The Effects of Extrinsic Product Cues on Consumer Perceptions of Quality, Sacrifice and Value

RESEARCH NOTE

The Effects of Extrinsic Product Cues on Consumers' Perceptions of Quality, Sacrifice, and Value

R. Kenneth Teas Sanjeev Agarwal Iowa State University

The authors report the results of two experiments designed to test the effects of extrinsic cues--price, brand name, store name, and country of origin--on consumers'perceptions of quality, sacrifice, and value. The results of the experiments support hypothesized linkages between (a) each of the four experimentally manipulated extrinsic cues and perceived quality, (b) price and perceived sacrifice, (c) perceived quality and perceived value, and (d) perceived sacrifice and perceived value. The results also indicate that the linkages between the extrinsic cues and perceived value are mediated by perceived quality and sacrifice.

Several researchers have developed and/or tested models of buyers' perceptions of value with particular empha- sis on buyers' use of extrinsic cues (such as price and brand name) as indicators of quality and value ~awar and Parker 1996; Dodds and Monroe 1985; Erickson and Johansson 1985; Monroe and Chapman 1987; Monroe and Krishnan 1985; Stokes 1985; Zeitham11988). On the basis of a meta-analysis of the results of empirical tests of the effects of extrinsic cues on consumers' perceptions of product quality (Rao and Monroe 1989), Dodds, Monroe, and Grewal (1991) specified a model in which perceived quality and perceived sacrifice mediate linkages between (a) brand name, store name, and price and (b) perceived value. The model is based on two premises. First, con-

Journal of the Academy of Marketing Science. Volume 28, No. 2, pages 278-290. Copyright �9 2000 by Academy of Marketing Science.

sumers' perceptions of value are based on a trade-off between product benefits (e.g., product quality) and monetary sacrifice. Second, consumers' perceptions of product quality and monetary sacrifice can be based, at least in part, on extrinsic cues. Test results reported by Dodds et al. (1991) suggest that three extrinsic cues (price, brand name, and store name) are associated with quality and value perceptions.

This study extends the Dodds et al. (1991) study by examining linkages specified but not tested in the Dodds et al. (1991) study (i.e., linkages involving perceived sacrifice) and by examining the degree to which perceived quality and sacrifice mediate the relationships between the extrinsic cues and perceived value. In addition, this study extends the Dodds et al. (1991) model via an additional extrinsic cue---country of origin. Although the literature suggests consumers may be influenced by several extrinsic cues beyond those specified by Dodds et al. (1991), such as warranty (Bearden and Shimp 1982), packaging (Stokes 1985), and advertising (Milgrom and Roberts 1986), a particularly important extrinsic cue is country of origin (Chao 1993; Darling and Arnold 1988; Hart and Terpstra 1988; Hastak and Hong 1991; Johansson, Doug- las, and Nonaka 1985; Thorelli, Lim, and Ye 1989; Tse and Gorn 1993; Wall, Liefeld, and Heslop 1991). Furthermore, the literature suggests that country of origin may moderate quality perceptions generated by extrinsic cues (Chao 1993; Erickson, Johansson, and Chao 1984; Hart and Terp- stra 1988; Wall et al. 1991). In the following two sections, the model is developed and the hypotheses are specified. The third section contains a description of the research method. The fourth section reports the results of mani-

Teas, Agarwal / EFFECTS OF EXTRINSIC CUES 279

FIGURE 1 A Conceptual Model of Extrinsic-Cue Effects on

Perceived Quality, Perceived Sacrifice, and Perceived Value

Brand Name

Store Name

Price

[cor I

a. Hypothesis 6 predicts that country of origin will have a positive effect on perceived quality, and Hypotheses 7a-c predict that country of origin will negatively moderate the linkages between the other three extrinsic cues (i.e., brand name, store name, and price) and perceived quality.

pulation checks, measurement validity tests, and tests of the hypotheses. The fifth section contains discussions of the findings.

THE CONCEPTUAL MODEL

The conceptual model examined in this study, which is diagrammed in Figure 1, suggests that quality and sacrifice perceptions mediate linkages between (a) antecedents of consumers' quality and sacrifice perceptions (e.g., brand, store, and price) and (b) consumers' perceptions of value. Country of origin is specified as an extrinsic quality cue and as a moderator variable.

