of the additional operating costs through increased restaurant prices.
Limitations and implications for future research While this study benefited from a relatively large sample size and was drawn across a variety of comparable restaurants, there are several limitations, which can be overcome in future research. First, the use of convenience sampling limits the generalizability of the results, as the sample may not be representative of the dining population in Columbus. Second, the use of Columbus as the only research location, combined with the focus on casual dining customers, limits the generalizability of the study results to the wider US dining population, or indeed, the much wider international dining population. Despite these limitations, the study results offer valuable insight into the to-date largely unexplored attitudes of customers towards ‘green’ restaurants. As the current study was designed as an exploratory research piece, many opportunities for future research arise as a result. First, it would be interesting to study further the impact of demographic variables on customer attitudes towards ‘green’ restaurants, in order to ascertain if there is a particular demographic market segment that would be most attracted to (and willing to pay most for) ‘green’ restaurants. Variables such as level of education and cultural background would be useful to include in such studies. Second, while customer attitudes are a good starting point, attitudes alone do not necessarily predict behaviour. Ajzen’s (1985)
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Theory of Planned Behaviour, which also includes aspects of social norms and perceived behavioural control to predict behavioural intentions, would be a useful framework to apply to future research in this area. Furthermore, it would be of great benefit to consider the attitudes of customers across a range of locations and cultures. It is quite possible that, had this study been conducted in the United Kingdom or mainland Europe, for example, the results would have been quite different. No comparable studies have been conducted in such locations, so future research located in such areas would be of great benefit, particularly if the research design allowed for comparison across different countries. This exploratory study has provided valuable insight into customer attitudes towards environmentally friendly restaurants. The ‘green’ trend that is gathering substantial public momentum is one that restaurateurs can adopt to their own benefit. Not only can engaging in ‘green’ practices have positive operational outcomes, a restaurant can also use being ‘green’ as a differentiating tool in the marketplace, and may even be able to charge a price premium as a result. Practitioners and academics alike would benefit from more focused research in this area, in order to better understand the ‘green’ restaurant customer, and be able to tailor operations and marketing strategies in a matching hue.
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