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Does Higher Price Signal Better Quality? IS PRICE AN INDEX OF QUALITY?
Abstract
With differentiated products, consumers may not be aware of the quality and features of the products they buy. They are often unable to make a quality comparison among various brands. Moreover, they often gather little information even when the financial commitment involved is substantial. A popular belief is: ‘You get what you pay for.’ Therefore, consumers tend to believe that high price is an indicator of better quality. Although many studies conducted on price-quality relationship have supported this belief, there are other studies that have found the relationship to be product-specific and weak in general.
This study seeks to examine the relationship between the price of the product and the buyers' perception of quality in respect of durable, semi-durable, and non-durable products in the Indian context. Three products were selected for the purpose of the study: colour television as a durable product; T-shirt as a semi-durable product; and toothpaste as a non-durable product. Data were collected from the primary sources with the help of a non-disguised, pre-structured questionnaire.
In particular, the authors sought to explore answer to two questions: (1) Does high price have a positive influence on the buyers' perception of product quality? (2) Is there a significant difference in the buyers' perception of the quality of products falling in different price ranges?
The major findings of the study are as follows: For a durable product, like colour television, setting the price too low will negatively affect the quality image of the product and the consumer would be reluctant to buy a low-priced brand as it might lower his image in the society. Pricing it reasonably high will give the product a high-quality image. However, the marketer should take care of the competitors' pricing policies and the buyers' purchasing power. The target market for T-shirt in India consists mainly of the young, especially the college students, having limited purchasing power. They prefer local, or little known, but trendy brands of T-shirts rather than expensive ones. Also, they would opt for a T-shirt of a reputed brand if it is within their purchasing power. However, reducing the price of the T-shirt may dilute its brand image. Hence, the marketer of the T-shirt should think of market segmentation strategies and select the appropriate target segment(s) and price the product accordingly. For toothpaste, brand reputation is a critical factor and the marketer should price the product according to the reputation enjoyed by the brand. However, the price-quality relationship for this product has been found to be weak in comparison to colour television and T-shirt. The marketer, therefore, should be wary of charging a very low price as it would create an inferior quality image in the mind of the buyer.
The findings have important marketing implications for pricing, market segmentation, target marketing, and product positioning.
... Heurystyka cena = jako odnosi si zar?wno do produkt?w znanych, jak i mniej rozpoznawalnych lub cenionych marek i dziaa w obie strony (Verma i Gupta, 2004). Oznacza to, e zbyt dua obnika moe zaszkodzi wizerunkowi renomowanej marki. ...
... W sytuacji zakadanej patnoci got?wk badani wybierali drosze produkty, gdy prezentowano je w kolejnoci wedug cen malejcych, a nie rosncych. Wynik ten jest zgodny z hipotez 1., kt?r postawiymy w oparciu o teori Kahnemana i Tversky'ego (1991), heurystyk cena = jako (Verma i Gupta, 2004) oraz wyniki wczeniejszych bada (Suk, Lee i Lichtenstein, 2012Pierwszego alternatywnego wyjanienia efektu kolejnoci prezentacji cen moe dostarczy nam teoria budowania wartoci (ang. query theory of value construction), zgodnie z kt?r konsumenci, analizujc dostpne opcje zakupowe, zastanawiaj si zazwyczaj, ile strac pienidzy, kupujc okrelone produkty (Johnson, H?ubl i Keinan , 2007). ...
... Kardes, Cronley, Kellaris i Posavac, 2004). Heurystyka cena = jako odnosi si zarówno do produktów znanych, jak i mniej rozpoznawalnych lub cenionych marek i dziaa w obie strony (Verma i Gupta, 2004). Oznacza to, e zbyt dua obnika moe zaszkodzi wizerunkowi renomowanej marki. ...
The presented research shows that consumer choice of product depends on the sequence in which products are presented. When they were presented according to decreasing prices the customer chose more expensive products than in the case of increasing prices. However this happens only in case of paying cash not voucher. In order to rule out the alternative reasons of this effect another study was conducted. Participants of the second study were randomly acquainted with 10 product brands. Then they chose one of ten products which were sorted according to their prices: decreasing or increasing. Again, when paying cash, participants chose more expensive products when they were sorted according to decreasing prices. The results of second research suggest that the presented differences in choosing products cannot be explained by anchoring heuristic, the effect of priority, or incomplete information processing.
Key words: price order, payment method, prospect theory, price-quality, consumers choices
... Price sensitivity has a significant impact on customers' perceptions of brands. They assess a brand's value in relation to its price, choosing competitive pricing for high-quality goods (Verma & Gupta, 2004). Marx's valuebased marketing places a strong emphasis on moral behavior that puts the needs of society and customers first (Ye et al., 2022;Gupta et al., 2020). ...
