A gap in our understanding of the price-perceived quality relationship is the lack . very heterogeneous in terms of their attention and reaction to price and price. The price-perceived quality relationship has received much attention in behavioral price research (Somervuori, ). Nevertheless, the. Consumers also pay attention to and rely on these appeals to decide whether . Study 1 investigates whether consumers' quality perceptions, price belief of a positive relationship between price and quality moderates the.
This study focuses on consumers' global assessments of the relationship between price and quality. Consumers view price as both an indicator of sacrifice and as an indicator of quality Lichtenstein, Ridgway, and Netemeyer ; Monroe In particular, research has found a group of consumers that believes in and relies on a strong positive relationship between price and quality, regardless of the product type.
Lichtenstein, Ridgway, and Netemeyerp. A consumer who believes that "you get what you pay for" could be said to possess a price-quality schema. The consumer who has low trust in a relationship between price and product quality might be called "aschematic" Lichtenstein and Burton ; Peterson and Wilson In addition, market behavior is affected by schema membership, with individuals who believe in a positive price-quality correspondence preferring higher-price products John, Scott, and Bettman ; relying heavily on price as a cue to quality in relation to other cues Etgar and Malhotra ; Peterson and Wilson ; demonstrating higher price acceptability levels Lichtenstein, Bloch, and Black ; and exhibiting relatively lower ability to recall prices accurately Lichtenstein, Ridgway, and Netemeyer However, virtually all price-quality schema research has been conducted with U.
Formerly without brands and not packaged, products are now produced by both private and state manufacturers, offering branded and advertised options for consumers.
In short, for the first time in forty years, urban Chinese consumers are experiencing choices in both price levels and product quality, and price-quality schema may be forming as a result. Unfortunately, along with expanded choice, market reforms have allowed inflation.
With no prior research on price-quality schema in Chinese consumers, one tact is to hypothesize patterns that are similar to those known for U.
Empirical findings can then highlight cross-cultural similarities or dissimilarities. In sum, the newly-emerging market environment of China provides a dynamic setting to study the phenomenon of price-quality schema. However, as Dickson and Sawyerp. Therefore, just as distinct clusters of consumers based on the strength of the price-quality schema have been found in the U. Urban Chinese consumers can be meaningfully grouped based on the presence or absence of a price-quality schema.
Therefore, when asked what price they would most likely pay for a product, those with a stronger belief in a price-quality relationship should generally cite a higher price. Urban Chinese consumers possessing a price-quality schema are likely to pay higher prices for products than those with a weak price-quality schema assuming price-quality schema groups are found. A focus group of Chinese respondents who had recently arrived in the U. Since all participants in the focus group were bilingual, the discussion vacillated between Chinese and English.
This qualitative phase confirmed that contemporary Chinese consumers did discern price and quality differences in products sold in China. At the same time, the focus group served to generate a list of products that were commonplace and exhibited price and quality variations in today's Chinese markets. Consistent with Peterson and Wilson and Burton and Lichtensteinthe research instrument asked respondents to evaluate a list of fourteen products on the statement "The higher the price, the higher the quality.
Fourteen durable and nondurable products available to urban Chinese consumers on the open market were identified and used as stimuli. Additional information collected included the price respondents would be most likely to pay for each product, purchase experience, shopping preferences, and demographics. Following cross-cultural research guidelines, the questionnaire was written in English, translated into Chinese, then back-translated into English Brislin, Lonner, and Thorndike Data Collection The questionnaires were administered by Chinese university faculty and graduate students to convenience samples of university students and adults consumers in two urban areas in China, Beijing population University students and adults consumers were surveyed to allow comparisons to U.
A total of questionnaires was collected: Due to the nonrandom selection of the sample, a series of statistical tests after scale refinement, described below was conducted to determine if demographic factors would confound the findings.
No significant differences were found in price-quality perceptions associated with education level or age in the adult consumer sample, and gender in both samples. Consequently, the internal validity of the study did not appear to be compromised by the sample composition.
Scale Refinement The product instrument was subjected to item analysis and purification, with a series of factor analyses and reliability assessments conducted on the central construct Bearden, Netemeyer, and Mobley ; Churchill The final scale form was found to represent two separate dimensions: The durables price-perceived quality scale consisted of four products: The nondurables price-perceived quality scale also contained four products: The items eliminated from the analysis included soap, cigarettes, soda, toothpaste, gold ring, and television.
Most of the eliminated items have dual functions in China as products that are used every day and luxury items that can be presented as gifts, a characteristic that undoubtedly contributed to their weak factor loadings.
The criterion variables used for the cluster analysis were the average price-quality perceptions for the four-product durables scale and the four-product nondurables scale. Adult consumers and university students were clustered independently using a two-stage procedure. First, a hierarchical method Ward's method; squared Euclidean distances was used to select a cluster solution and identify seed points.
Price-Quality Relationships by Steven M. Shugan
Then, a nonhierarchical cluster technique parallel threshold procedure was used to calibrate the results Hair et al. The cluster solutions were chosen based on uniformity of cluster sizes and change in agglomeration coefficients Hair et al.
A two-cluster solution provided the most interpretable results for both the adult consumer and university student sample see Table 1.
