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Table of Contents

1.0 Introduction ....................................................................................................................................... 2
2.0 Costa Coffee...................................................................................................................................... 3
2.1 Consumers Perspective and Decision Making Process .............................................................. 3
2.2 Analyse Needs and Expectation of Consumer through Market Segmentation and Maslows
Needs Hierarchy ........................................................................................................................... 7
2.3 Analyse the Quality of Service Encounter ................................................................................. 14
3.0 Conclusion ...................................................................................................................................... 17
4.0 References ....................................................................................................................................... 18
5.0 Appendices ...................................................................................................................................... 25



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1.0 Introduction
This report discusses and evaluates the consumers decision making process when an
individual served in hospitality industry. Before the decision making process discussed, the
perspective of consumers will be evaluate since different consumers perspective will give
different result on the decision making process. A model of decision making process will be
choose to understand the consumer behaviour and explores the communication activities
provided by the service provider. Primary segment will be identified through observation and
information obtained by the service provider. The needs and expectation of the primary
segments will be studies through the used of market segmentation to investigate the target
consumers desire and Maslows needs hierarchy to find out whether the service provider
able to meet consumers expectation. The third part will be identifying the quality of the
service encounter by referring SERVQUAL model based on personal experience.
The service provided will be analysed on is Costa Coffee. Costa Coffee has found in
London in 1971 by Sergo and Bruno Costa. Whitbread PLC acquires Costa Coffee in 1995
which is the UKs biggest hospitality company. Costa is an international brand Costa and
voted the UKs favourite coffee shop, has grown significantly over the past five years and
now has over 2000 stores in the world and represented in 29 countries. Costa has provided
the service through its own stores, drive-thru, espresso bars and also Costa at home by own a
Tassimo brewer. Costa has fully committed with CSR policies such as Costa foundation, a
charity for education. Costa use sustainable and recyclable products and equipment. Costa
has gained the Rainforest Alliance certified as they know their customers want to support
British farmers and trust their quality and welfare standards. Costa has offer full range of
menu to satisfy different consumers needs and provides a comfortable environment and
atmosphere with professional staffs to serve their customers.



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2.0 Costa Coffee
According to Belch & Belch (2004), consumer behaviour refer as complex process
comprising the activities people engage in when looking for, selecting, purchasing,
consuming, assessing and positioning of products and services with the goal of satisfying
needs, wants and desires.
2.1 Consumers Perspective and Decision Making Process
Consumer has different perspective towards a product or service based on their buying
intention and past experience before purchasing such as rational, behavioural and experiential
perspective (Williams, 2002). For the consumers who first visit to Costa Coffee, they would
set themselves as a rational or behavioural perspectives consumers. Rational perspective
means consumer able to use the information provided by the service provider and evaluate
themselves with rational thinking to investigate the potential benefits and losses (Williams,
2002). Costa provides the nutritional info on each menu items to allow consumer have the
better info of each calories and other nutrition contained and enable consumers choose based
on their nutrition preference especially for those fitness seeker (Hughner & Maher, 2006)
while behavioural perspective refer as consumer place their decision as behaviour intention
through the distinctive of environment (Eckardt, 2014) such as the thoroughgoing interior
design of Costa stores that provide different kind of seat setting like sofa seats for chilled
with friends, couple seat at corner side, individual seat and outside seat for smoker. However,
loyalty customer of Costa placed themselves as experiential perspectives consumer which
something that could not be explained in rationality (Eckardt, 2014) or they evaluate the
decision making process by their past experience such as the Costa barista address
consumers name and know their preference during purchasing in result of consumers feel
impress and valued from the service provider.
Decision making process of consumer allows the service provider to understand
consumer behaviour. It is a routine action that carries out by all individuals (Williams, 2002).
Decision involves a set of congregated steps of action and refers as finalized solution in a
problem solving procedure (Williams, 2002) while decision process refer as a structure that
proposes decision-making is a sequence of activities or which the decision itself is one stage
(McGrew and Wilson, 1982: 4). To investigate the consumers behaviour, there are series
models of decision making process which adapted to different situations or areas.


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The Engel, Kollat & Blackwells model of consumer decision-making is chosen to
study the Costas consumer decision making process. It consisting five stages which are
motivation and recognition of need, information search, evaluate alternatives, purchase and
post purchase evaluation in order to understand the overall concept of consumer behaviour.