... These aspects create positive resonance and affinity and match customers' value judgments (Lin, 2010). High perceived quality is positively correlated with strong brand loyalty and trust, which improves perceptions of dependability and quality (Verma & Gupta, 2004). Value perceptions have a crucial role in consumer purchase choices in competitive marketplaces. ...
This study investigates the impact of promotional offers on consumer perceptions of brand personality and their subsequent behavioral intentions. Research employs a between-subjects design with two conditions: exposure to an advertisement with a promotional offer versus no offer. The results reveal that promotional offers significantly affect perceptions of several brand personality traits, notably reducing the perception of traits such as 'spirited', 'outdoorsy', and 'upper class'. Moreover, the study examines how individual differences in consumer price sensitivity and brand affinity moderate these effects, indicating that the impact of promotional offers varies across different consumer segments. Mediation analyses further demonstrate that the perceived changes in brand personality traits due to promotional offers significantly mediate the relationship between advertising conditions and consumer responses, such as willingness to pay a premium and likelihood of visiting the brand's retail outlets. These findings suggest that promotional offers can alter consumer perceptions of brand personality. This study provides essential insights for marketers on how promotional strategies can be optimized to influence consumer attitudes and behaviors effectively, offering a nuanced understanding of the interplay between promotional offers, brand personality perception, and consumer behavior.
... People imagine phantom costs because they would explain why the overly generous offer was made-the offeror knows it's not actually overly generous. Most obviously, they could be hiding that a product is low quality (Akerlof, 1970;Mastrobuoni et al., 2014;Verma & Gupta, 2004), but phantom costs could be any kind of hidden risk in the transaction known to the offeror that would explain why they are trying to sweeten a bad deal. ...
If money is good, then shouldn’t more money always be better? Perhaps not. Traditional economic theories suggest that money is an ever-increasing incentivizer. If someone will accept a job for US30/hr and especially for US$250/hr. However, 10 preregistered, high-powered studies ( N = 4,205, in the United States and Iran) reveal how increasing incentives can backfire. Overly generous offers lead people to infer “phantom costs” that make them less likely to accept high job wages, cheap plane fares, and free money. We present a theory for understanding when and why people imagine these hidden drawbacks and show how phantom costs drive judgments, impact behavior, and intersect with individual differences. Phantom costs change how we should think about “economic rationality.” Economic exchanges are not merely about money, but instead are social interactions between people trying to perceive (and deceive) each others’ minds.
... First, a simple but very effective keyword search method is used, using the corpus approach in the tm (e.g. Verma and Gupta, 2004;Feinerer et al., 2023). Second, topic modelling is used to "find and track word clusters (topics)" in large (unstructured) text corpora (Posner et al., 2012), using a probabilistic iterative procedure to identify major topics (Blei, 2012). ...
Purpose
The Internet has changed consumer decision-making and influenced business behaviour. User-generated product information is abundant and readily available. This paper argues that user-generated content can be efficiently utilised for business intelligence using data science and develops an approach to demonstrate the methods and benefits of the different techniques.
Design/methodology/approach
Using Python Selenium, Beautiful Soup and various text mining approaches in R to access, retrieve and analyse user-generated content, we argue that (1) companies can extract information about the product attributes that matter most to consumers and (2) user-generated reviews enable the use of text mining results in combination with other demographic and statistical information (e.g. ratings) as an efficient input for competitive analysis.
Findings
The paper shows that combining different types of data (textual and numerical data) and applying and combining different methods can provide organisations with important business information and improve business performance.
Research limitations/implications
The paper shows that combining different types of data (textual and numerical data) and applying and combining different methods can provide organisations with important business information and improve business performance.
Originality/value
The study makes several contributions to the marketing and management literature, mainly by illustrating the methodological advantages of text mining and accompanying statistical analysis, the different types of distilled information and their use in decision-making.
... Narrow-oriented research of Verma and Gupta (2004) set in the Indian environment assessed three different products, one of them being a T-Shirt. The scientists determined that their sample of 175 respondents perceived that the lower the T-shirt's price, the more inferior the quality would be. ...
... Merchandise mix is the focal point of every shoppers to select retail outlet for shopping DelVecchio, 2001) which consists of variety, availability, and uniqueness (Thang & Tan, 2003). The shoppers at large look for quality of the merchandise which is related to the value for the money they are going to sell (Erdem et al., 1999;Hu & Jasper, 2006;Verma & Gupta, 2004). On extension to this visual display of merchandising (Park et al., 1989), fashionable (Shim & Kotsiopulos, 1992), and branded products (Porter & Claycomb, 1997) contribute under merchandise selection. ...
