The Role of Price Perception in the Social Inequality in Restaurants

by: Chelsea Ericka Caritativo, Poppy Merilleno and Vince Roldan

SA 21- G

INTRODUCTION

According to an article, the concept of restaurant is most like a revolution that has reduced the power of the dominant class. The society considered a place where people can relax, enjoy, and socialize while having their decent meals. (Gustafsson, Öström and Johansson) In relation, Katipunan has become one of the most visited food hub here in the metro.  There are a number of food establishments which offers different cuisines with different price range. Indeed, the sidelines of Katipunan can accommodate a lot of people from diverse social classes may it be coming from the lower, middle and upper class. Thus, the group did a research which deals on figuring out the correlation between the price perception of customers coming from various restaurants and the concept of social inequality.

REVIEW OF RELATED LITERATURE

       The sources dealt with stratification in the restaurant world. The first source used is Lucy McCammon’s “Introducing Social Stratification and Inequality: An Active Learning Technique” in which she shows how students can approach stratification topics in sociology. (McCammon)

       For our particular fieldwork subject, we used “Stratification on the Menu: Using Restaurant Menus To Examine Social Class” by Wynne Wright and Elizabeth Ransom, whose thesis examined what its title suggests: how the food people eat and the restaurants we choose to eat them in have become important signifiers of social class, in that our aesthetic tastes reflect it. They observed that a restaurant’s “class” is reflected in how their menus look- the design, the illustrations, and the language.  (Wright and Ransom)

        Another one of the sources is another journal, called “Social Attributes and Strategic Equilibrium: A Restaurant Pricing Game” by Edi Karni and Dan Levin. In it they try to understand the possible equilibrium explanations in the all-too-often occurrence of having two restaurants that offer similar menus and yet have significantly different demands. (Karni and Levin)

         In “Main Attributes of Quality and Price Perception for a la Carte Restaurants” is where we got the inspiration for the fieldwork. The journal investigates the determinants of perceived quality in restaurants, and how that correlates to price perception, and identify what attributes to these perceptions. (Canaizzoro Tin and Rubeiro) Gary S. Becker’s “A Note on Restaurant Pricing and Other Examples of Social Influences on Prices” also helped in the formulation of the theory and the techniques that the team used as it talks about how the way restaurants price their food affects the way people see them. (Becker)

 RESEARCH QUESTIONS

·         How does price perception affect the way people classify restaurants into social classes?

·         How willing are people in paying for the restaurant's ambiance?

·         How do the prices reflect the restaurant workers' and customers' social conditions?

THEORY/PERSPECTIVE USED

            

The main objective of the study is to know how the price perception of people reinforces social inequality. Some related articles and study agreed to the idea that there is a complex relationship between the concept of social class and food consumption. Some of the factors highlighted are the following:

1.         Family income is considered as a variable for social position/class and the allocation or budgeting is limited only to the total amount of earning in a family.

2.         People nowadays considered food to flaunt or express their standards of living or their lifestyle per se. With this, they use food as a tool or trademark as an indication of what class they belong within a society.

With the abovementioned factors, it clearly shows that the dominant perspective to be used is the theory of social conflict which touches the idea of social stratification even to the food and restaurant industry.

RESEARCH DESIGN

The choosing of three restaurants to represent the three classes commonly identified by the society relied on randomly asked Ateneans. Although the researchers had preferred places in mind, they still wanted to know if their inferences are correct. Asking students in Ateneo was already quite biased as the school caters to certain social classes, but due to time constraints, the team decided to just include this in the limitations of the research. The team also restricted the location of the restaurants along Katipunan.

After this, the researchers started to ask the permission from the top restaurant choices (R for the lower class, S for the middle class and T for the upper class) for the visit and participant observation/interviews. Letters were sent to the managers of each place to secure consent and assure the people involved of confidentiality.  Guide questionnaires were also attached to add to the rapport and to fully gain trust.  The team cites the similarities of the questions they use with the research of Wright and Ransom, though theirs focuses on the stratification of the menu.  (Wright and Ransom) Fortunately, they responded favourably and dates were set for the fieldwork.

The interviewees in each restaurant were a manager, a waiter, and a customer. This was so that the team would have different perspectives and observations from people that have different roles in such a place. The data gathered was then analysed using the perspectives and theories used in class. This technique was inspired by the strategies Lucy McCammon wrote. (McCammon)

FINDINGS

I. The Price is Right…Right?

Based on the nine interviews conducted, price really has a lot to do with the general perception of people have on a restaurant especially when:

a.       The restaurant uses promo materials with the meals’ prices.

b.      The menu of the restaurant features “combo meals” or the lack thereof.

c.       Word of mouth of the best sellers

d.      The type of customers look “rich” or “poor”

These characteristics were fruits of the analysis of the answers given by the interviewees.