Figure 1 Engel, Kollat & Blackwells Model of Consumer Decision-making

Firstly, consumers aware of their need on particular need and only motivate them to get
it. For instance, human needs food to ease hunger and water to quench (Williams, 2002).
Costa has provided varieties of food and beverages choice to satisfy their customer appetence.
According to The British Coffee Association (2014), coffee provides consumer positive
outcome by increase their alertness, concentration and performance especially for those
drivers and night shift workers. A desire of caffeine will create intention of people to go for a
cup of coffee. Costa has provided quality coffee by fine selection coffee beans by expert. It is
a current trend and lifestyle to have a coffee everyday which proved by the Allegra Strategies
definitive report, illustrates that the coffee drinkers statistic is increasing year by year. In
addition, Costa has creates the extrinsic and intrinsic motivation to their customers by only
corporate with the British farmers as their suppliers and Rainforest Alliance Certified has
clearly labelled on the Costa packaging, and provide the details nutritional information to
allow customers aware their health .
When a need is recognised, consumers will search for the possible purchase choices by
referring several channels of information sources such as mass media, marketing efforts and
personal information from friends and family in order to have some ideas and supportive
motive (Williams, 2002 and Engel et. al, 1978). Costa has provided the menu on official
website for consumer refer the selection. Costa has several social media communicating with
their customers such as Facebook, twitter, Tumblr, Instagram and YouTube as well as the
official website to provide the information for consumers. Costa keeps connecting with their
customer by updating all their social media frequently with the post of greeting customers,
update their recent activities, promotion, promote new products, and share some general
Motivation and
recognition of need
Information
search
Evaluate
alternatives
Purchase
Post
purchase
evaluation

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knowledge about coffee. For example, Costa run the photo competition Hello Summer for
consumers snap a photo with their cold beverages and get a chance to win prize by post on
their Facebook page. They also run the roadshow to distribute free ice-blended beverages for
customer taste their new products of summer season. The stores of Costa offers the free
membership cards with 100 points included for customer collects their points and redeem
beverages. Costa has won the UKs favourite coffee (Whitbread Annual Report, 2013)
meanwhile the good image of Costa creates the positive word-of-mouth among the coffee
lover and also influences other non-coffee lover to have a try of their products. Costa also has
create a link on their website named The Costa Experience and designed in animation
which make customer feel exciting to read through the Costa story and have a clear general
idea towards positive image of Costa. Costa has done well in their information part for
customers to review.
After gather the relevant information, evaluates all the alternatives will be take place in
the next step. Consumers starting considers the varieties of choices available and evaluates
each in terms of gains and losses and also their preference (Williams, 2002). Time, place,
method of payment are involve in the selection process (Williams, 2002). Previous
experience will also influence the consumer when evaluates the alternatives (Underhill, 1999).
For the coffee lover, they could go for the Americano choice that provides the origin taste of
coffee whereas for those non-coffee lover can go for the choice of tea, hot chocolate, and
fruits flavour beverages. Consumers that could only consume certain caffeine or chocolate
lover can choose the Mocha. The Hello Costa Ice is specially creates for cold drinks lover
and welcome the summer season. The consumers who prefer low calories can request low fat
milk for their favourite coffee without additional charge. For each menu items, Costa offers
the nutrition information includes energy, calories, protein and fat to match the healthy trend
now that most of the consumers seek for (Hughner & Maher, 2006). So, consumer could
evaluate the info given and make the decision to go for the best nutritional value they desired.
Light food served for the consumers as well to make a perfect match with beverages. Costa
also provide take away and dine in services. The price will be according to the size that
consumer choose so for consumer who has budget can go for the smallest size. The price
range is at the standard level (2.65 for large cappuccino) so most of the consumers able to
afford it and even lowest than Starbucks (2.90 for large cappuccino). They also accept the
payment method of card and cash term as well as the Costa member card to redeem their
order.