The Impact of Price on Consumers' Perceptions of Quality and Sacrifice

Considerable theoretical and empirical evidence suggests that price is often used by consumers as an extrinsic product-quality cue (Bearden and Shimp 1982; Dodds and Monroe 1985; Dodds et al. 1991; Erickson and Johansson 1985; Lichtenstein, Block, and Black 1988; Lichtenstein, Ridgway, and Netemeyer 1993; Monroe and Krishnan 1985; Rao and Monroe 1989; Zeithaml 1988). Theoretical ration- ales underlying an expected positive price-quality linkage can be based on expected market forces--high-quality products often cost more to produce than low-quality

products and competitive pressures limit firms' opportuni- ties to charge high prices for low-quality products (Curry and Riesz 1988; Erickson and Johansson 1985; Lichten- stein et al. 1993). Complicating the extrinsic cue effect of price is that price also is an indicator of sacrifice (Dodds et al. 1991; Erickson and Johansson 1985; Grewal, Monroe, and Krishnan 1998; Lichtenstein et al. 1993; Zeithaml 1988).

The Impact of Brand and Store on Consumers' Perceptions of Quality

Research evidence indicates that brand names (Dodds and Monroe 1985; Stokes 1985) and store names (Wheat- ley and Chiu 1977) are extrinsic quality cues. Researchers have viewed brand name as a "summary" construct (Hart 1989; Johansson 1989) or a "shorthand" cue (Zeithaml 1988) for quality because consumers can make product quality inferences based on brand name. The process can be explained via the "affect-referral" process discussed by Wright (1975), which suggests consumers do not examine brand attributes every time they make brand choice deci- sions; they simplify their decision-making process by bas- ing their judgments on brand attitudes (summary information) rather than on product attribute information. Empirical test results reported by Dodds et al. (1991) indicated significant brand and store treatment effects on consumers' perceptions of product quality.

280 JOURNAL OF THE ACADEMY OF MARKETING SCIENCE SPRING 2000

Country of Origin as an Additional Extrinsic Quality Cue

The results of several published studies (see Bilkey and Nes 1982 and Han 1989 for reviews) suggest that country of origin may directly affect consumer perceptions of quality and/or may moderate the effects of other product quality cues.

Main effects. Research results reported by Erickson et al. (1984) and Johansson et al. (1985) indicate positive relationships between country-of-origin image favorability and respondents' ratings of automobiles on specific fea- tures. Research results reported by Hastak and Hong (1991) indicate that the impact of country of origin on quality perceptions can be comparable with that of price, and research results reported by Darling and Arnold (1988) suggest that country of origin can be more important than brand name as an influencer of quality perceptions. Thorelli et al. (1989) conducted an experiment to examine the impact of country-of-origin cue (in conjunc- tion with product warranty and retail-store cues) on perceived quality, overall attitude, and purchase intention. The results suggest that consumers' perceptions of country of origin affect their perceptions of quality, attitude, and purchase intention. Wall et al. (1991) examined the impact of country-of-origin, price, and brand cues on perceived product quality, perceived risk associated with purchasing the product, perceived value, and likelihood of purchasing. All three cues were found to be significantly related to perceived product quality. Experimental research results by Tse and Gorn (1993) indicated that country of origin, brand name, and consumers' experience with the product resulted in significant main effects on respondents' perceived product quality. Experimental research results reported by Chat (1993) indicated that price, country of design, and country of assembly were statistically significant predictors of respondents' quality perceptions. Han and Terpstra (1988) also reported significant main effects of country of origin and brand name on overall evaluation of automobiles.

Moderator variable effects. On the basis of the concept of country-of-origin halo effects (Erickson et al. 1984; Han 1989; Hanssens and Johansson 1991), Chat (1993) argues that the effects of extrinsic quality cues such as price may be different across different countries' products. He argues that when consumers have high (low) confi- dence in a country's ability to produce high-quality products, they may perceive that the products produced in the country will be generally high-quality (low-quality) products; consequently, consumers may be less (more) likely to use price as an indicator of quality. Empirical findings reported by Chat (1993) suggested that for television sets manufactured in a high-quality-image country (Japan), price differentials were not translated into quality image

differentials. However, for television sets designed in countries with the lower-quality image (e.g., Taiwan), higher prices were associated with significantly higher- quality ratings. Research also suggests that country of origin may moderate brand name--perceived quality and store name-perceived quality linkages. Han and Terpstra (1988) report findings that indicated United States' brands that were manufactured in the United States were perceived to be of much higher quality than the United States' brands manufactured in Korea--the country of origin for the brand moderated the impact of the brand on perceived quality ratings. Wall et al. (1991) reported similar country-by-brand interaction effects in predictions of consumer quality perceptions. In addition, Thorelli et al. (1989) argue that a high (low)country-of-origin image may enhance (reduce) the impact that store image has on the perceived quality.

