Course project of "STAT3613 Marketing Engineering" that performed an exploratory market research of launching an off-campus restaurant using R
Every student at The University of Hong Kong (HKU) hopes for an ideal restaurant that they can run for after class. After the renovation of HKU campus, this semester there are several new dining places. However, it is rumored that students are not satisfied with them in terms of flavor, price or cost performance, etc. This motivates us to explore the opportunity of launching an off-campus restaurant, which hopefully can meet the requirements of the majority of our students. The objective is to discuss the possible and relative importance of the attributes of a restaurant targeting HKU students, identify the optimal setup of the new restaurant for each attributes that maximize the gross profit of the restaurant. By studying the characteristics of the sampled customers, we find out our target customer cluster and makes an estimation of total gross profit accordingly. Thus, the best hypothetical new restaurant and it’s estimated total gross profit can serve as the baseline or starting point for further marketing research.
Corresponding to the objective of this project, the project mainly targets at HKU students. According to the official figure, the total number enrollment of students in all programmes at HKU is 28744 by November 2017. Initially, the survey aims to obtain 300 responses which would be around 1 percent of the whole population. However, due to time limit and low response rate, 53 and 20 students respond to our first and second questionnaires respectively.
For the first round of survey, Correspondence Analysis was applied to find the features that mainly affect the consumer’s choice of restaurant, and their relative importance. Then a Logit Choice Model was conducted to evaluate the relative importance of the three selected attributes based on the findings of Correspondence Analysis. We selected the profile of (Asian, $45, 10 min) since it has the highest utility value of 2.1409 from previous analysis and conducted the second round of survey to estimate the costomers' attitude toward this new restaurant. A logistic model was chosen from several market response model to describe the relationship between demand and price.Then We find that when price=$45.67, the gross profit will be maximized. A cluster analysis was performed later to study the characteristics of the respondents to better estimate the total monthly gross profit.