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Purchase decision will be made after go through the progress of motivation and needs,
information search and evaluation of alternatives. Costa will topped the cocoa powder on
their coffee to enhance the presentation that increase consumer excitement and the design of
recyclable paper cup for hot drinks take away with uneven surface to ensure consumer hold
properly.
Lastly, post-purchase which the important stage for the service provider to enhance
their service and product as well as the reputation through their customer response of the
satisfaction level in overall. Costa has done well in this stage as they concerned on every
comments and suggestion from their consumers. The website has a wide platform for
consumer to comment and enquiry. Costa designs the webpage for enquiry and feedback into
categories by the general, coffee club, business, press, students and jobs to make their
customers easy to access. Feedback is also a best tool to create the consumers intention to
visit or revisit by viewing the past consumers positive experience and recommendation Costa
has promise they will take any complaints or feedback very seriously and try to rectify the
problem as effectively as possible. For example, Costa has responded all the customers
comment on their official Facebook page post and taking action if that is a problem of their
consumer faced such as the tidiness of store has been complained and Costa take action to the
area manager about this issues. The efficient reply of consumers comments influences other
consumer as well that they are valued to the service provider.


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2.2 Analyse Needs and Expectation of Consumer through Market Segmentation
and Maslows Needs Hierarchy
Market Segmentation
The supporting theoretical philosophies of market segmentation can be found within
economic pricing models which proposed that discriminatory pricing could be used to
maximise profits amongst different consumer clusters (Stigler 1942), in other meaning of
attaining greater efficiency in the supply of products to meet the demand and improved cost
effectiveness in the marketing process (Middleton et al., 2009). There are many segmentation
approaches includes geographic, demographic, socioeconomic, psychographic and
behavioural segmentation. The primary segment of Costa will be studied through
demographic, psychographic and socioeconomic segmentation.

Demographic
Demographic segmentation includes the elements of age, gender, religion, family
lifecycle or ethnicity (Williams, 2002). Costa has focus on the age groups and family
lifecycle to develop their markets as they have a wide age range of consumers from kids to
old adults so they offer many varieties of menu choice to serve all the age of consumers.
Costa offers varieties choice of sweet beverages and or with fruity flavoured as well as some
dessert which to satisfy their smallest age range of consumers (age 5-14) such as red berry,
mango and passion fruit, raspberry and white chocolate, chocolate caramel short cakes,
Belgium chocolate teacake and etc. According to Birch (1999), children prefer sweet taste
more than the bitter and sour taste as well as fruit drinks. The youth with age ranges of 15-24
(UNESCO, 1945) tend to have a try on different kinds of special or new things cause of their
curiosity (Paddock, 2014). The specialty menu such as gingerbread latte has designed to
consumers who tend to have some different experience, and also the new creates of seasonal
menu like Summer Fancies in the summer season menu which motivates the consumer to
have a try before the summer ends. Adults and older adults which age 25 and above are
suggested to have more hot drinks rather than cold drinks with the statement of hot drinks
protect human health all year long from the publish of Consumer Reports (2013). Numerous
hot beverages were offered by Costa for the hot drinks seekers. People are pursuing the
healthy lifestyle like older adults for avoid illness and proper nutrition (Ervin, 2008) and also
consumer age 19-25 and young women pursuing fitness lifestyle to create better body image
(Abraham 2003) so Costa has provides the nutrition info of their products to fulfil their need.

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According to a 2012 study by the National Coffee Association, shows a significant increase
in coffee consumption in the 18-39 age groups (Duff, 2014).

Psychographic
Psychographic segmentation is based on the clue that the individuals personalities,
attitudes, opinions and lifestyles to determine consumers behaviour (Swarbrooke and Horner,
2007). Many models have been developed by researchers such as VALS-Values and
lifestyles (Swarbrooke and Horner, 2007). Lifestyle approaches are usually based on the
presentation to individuals of a series of response statements with all the data then gathered to
classify respondents who are relatively similar within a group (Williams, 2002). Consumer
purchasing patterns are usually determined by the common values among groups of
consumers such as health farms and spas target their marketing at consumers who seek for a
healthy lifestyle (Swarbrooke and Horner, 2007). However, a growing number of hospitality
organisations adopt the psychographic segmentation.
Coffee is the most consumed beverage in the world with the exception of water (Bidel
and Tuomilehto, 2013). Coffee consumption began around fifteen century and coffee trend
would not outdate, yet last till now or even future (Tucker, 2011). In the western society,
most of the westerners tend to have a cup of coffee everyday and it is a habit of their daily
lifestyle which inescapably presents (Tucker, 2011). The consumer will feel relax while
consuming coffee (Jacques, 2013). Due to the caffeine additive, so it make consumer wants a
cup of coffee to fulfil the needs of caffeine (Sculman, 1995). Coffee offers an excuse for
consumers to have a gathering with their friends and coffee shop provides the nice
environment with aroma of fresh-brewed coffee surrounding to cheer people up as well
(Tucker, 2011) such as Costa provide the sofa seat setting that could accommodate a group of
friends or family to have a comfortable environment to socialize and have a chance to slow
down their pace of life. Yet, coffee has little nutrition benefits (Tucker, 2011) for consumer
has the lesser chance to develop Parkinsons disease which states by the studies of Ronald
Postuma (MD) that caffeine can aid with movement symptoms for people who already have
the disease (Jacques, 2013).
Costa Coffee is making significant efforts to be a socially and ecologically responsible
organization as they know their consumers tend to be good to the society and the
environment. Costa has their foundation to educate the children in the poor countries like