Antecedents of Perceived Value

Consumer perceptions of value are posited by Dodds et al. (1991) to involve a trade-off between perceived quality and perceived sacrifice that results in a positive linkage between perceived quality and perceived value and a negative linkage between perceived sacrifice and perceived value. This conceptualization of value is similar to concep- tualizations posited by Hauser and Urban (1986) and Zeithaml (1988) and suggests (a) perceived quality mediates the linkages between extrinsic cues and perceived value and (b) perceived sacrifice mediates the linkage between price and perceived value. Empirical findings reported by Dodds et al. (1991) indicated strong support for their hypothesized positive linkage between perceived quality and perceived value, their hypothesized positive linkages between two extrinsic cues (i.e., brand and store name) and perceived value, and their hypothesized negative linkage between price and perceived value.

Hypotheses

This study extends the Dodds et al. (1991) study by examining the role of an additional extrinsic cue---country of origin--and by testing the degree to which perceived quality and perceived sacrifice mediate the effects of the extrinsic cues on consumers' perceptions of value. It is important to note that the mediating role of perceived sacrifice was hypothesized but not tested by Dodds et al. (1991). Fur- thermore, although the model proposed by Dodds et al. (1991) implies that the impact of the extrinsic cues on perceived value is mediated via perceived quality and sacrifice, they did not specify formal hypotheses or tests for mediation they examined relationships between the extrinsic cues and perceived value independent of the impact of the perceived quality and perceived sacrifice mediating variables. Our research extends the Dodds et al. (1991)


study by examining the impact of the extrinsic cues on perceived value after controlling for perceived quality and sacrifice. On the basis of the Dodds et al. (1991) model, the following direct-effect hypotheses are specified:

Hypothesis la: Price level is positively related to perceived quality.

Hypothesis lb: Price level is positively related to perceived sacrifice.

Hypothesis 2: Favorability of the brand name is positively related to perceived quality.

Hypothesis 3: Favorability of the store name is positively related to perceived quality.

Hypothesis 4: Perceived quality is positively related to perceived value.

Hypothesis 5: Perceived sacrifice is negatively related to perceived value.

On the basis of the empirical evidence that country of origin may be an important extrinsic quality cue, the following hypothesis is specified:

Hypothesis 6: Favorability of the country-of-origin image is positively related to perceived quality.

Hypotheses 1-6 indicate that perceived quality and perceived sacrifice mediate the linkages between the extrinsic cues and perceived value.

On the basis of the previously cited empirical evidence, country of origin is also hypothesized to moderate the effects of other extrinsic cues (Chao 1993); hence, the hypotheses are the following:

Hypothesis 7a: Country of origin moderates the price- quality relationship hypothesized in Hypothesis la.

Hypothesis 7b: Country of origin moderates the brand name--quality relationship hypothesized in Hy- pothesis 2.

Hypothesis 7c: Country of origin moderates the store name--quality relationship hypothesized in Hy- pothesis 3.

THE EXPERIMENT

Experimental Design

The hypotheses were tested via experiments based on a 2 x 2 x 2 x 3 between-subjects full-factorial design. The experimental manipulations involved two brand-image levels (high and low), two store-image levels (high and low), two country-of-origin image levels (high and low), and three price levels (high, medium, and low).

A pretest involving 70 university undergraduate students was used to determine (a) the type of products, brand names, store names, and countries of origin recognizable to the participants and distinguishable on the basis of

image favorability and (b) realistic price ranges. The pretest led to the selection of two products (handheld business calculators and wristwatches), four brand names (Hew, lea Packard and Royal for calculators and Seiko and Precis for wristwatches), four retail outlets (Campus Bookstore and K-Mart for calculators and Belden Jewelers and K-Mart for wristwatches), four countries of origin (Japan and Mexico for calculators and Switzerland and Mexico for wristwatches), and six price levels ($15, $32, and $50 for calculators and $50, $175, and $300 for wristwatches). Handheld business calculators (with Hewlett Packard and Royal brand treatments) were used by Dodds et al. (1991), thus providing us the opportunity to replicate their study. Wristwatches were used by MacKenzie and Lutz (1989) in a study involving a similar participant population.

Sample

The participants in the experiment consisted of 5301 undergraduate students attending a major midwestern university. Similar to procedures used by Dodds et al. (1991), students were randomly assigned to 24 treatment cells for the calculator study. The cell assignments for the wristwatch experiment were also random and independent from the experimental cell assignments for the calculator experiment.

The Stimuli and Measures

Data were collected via two questionnaire surveys, separated by 1 week, that were administered to the same sample of students. The time lag between the surveys was planned to reduce carryover effects (note that Dodds et al. 1991 obtained responses for two separate stimuli at the same time). The product represented in the stimulus advertisement was handheld business calculators in one survey and wristwatches in the other. The advertisement, which displayed a black-and-white picture of the product, remained unchanged across the treatments. The experimentally manipulated brand name, store name, country of origin, and price information were displayed beside the picture.