The Indian retail industry is witnessing transformation from unorganized to an organized one. The changing and vibrant retail industry poses significant challenges to the retailers to withstand in the competition and to have their business organized. This research work provides an insight over the organized supermarket store image factors and its impact on shoppers’ perspective. This research work connects the store image attributes dimension and its impact on shoppers’ attitude to predict their in-store behavior in retail context. The researcher attempts to create a model by relating the mentioned variables through an extensive literature review. The model has been tested empirically. Confirmatory factor analysis (CFA) and Path analysis confirms that the store attributes dimension impacts shoppers’ attitude which in turn determines the perceived value. Further it confirms that perceived value determines the purchase intention among shoppers in a supermarket outlet.
... According to them apart from trust and satisfaction, commitment of the organization to keep their customer well informed and creating among them a sense of long term relation is very important to enhance the quality of relationships. Gupta and verma (2004 ) in their study tried to find out relationship between price perception and the quality of the product. They found hat in case of durable product highly priced product are perceived to of higher quality. ...
Telecom companies across the globe are facing tough times. Changing dynamics of business environment have been reshaping the strategic framework within which telecom companies have been operating. Higher attrition rate, price war, government regulations, increased customer choices, low switching costs have once again brought the customers at the centre stage of business strategies of telecom companies at both local and global level. This paper has analysed the CRM practices of Public and Private sector telecom companies operating in the Jammu and Kashmir state. The study has concluded that there is a significant difference between the CRM practices of BSNL and Airtel. Further the study revealed that CRM practices of Airtel were better than BSNL. In order to survive in the highly competitive business environment BSNL has to improve upon its CRM practices.
... Moreover prior studies clearly show that increased purchase costs have a positive impact on perceived value[8], the indirect impact of which should extend product life as consumers keep blinds until they no longer function or reuse electrical and mechanical components and update and replace textile components as described above. The inclusion of electrical and electronic components means that blinds will be subject to WEEE legislation and grinding as construction waste or sending to landfill will no longer be permissible and collection of motorised and automated blinds will be mandatory to separate out WEEE materials. ...
Blinds and shutters create privacy in residential and commercial buildings; they can also be used to keep rooms cool when sunny and to minimise heat loss at night or in winter, which reduces use of air conditioning and heating, associated energy inputs, carbon and other outputs and costs. In addition to controlling temperature, they also reduce glare and control light levels, all of which contribute to general health and well-being. In many instances however these products are not used correctly and consequently their potential is not fully realised. Consequently a streamlined LCA was undertaken to measure overall environmental impact and to promote the value of blinds as passive and sustainable energy saving products in a typical house in the UK. The LCA also shows that recycling has a lower impact than other end-of-life scenarios although at present the majority of blinds and shutters are either landfilled, down-cycled with construction waste, or incinerated with energy recovery. The materials used in conjunction with component design, assembly, and disassembly processes indicate that it is technically feasible to develop a Circular Economy for this industrial sector to conserve resources and energy although there are a number of barriers to its development; therefore this paper concludes by discussing these barriers and drivers for change in order to help businesses to develop a Circular Economy and to bridge the gap between theory and practice.
... The model, also, provided an insight into the creation of a brand's equity and can thus be used as a decision support system in the brand management process. Verma and Gupta (2004) examined the relationship between the price of the product and the buyer's perception of the quality in respect of durable, semi-durable and non-durable products. For durable products like CTV, the authors discovered that setting the price too low negatively affects the quality image of the product. ...
This research study analyses the key components of brand equity for selected cellular phone companies in India. Various components of brand equity regarding three selected brands were analysed based on Aaker's conceptual model of brand equity. Brand association, brand extension and brand personality were also analysed. The present study used a sample of students from a university in India. Factor analysis was applied and five factors namely satisfaction and leadership, usefulness, brand loyalty, customer value and brand image emerged from the analysis of various components of brand equity. The present study contributes to the understanding of customer-based brand equity approach.
... Price, brand name, retailer reputation, and level of advertising were four major extrinsic cues frequently associated with perceived quality and value in research, and many other extrinsic cues as well useful to consumers (Olson, 1977;Rao and Monroe, 1988;Zeithaml, 1988;Dodds et al., 1991). In particular, the role of price in quality inference has been supported in numerous studies (Olson and Jacoby, 1972;Monroe, 1976;Erickson and Johansson, 1985;Lichtenstein et al., 1988;Dodds et al., 1991;Verma and Sen Gupta, 2004). This relation is now accepted as a positive non-linear one (Rigaux-Bricmont, 1982). ...
Purpose
The purpose of this paper is to find out the relationship between the qualities of generic drugs perceived by the physicians and brand equity of the branded generics and to examine the physicians' perceptions of prescribing generic drugs for selective medical conditions in India.