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Colombia, use sustainable and recyclable products and equipment such as the cup of take-
away, coffee machines on sleep mode automatically when not in use, recycle their organic
waste and coffee grounds helping create renewable fuels, recycled unwanted uniforms and
supporting the local farmer that uses sustainably grown beans sourced from Rainforest
Alliance Certified farms, hence, consumers in a way of enhance the famer likelihood and
family as well as the planet whenever they consuming the Costas coffee.

Socioeconomic
Socioeconomic segments are based on segmenting markets on the basis of economic
act (Williams, 2002). Economic status of the consumer can designate the buying power;
however, it gives no clear idea about the actual needs of consumer (Middleton et al., 2009).
There are few factors to determine the consumers economic status including income, wealth,
occupation and sometimes life-cycle segmentation. The British approach to socioeconomic is
based on the classification of JICNARS as shown as Figure 2 below. JICNARS has clearly
defined the socioeconomic of a consumer by according their social grade, social status and
occupation. Social grade will be categorized into A, B, C1, C2, D and E with the social status.
Social class is principally defined by the individuals occupation (Blythe, 1997: 94).

Figure 2 JICNAR Scale
Costa coffees consumers are included the entire social grade from A to E since the
pricing of Costa is under the affordable category that most of the people able to pay at a
reasonable price and get a quality coffee or other beverages and food. The price range of

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Costa is around 0.55 to around 5 for their food and beverages such as babyccino cost only
0.55 and Piri Piri Chicken Panini cost only 3.95. As a consumer of 200 weekly income
holder (Hirsch, 2013), it is possible for them to visit Costa Coffee. Students and office
workers are the main consumers of coffee shop (Bplans, 2014). Students tend to visit the
coffee shop to complete their assessment with a cup of coffee for refresh their mind under a
comfortable environment and office workers always go for a cup of coffee before work.

Maslows Hierarchy Needs

Figure 3 Maslow's Hierarchys Need
Maslows hierarchy needs is a general framework for grouping and ranking needs
(Wahba & Bridwell, 1976). According to Maslows needs hierarchy (Maslow, 1943, 1970),
people have inborn desires to fulfil a set of needs such as physiological needs, security needs,
belongingness needs, esteem needs and self-actualisation needs. According to Yu and Fang
(2009), the basic needs such as physiological needs and security needs can be satisfy from
product quality; service fulfils the social needs such as belongingness and esteem needs; and
the experience is accordingly to achieve the even higher level of needs includes self-
actualisation, knowledge or understanding and aesthetics. Maslow (1954) states that an
individual will only be moved to meet higher needs after the lower order needs are satisfied
(Ross, 1998).

Upper level of needs
Lower level of needs

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Level 1: Physiological needs
Physiological needs are the demand that humans bodies put on an individual in term of
survival include hunger, thirst, sex, sleep and air (Ross, 1998). An individual who is needing
food or drinks, safety, love, and esteem would likely desire for food and drinks more strongly
than for anything else (Stephens, 2000). Costa provides a wide range of menu choice to allow
consumers satisfy their stomach and throat. From hot drinks (hot mocha) to cold drinks (iced
specialty latte), caffeinated (cappuccino) to decaffeinated drinks (peach iced lemonade, hot
food (egg and mushroom muffin) to cold food (sandwiches), as well as sweet food (cakes and
pastries) to fulfil the consumers refreshment need. The comfortable seating of sofa seats
provided in the Costa store would make consumers falls asleep to have a break (Francis,
2010). The coffee aroma surround in the air of the stores enhance the Costa atmosphere and
make consumers feel relaxation.