The questionnaires contained measures for the endogenous variables followed by manipulation check measures. Perceived quality and perceived value were assessed via five-item scales developed by Dodds et al. (1991). Since Dodds et al. ( 1991) did not measure perceived sacrifice, a scale was constructed for this study based on published discussions of perceived sacrifice (Dodds et al. 1991; Monroe and Chapman 1987). The following two items were used to measure perceived sacrifice (5-point response scale where 1 = strongly disagree and 5 = strongly agree): (I) If I purchased the (watch/calculator) for the indicated price, I would not be able to purchase some other products I would like to purchase now; and (2)


If I purchased the (watch/calculator) for the indicated price, I would have to reduce the amount of money I spend on other things for a while.

Since students possess varying levels of financial resources, they can be expected to have different perceptions of the degree to which a particular price represents a sacrifice. Thus, we measured the concept of sacrifice from a budget constraint perspective. This measure allows for the possibility that the perception of sacrifice will vary depending on an individual's financial situation. The same price may involve a higher level of sacrifice for a finan- cially constrained individual when compared with a finan- cially endowed individual (Schmidt and Spreng 1996).

The manipulation check measures consisted of respondents' perceptions of the brand (7-point scale where 7 = high quality and 1 = low quality), price (7-point scale where 7 = very high and 1 = very low), store (three 7-point scales measuring the likelihood that the store "sells high- quality merchandise," "is a prestigious store:' and "is a high-quality store"), and country of origin (six 5-point agree~disagree scales involving expectations about the product's quality, durability, prestige, reliability, workmanship, and dependability).

RESULTS

Preliminary Tests

Manipulation checks. One-way analyses of variance (ANOVAs) were conducted to assess the impact of the three price levels (calculators: F2. 527 = 135.26, p < .000; wristwatches: Fz 52~ = 127.96, p < .000), the two brand levels (calculators: F1. s28 = 592.65, p < .000; wristwatches: F~.527 = 274.78, p < .000), the two store names (calculators: F~. 52s = 118.73, p < .000; wristwatches: F L 527 = 342.74, p < .000), and the two countries of origin (calculators: Fl.52s = 238.60, p < .000; wristwatches: F~. s27 = 460.52, p < .000). Each of the manipulation checks indicated that the four extrinsic-cue experimental treatments were perceived by the respondents as intended. For the calculators, Hewlett Packard received more favorable brand-image ratings than Royal; Campus Bookstore received more favorable store- image ratings than K-Mart; Japan received more favorable country-image ratings than Mexico; and $50, $32, and $15 were considered by the respondents to represent high, medium, and low prices, respectively. For the wristwatches, Seiko received more favorable brand-image ratings than Precis; Belden Jewelers received more favorable store- image ratings than K-Mart; Switzerland received more favorable country-image ratings than Mexico; and $300, $175, and $50 were considered by the respondents to be high, medium, and low prices, respectively.

TABLE 1 Factor Analysis Results

Watch Data Calculator Data

Factor Factor Factor Factor Factor Factor Item 1 2 3 1 2 3

Quality perception Reliability .85 .18 -.10 .91 .12 -.01 Workmanship .86 .12 -.09 .90 .18 .02 Quality .90 .14 -.06 .93 .16 .03 Dependability .90 .19 -.03 .94 .13 .02 Durability .74 .25 -.08 .85 .22 .04

Value perception Value for money .42 .69 .05 .39 .77 .06 Economical .09 .87 .18 .07 .88 -.24 A good buy .32 ,86 .09 ,33 .85 -.I0 An acceptable price ,22 .85 .19 ,13 .91 -.17 A bargain .03 .79 .16 .06 .86 -.19

Sacrifice perception . . . unable to purchase some other products I would like to purchase now. -. 11 .18 .86 .04 -.21 -.91 . . . reduce the amount of money I spend on other things for a while. -. 11 .24 .87 .04 -.25 .90

1.17 5.84 3.09 1.19 Eigenvalue 5.57 3.06 Percentage of

variance explained 46.40 25.50 9.80 48.60 25.80 9.90

Preliminary assessment of the measures. Following the procedures used by Dodds et al. (1991), we assessed the measures of perceived quality, value, and sacrifice via factor analysis by using varimax rotation, Cronbach's alpha, and correlation analysis. The results of the factor analyses, which are reported in Table 1, indicate three factors that are consistent with the intended measures and that account for more than 80 percent of the variance in the two sets of data. 2 Coefficients alpha for the quality, sacrifice, and value measures are .94, .89, and .93, respectively, for the wristwatch data and .96, .85, and .94, respectively, for the calculator data. Average interitem correlations for the quality, sacrifice, and value measures are .75, .81, and .72, respectively, for the wristwatch data and .81, .75, and .74, respectively, for the calculator data.

