Case Study

CASE: The Pizza Puzzle

Topic: Deceptive Advertising

 

The Marigold Inn, located in Augusta, Georgia, is facing a decline in its room service business, which is the highest margin portion of its food service operation. Sharon Coombs, the Restaurant and Food Services Manager, noticed the decline and tried to improve it by installing a pizza oven and offering room service pizza. However, sales did not increase. She then sent out questionnaires which were completed by departing guests to reveal the problem with the product.  

 

The issue was found to be the pizza quality. After improving the quality of the pizza, Sharon believes that the less than positive response and decline in sales is due to their guests misperception of the quality of the Inn's pizza compared to its competitors and not the pizza quality itself. Based on this conclusion, Sharon proposed a solution, to create a  Napoli Pizza brand for the hotel using a broacher for the guest room delivery service which leads guest to perceive as if the pizza is coming for elsewhere and not the hotel kitchen. She also proposes using Napoli Pizza boxes and uniforms to be used for their delivery. George Hansen, the General Manager for the Marigold Inn, is unsure how to respond to this and is looking to weigh the options before him.

 

George first need to consider his stakeholders

 

·       Owners and shareholders

·       Management and employees

·       Guests and customers

·       Suppliers and vendors of food and beverages

·       Local community

·       The Government

·       Investors and lenders

·       Tourism boards and industry organizations

·       Environmental and community groups

·       Competitors in the hospitality and restaurant industries

·       Insurance companies and legal advisors.

 

He then should use these criteria as a guideline

 

Effectiveness of the Proposed Solution

Will the new image for room service pizza as Napoli Pizza effectively overcome guests misperception of lower quality compared to competitors?

Weighting: High (The success of the proposal will have significant impact on the overall room service business, which is the highest margin portion of the operation)

 

Cost of Implementation

What is the cost of creating brochures, special boxes, hats and jackets for room service staff?

Weighting: Medium (It is important to consider the cost of implementation, but the primary focus should be on increasing room service sales)

 

Impact on Marigold Inn's Image and Reputation

Will the proposed changes affect Marigold Inn's overall image and reputation?

Weighting: Medium (The primary focus is on improving the room service sales, but it is important to consider the potential impact on the overall image of the Inn)

 

Guest Satisfaction

Will the changes result in higher satisfaction levels among guests?

Weighting: High (Guest satisfaction is a key factor in the success of any hospitality business)

 

Ethics and morality

Is creating this new brand image deceitful to the guest?

Weight: High (along with the image and reputation if this were to be found unfavourable then there could be a loss of customers to both the restaurant and hotel)

 

Potential Outcomes

 

1.     Create the Napoli Pizza brand but be upfront

2.     Create the Napoli Pizza brand as proposed

3.     Continue the current brand and try to remarket it with a new campaign highlighting its new quality

 

 

Best Alternative

 

Create the brand/ rebrand but be upfront about the change and where the product is coming from. This could also lead to a potential to also join the pizza delivery market should they choose to which would increase their revenue. By doing this they are remaining ethically and morally in the right to all of their stakeholders but most important to their customers. This also is a better way to keep good relations with their competitors who would hopefully not feel as though the hotel was being predatory to their market.