Design/methodology/approach
The study was carried out across six major cities in Eastern India with 392 physicians. Here components of perceived quality, i.e. intrinsic cues and extrinsic cues are hypothesized to influence perceived quality of branded generics which in turn influence brand equity. It is also hypothesized that respondents' quality experience is assimilated towards their quality expectations, independent of small variations in objective quality of the drug.
Findings
Results showed that perceived quality of branded generics significantly, but indirectly, affected brand equity through the mediating variables, intrinsic cues and extrinsic cues. The results also showed that physicians' quality experience leads to quality expectations, independent of small variations in drug quality on five common yet serious diseases in India.
Practical implications
Current research finds that for prescription‐based branded generic drugs, perceived quality mainly depends on intrinsic cues; therefore, managers should be interested in intrinsic cues that increase brand equity and necessary marketing actions should be implemented accordingly.
Originality/value
No other scholarly article has been developed, so far, analyzing the effect of perceived quality on brand equity in the Indian branded generic drug segment. Besides providing evidence from the Indian pharmaceutical context about the impact of quality cues, the paper also presents evidence on physicians' quality observation of branded generics on five common yet serious diseases in India.
... The subdimensions were grouped together on the basis of name similarity and frequency of mentions recorded. However, the need to further refine the subdimensions for inclusion in a model & Carpenter, 2006; Sullivan et al., 2002 Merchandise quality Dependable merchandise; Merchandise quality; Store quality Babakus et al., 2004; Verma & Gupta, 2004 Promotion Advertising Promotion; Advertising; Personal contact; Realistic models Carroll et al., 2007; DuFrene et al., 2005 Displays The proposed conceptual model of the underlying theoretical structure of store image was submitted for expert judging to further enhance the accuracy and comprehensiveness thereof. Firstly, the model was considered at a special advisory session with two experts in the field of store image and consumer behaviour. ...
The lack of a universal definition and conceptual model of store image guided the aims for this research, namely to 1) delineate the underlying structure of the store image construct; 2) formulate a definition of store image; and 3) develop a model of the underlying theoretical structure of store image. An in-depth literature review was done to specify the domain and to delineate the underlying structure of this construct. The knowledge gained was incorporated into the model of apparel store image that served as point of departure for the development of a scale to measure the importance of apparel store image dimensions.
... Other examples show that when prices are reduced, customers may have concerns about product quality. Some products can benefit by the quality signals communicated by higher prices and others do not (Verma and Gupta 2004). One key factor to strengthen the message price sends about quality is to make sure that other cues (e.g., warranty, brand name etc.) also send the same signals (Miyazaki, Grewal, and Goodstein 2005). ...
A recent review of food retailer pricing found evidence that much of the behavior was inconsistent with traditional economic models (Li, Sexton & Xia, ARER 2006). These inconsistencies may stem from the theoretical foundation that firms use to guide their pricing. When firms can influence price, they often use pricing principles from psychology, based on buyer behavior instead of utility maximization. These principles have been incorporated into the marketing approach to pricing. A comparison of the economics and marketing approaches toward pricing found important differences and concluded that marketing principles provide: “a richer and more empirically based treatment of the pricing issue from the buyer’s perspective . . . ” (Skouras, Avlonitis & Indounas, JPBM 2005, p. 362). This paper reviews more than twenty different pricing principles, developed by psychologists and consumer behaviorists, that may appear inconsistent with some traditional economic theories and that could help increase the profits of agricultural organizations that have enough marketing power to affect price. These pricing principles can be grouped into four main categories. The first category is called “framing.” Framing refers to the way something is depicted or what is emphasized (e.g., telling buyers that hamburger is 25 percent fat or 75 percent lean). Price framing deals with how the price is described to customers. Incorporating “free” into an offer, describing a price in terms of multiple units (e.g., three for a dollar), specifying purchase limits, adding an anchor (e.g., suggesting a number to buy or a reason to buy more), highlighting the price in terms of spare change, encouraging purchases on credit, and reframing ( e.g., specifying the cost per day, comparing the purchase with other small regular expenses, or using two different currencies) have been shown to increase willingness to pay. The next second category is called “congruency.” Marketers strive to make all their messages to prospective buyers consistent. Congruency means that the signals sent by the price should match the messages from other sources. Within this category, there are principles dealing with packaging (e.g., size and shape) and with the terminology, font, and typeface size that are used to describe the product and its price. The next group is called “context.” Researchers have found that the information people see around an item and the sequence they see this information can influence prospect willingness to pay. Adding an external reference price to advertisements or store signage, striving to make key information first or last in the viewing sequence (e.g., primary and recency), separating shipping and handling charges from product costs, and striving to be perceived as the premium product because asymmetric competition may exist are the pricing principles in this group. “Signaling” is the last category. The principles in this group involve the messages that buyers receive from the price. One pricing principle involves the effect of certain price endings, often called the effect of nines. A common belief in economics is that if all other things are held constant, lowering the price should generate a downward-sloping demand curve. However, at certain price points, the quantity demanded is likely to be sharply higher, and if price is lowered below a price point, the quantity demanded may fall. Instead of being downward sloping, the demand curve may have segments with a positive slope. Other principles within this group involve the sensitivity of buyers to the frequency distribution of past prices, the ability of buyers to recall past prices, the awareness of buyers to the cost of a product, the number of syllables in the price, the ability of higher prices to suggest higher quality, and the ability of higher prices to improve a product’s perceived performance (e.g., the price placebo effect). By including these marketing-based principles in their tool kit, applied economists can better understand the pricing behavior they observe in the marketplace and can provide more practical advice to agricultural organizations on what they should consider when developing their pricing strategies.