Level 2: Safety needs
The new needs emerged after the psychological needs met, which categorized as
safety needs. The safety needs indicate the need to be free of danger or threat (Seeley, 1988;
Pearce, 1988, 1996); a secure, orderly and predictable environment (Ross, 1998); and
familiarity (Williams, 2002). According to annual Project Cafe13 UK report (2013), Costa
has been awarded the Nations Favourite Coffee Shop consecutive four years with 41%
proportion of UK adults who rate Costa as their favourite coffee shop (Whitbread annual
report, 2013). The award offers the credibility towards the consumer especially for the first-
try consumer that Costa Coffee is awarded to pay a visit. Costa consumers are under the
secure of CCTV set-up in case of any unwanted incident happened and able to track it such as
theft case. The healthy of consumer has been concerned by Costa since it is considered in the
safety need category as well (Tikkanen, 2007). Costa has provided the nutritional info in
order to make the consumer understand the nutrient and ingredients contained in their product
and safe to consume. Consumer could get it through Costas official website and on the
counter of every Costa stores. Costa has also gained the Rainforest Alliance Certified as they
know their consumers want to support the local farmer with good quality products (Costa,
1971).



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Level 3: Love and belonging
Subsequently, needs for love and belongingness appear. Consumers must not only feel
physically safe in the stores but they must also have the sureness that it is someplace they
belong (Francis, 2010). A wide variety of needs for a person from a sense of feeling
belongingness, affectionate relationships, afliation such as group membership, clubs,
churches, work afliations, to friendship and love of spouses, children, and parents (Seeley,
1988; Ross, 1998). Costa Coffee has design the membership card for their consumer in a way
of maintaining good relationship with their consumer and leads their consumer to loyal to
their brand. It makes consumers found value towards the service provider that not only focus
on own revenue but care of the consumers benefit. The membership card has included 100
points and free to take one from the cashier counter, so, consumer can collect the point and
redeem it for the next visit after accumulate the points required for the item they prefer. Costa
official website provides a corner to allow consumer check their account through click on the
Coffee Club. Costa also contacting their consumers through email by updating the
promotion or any new events or products happens around. Costa also has an activity for their
member only named Chooseday which giving out double points for the selected offer drinks
and treats by carry out once a week. In addition, the environment of Costa stores provides
consumer comfortable seat setting by allocate the couple seats on the side to give couple has
more private space, sofa seats for family and friends gathering, long stand individual seats for
person need self space to chill and so on. Thus, consumers spend their time under a relaxed
environment.

Level 4: Esteems needs
The fourth level comes to esteems needs. The esteem needs indicate an individual
needs for a feeling of self-condence and capability (Tikkanen, 2007). This may incarnate
internal feelings of strength, achievement, independence or external desires of reputation,
prestige, recognition, attention and so on (Seeley, 1988). Esteems used to motivate people to
visit by sharing the information about the experience with others after returning home (Kolb,
2014). For some consumers, the importance of the stores is seen in the respect they are
shown by the staff. Costa coffee is a self-service coffee shop which consumer purchase the
products at the counter and get their prefer seats in the meaning of consumers would not be
disturb by the staff while chatting with their friends or doing their assignments. It also can be
improved by participation in the special or limited events like Chooseday offered by Costa

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to their members only (Kolb, 2014). As stated at previous level of the membership card,
points collection for Costas members is a financial rewards that can fulfil the consumers
esteem since it is a signals of peoples worth to organization (Kolb, 2014). In this technology
advancement era, social media is the most popular platform to connect with friends and
family and sharing their recent activities. Consumers can check in to the stores and share to
their friends about todays drinks or food through social media such as Facebook and
Foursquare. It makes consumer feel prestige that they are enjoying the service and product of
the recognised coffee shop. The sense of respect to the customer might need to improve by
Costa employee due to no acknowledge customers once they step in the stores but presence at
the cashier when purchasing take place only. This action will make customers feel welcome.

