A longitudinal examination of the impact of quality perception gap on brand performance in the US Automotive Industry

Abstract

A quality perception gap, defined as the difference between perceived and objective quality, indicates either consumers' overappreciation or underappreciation of product or brand quality and can have critical effects on performance. The purpose of this research is to examine the impact of a quality perception gap on brand performance and its moderating role in the relationship between marketing-mix signals and performance. Analyses based on a longitudinal dataset from the US automotive industry reveal that the relationship between the quality perception gap and brand performance has an inverted U-shape. Findings also demonstrate that, except for advertising, the impact of marketing signals on performance is higher when the quality of a brand is perceived as higher than its actual quality. Finally, over an 18-year period, the average gap between perceived and objective quality demonstrates a decreasing trend, indicating that the nature of demand in the automotive industry has become more utilitarian.

An optimal control model with defective products and goodwill damages

“…1 and proposed by the Operations Management literature. Our findings suggest that the negative impact of failures on goodwill is economically and operationally harmful for the business, as it has also been empirically demonstrated by Akdeniz and Calantone (2015). Complementing a conformance quality policy with an appraisal and prevention strategy provides an outstanding opportunity to preserve both goodwill and the sales by minimizing the indirect conformance quality costs.…”

“…Nevertheless, they did not consider the impact of defects on goodwill. Similar approaches by Fine (1986Fine ( , 1988, Tapiero (1987) and Chand et al (1996) disregard the implications of defective products for goodwill, while Akdeniz and Calantone (2015) and De Giovanni (2018) empirically demonstrate that leaving a gap between the perceived and the objective quality substantially harms the market performance. According to recent developments in this stream of literature, the first contribution of this research is to capture the detrimental effect of non-conformance quality on goodwill and suggest how firms can prevent any brand deterioration caused by defect issues.…”

“…The amplitude of k 4 depends on the gravity of the failure to be assessed by means of a Failure Mode and Defect Analysis (FMDA): k 4 is low when the company's reputation is only marginally affected by defected goods, while it is tremendously high when product failures lead to catastrophic events (e.g, people death). When Q (t) < 1 there exists a gap between expected and objective quality that harms the market performance through a negative impact on goodwill (Akdeniz and Calantone 2015).…”

Evolución de la inversión publicitaria durante la década de crisis económica (2007-2018). El caso del sector del automóvil y su adaptación a Internet

“…The personal values of car buyers that relate to product attributes are hedonism or personal pleasure and design, as well as a concern for safety and the search for protective features (Pimenta and Piato, 2016). If anything, the relevance of advertising values in this sector have increased due to empirical evidence that shows that the gap between perceived and objective quality has decreased over the last two decades (Akdeniz and Calantone, 2017). Moreover, the use of unrealistic images, which are sometimes used in car advertising, increases uncertainty in evaluating the product and imagining its use (Kim, Choi, and Wakslak, 2019).…”

Dynamic perceived quality analysis using social media data at macro- and micro-levels

“…Perceived quality, which is generated by consumers during use (Golder et al, 2012;Mitra and Golder, 2006), has a significant impact on consumers' purchasing decisions (Wang et al, 2018;Xu et al, 2019). High perceived quality means products are favored by consumers, so perceived quality has significance for manufacturers to establish a competitive advantage (Akdeniz and Calantone, 2017). With the development of social media, increasing Dynamic perceived quality analysis consumers are sharing their product quality perceptions online (He et al, 2018;Zheng et al, 2020).…”