Purpose
In business, online reviews have an economic impact on firm performance. Customers’ data in the form of online reviews was used to understand the appreciation and service complaints written by previous customers. The study is an analysis of the online reviews written by the customers about Indian heritage hotels. This study aims to understand the dimensions of service appreciation and service complaints by comparing positive- and negative-rated reviews and find the patterns in the determinants of the satisfaction and dissatisfaction of the customers.
Design/methodology/approach
A total of 23,643 online reviews about heritage hotels were collected from the TripAdvisor website by using a Web crawler developed in Python. A total of 1000 reviews were randomly selected for further analysis to eliminate the bandwagon effect. Unsupervised text mining techniques were used to analyze reviews and find out the interesting patterns in text data.
Findings
Based on Herzberg two-factor theory, this study found satisfied and dissatisfied determinants separately. The study revealed some common categories discussed by satisfied and dissatisfied customers. The factors which satisfy the customers may also dissatisfy the customers if not delivered properly. Satisfied customers mentioned about tangible features of the hotel stay, which includes physical signifiers, traditional services, staff behavior and professionalism and core products (rooms, food). However, most of the customers complained about intangible service problems, such as staff attitude, services failure, issues with reservation and food, value for money and room condition. The results are contradicting with commercial hotels-based studies owing to the unique services provided by heritage hotels.
Practical implications
The dimensions for satisfaction and dissatisfaction among customer of heritage hotels provide marketers to understand the real emotion and perception of the customers. As these dimensions were extracted through text mining of the reviews written by the customer of heritage hotels, the results would certainly give better insights to the hotel marketers.
Originality/value
The study is a rare attempt to study online reviews of customers on heritage hotels through a text mining approach and find the patterns in the behavior and the determinants of satisfaction and dissatisfaction of customers.
Purpose
This study aims to know the effects of environmental characteristics and business partner relationships on improving innovation performance through the mediation of knowledge management practices (KMPs).
Design/methodology/approach
The population of this research was all manufacturing companies engaged in the food and beverage sector categorized into large industries. According to Jakarta’s Badan Penyelenggara Jaminan Sosial (BPJS) Ketenagakerjaan (social insurance administration body of employment), large industries are industries with a number of employees > 100. However, in this research, the total population did not reach 100 but only 89 companies. The analysis unit used in this research was the companies. Data collection for this research relied on questionnaires with closed questions. The questionnaires were then distributed to the sample companies by using enumerator services. In accordance with the hypotheses formulated, the data analysis used in this research was partial least square.
Findings
The three findings are the significant and negative effect of environmental characteristics on KMPs, the significant effect of business partner relationships on innovation performance and the insignificant effect of KMPs on innovation performance. The management of food sector manufacturing companies needs to support the activities of generating ideas carried out by employees and support their innovative ideas and creativity. Good cooperation between employees and management is highly needed in an effort to develop company innovation.
Originality/value
This research used the innovation diffusion paradigm and the combination of market-based and knowledge-based paradigms is expected to fill the previous research gap and become the uniqueness and originality of this research. The second originality is that this research examined the role of the KMP variable as the moderating variable. The third originality of this research is the focus on examining the effect of business partner relationships on innovation performance. These three originalities are rarely found in previous studies. Therefore, this research is expected to complete and expand the study of knowledge management and innovation performance.
Bir ürünün yetkili dağıtım kanalı dışında satışını ifade eden gri pazarlara ilişkin akademik ilgi giderek artmaktadır. Literatürde gri pazarlara ilişkin üretici ve dağıtım kanalı odaklı pek çok çalışmaya rastlanırken tüketici perspektifli çalışmaların sayısı oldukça sınırlıdır. Bu nedenle konunun tüketici perspektifinden de incelenmesi, gri pazar dinamiklerinin bütüncül bir bakışla değerlendirilebilmesine yardımcı olacaktır.