Level 5: Self-actualization
The last level proposed by Maslow is self-actualization. The inward vocation is
important for a person even though the above needs have been satisfied (Tikannean, 2007).
The fulfilment will be achieved completely once the self-actualization of individual achieved
(Williams, 2002). Self-actualization needs show the desire to realize ones full potential
(Seeley, 1988). Service provider may deliver the opportunity for consumers to develop their
own special skills or interest to a professional level. The official website of Costa has
provided a platform for the customers to understand more about the coffee process for a
coffee shop. By visit the official website, The Costa Experience has provide the information
from coffees origin, crops, roasting process to the end of production, a cup of best quality
coffee. It also refers as a story of successful coffee shop includes their coffee, responsibility
of sustainable, suppliers, teams, menus and stores. The nutrition info provided at the stores
and on the website is able to improve the consumers knowledge of healthy. Costa has
launched the Costa Book Awards in 2006 and Costa Short Story Award in 2006 which
encourage people to spend time with a coffee to enjoy some great writing and participate in
this Book awards. The winner will be reward by attractive prizes with 5000 or above and
book published in UK. Costa Coffee can apply some coffee knowledge in physical like
Starbucks which place some different kinds of coffee bean used with descriptive at the stores
to increase their consumers understanding about the characteristic of coffee instead of enjoy
the aroma and taste without general knowledge.


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2.3 Analyse the Quality of Service Encounter
A service encounter is every time a customer interacts with an employee (Lovelock &
Wirtz, 2007) while service quality defines as meeting customer expectations (Parasuraman et
al., 1985). The preferred service quality is a global judgment, or attitude, involving to the
service of supremacy while satisfaction is associated to specific transaction (Parasuraman et
al., 1988) in a meaning of the service quality is for long-run evaluation about service where
as satisfaction is a transaction-specific evaluation. Parasuraman et al. (1988) stress that a
consumer will observe that there is service quality only when the service provider meets their
expectations. SERVQUAL will be used to evaluate the quality of Costa Coffee when the
service encounter take place as it is the most appropriate tools to be used in most of the coffee
shop (Fick and Ritchie, 1991). SERVQUAL model is based on five dimensions of service
quality which are reliability, responsiveness, assurance, tangibles and empathy.
Reliability is the ability to perform the promised service dependably and accurately as
Costa has performed it well. The food and beverage menu offers by Costa have stated clearly
of the info of choices and prices for each size that desired as well as nutrition contained in
each products have display in the stores as it is important for consumer who pursue healthy
lifestyle wanted to aware of the calories taken. The Rainforest Alliance Certified logo stamp
on the product packaging and details info stated on their official website has increase the
confidence of consumer to consume their products as Costa is certified that they are
supporting local farmers and sustainability responsible.
Responsiveness can be defined as willingness to help consumers and provide
consumers with prompt service such as deals the consumers request, questions and problem
effectively and efficiency. In term of responsiveness, Costa should put more effort on it. The
frontline employees act as ambassadors of their companies during service encounters and
playing a vital role in influencing consumers perceptions of quality (Lee-Ross 2001). Yet,
costas staffs seem have no any proactive welcoming or proposing signs to their consumers.
A simple greeting is needed not only happened on face-to-face meet but showing welcome to
their consumers once enter the stores will makes them feel being respect. Staffs suggestion
on choice will assist the consumers reduce their difficulty in selection among the varieties
choice and also allow consumer to have a different experience. Consumers will be interested
on try the new products of their familiar brands but the approach of introduce the new or
recommend other products to consumers seem fails to perform by Costas staff. It is a way to

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increase the consumers product knowledge and also increase the profit, so, Costa should try
to enhance in this extent.
Assurance refers the knowledge and courtesy of employees and their ability to convey
trust and confidence. According to Pugh (2001) of his study service with a smile studies on
how employees feel and act towards consumers and in which sense showing emotions effects
customer affect and decision of service quality. Costa has train their staff to be professional
as have a smile to serve the consumers so consumers would not feel offense by the staffs own
emotions. Knowledgeable staff is able to answer in confidence to solve the consumers
problem. Costa have training academies across the world where their staff can learn to make
coffee and a training team equipped to teach them about a whole host of things which to
ensure their staff have the sufficient knowledge and skills in every aspect and to be a
professional service provider. However, the staff has no show proactive to share their
knowledge with the consumers and this would be suggest that Costa need to emphasize the
proactive of employees instead of improve knowledge only by carry out outdoor activities
that makes consumers and employees associate together.
Tangibles define as the appeal of physical facilities, equipment and appearance of
personnel (Swarbrooke and Horner, 2007). Costa has display the menu with price list on the
wall in front of the order counter. The display menu has clearly stated the no chargeable
additional request for drinks with skimmed or soy milk and chargeable request like extra shot.
However, the spot light reflect of and word size of the menu creates difficulty for consumer
to read it. Costa should improve their menu design to the bigger word size and also display
more of the menu in the stores. There are no music plays in the stores and the noise from
electronic machine makes consumers feel interrupted. Music is important for consumer feel
lively and enjoyable with enjoy their favourite drinks. Costa may consider to invest the less
noise produced machine or the stores structure that could reduce the noise. The smiley staffs
make consumers feel friendly and intention to visit for enjoy their service again. The layout
of Costa might improve in the problem of take-away waiting area which consumer has no
direction where they should be while waiting their order. However, the type of furniture and
well allocation of seats setting make consumer feel comfortable to spend their time in the
stores.


