The Perceived Fairness of Waitlist- Management

Techniques for RestaurantsBy: Kelly A. McGuire &

Sheryl E. Kimes

Presentation By: Lauree Francis

Objective

Determine how customers of restaurants that do not take reservations react to common waitlist management techniques that can violate first-come, first-served expectations

Party-Size SeatingSeats parties at right sized tables

More seats are filled, increases both seat utilization and revenue

VIP SeatingSeating priority in loyal customers in hopes of continued revenueSeating priority to well known customers (Celebrities) to add a higher “status” to restaurants reputation

The Four Waitlist Management Policies

The Four Waitlist Management Policies

Large-party ReservationsOnly allows reservations for parties of 6/8 or moreHelps plan ahead for table useWalk In large parties can interrupt service, by causing restaurants to hold tables and may end in loss of revenue

Call-ahead SeatingAllows customers to call before arrival but does not promise a table immediately upon arrival (no reservation)Shorter wait times for customers who call aheadRestaurants can spread demand to less busy times, maybe even negotiate arrival time

Issues to Consider

Reference Transaction (Past Experiences)

Violations occur when the restaurant behaves differently than the customers past experience, even if they are following an existing policy

Social JusticeCustomers evaluating the “fairness of a transaction”

Procedural JusticePolicy is viewed as “fair”

Distributive JusticeAfter customer experiences the policy they decide the outcome is “unfair”

Issues to Consider

FamiliarityMore familiar the customer is with the transaction the greater the chance they will view the transaction as being “fair”

If customers has complete information on a company policy, his or her fairness ratings tend to be higher than if the information has been withheld

Can be provided to customers by hostess or by a marketing campaign about call ahead seating or large party reservations

The StudyTested customer-fairness perceptions of the four waitlist management policiesUsed Scenario based survey

Two different scenarios for each policy

Advantage of shorter wait

Disadvantage of shorter wait

Scenarios were identical except in one they were with the a party that was seated right away and the other they had to wait

Scenarios were designed so customers knew the reason the restaurant made the choice of whom to seat first

MethodologyQuestions were ranked on a 7 point scaleIncluded questions about

AgeGenderfrequency of dining out

Analysis showed that none of those demographic factors influenced the responses

Convenience sample of 268

Majority (58%) female

Most customers had eaten out 5 to 10 time during the previous month

Key

Findings

Key Findings

Key Findings

Key FindingsCustomers rated seating by party size and call ahead policies as relatively fair

Taking large party reservations only was viewed as neutral to slightly unfair

Giving priority to VIP customers was viewed as unfair

Some differences in fairness rating between customers who did not have to wait and those who did, but they were not statistically significant. Indicating that customers felt the same about the policies whether they were seated first or not

Key Findings

Means for Fairness RatingsCustomers ranked fairness of outcome

similarly to the fairness of the policyCall Ahead seating was still considered fairVIP seating was still considered unfairSeating by party size and large party reservations were rated Neutral

Large-party reservations customers with shorter wait time ranked the outcome significantly fairer than those who had to wait longer

Compared procedural and distributive justice ratingsCall ahead and VIP scenarios

No difference between fairness of policy and fairness of outcome

Party size and large party reservationsSome difference between fairness of policy and fairness of outcome

Means for Fairness Ratings

Customers judged the policy of seating by party size to be slightly fairer than the outcome of the policy (regardless of wait)

Customers judged the policy of seating by large party reservations to be slightly less fair than the outcome of the policy

Results indicate that customers felt it was fair for the party to be seated ahead of them because they had a reservation

But customers felt that the policy of restricting reservations to large parties only was unfair

Impact of Familiarity of Fairness

Impact of customers familiarity with each waitlist policy on fairness perceptions to the policyRestricted analysis to customers that stated they were familiar with waitlist policies (scored 6 or 7) and those that weren’t (scored 1 or 2)

Customers with high familiarity ranked the waitlist policies as being more fair than those that were not familiar with policies

(all except for large party reservations)

• Accepting large-party reservations was considered slightly unfair regardless of being familiar with policies or not

Implementation for Management

Party SizeCustomers respond better to policies when they are aware of them and suggested phrase:

“There is a wait for tables right now. But we’ll put you on the list for the next available table for two”

VIP Customers• Strong negative ratings, should handle with care• Managers should attempt to mask special

treatment• Customers wait in an area away from

hostess table• Bring VIPs through a separate entrance• Use pagers, so customer cannot track place

in line

Implementation for Management

Reservations for Large Parties OnlyBeing familiar with policy does not influence

fairness outcomeRestaurants should allow reservations for all

party size

• Call ahead Seating•Most fair policy in study•Restaurants should promote use of this policy and the rules of the policy

ConclusionWaitlist management helps managers to make important decisions of seating the right customer at the right time

VIP and large party reservations were considered most unfair

Party Size and Call ahead seating were considered most fair