Bu çalışmada tüketicilerin gri pazarlara dönük bakış ve değerlendirmelerinin incelenmesi amaçlanmıştır. Bu amaçla belirlenen cep telefonu özellik ve düzeylerinin kombinasyonu ile oluşturulan hipotetik ürün profillerine ilişkin tüketici değerlendirmeleri konjoint analizi ile test edilmiştir. Araştırma bulgularına göre tüketiciler ürün tercihlerinde en fazla garanti kaynağı ve satış ortamına önem vermekte, fiyat ve garanti süresi daha sonra gelmektedir. Ayrıca distribütör garantisi, ithalatçı firma garantisine göre daha yüksek fayda değerine sahip bulunmuştur.
Academic interest in gray markets, which represents the sale of a product outside authorized distribution channels, has been steadily increasing. In literature, many studies on gray markets with producer and distribution channel orientation can be seen, whereas the number of studies from consumer perspective is quite scarce. Thus, the investigation of the subject from consumer perspective will help the dynamics of gray market to be evaluated in a holistic view.
In this study, it is aimed to examine consumers’ views and evaluation toward gray markets. Consumer evaluations of the hypothetical product profiles formed by the combination of mobile phone features and levels determined for this purpose have been tested by using conjoint analysis. According to the findings of the research, consumer give importance to the guarantee source and sales environment the most in product preference, and the price and warranty period come later. In addition, distributor guarantee has higher utility value than the importer firm warranty.
Neste artigo, analisou-se o efeito do formato de desconto na intenção de compra e percepção de qualidade do produto em ambiente crowding, com percepção de alta densidade de consumidores no ambiente de loja de varejo. No primeiro experimento, composto por 120 participantes, identificou-se efeito significativo entre formatos de desconto moeda versus percentual, com versus sem atributos do produto na intenção de compra e percepção de qualidade. No segundo experimento realizado com 59 participantes, identificou-se efeito significativo entre formatos de desconto moeda versus percentual, com atributos do produto em ambiente crowding. Em ambiente crowding, o anúncio com desconto em percentual aumentou a intenção de compra comparado ao desconto em moeda. Não se observou efeito sobre a percepção de qualidade do produto.
Palavras-chave: Varejo. Crowding. Promoção. Desconto. Atributos.
To gain competitive advantage, marketers must make sure that they meet consumers’ needs and demands, to guarantee their satisfaction. It is therefore crucial that marketers will know to what extent their apparel customers apply evaluative criteria to assess clothing quality. The aim of this study was to determine the importance of extrinsic evaluative criteria used by female fashion consumers in the Vaal Region to assess apparel quality when purchasing casual daywear. For this quantitative study a self-administered, structured, validated questionnaire was developed to test how important the female lecturers at the Vaal University of Technology (in the North-West Province in South Africa) deemed six extrinsic evaluative criteria when purchasing casual daywear. Mean scores showed that appropriateness of the garments for a specific purpose was rated most important, followed by price and labels. Store image was rated in the fourth place, while brand and country of origin were rated much lower than all the other attributes. It was concluded that apparel manufacturers and retailers should take note of the outcomes of this study in order to understand consumers’ selection criteria when purchasing apparel. In-depth information on apparel consumer preferences could help retailers to plan their merchandise mix more efficiently, to identify niche markets and to develop targeting strategies for the various markets. Retailers could, in co-operation with consumer educational authorities, develop educational opportunities during which consumers could be made aware of the importance of using a wide variety of applicable evaluative criteria in order to make informed and responsible apparel purchase decisions.
DOI: 10.5901/mjss.2014.v5n20p2133
─ Although, incoming role of price have leaded to more researchers attention than other factors of mix marketing, price has also other roles in marketing context. Price signals the quality of goods. As one approach, higher price shows higher quality perception. Nevertheless, many factors such as brand, advertisement, country of origin, story name and etc affect on this relationship. Beside of these factors, information level of customers influences on the relationships of price and quality perception too. Some researches show that informed customers, less rely on price. Many researches has been worked on this area but none of them has adverted to the customer information sources. In this article is shown the effectiveness of customer information sources: 1. B2C relationships 2. C2C relationships. This article has been examined on Iranian Cell-Phone Market with 350 surveys and analyzed by SPSS. This model helps marketers being aware about effectiveness of each references and so allocate their resources more efficiency in order to proving their qualities and additionally reduce the effectiveness of price on quality perception.
The theoretical framework that underpins this research study is based on the Prospect Theory formulated by Kahneman and Tversky, and Thaler’s Mental Accounting Theory. The research aims to evaluate the consumers’ behavior when different patterns of discount are offered (in percentage and absolute value and for larger and smaller discounts). Two experiments were conducted to explore these patterns of behavior and the results that were obtained supported the view that the framing effect was a common occurrence. The patterns of choice of individuals in a sample were found to be different due to changes in the ways discounts were offered. This can be explained by the various ways of presenting discount rates that had an impact on the influence of purchase intentions, recommendations and quality perception.