Letters a and b were confirmed by the managers of the food places. Manager Z of restaurant R said that the company does face-to-face suggestive selling and leafleting of discount coupons to attract people to go to the store. Manager W of restaurant S commented that it is their way of reaching out to their audience.  Manager Y of restaurant T, meanwhile, stated that they do not do promo meals and the like not because they want to be viewed as snobbish, but because they want to keep the menu simple.

Letters c and d came from the answers of the customers.  Customer M of restaurant T said that she chooses the food places she goes to base on her personal whims and the most popular dishes that each diner. Customers N and O of restaurants R and S respectively remarked that they opt for restaurants with cheap meal prices and with customers who seem “welcoming”.

It was noted, however, that customer N’s reaction to one of the interviewers’ additional questions captured an unnoticed sentiment of ordinary consumers. When asked what she thinks of a beggar eating in a diner like restaurant T, she murmured, “May pera ba siyang pambayad?”

II. The Importance (?) of Ambience

All managers and customers interviewed were in agreement that the atmosphere and the environment provided by the restaurants doesn’t matter that much as long as the food quality is great and affordable.  However, people pick restaurants like Mom & Tina’s or coffee shops like Starbucks and CBTL when they want to meet someone “special” because of the ambience and aura they exude.

C.      Price = Reflection?

Prices do not necessarily reflect the living conditions of the workers in the restaurant. Whether one works in a fast-food chain or a fine dining restaurant, the reason for working is the same—to support the family. This is because all workers the team spoke to said that their jobs are full-time and their main source of income.  Worker J of restaurant S though is a class higher (class C) than workers K and L (class D) from restaurants R and T respectively.

ANALYSIS

 This research as mentioned in the theory/perspective used section focused on the social conflict perspective and Karl Marx’s theory of class conflict.   The findings revealed that price perception of people does maintain the stratification existing in the restaurant industry.  The interviewees’ answers show that there are three factors on how this perception further widens the gap between the social classes.

First in line is the concept of target market. Target market is the type of audience that a restaurant aims to cater to. By concentrating on these kinds of customers, it brands itself according to the prices these people associate with their lifestyle. They further reinforce the perception they already built by having promos and other advertising materials. 

The second is the competition between restaurants. In the restaurant industry, they classify food places as their rivals according to the prices and food they offer.  They also monitor the techniques of potential substitutes. This is also affirmed by the research Karni and Levin did on Becker’s and von Stackelberg’s pricing games. (Karni and Levin) This information proves that they also stratify themselves.

Last but not the least, the price range of the meals is the primary factor of the perception people have on a restaurant establishment. This is because customers of lower and middle classes tend to spend within a certain budget while those of food places which serve the upper class are willing to spend as much money needed as long as the food is, in their opinion, great. Having a sales or increasing prices would affect the kind of customers that the diners would attend to.

The research also touched on the food culture, specifically on the norms. People see the stratification existing in the world of restaurants as normal – something which one should know and follow.  Any act of deviance will result to incredulousness and critical judgement of those who respect the unwritten rules.

CONCLUSION

For this fieldwork assignment the team set out to investigate how food and restaurants reflect different social classes, and vice versa. In the work the researchers did in Katipunan, they learned that different restaurants have images and brands that are easily categorised into a social class because of what they know of their menus and target markets.

The team went to three restaurants that are representative of different social classes, restaurant T for the upper, S for middle, and R for the lower class.  They learned that the quality of the food is a major determinant for these class labels, as well as the prices they are sold for. The people the researchers interviewed did not much mind the ambiance of the places when they eat, but they do take note of it when 
they are using the venues for particular functions, such as meetings (i.e.  Customer N says they didn’t care of restaurant R’s appearance, but perhaps they wouldn’t bring a colleague there for a business meeting; she would rather go to the Coffee Bean).

The team knows that in Katipunan, with an upper-middle to upper class student population but sometimes a limited student budget, Ateneo students have the option of dining in more “lower class” establishments so they are given a chance to explore and have an idea of the different classes that go to these establishments. From what they learned, students tend to put restaurants into class categories based on the customers it has, the prices it sells, and the quality of the food.

BIBLIOGRAPHY:

Becker, Gary. "A Note on Restaurant Pricing and Other Examples of Social Influences on Price." Journal of Political Economy (1991): 1109-1116.

Cannazorro Tin, Maria Elizabeth and Luis Duarte Ribeiro. "Main Attributes of Quality and Price Perception for a la Carte Restaurants." Scientific and Academic Publishing (2012): 40-48.

Gustafsson, Inga-Britt, et al. "The Five Aspects Meal Model: A Tool for Developing Meal Services in Restaurants." Journal of Food Service (2006): 84-93.

Karni, Edi and Dan Levin. "Social Attributes and Strategic Equilibrium: A Restaurant Pricing Game ." Journal of Political Economy (1994): 822-840.

McCammon, Lucy. "Introducing Social Stratification and Inequality: An Active Learning." Teaching Sociology (1999): 44-54.

Wright, Wynne and Elizabeth Ransom. "Stratification on the Menu: Using Restaurant Menus to Examine Social Class." Teaching Sociology (2005): 310-316.