David A. Cranage

Plan to do it right: and plan for recovery

This paper presents research results and implications in the literature for the last 15 years, and suggests guidelines on how to make the best use of the information to develop strategies that “fit” a service operation. There are considerable benefits of customer satisfaction, loyalty and increased profits from developing strategies to prevent service failures and strategies to successfully implement service recovery.

Forecasting Hotel Occupancy Rates with Time Series Models: An Empirical Analysis

This study examines empirically the use of two time series models, Box-Jenkins and exponential smoothing, for forecasting hotel occupancy rates. The models are fitted and tested using actual monthly occupancy rates for a major center-city hotel. Both models show a high level of predictive accuracy. Since these models are relatively easy to implement, they should be very useful in actual hotel operations and other applications such as yield management.

Toward Understanding Consumer Processing of Negative Online Word-of-Mouth Communication The Roles of Opinion Consensus and Organizational Response Strategies

Although many hospitality organizations strive to handle negative word of mouth (NWOM) online, limited research has attempted to understand the influence of NWOM on potential consumers’ buying behaviors in order to suggest the appropriate organizational response strategies to NWOM communication. In an attempt to bridge this gap, the authors identified the roles of consensus in NWOM communication and how organizational responses to NWOM affect the ways in which potential consumers evaluate service organizations—by making attributional judgments and forming attitude. The results show that consensus in online NWOM communication plays a pivotal role in influencing how potential consumers incorporate NWOM into their evaluations about the organization. Additionally, these NWOM consensus effects are contingent on organizational response strategies. Finally, the authors discuss theoretical and practical implications, limitations, and directions for future research.

Customer Choice: A Preemptive Strategy to Buffer the Effects of Service Failure and Improve Customer Loyalty

This study examined the impact on customer loyalty of giving customers an informed choice. The main objective was to find that if giving customers a choice in determining their service experience, and by providing relevant information about the choices, customer loyalty was maintained or improved following a service failure. The study examined the interactive effects of the foreseeability of the service failure on the choice manipulation. A 3 (choice: no choice, uninformed choice, or informed choice) by 2 (foreseeability: unforeseeable or foreseeable service failure) design was used to test the effects of informed choice on customer loyalty. The principal finding was that customer loyalty was highest in the informed choice and foreseeable condition. This would suggest that hospitality managers should give choices to their customers as well as relevant information about their choices. Additionally, it suggests that management identify possible service failures, making them foreseeable to both customer and management.

Nutrition Information at Point of Selection Could Benefit College Students

Residential college life offers a window of opportunity to promote long-term healthy eating. Food and nutrition professionals providing services to college students can lay claim to these “teachable moments.” Nutrition information provided as part of residential dining services can be used to increase students’ knowledge and promote skills to help students make better food consumption decisions. The college years are a critical period in young adults’ lives when appropriate lifelong eating habits targeted at achieving or maintaining ideal body weight can be developed or reinforced. The current obesity problem in late adolescence is discussed as well as research findings that suggest that nutrition information at the point of selection may be an effective means to provide college students with the knowledge to make informed choices about the food they eat.

College Studentsʼ Use of Point of Selection Nutrition Information

The study examined the use of nutrition information at point of selection by first-year college students. Objectives were to determine whether freshmen were aware of the labels and used the information to influence their food choices. Nutrition label use by gender and how food choices were affected by nutrition information also were investigated. A Web-based survey was used for data collection. Results showed that females reported a significantly greater tendency than males to use labels to make food choices, and labels made a difference in their decision to eat at the dining commons rather than other foodservice establishments. Females sought foods to promote weight loss by selecting menu items with lower total calories and total fat. Males were more likely to want to gain weight and selected foods with high levels of protein and general overall balance of nutrients. Study findings reinforce the policy of posting nutrition information at point of selection and also present potential strategies for nutrition education to college students.

Service Recovery and Pre-Emptive Strategies for Service Failure: Both Lead to Customer Satisfaction and Loyalty, But for Different Reasons

ABSTRACT Recent research has shown that giving an informed choice to customers can be an effective pre-emptive strategy to offset the damaging effects of service failure. The principle behind this strategy is that customers given an informed choice have increased feelings of self-attributions, share the responsibility for the service failure, feel more regret and stay more loyal. The research has shown that this strategy of informed choice keeps customers more loyal, whether they choose a risky or safe alternative. However, does this strategy work when service failure occurs and the normal service recovery strategies of an apology and/or compensation are given? Would customers still feel some responsibility for the outcome and still be satisfied and stay more loyal? Or would an apology and/or compensation give a mixed signal that the service establishment alone was responsible for the service failure? An alternative perspective would be that by combining pre-emptive and service recovery strategies, customers would feel appreciation and respect for the service company for their disclosure and commitment to complete customer satisfaction. The principle finding was that customer satisfaction and loyalty were higher after a service failure when either the pre-emptive strategy of giving informed choice or the service recovery strategy of an apology and/or compensation were used, than when no choice, apology or compensation were offered. However, the highest ratings for customer satisfaction and loyalty were recorded when both strategies were employed together. Interestingly, the reasons for the higher customer satisfaction and loyalty differed for the individual strategies as well as for the combination of the two strategies. The results have practical implications for service managers.

Practical time series forecasting for the hospitality manager

One of the most basic pieces of information useful to hospitality operations is gross sales, and the ability to forecast them is strategically important. These forecasts could provide powerful information to cut costs, increase efficient use of resources, and improve the ability to compete in a constantly changing environment. This study tests sophisticated, yet simple‐to‐use time series models to forecast sales. The results show that, with slight re‐arrangement of historical sales data, easy‐to‐use time series models can accurately forecast gross sales.

A comparison of time series and econometric models for forecasting restaurant sales

Abstract Historically, forecasting of restaurant sales in the hospitality industry has been ‘judgementally’ based. Given the importance of both short-term and long-term sales forecasts for effective restaurant management, we have investigated various forecasting models for accuracy and efficiency. The results of the study show that for the actual restaurant sales in this sample, time series models (specifically Box-Jenkins and exponential smoothing models) performed as well or better in forecasting sales than an econometric model. Since time series models (especially exponential smoothing models) are typically more economical in terms of time and skill levels of the users, the results of this study have important implications for the use of forecasting techniques in the restaurant industry.

Why wait? Impact of waiting lines on self-service technology use

Purpose – The purpose of the present study is to examine the effect of waiting lines on customers’ decisions between using a self-service alternative and using a service employee. As self-service technologies are expensive and time-consuming to design and implement, service providers need to understand what drives customers to use them. Service operators have the most control over waiting lines and flexibility in expanding capacity, either by adding service employees or by adding self-service kiosks. Design/methodology/approach – The study used online scenario-based surveys following a 4 (number of customers waiting for the self-service technology) × 4 (number of customers waiting for the service employee) design. A binary dependent variable was used to record participants’ choice of service delivery alternative. Findings – Using logistic regression, the authors found that customers are increasingly motivated to use self-service technology as the waiting line for the service employee grows longer. This ef...