Role of brand heritage in local and franchise restaurant service

Abstract

Given the growth of franchise practices in the service industry, this study focuses on the impact of restaurant heritage in helping to create positive outcomes in company performance. In particular, this study examines the direct impact of brand heritage on customers' perceived restaurant image and whether it produces positive attitudes and behavior. Due to limited studies on restaurant operation type, the proposed relationship is compared between franchise and local restaurants. Partial least squares structural equation modeling with SmartPLS 4.0 software was used to analyze 599 restaurant customers in the United States. The findings confirm that the perceived restaurant heritage affects the brand image for customers, leading to positive customer evaluations (i.e. satisfaction and trust). In addition, differing levels of customer satisfaction and trust are found to influence the behavioral intentions of customers (i.e. willingness to pay a premium and repurchase intentions). Last, a multigroup analysis showed that the effect of trust on customer behavior was significantly higher among franchise than local customers. In contrast, the effect of satisfaction on customer behavioral intentions was stronger among local than franchise customers. This study provides valuable insights for both local and franchise operators who need to manage their brands to create positive customer outcomes.