To analyse how change in customer perception towards health and wellness influences product design in sports and fitness industry

Table of Contents

Chapter One - Introduction. 1

1.1      Background. 1

1.2      Research Aims and Objectives. 3

1.3      Research Questions. 3

1.4 Significance of the study. 3

1.5 Structure of the Dissertation. 5

Chapter Two: Literature Review.. 6

    2.1 Introduction. 6

2.2 Importance of customer perception in the development of products and services. 6

2.2.1 Product and service strategy and the customer perception. 6

2.2.2 Marketing Strategy and the Customer and Product Perception. 7

2.3 Customer's perception of health and wellbeing in the UAE region. 8

2.4 Customer Perception Has an Impact on Sports and Fitness Industry Outlook. 10

References. 12

Chapter One - Introduction

1.1    Background

The sports and fitness industry is growing rapidly worldwide. The sports and fitness organizations operating in the private sector are booming and they can potentially become the leaders of the leisure settings. The market is most profitable with Europe and is increasingly witnessing a growing number of practitioners. Within UAE, the trend of sports and fitness amongst the general public has become common and the customers are actively seeking the sports and fitness products and services that can serve their individual needs (Pedragosa, 2009). With the increasing trend of sports and fitness in UAE, the awareness regarding the related products is also increasing and the customers have become increasingly aware of the products and services that can help them to enjoy and maintain their fitness and sports (Canhoto & Arp, 2017).

Customer perception, in general, remains the center of concern for product development and marketing professionals. Customer perception changes with time and us generally impacted by the large number of factors. It can include the pricing, service quality, customer service, and the utility that the product is providing to the customer. The customer perception is also impacted by the value and ethics of the product and the reputation of the product in the market. However, with the increase information flow, the knowledge of the customers regarding different products have improved. The customers have become more aware of their needs and which have resulted towards altering the specifications of the products and services that are being offered in the market. There are some basic characteristics that are inherent in the generic product version which is designed to provide fundamental benefit to the customers. These generic products and services are made distinct by adding the value of the extra features such as performance or quality enhancement. Thus the final version of the product in this context includes the augmented properties that offer the customer with more tangible benefits and that best meet the customers’ needs and customers’ requirements (Nam & Lee, 2017). In every industry, the perception of the customer changes with time and with increased awareness and knowledge, the perception and demand for the product and services vary significantly. The same is the case with the UAE sports and fitness industry. Within the UAE, the perception of the customers has changed greatly with respect to the concept of health and wellbeing. The focus of people has increased greatly to improve their quality of life. Sports is not only perceived as the source of physical wellbeing, but it is also considered as a source of psychological wellbeing. Therefore, people seek services that can help them to get relax and to enjoy a relaxing and relishing environment that can enforce positive energy within them. This has also affected their demand for the product and service which can satisfy their psychological and physical needs. However, this has not much impacted the sports sector but has significantly affected the fitness sector (Lagrosen & Lagrosen, 2007).

With the increasing awareness and changing needs of the customers, the sports and fitness industry is required to bring changes in its product design. To remain competitive in the market, industry professional is required to level up their production and capabilities in order to cater to the current customer perception. Product and Service creation, in general, remains a multifaceted and important aspect of running a successful business (García-Fernández, et al., 2018). Catering to the different customer needs requires the sports and fitness industry to conduct research work, focus on different methods of engineering and designing and using different and improved materials for a better product (Avourdiadou & Theodorakis, 2014).

1.2    Research Aims and Objectives

The aim of this study is to analyze the influence of customer perception of health and wellbeing and its impact on the product and service design on the fitness and sports industry. The objectives of this research study include;

·         To analyze the importance of customer perception in the development of products and services.

·         To investigate the customer's perception of health and wellbeing in the UAE region

·         To examine the extent to which customer perception has an impact on the design and service of the sports and fitness industry.