Purpose
– The purpose of this paper is to explore the attitudes and behaviour of low‐income women consumers in respect of low‐involvement grocery products.
Design/methodology/approach
– One focus group and 30 in‐depth interviews on the subject‐matter are conducted with low‐income women in Salford (Northwest England). Given the nature of the topic and the target respondents involved, the subjects are recruited through the use of purposive and snowballing sampling methods.
Findings
– The findings suggest that low‐income women consumers' purchases of low‐involvement grocery products are based on habit. They do not show strong loyalty to brands of these products, and do not perceive price as an indication of their quality. Their key motivation underlying their purchases of these products is value‐for‐money. Also they are very sensitive to sales promotional stimuli, albeit in varying degrees according to the respective attractiveness of these tools. However, while they indicate a positive attitude towards buy‐one‐get‐one‐free (BOGOF), free samples, discount and coupons, BOGOF stands out as their best preference; but they are not positively inclined towards gifts and competition.
Originality/value
– The paper explores the motivation, attitudes and behaviour of a special group of consumers (low‐income women) in respect of low‐involvement grocery products. It indicates the directions of their sensitivity in terms of marketing stimuli. Hence, it will be valuable for marketing decision making towards providing this group of consumers with the utmost satisfaction needed in this increasingly complex marketing environment.
This paper examines the disruptive impact that open source (OS) software has on the mainstream software market within the period 2001 - 2003. The findings indicate that the stock market reacted negatively when the strategic responses of closed source incumbents were antagonistic to open source despite their relentless effort and investment in product and service enhancement. Whereas their counterparts that embraced open source were most likely to perform well on the stock market and successfully enter into the emerging new markets.
Evidence from past research and insights from an exploratory investigation are combined in a conceptual model that defines and relates price, perceived quality, and perceived value. Propositions about the concepts and their relationships are presented, then supported with evidence from the literature. Discussion centers on directions for research and implications for managing price, quality, and value.
The authors report a study of the effects of price, brand, and store information on buyers' perceptions of product quality and value, as well as their willingness to buy. Hypotheses are derived from a conceptual model positing the effects of extrinsic cues (price, brand name, and store name) on buyers' perceptions and purchase intentions. Moreover, the design of the experiment allows additional analyses on the relative differential effects of price, brand name, and store name on the three dependent variables. Results indicate that price had a positive effect on perceived quality, but a negative effect on perceived value and willingness to buy. Favorable brand and store information positively influenced perceptions of quality and value, and subjects' willingness to buy. The major findings are discussed and directions for future research are suggested.
Used 7 price-related constructs, 5 consistent with a perception of price in its "negative role" and 2 consistent with a perception of price in its "positive role," as independent variables to predict marketplace responses/behaviors in 5 domains: price search, generic product purchases, price recall, sale responsiveness, and coupon redemption. The price-related constructs explained a significant amount of variance in all 5 domains, providing evidence of predictive validity. Results of a higher order factor analysis are also reported, which provide some support for the positive-negative perception of price taxonomy.
This article examines the dissimilar use of product information cues in product evaluations by differentially familiar subjects. Specifically, the use of price cues and intrinsic product cues for the assessment of product quality is hypothesized to depend on prior knowledge. For a product with a positive quality-price association in the marketplace, the study shows that low-familiar and highly familiar subjects tend to perceive a stronger price-quality relationship than do moderately familiar subjects. Moreover, as subjects product familiarity increases, the use of intrinsic cues for product quality assessments tends to become relatively stronger.
The potentially multifaceted role of price in product evaluations is investigated with an empirical analysis of surveyed beliefs, attitudes, and intentions regarding automobile brands. It is found that price beliefs both influence and are influenced by beliefs about a brand's quality, thereby contributing to the attribution definition process. However, price is not a significant determinant of overall attitude. It is also found that price becomes a negative factor when behavioral intentions are involved, lending support to an economic interpretation of price.
Seven price-related constructs—five consistent with a perception of price in its “negative role” and two consistent with a perception of price in its “positive role”— are used as independent variables to predict marketplace responses/behaviors in five domains: price search, generic product purchases, price recall, sale responsiveness, and coupon redemption. The price-related constructs explain a significant amount of variance in all five domains, providing evidence of predictive validity. Results of a higher order factor analysis are also reported, which provide some support for the positive-negative perception of price taxonomy.
Four studies were conducted to assess the accuracy with which consumers perceive objective price-quality relationships. Results across four studies indicate that, overall, consumers perceive objective price-quality relationships with only a modest degree of accuracy. However, findings also suggest that the accuracy of consumers’ perceptions is moderated by product type; that is, price-quality perceptions are more accurate for nondurable products than for durable products. The authors conclude that consumers’ price-quality perceptions appear to be a function of general or product-type-specific schemas, rather than independent evaluations of price-quality relationships for individual product categories.
