How Does Objective Quality Affect Perceived Quality? Short-Term Effects, Long-Term Effects, and Asymmetries

Debanjan Mitra () and Peter N. Golder ()
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Debanjan Mitra: Warrington College of Business, University of Florida, P.O. Box 117155, Gainesville, Florida 32611
Peter N. Golder: Stern School of Business, New York University, 40 West 4th Street, New York, New York 10012

Marketing Science, 2006, vol. 25, issue 3, 230-247

Abstract: We examine the relationship between objective and perceived quality for 241 products in 46 product categories over a period of 12 years. On average, we find that the effect of a change in objective quality is not fully reflected in customer perceptions of quality until after about six years. In the first year after a quality change, only about 20% of the total effect over time is realized. These effects are significantly larger and quicker for a decrease in quality relative to an equivalent increase. Interestingly, we also find that brand reputation has a “double” advantage. High-reputation brands are rewarded three years quicker for an increase in quality and punished one year slower for a decrease in quality compared to low-reputation brands. These differences in response time are a meaningful measure of brand equity. Finally, we examine the differences in quality effects across several product- and category-specific variables and discuss the implications of our findings.

Keywords: quality; quality perception; lagged effects; carryover duration; brand management; reputation effects; consumer learning; product management (search for similar items in EconPapers)
Date: 2006
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Citations: View citations in EconPapers (52)

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Persistent link: https://EconPapers.repec.org/RePEc:inm:ormksc:v:25:y:2006:i:3:p:230-247

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