1.3    Research Questions

1          What is the importance of customer perception in the development of products and services?

2          What is the customer’s perception of health and wellbeing in the UAE REGION?

3          How customer perception impacts on the design of products and services of the sports and fitness industry?

1.4 Significance of the study

Within UAE, the people have become more aware of their health. The people have made the health and wellbeing an essential part of their life. The latest results of the Global Cigna 360 Wellbeing survey have included UAE for the second consecutive year. This is the greatest evidence of the desire of the local population to desire better and secure future and to take care of their health and wellbeing. Considering the level of concern, the people have become aware of different aspects of wellbeing and health. Many people have proper knowledge about the sports and fitness products that they want to ensure a better and healthier life. Therefore, the need of the products and services from the fitness and sports industry have changed significantly (Arabian Business, 2018). The increasing trend amongst the customers in the sports and fitness industry has made the customers increasingly aware of the products and services that can best cater to their sports and fitness needs. It, therefore, has a significant impact on the design of the services and products. This requires the organizations that are working in the sports and fitness industry to become more aware of the changing needs of the customers and to investigate which product and service they require the most. Therefore, the sports and fitness organizations are required to conduct an in-depth investigation of the expectations of the customers, their subjective norms, their perceptions, their attitude, and perceived behavior when making a decision for the purchase of sports and fitness products and services (Zhang & Li, 2014). The consumers in UAE want to lead a happy and healthier lifestyle and are actively making efforts for it. In order to seek the health and wellbeing advice, the customers regularly seek help of the professionals. Most of them consult with their families and friends with respect to the healthcare and wellbeing. The products and services are sought out either on the advice of the professionals or on the advice of the families and friends.  Considering all the mentioned factors it has become necessary to investigate whether the customer perception about health and wellbeing impacts the design of the fitness and sports goods industry. There are many studies that have focused their attention on analyzing customer behavior, service quality and factors impacting consumer purchase intentions. There is very limited literature that is available on the influence of customer perception of health and wellbeing and its impact on the product design and service. Also, very limited literature is available in the UAE region concerning the impact of customer perception on the product and service design of the sports and fitness industry. Considering the limitation of the research work on this area, it was necessary to investigate the said topic. This study can add value to the already available literature and might lead towards providing insight specifically on the UAE region about the influence of customer perception on the product and service design of the fitness and sports industry.

1.5 Structure of the Dissertation

 The dissertation is made on the following structure. This dissertation constitutes of five chapters which include

·         Chapter One- Introduction:  The first chapter is the introduction which includes the details about the background of the topic, the research questions and objectives and the significance of this research work.

·         Chapter Two-Literature Review: The second chapter is a literature review. It is based on the available literature that has already been published on this topic. The information for this chapter has been taken from the published journal articles in order to ensure the authenticity of the material.

·         Chapter Three- Methodology: In this chapter, detailed elaboration of the methods has been explained which has been adopted for conducting this research work. This chapter is based on providing insight into the details regarding the data collection and analysis method.

·         Chapter Four- Results and Discussion:  This chapter includes a discussion of results and its relevant interpretations. This chapter also entails the discussion of the results of the collected data.

·         Chapter Five –Conclusion: This is the last chapter of the dissertation. This chapter includes the conclusion of the research sturdy.

·          

Chapter Two: Literature Review

2.1 Introduction

Customer perception plays significant importance in designing of any product or service. Customer perception contribute towards designing the product that can meet the needs of the customers. The sports and fitness industry has been observing h since the past two decades.  People have become much aware of their need for the products and services that they need to keep themselves active and healthy. The change in the perception of customer regarding wellness and health have changed over the time. The products, services and activities once were considered important for fitness have greatly become obsolete. This has caused the change in the product and service requirements amongst the customers.