Preliminary MANOVA Tests

Before examining specific hypothesized linkages, multivariate analysis of variance (MANOVA) was used to test the hypothesized linkages between the set of treatment variables and the set of endogenous variables. The results


TABLE 2 Analysis of Variance and Covariance (wristwatch data)

MANOVA ANOVA ANCOVA

Quality Sacrifice Value Value Value Value Treatment Wilks df F Value F Value F Value F Value F Value a F Value b F Value c

Brand (B) .933 3; 512 12.29"** 21.09"** 2.33 26.53*** 14.32"** 11.63"** 30.20*** Country (C) .898 3; 512 19.43"** 56.56*** .04 18.58"** .64 1.11 18.85"** Store (S) .928 3; 512 13.19"** 20.57*** .43 35.12'** 16.87"** 18.37"** 34.77*** Price (P) .637 6; 1024 43.22*** 5.57** 43.03*** 84.18"** 85.19"** 125.54"** 56.54*** B x C .989 3; 512 1.85 1.04 .65 .98 3.63 2.55 1.32 S x C .984 3; 512 2.81' .69 1.65 7.76** 5.78* 7.29** 6.70** P • C .988 6; 1024 1.01 .17 1.57 1.66 1.27 1.59 1.45 B x S .977 3; 512 4.07** 5.70* 2.95 8.35** 2.42 4.14" 6.83** B x P .980 6; 1024 1.74 1.61 2.43 2.00 1.06 .91 2.08 S x P .997 6; 1024 .22 .01 .40 .32 .27 .42 .23

Covariates Quality 148.27"** Sacrifice 37.58***

123.80"** m

17.05"**

Mean square explained 13.28 8.69 29.28 37.66 37.33 28.98 Mean square residual 1.52 1.17 1.50 1.13 1.21 1.46 F 8.74*** 7.43 19.52 33.33 30.85 19.85

NOTE: MANOVA = multivariate analysis of variance; ANOVA = analysis of variance; ANCOVA = analysis of covariance. a. Covariates = quality and sacrifice. b. Covariate = quality. c. Covariatc = sacrifice. *Significant at .05. **Significant at .01. ***Significant at .001.

of the analyses of the wristwatch data, which are reported in Table 2, indicate that each of the extrinsic-cue variables is significantly related to the set of dependent variables. These results indicate that testing specific hypothesized linkages specified in Figure 1 is justified. In addition, the store-by-country (S x C) and the brand-by-store (B x S) interactions are significant. The results of the analyses of the calculator data, which are reported in Table 3, indicate that three of the four extrinsic cues are significantly related to the set of endogenous variables. These results indicate that testing specific hypothesized linkages specified in Figure 1 is justified. However, none of the two-way interaction terms were significant at the .05 level.

The univariate homogeneity of variance across the 24 groups was assessed via the Bartlett-Box test. The results, based on the wristwatch data, were nonsignificant for quality (p = .488) and value (p = .116) but significant for sacrifice (p = .002). The results, based on the calculator data, were nonsignificant for quality (p = .206) and sacrifice (p = .639) but significant for value (p = .024). Multi- variate tests of homogeneity of covariance matrices using the wristwatch data and calculator data were statistically significant (Box's M = 195.28, p = .01) and statistically insignificant (Box 's M = 173.85, p = .06), respectively. It is important to note, however, that violation of the equality of variance-covariance matrices assumption has minimal impact if the groups are of approximately equal size (Hair, Anderson, Tatham, and Black 1995:275).

Hypotheses Tests Involving the Prediction of Perceived Quality and Perceived Sacrifice

The hypotheses focusing on the prediction of perceived quality and perceived sacrifice were tested via ANOVA procedures.

Price. Th e results for the wristwatch experiment (Table 2) indicate that the price-level manipulation_positively affected perceived quality (Xt , p~ = 4.47 vs. X . ~ , m ~ = 4.72 vs. Xh~r~ = 4.95; Fz52s =5 .57 ,p < .01) and perceived sacrifice (X~o, p~ = 3.35 vs. Xm~i,~,~ = 4.18 vs. X ~ r ~ = 4.36; /72. 52s = 43.03, p < .001). Similarly, the results for the experiment involving calculators (Table 3) indicate that the price-level manipulation p__ositively affected p.e.rceived quality (Xj , r~ = 4.75 vs. Xm~i r ~ = 4.98 VS. ~ ~.~ = 5.10; F2.52__9 = 3.24, p < .05) and_perceived sacrifice (Xk,,p,~ = 2.21 VS. X~d~mp,~ = 3.09 VS. Xh~jh~ = 3.58; F2.s29 = 74.55, p < .001). Thus, the relationships between price and perceived quality and sacrifice proposed in Hypothesis 1 a and Hypothesis lb are supported in both experiments.

