Lisa came up with a strategy to address this issue by introducing Bingo during orning hours in the party room with underutilized employees to keep the senior citizens as her customers and make room for new customers in main area.
It is important to understand the implications Of Lisa’s strategy as it could impact the McDonald image and the overall business. McDonald IS a fast food restaurant where the customers are expected to get in and get out in a 20 to 30 minutes whereas Lisa’s customers are staying on an average 4 to 6 hours.This may pose problems for other customers as it seems like crowded and no place to sit.
Tse, Sin & Yim (2002) study found that customers attribute the high level of crowdedness to high quality of food, low food price and good reputation which draws more people to the restaurant. On the contrary, a quiet restaurant means low food quality, high food price and poor reputation. Lisa’s restaurant is doing well since her restaurant is well crowded. Sun & Morrison (2007) found that 80% of the retired people are most loyal to a particular restaurant when compared to other age groups.The research conducted by Knutson and Patton (1993) affirmed that the two otivation factors for older consumers to eat out are convenience and companionship. Lisa’s restaurant is the convenient and comfortable place for the seniors to gather and spend time with their companions. Moschis et. al.
, (2003) asserted that older consumers are more attracted to senior-citizen discounts, comfortable place to socialize, and proximity to their residence. This restaurant seems to be a perfect place for the seniors to gather around and they spend good amount of money too (Perreault, et. al.
201 1).Lisa, definitely don’t want to lose the loyal customer base. Doing anything that hurts seniors could impact the reputation of the restaurant as public may perceive that the restaurant is not customer friendly. McDonald’s states its mission is to be our customers’ favorite place and provide exceptional customer experience. At present the restaurant is a happy place, but Lisa is only worried about the future business growth and image of her restaurant since most of her customers are senior citizens and she would like to attract the young customers in order to increase the sales and future growth.
Lisa’s oncern is reasonable and she is thinking in a right direction to have diversified customer base and increase revenues. Lisa’s Bingo strategy is a great idea on the surface, but there will be implications as she needs to deal with McDonald’s franchise rules, required gaming license, associated liabilities and insurance etc. She may also get distracted from the main line of businesses and the restaurant may develop more senior friendly image that will cause the younger crowds to stay away.
Recommendations Lisa should continue the business the way it is but implement the following hings to balance to crowd and protect the image.She should not start the bingo game but open up the party area and direct the seniors there by providing them more freedom at the same time free up the main area to accommodate other customers. She should also introduce promotions for young crowd for lunch and dinners like a free drink when they buy a sandwich etc.
Also, promote family specials and kid meals and toys. Also, improve kid play areas. This will surely enhance the restaurant image and increase the sales and improve the profits along with reputation.