2.2 Importance of customer perception in the development of products and services

According to Avourdiadou and Theodorakis (2014) Customers serves as the lifeblood for organizations. Customers are the kings and meeting their needs and demands is the prime responsibility of the organization.  Designing products and services as per the needs of the customers is the prime requisite of every organization. Customer perception in this context plays pivotal role in retaining the old customers and attracting new customers. The companies therefore, are required to take into account a number of factors that contribute towards building customer perception (Avourdiadou & Theodorakis, 2014)

Nam and Lee ( 2017) mentioned that customer perception can be defined as the concept of marketing which includes the impression of the customers, consciousness and awareness about the offering of the company. Customer’s perception therefore, can be explained the perception of the customers about the organization. This perception has direct impact on attracting new customers and also impact the capacity of the organization for maintaining goodwill with the already existing customers. Customer perception plays significant role for the sports and fitness organizations. Customer perception in the current century has been predicted to overtake the precedence over the traditional competitive advantage features of the market such as usability, feature and the pricing. Therefore, for the companies, it has become necessary to take into consideration the customer perception and their related experiences. Ignoring customer’s perception might bring the company to the risk of failing in the market. Considering the increasing expectations of the customers, the organizations are required to take into consideration the perception of the customers in order to try and create positive customer experience (Nam & Lee, 2017).

2.2.1 Product and service strategy and the customer perception

According to García-Fernández, et al (2018) the product and services which the companies offer to its customers are designed generally according to the need and demand of the customers. The needs and demands of the customers are given prime importance and is considered as an important aspect of the business. For running a successful enterprise, creating a successful strategy for the development of the product is an important aspect and constitute a prime element of running a successful business. Successful product and service strategy requires a range of accompanying principles which includes marketing, design, research and development, materials, manufacturing and engineering. In a number of cases, it has been observed that, the product and service development strategy usually depends upon two main goals which includes keeping the product line and the new product and service in line with the overall objective of the organization and its marketing philosophy. It also depends upon establishing such a system that can evaluate the performance of the product.  The evaluation of a successful product depends upon a number of factors which includes customer response, market acceptance, sales, profit and the current competition of product in the market (García-Fernández, et al., 2018).

Nam and Lee ( 2017) mentioned that the development of product and service is furthermore based on such criteria that helps in putting together a strategy which can help in determining whether a product needs to be discontinued, continued or modified. The development analysis therefore, should include the guidelines for the services and the products that are likely to be introduced in the market. In the situation, the organizations are working on the development of the product or service, it should be taken into consideration that the product and services contains more value as compared to that of the tangible goods. A product or service offering of the organization also included economic, technical, personal and legal relation between the seller and the customer. Moreover, there are a number of elements that are required to be considered in assessing the overall product performance which includes but are not limited to purchasing contract, product specification, prices and the interpretation of the customers about the organization (Nam & Lee, 2017).

According to Zhang and  Li  (2014)Consumers therefore, can evaluate the service and the product on several level. The products and services basic characteristics are inherent in their generic version and can defined in a number of benefits that it offer to its customers. The generic services and products can be designed to create distinction through adding value and the extra features which include performance enhancements and the product and service quality. The augmented properties of the product and service also constitutes the final level of consumer perception which includes less tangible benefits such as maintenance service, appealing payment options, customer assistance and training. The consumers values these benefits more during making the decision of purchasing certain product and services (Zhang & Li, 2014).

2.2.2 Marketing Strategy and the Customer and Product Perception

Avourdiadou and Theodorakis (2014) mentioned that Customer and product perception plays greater role in altering and changing the marketing strategy of sports and fitness organizations. The customer and product perception in the sports and fitness industry can forces the organization to make changes for addressing better customer needs, evaluating product lifecycle and assessing the needs for technological development (Avourdiadou & Theodorakis, 2014). The marketing strategy therefore, requires to keep into consideration the customer perception along with other external factors which are discussed below

·         Technological Advances: The marketing strategy needs to consider the technological advances in order to meet the needs of the customers. Due to technological advances, there might be some products and services that can become endangers and might require change in the entire service and product line. For instance, fiber optic cables can replace other cables in many areas of the businesses. Similarly, main frame computers have been substituted by the personal computers. Thus these changes have emerged in the market on the basis of customer needs and changes in the customer perception of the mentioned products. The organizations are therefore required to be aware of such advances in order to remain ahead in the market (Avourdiadou & Theodorakis, 2014)