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Lastly, empathy is about easy access, good communication and understanding the
customer needs (Zeithaml, Parasuraman and Berry, 1990). Easy access is linked to the
accessibility, for instance, different stores has different operation hours with the early at 0530
to the late at 2030 so consumers can proceed to the other stores if the visited is closed; Costa
has more than 2000 outlet in the world which make consumers can get their favourite coffee
almost everywhere; Costa has promise to service their consumer in 5 minutes and also
contact number available on the website. Costa has different official website for each
countries by using their main language display. Understanding the customer includes learning
about specific wants, providing personalized attention and also recognizing the regular
customer. Costa has provide a wide feedback platform on website for their consumers express
their experience, or good or bad comments in order to rectify as effectively as possible and
get improve in the future. The passionate staffs have also remembered some of the regular
consumers favourite and make consumer feel impressive of their service.


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3.0 Conclusion
The Engel, Kollat & Blackwells Model of Consumer Decision-making has been used to
identify the consumers step-by-step decision making process so Costa could be used the info
to reduce the obstacles of consumer faced during the process. Market segmentation gives the
useful clues for Costa to understand well of their targeted customers. Demographics,
psychographic and socioeconomic provided useful information to examine the specific wants,
needs and trend of consumers from different age, lifestyle, personality and socioeconomic
status. The Maslows Hierarchy has been used to understand the consumers motivation to
Costa because it provides all aspect of an individual needs that could not be skip either one of
the level to fulfil the consumers needs requirement. Lastly, SERVQUAL has been applied to
evaluate the perception and satisfaction on the consumer expectation through the service
encounter by Costa and understand how well of the quality has meet the consumers
expectation. In future, Costa should put more efforts on the quality of tangible or intangible
service instead of products only. They may create more promotions to compete with their
competitor like Starbucks which has different kinds of discounts frequently for both member
and non-member. Discount is the tool created the awareness of consumers to the brand and
make consumers to be loyalty.

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4.0 References
Journal and Books
Abraham, S.F. (2003) Dieting, body weight, body image and self-esteem in young women:
doctors dilemmas. Young Womens Healthy. Volume 178, 16 June 2003.
Belch, E.G. & Belch, M.A. (2004) Advertising and promotion: an integrated marketing
communications perspective. New York: McGraw-Hill.
Bidel, S., & Tuomilehto, J. (2013) The Emerging Health Benefits of Coffee with an
Emphasis on Type 2 Diabetes and Cardiovascular Disease. European Endocrinology, 9 (2),
pp. 99-106.
Birch L.L. & Marlin D.W. (1982) I dont like it; I never tried it: effects of exposure on two-
year-old childrens food preferences. Appetite, 3, pp. 353360.
Birch, L.L. (1999) Development of food preferences. Annu Rev Nutr,19, pp. 4162.
Cooke, L. & Wardle, J. (2005) Age and gender differences in children's food preferences.
British Journal Of Nutrition, 93 (5), pp. 741-746.
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25

5.0 Appendices
Exterior design of Lord Street Costa Coffee


Interior design of Wimborne Costa Coffee


Friendly Staff of Costa Coffee


26


Costa Coffee Menu


Take-away recyclable cup


Costa Ground Coffee Packaging with Rainforest Alliance Certified Logo


27


Official Website - Feedback/ Query


Official Website - The Costa Experience


Official YouTube

28



Costa Coffee on Tripadvisor


Official Facebook Page Consumers comment


Event - Hello Sumer Snaps