Wednesday, May 7, 2008

Perceived vs. Objective Quality

Given my undergraduate degree in Chemical Engineering, I understand the engineer's passion for maximizing objective quality. After all, an engineer is driven by a passionate need to create a high-quality product which may be defined as "zero defects/bugs" or "built to specifications."

At the same time, in marketing, the quest is for perceived quality. Marketers strive to maximize perceived quality. How does one reconcile these two perspectives?

As Doug mentioned, blind taste tests are a great way of separating these two effects out. For instance, see this study on search engines.

Does the pursuit of perceived quality imply capitulation on the objective quality front? Does the maximization of perceived quality equate with the sale of products with low objective quality and hence, harm to society?

One way that I am able to reconcile these two in my mind is to adopt a threshold model. If the objective quality is above a minimum threshold, then the pursuit of perceived quality is not problematic. At a minimum, the product should not cause physical, financial or psychological harm. It must be reliable. It must work. Beyond that, it is fine to use marketing to gain a perceived quality advantage.

There are some that will argue that a perceived quality advantage is bound to be transitory since the market will figure out that the objective quality is poor. What is very relevant here is the classification of products as search (quality is ascertainable through an objective search process), experience (quality can only be ascertained through an experiential process such as taste, smell or touch) and credence (quality can never be reliably ascertained by an average consumer). Perceived quality advantages are likely to be highest for credence products and lowest for search products. In the case of credence products, perceived quality effects may never be detected and may persist over a long period of time.

Next, there is the ethical issue. Is it unethical to pursue high perceived quality when the objective quality is poor? In some cases, yes. If the product does not work as described, causes harm or is excessively unreliable, I think you have a problem. If you are claiming that your product/service is something that it is not, you have a problem. Beyond that, I believe it is fine to get a perceived quality bump from your marketing activities.

Early on, I made a case for three marketing goals- attention, trust and value. I think perceived quality affects both trust and value.