However, neither type of Chinese consumer group exhibited acceptable identification beyond two subgroups. The mean response for "the higher the price, the higher the quality" for Cluster 1 of both samples corresponded to "agree" for the durables scale and "somewhat agree" for the nondurables scale. Cluster 2 of both samples, on the other hand, recorded a mean price-quality perception of "neither disagree nor agree" for durables and "somewhat disagree" for nondurables.The Relationship between Price and Quality of the Product of Angel's Burger
Thus, the results support Hypothesis 1, and we have labeled the two clusters "schematics" and "aschematics" respectively. While the mean responses for the schematic clusters of adult consumers and university students are similar, the number of university students classified as schematics is higher see Table 1. The sample size decreased from to due to missing data.
A MANOVA for each sample was conducted to compare the mean price differences of the cluster groups for the four durable products and the four nondurable products. To correct for abnormal distribution of values and heterogeneity of variance-covariance matrices, logarithm transformations were applied to all price variables Hair et al.
The responses exhibited large variances, perhaps due in part to the escalated inflation rates in urban China and the diverse reference products of respondents. Some have the perception that, product with high price is of high quality to one consumer may be an inferior to another person.
In Ghana for instance people perceive product being sold in super markets and retail stores to be of a high quality. In view of this, it is difficult to define what quality product is, because of different perceptions hold by different consumers. Although some of the attributes of quality must be measured objectively, quality must be measured in terms of buyers perception Kotler e tal Therefore, it is obvious that managers cannot boast of having the quality product on the market.
Since quality based on buyers perception 2. Consumer Perception Consumers use different variables to determine the quality of a product. These quality lies in the eyes of the consumers in question. What may be seemed to be of high quality to one consumer may be inferior to another. Even though many consumers uses price as an indicator of product quality Kotlerthere are doubts in consumers mind whether there is a relationship between price, value and product quality and further price itself is a strong indicator of product quality in the absence of any information.
However, some consumers also determine rice quality based on the country of origin whilst others based quality on producer. It is clear that, consumers evaluate directly attribute by physical cues such as tasty, smell and size.
Others use variable such as place of origin, type of distribution channel, price, packaging the manufacturer and among others. Perception plays an important role in life of the consumer. Our environment including business environment is littered with numerous stimuli trying to attract our attention. The quality of our perception depends on the way we process and interpret the stimuli or the information reaching our senses.
Perception is the process, by which an individual select, organizes and interpret information inputs to create meaningful picture of the world.
When we interpret a situation or events we are then in position to respond. Perception, according to Gregory et alis a set of process by which an individual becomes aware of and interpret information about the environment. If everyone perceived everything the way, things would be a lot simpler, of course, the reverse is true. Moreover, people often assume that, reality is objective that, we all perceive the same things in the same way.
According to Markinperception is concerned with the way in which we select and recognize sensory data presented by our environment. In other words perception may be defined as a complex process by which people select, organized and interpret sensory stimuli into meaningful picture of the world.
Markin Continues that, a number of stimuli constantly reaching consumers sensory organs from the environment they select certain stimuli to which they attend, they organized these stimuli so that they become understandable, but their interpretation of sensory stimuli involves more than just receiving and processing information by attitudes and beliefs and their past learning as is by the character of the stimuli themselves.
And understanding of perception process is important to the producer or the manufacturer. This is because Consumers decision to purchase a product will be influenced to a large extent by the attribute which the successful marketer is able to give or lend to the product through advertising, packing, Manufacturing, Country of origin and other promotional techniques which in a way determined product quality.
Psychologists have succeeded in identifying a number of factors that are important in determining the direction of attention. They can be broadly classified under external and internal factors External factors relates to physical characteristics of stimuli, while internal factors include our motives and expectations which also affect the way consumers determine product Quality.
Courtland L, Bovver and John J.
ThrillP have the view about perception; before consumers can buy a product, they must be aware that it exist. This is a process that starts with being exposed to the stimuli that represent a particular product, attending to these stimuli and interpreting them to form an overall perception of the object. The Steps involve exposure, attention and interpretation.
Consumer Behavior Consumers respond differently to the same external forces that are they perceive those forces differently. This perceptions is said to be the way they gather and record information Gilbert A. Churchill and Douglass F. It is believed that, it is not to be satisfied and delighted as they must perceived that the product is excellent Larforce et al, Some have come out with the following trend affecting Consumer behaviour.
Shoppers increasingly economizing or down scaling to less expensive brands, Searching for deals, waiting longer to but, balancing quality and price Consciousness.
Consumers moving from conspicuous consumption to rational Consumptions and cautions use of finance. Consumer utter behaviour and diets to reflect great concern for health and physical fitness. The aging of the population, long life expectation and lower birth rates. Changes in family and work force Composition making men and woman increasingly similar in choices of product and services.
According to the journal of marketing Research, Self-perception theory provides a theoretical frame work within which behavioural influence strategies can be investigated. In essence, self- perception theory specifically the process and conditions under which a person past behaviour is used as data in making influence upon the circumstances in which behaviour is enacted. Specifically the central preposition of buyers perception theory stated individual comes to know their own attitude, emotions and the internal states practically by informing them from observation of their own behaviour and the situations in which the behaviour occurs, when Consumers do infer a positive relationship likely to compare the two stores dealing with 2 different products, the key point is the judgment quality based on the brand name or the channel of distribution are necessarily comparative and perceived differences in product, lend to relative and perceived differences in product quality varies significantly journal of Marketing Research Selective Perception Since the average consumer operate in an environment, the Human brain attempt to organize and interpret information with a process called selective perception a filtering of exposure.