The authors report a study of the effects of price, brand, and store information on buyers’ perceptions of product quality and value, as well as their willingness to buy. Hypotheses are derived from a conceptual model positing the effects of extrinsic cues (price, brand name, and store name) on buyers’ perceptions and purchase intentions. Moreover, the design of the experiment allows additional analyses on the relative differential effects of price, brand name, and store name on the three dependent variables. Results indicate that price had a positive effect on perceived quality, but a negative effect on perceived value and willingness to buy. Favorable brand and store information positively influenced perceptions of quality and value, and subjects’ willingness to buy. The major findings are discussed and directions for future research are suggested.
When information on product quality is not perfect, theories in the areas of consumer rationality, inference, and risk-aversion suggest at least three consumer choice strategies: best value, price-seeking, and price aversion. The authors relate these choice strategies through a common utility model and show they are three types of response to price: rational, overweighting, and underweighting, respectively. Through a simulated shopping experiment, they show the factors that discriminate when consumers use these strategies. In particular, they find that price-seeking due to inference is not strictly rational and can lead to a positive response to price when information on quality is low but quality is important. Although information on quality generally promotes the rational choice of best value, experience neither promotes rationality nor mitigates inference. Ironically, subjects seem to react to but do not learn from experience.
Marketing universals are defined as consumer behaviors within a segment and toward a particular product category that are invariant across cultures. Using several definitions of culture and three different criteria for universality, the authors evaluate whether the use of brand, price, retailer reputation, and physical product appearance as signals of quality are marketing universals for consumer electronics products. Using a sample representing 38 nationalities, they find that there are few differences in the use of quality signals across cultures for a high priority segment of consumers. They draw conclusions for the adaptation versus standardization debate and argue that certain behaviors are likely to be universal, whereas others are not. Understanding such differences is essential to designing international marketing strategies.
Only limited research has focused on developing a taxonomy to distinguish products that may have reverse sloping demand functions from those with conventional demand curves. Findings in this article suggest that preferences for higher prices within a product line are related to consumer perception of product-specific characteristics.
Do behavioral differences exist among consumers who select items priced differently within the same product category? Analysis of 18 perceptual, personality, and economic variables compared across subjects selecting differently priced alternatives in 7 product lines revealed relationships between perceptual differences and price selections.
The relationship between price and perceived quality is investigated for a variety of products in an experimental situation. The correlates of the consumer's use of price as a communicator of quality (price reliance) is determined and incorporated into a model of the sources of price reliance.
Although management assumes a relationship between price and quality when making decisions about pricing and when acting against price cutting within distribution channels, little research on this relationship has been done. Earlier price-quality studies have not involved consumers actually using products over time. This article reports a study in which price was the only variable and, over 24 trials, quality differences for three brands were perceived by subjects when no quality difference existed. The relationship between price and perception of quality was positive but not linear.
The author reports some empirical results on the strength of the quality-price relation. For many products, the relation between quality and price appears to be very weak; hence, for many products, higher prices appear to be poor signals of higher quality.
The authors integrate previous research that has investigated experimentally the influence of price, brand name, and/or store name on buyers' evaluations of prod¬uct quality. The meta-analysis suggests that, for consumer products, the relation¬ships between price and perceived quality and between brand name and perceived quality are positive and statistically significant. However, the positive effect of store name on perceived quality is small and not statistically significant. Further, the type of experimental design and the strength of the price manipulation are shown to significantly influence the observed effect of price on perceived quality.
I. Introduction It is generally accepted that price may enter into the determination of consumers' choice in two ways: as an indicator of cost and as an indicator of quality. Contemporary demand theory rests heavily on the first of these two functions while the second tends to be treated as if it were an exceptional and anomalous phenomenon, to be mentioned only in order to be dismissed as unimportant. Indeed, it is of considerable analytical convenience to ignore price as a quality indicator, because if this is not done, the utility function of the individual must be formulated so as to incorporate an additional set of independent variables, namely the prices of all the commodities in the market. The problem is not intrinsically insoluble but it leads to difficulties which can be avoided simply by denying the relevance of this aspect of price.
The relationship between product price and perceived product quality has been developed extensively in the literature. Less
work has been done to investigate the possible effects of other variables in combination with price as perceived-quality influentials.
This paper examines the effect on perceived product quality of price, brand name and store name. The results tend to confirm
the hypothesis that consumer quality perception is dependent on a combination of controllable marketing attributes, but that
not all classes of products are subject to the same type of interaction.
- Gabor
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Impact of Price and Brand on Consumer's Choice: An Experimental Study
- Subhash C Mehta
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Psychology of Pricing: Price-Perceived Quality Relationship
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