Brand . T h e results for the wristwatch experiment (Ta- ble 2) indicate a significant effect of brand name on perceived quality, F(1, 528) = 21.09, p < .001. Since the brand-by-store interaction 3 is statistically significant, the brand effect is interpreted within store levels. The brand effect is significant within the low-store condition but is


TABLE 3 Analysis of Variance and Covariance (calculator data)

MANOVA ANOVA ANCOVA

Quality Sacrifice Value Value Value Value Treatment Wilks df F Value F Value F Value F Value F Value a F Value b F Value c

Brand (B) .897 3; 513 19.74'** 59.36*** .10 12.49'** .07 .06 12.63"** Country (C) .865 3:513 26.76*** 76.96*** 1.40 18.80"** .93 .36 22.29*** Store (S) .996 3; 513 .77*** .43 1.55 .19 .26 .63 .03 Price (P) .627 6; 1026 45.04*** 3.24* 74.55*** 74.34*** 56.40*** 106.40'** 36.10'** B x C .991 3; 513 1.54 2.39 1.70 2.78 .72 1.23 1.97 S x C .996 3; 513 .73 .05 .32 1.48 1.82 2.10 1.24 P x C .977 6; 1026 2.03 1.94 1.85 2.88 2.35 3.22* 2.01 B x S .996 3; 513 .65 1.60 .28 .15 .00 .03 .27 B x P .984 6; 1026 1.36 1.08 2.88 .31 .12 .44 .06 S x P .992 6; 1026 .72 .60 .92 1.25 .66 .99 .93

Covariates Quality 115.76"** 115.22'** Sacrifice 28.98*** - -

m

28.37***

Mean square explained 18.23 13.66 23.90 33.57 33.21 25.42 Mean square residual 1.64 1.16 1.73 1.35 1.42 1.65 F 11.12 11.78 13.82 24.87 23.39 15.41

NOTE: MANOVA = multivariate analysis of variance; ANOVA = analysis of variance; ANCOVA = analysis of covariance. a. Covariates = quality and sacrifice. b. Covariate = quality. c. Covariate = sacrifice. *Significant at .05. **Significant at .01. ***Significant at .001.

insignificant within the high-store condition (high store: X~ow~,d._y 3.75 vs. Xh~ ~,~d= 3.98; F~.~ = 2.40,p < . 123; low store: X~o, b,~,d = 2.99 VS. X~gh b~,~d = 3.74; F~.563 = 20.38, p < .000). These findings indicate that the relationship between brand name and perceived quality hypothesized in Hypothesis 2 is supported under the low-store condition but is not supported under the high-store condition. The re- suits for the calculator experiment (Table 3) indicate a significant effect of brand name on perceived quality (X~o~,,~ = 4.48 vs. X~h b,~d= 5.39; F1.559 -- 59.36, p < .001); therefore, Hypothesis 2 is supported. Note that the brand name treatment has no significant effect on perceived sacrifice in either experiment as expected.

Store. The results for the wristwatch experiment (Table 2) indicate a significant effect of store name on perceived quality, F(1,528) = 20.57,p < .001. The store treatment effects were interpreted within brand treatment levels (brand-by-store interaction is significant). The store treatment effect is significant within the low-brand condition but is insignificant in the high-brand condition (high brand: Xio,,to~ = 3.74 vs. Xhi~ ~ = 3.98; Fi. 5~ = 3.37, p < .125; low brand: Xjow ~ = 2.99 vs. Xh~gh ~o~ = 3.75; F~. 561= 21.04, p < .000). 4 Therefore, Hypothesis 3 is supported under the low-brand condition but is not supported under the high-brand condition. However, the results for the calcula-

tor experiment (Table 3) indicate that the store name treatment has no significant effect on consumers' perception of quality; thus, Hypothesis 3 is not supported in the experiment involving calculators. Note that the store name treat-

ment has no significant effect on perceived sacrifice in either experiment as expected.

Country o f origin. The results for the experiment involving wristwatches (Table 2) indicateasignificant effect o f country name on perceived quality (X, ...... ~ = 4.31 vs. Xh~h ~n~ = 5.13 ; F1.558 = 56.5 6, p <.001). In addition, the re- suits for the experiment involving calculators (Table 3) indicate a significant e f f ec to f country name on perceived

quality (X,o~m~ = 4.46 VS. X~'~con,~r = 5.41; F1.559 = 76.96, p < .001). Thus, Hypothesis 6 is supported in both experi-

ments. Note that the country name treatment has no sig-

nificant effect on perceived sacrifice in either experiment as expected.

Moderating effects o f country o f origin. The results for the experiments involving wristwatches (reported in Ta- ble 2) and calculators (reported in Table 3) indicate that none of the second-order interaction terms involving country of origin have a significant effect on perceived quality. Thus, the results of both experiments do not support Hypotheses 7a-c.