·         Preferences of the Customers

The consumer needs can be changed due to fluctuations in the cost of material, changing awareness of the brands and new application requirements of product or service.  The organizations operating in the sports and fitness industry are therefore, required to keep a close track of the response of the customers for a certain product and are required to take into consideration the demands of the customer in order to maintain the market share (Zhang & Li, 2014)

·         Laws and Regulations

The new governmental laws implementation can further impact the customer perception and can force the organizations to bring change in their marketing strategy. For instance, the laws and regulations regarding consumption of alcohol has contributed towards changing the customer’s perception and has led the companies to offer a range of other products and alter their current product offering (Anderson, 2019)

·         Product Life Cycles

The organizations in order to preserve the growth rate in terms of sales and profits, introduce, alter or discontinue new products for replacing and changing older customer products. These changes in the sports goods and services are made periodically for allowing the existing product to reach to their maturity and to retain their appeal in the market (Zhang & Li, 2014).

2.3 Customer's perception of health and wellbeing in the UAE region

According to Rajan (2018) UAE serves as the main business hub for the UAE region. Since the people require to work hard than ever before for maintaining their life standards, the people have become more conscious of their health and wellbeing. For maintaining healthy balance between their work and social life, the people are placing more importance to their wellbeing and health and are focusing towards the innovative methods and ways that can help them to spend a happy and healthy lifestyle (Rajan, 2018).

Thompson (2014) mentioned that in UAE with increased knowledge and the information, the concept of health and wellbeing is understood in much broader scope as compared to just the management of diseases and exercising regularly. Wellbeing amongst the customers of UAE includes several dimensions such as emotional health, physical health, social connectedness, financial security, and character strength as well as the purpose. This view has become common amongst the UAE population and is well reflected in the expectations and demands of the well informed customers of sports and fitness industry of UAE. The customers in the UAE region are increasing focusing upon wellness and health initiatives to keep themselves in good shape and to improve their quality of life (Thompson, 2014).

In the work of vRemy-Miller ( 2017)In the UAE region, there has been observed a growing interest amongst the UAE residents to send a healthy and more active life style that can offer better quality of life to the customers. This has increased the demand of personal training sessions, gym memberships and other such sports and fitness services. In the UAE region, a combination of a number of factors such as better awareness about leading a healthy life, looking fit and active has also contributed towards increase in the social media content related to fitness and health. The people in the UAE region are therefore indicating much interest to seek help of the experts and the professionals (vRemy-Miller, 2017).

According to Gericke (2019) these are both the exciting and challenging time for the health and fitness industry as the people nowadays have increased awareness about the advantages they have for leading a healthy lifestyle. People have also become much aware of the product and service they require from the industry in order to keep themselves fit and active. In the UAE region, in the past five years, increasing interest in obtaining gym membership has been observed. With the amount of information available on social media, people have realized that their health and physical wellness is an essential part of their overall performance and wellbeing. People in general life circumstances are making more healthy decisions when it comes food consumption, selecting a sports activity or selecting a product and service that can help them to remain active and fit (Gericke, 2019).  (khaleejitimes, 2020)In the past five years, the TV and social media have produced the content based on fitness and wellbeing in greater quantity for promoting the concept of proper nutrition and training. The people are therefore, much inclined to follow the path of the experts whom they admire the most. Furthermore, the initiative of the government such as 30:30 Fitness challenge which has been introduced by Sheikh Hamdan, the Chairman of Dubai sports Council and the Crown prince of Dubai have further contributed towards promoting and changing the perception of the people about health and wellbeing in the UAE region. This health and fitness initiative have strongly resonated with the UAE residents thus has contributed towards promoting a better, fit and healthy life style for the people. Corporate entities operating in the UAE have also taken interest and therefore, increasing trend has been observed by the companies to offer to its members the fitness perks such as offering gym membership to their employees and allocating specific sports hours in a month.