Hypotheses Teats Involving the Prediction of Perceived Value

The hypotheses involving the prediction of perceived value, and the associated mediation effects, were tested via ANOVA and analysis of covariance (ANCOVA) following Baker, Grewal, and Parasuraman (1994) and Grewal et al. (1998). Three conditions must be met to establish mediation: (1) the independent variables affect the mediator; (2) the independent variables affect the dependent variable; and (3) when the independent variables and the mediators are regressed on the dependent variable, the mediators are significant and the effects of the independent variables are reduced (Grewal et al. 1998).

The ANOVA results presented in the previous section satisfy the first condition, except for the insignificant store effect in the calculator experiment. The second condition was tested via ANOVA in which the dependent variable is perceived value and the independent variables are the four extrinsic cues. The results involving wristwatches (Table 2) indicate that each of the extrinsic cues is significant (p < .001). In addition, two interaction effects (S x C and B x S) are significant (p < .01). The results of the calculator experiment (Table 3) indicate that three of the four extrinsic cues--brand, country, and price--are significant. With the exception of the insignificant store effect in the calculator experiment, these results satisfy the second condition needed to establish a mediation effect.

ANCOVA was used to assess the third condition for mediation. The results of the wristwatch experiment (Table 2), which indicate that perceived quality and sacrifice are significant (F = 148.27, p < .001 and F = 37.58, p < .001, respectively), support Hypotheses 4 and 5. In addition, price, brand, and store are significant (p < .001) and the brand-by-store interaction is significant (p < .05). The results of the calculator experiment (Table 3), which indicate that perceived quality and sacrifice are significant (F = 115.76, p < .001 and F = 28.98, p < .001, respectively), support Hypotheses 4 and 5. Furthermore, price is a significant predictor in the estimate. Since the F values associated with the direct effects of the extrinsic cues on perceived value are generally smaller in the presence of the covariates than in their absence, these findings largely satisfy the third condition for mediation.

DISCUSSION

Price as a Quality and Sacrifice Cue

Similar to the empirical results reported by Dodds et al. (1991), the findings support the hypothesized positive linkage between price and perceived quality. Also, the findings extend the Dodds et al. (1991) empirical results by testing the price-perceived sacrifice linkage hypothe-

sized but not empirically tested by Dodds et al. (1991 ) and by demonstrating that price continues to be a significant quality cue in the presence of other extrinsic quality cues, including country of origin.

Brand, Store, and Country of Origin as Quality Cues

Similar to the results reported by Dodds et al. (1991), the findings indicate that the brand treatment is a statistically significant quality cue in the presence of a price cue and that this effect continues to be significant in the presence of a store quality cue. In addition, the results indicate that the effect of brand treatment is significant in the presence of the country-of-origin cue. This suggests that, when the other quality cues are controlled or held constant, brand can affect consumers' perceptions of product quality. It should be noted, however, that the brand treatment administered in this study did not significantly affect wristwatch quality perceptions in the context of a high store image. Similarly, the findings involving wristwatches indicate the retail name treatment is a significant quality cue in the context of a low brand image but is insignificant in the context of a high brand image. In general, the pattern of results concerning the store-by-brand interaction effect indicates that the effect of one cue on wristwatch quality perceptions is stronger when the other cue is weak, which suggests perceived quality and value can be enhanced by improving brand image o r by distributing through high-image stores. The findings indicate the retail store is not a significant quality cue in the calculator experiment.

The country-of-origin cue was found to have a significant main effect on the perceived quality for both of the products examined. However, the findings do not support the hypothesized effects of country of origin as a moderator variable. A possible explanation for this finding is that the brands and stores used in this study have somewhat unambiguous images; consequently, the brand and store main effects are stable across situation (e.g., country-of- origin condition). The respondents may have perceived that wristwatches and calculators are routinely manufactured in many different countries using standardized manufacturing and quality control procedures. Moreover, with the trend toward increased globalization of business, Seiko watches made in Mexico may be perceived by consumers to be made by Seiko, or at least under the control or supervision of Seiko, rather than by a Mexican manufac- turer without the control or supervision of Seiko. Conse- quently, the brand effect on perceived quality is not moderated by country of origin. Furthermore, if these kinds of products are perceived by consumers to be routinely manufactured in different countries, the effects of price and store as quality cues may be unaffected by country of origin as suggested by our findings.


Perceived Quality and Sacrifice as Predictors of Perceived Value

The results support the hypothesized linkages between the perceived quality and perceived value and between perceived sacrifice and perceived value. These findings extend the Dodds et al. (1991) findings in that perceived sacrifice is found to be a significant predictor of perceived value.