Almenhali (2019) mentioned that with the increase in knowledge of the customers about the health and fitness, their perception has changed greatly with respect to the products and service offerings in the UAE region. With the change in consumer perception functional training and high intensity training has greatly been in demand. However, at the same time, it has been observed that the proven traditional gym model is consistently well received amongst the UAE consumers. The customers are also increasingly seeking the customized training regimes where the personal trainers are required to devise the training programs for individuals on the basis of their current level of fitness, their goals respective to their age and interest. The customers are increasingly seeking the use of technological equipment in order to enhance the quality of their training (Almenhali, 2019).  

Surge in the Health and Fitness Industry of UAE

Anderson (2019) noticed that UAE had the reputation for being inactive. The residents were presumed to enjoy a life that rather follows a lazy lifestyle with less focus and interest on health and wellbeing. However, with the increasing perception of the customers about health, fitness and wellbeing, UAE fitness market has experienced increased demand the in the health and fitness related products and services that can offer better life style to the people. UAE, as a state now perceives fitness and sports activities as the main source of addressing key challenges of healthcare of the region, including diabetes, obesity and other unhealthy lifestyle challenges. Considering these healthcare challenges, UAE government has become increasingly active in promoting the healthy life style amongst the people and to encourage them to become more active. The government have further introduced a number of fitness and sporting related events to promote healthy lifestyle amongst the people. This sparked enthusiasm amongst the residents of UAE have helped in attracting a large number of fitness and sports related startups. Thus with the increased in the fitness and sport industry investment opportunities, the startups also had to face many challenges to keep up with the changing demands of the customers.  The customers have become more aware and conscious about the products and services they need in order to keep themselves active. This has increased the challenge for the sports and fitness companies to design the products and services that can meet the demands and needs of the customers in the UAE region (Anderson, 2019).

2.4 Customer Perception Has an Impact on Sports and Fitness Industry Outlook

Anderson (2019) has mentioned that with the change in the customer perception and the increased interest of the customers towards the sports and fitness, the UAE fitness market outlook has also changed. The increasing interest of the customers in the fitness and sports have opened many opportunities for the people in the market. Within the UAE region, the number of organized fitness service centers are expected to increase. As per the estimate, such outlets are expected to grow from 1400 outlets to 2022 due the penetration of the existing sports and fitness players such as Gold Gyms, Fitness First and Lifeline wellness (Anderson, 2019). Almenhali (2019) mentioned that the industry is also experiencing and increase in the fitness special classes in the upcoming two years.  The customers demand for pilates and Zumba, martial arts and cross fit has also increased and is expected to experience a further rise in the next coming years. The region is also experiencing and increasing number of group exercise classes for the people of all ages and for both males and females. The trend of increasing number of new entrants in the market is further capitalizing the shift away from the gyms and techniques that were traditionally in practice. In this surge in the demands and needs of the customers, the new and old market players are increasingly experience the challenge to meet the changing customer needs especially in the environment where the customers have growing number of health and fitness options. According to Anderson (2019) the businesses operating in the health and fitness industry can no longer sell the products and services that are easy for them to design or sell. In the current situations, the business are required to provide the product and service keeping in consideration the customer standpoint and their needs, perceptions and customers’ expectations (Almenhali, 2019). The old players in the market, keeping into consideration the current surge in the needs and demands of the customers are further penetrating in to the areas such as meditations, salons, massages and wellness centers. The businesses are now actively seeking to design and produce such service and the related platforms that can cater the wellness and fitness related needs of the customers and to expand these services and products beyond their current expectations (Anderson, 2019).

Almenhali (2019) further mentioned in his work that the increased option of fitness and wellbeing centers have outdates the one size fit all approach of the gyms that were designed on the traditional products and service models. For being in the market, the companies are required to cater the customized customer needs with the addition of personal touch to the offered services and products. Therefore, for the sports and fitness industry of UAE, it has become increasingly necessary to design their products and services on two pillars that is accessibility and education. The firms and the professionals who are operating in the fitness and sports market are required to proactively educate themselves and their client about the ways they can integrate fitness and healthy lifestyle rather than following the traditional and old school schedules (Almenhali, 2019).

 

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