The results indicate that the effects of the extrinsic product cues--price, brand, store, and country of origin---on perceived value are mediated by perceived quality and sacrifice. First, the findings of the wristwatch experiment indicate that the extrinsic cues have significant direct linkages with perceived quality, which, in turn, has a significant positive linkage with perceived value. How- ever, the findings indicate that three extrinsic cues-- brand, store, and price--have significant direct linkages with perceived value that are not completely mediated by perceived quality and/or perceived sacrifice. Second, similar to the findings of the wristwatch experiment, the findings of the calculator experiment indicate a direct linkage between price and perceived value in addition to indirect linkages mediated by perceived quality and sacrifice. These findings suggest the price-value relationship is complex--price has positive linkages with perceived sacrifice and perceived quality, which, in turn, have negative and positive relationships, respectively, with perceived value. The ultimate effect of a price decision in a particular situation is affected by the relative strengths of these sets of linkages.

Effect Size

Table 4 contains a comparison of effect sizes reported by Dodds et al. (1991) with effect sizes estimated in this study.

Price. As indicated in Table 4, the effect size of price on perceived quality is smaller in the current study under the four-cue condition (rl 2 = .015) than the effect size resulting from the Dodds et al. (1991) three-cue condition (rl 2 = .030). This supports the Dodds et al. (1991) findings that the effect of price on perceived quality tends to be reduced in the presence of additional extrinsic cues. However, a comparison of our findings with Dodds et al. (1991) findings does not indicate that the effect of price on perceived value is smaller under the four-cue condition than it is under the three-cue condition.

Brand. The effect sizes of brand on both perceived quality (rl 2 = .065) and perceived value (rl 2 = .025) are smaller in the current study under the four-cue condition than the effect sizes resulting from the Dodds et al. (1991) three-cue condition.

TABLE 4 Average Main Effects of Independent Variables: Dodds, Monroe, and Grewal (1991) Compared

With the Current Study

Combined Effect Size (1] 2)

Independent Perceived Perceived Perceived Variable Treatment Condition a Quality Sacrifice Value

Price With brand and store (DMG 91) .030 NA .195

Price With brand, store, and country (C oo ) .015 .180 .210

Brand With price and store (DMG 91) .295 NAt .090

Brand With price, store, and country (C oo ) .065 .005 .025

Store With price and brand (DMG 91) .015 NA .010

Store With price, brand, and country (C ~176 .020 .000 .020

Country With price, brand, and store (C ~176 .105 .000 .030

NOTE: NA = not applicable. a. DMG 9~ designates findings from Dodds, Monroe, and Grewal (1991); C ~ designates findings from the current study.

Store. The effect sizes of store on perceived quality (112 = .020) and perceived value (rl 2 = .020) are not smaller in the current study under the four-cue condition than the effect sizes resulting from the Dodds et al. (1991) three- cue condition. It is important to note, however, that the effects of store in general are small.

Country. The estimated effect sizes of the country-of- origin treatment on perceived quality under multiple cue conditions are larger than the effect sizes of price and store reported by Dodds et al. (1991). This finding suggests that country of origin is a potentially important extrinsic quality cue. However, our findings indicate that under multiple extrinsic-cue conditions, the effect size of country of origin is small when compared with the effect size of price on perceived value reported by Dodds et al. (1991) and found in this study.

Product Differences

The results suggest that there may be product-related variables that moderate the effects of the extrinsic quality and sacrifice cues. In the wristwatch experiment, the store treatment significantly affected perceived value both directly and indirectly via the perceived quality mediator variable. On the other hand, in the calculator experiment, the store treatment had no significant direct or indirect linkages with perceived value. One explanation for these results is that, when compared to wristwatches, calculators may be perceived by consumers to be more widely

Teas, Agarwal / Eb'FEL-'TS OF EXTRINSIC CUES 287

available across retail stores. Consequently, store name may not be an important factor affecting the perceived quality of calculators. However, the selection of wristwatches in a particular retail store is usually limited. Con- sequently, the retail stores through which the wristwatch is marketed may be a factor that differentiates wristwatches. The result may be that the retail store affects perceived value of wristwatches through more complex processes. Examples of these processes could be the effect of the retail store on the perceived risk and the degree to which the product is congruent with self-image.

There may be product differences that explain the brand effect differences found in the two experiments. In the case of calculators, brand name may function primarily as a perceived quality cue. However, in the case of wristwatches, brand name may be a more complex cue. For example, because of the personal-image implications of a wristwatch, the image associated with a brand name may be more likely to enhance the benefits associated with a wristwatch than the benefits associated with a calculator.

Price differences across wristwatch brands may be larger than price differences across the types of calculators examined in this study. This may have caused the respondents to associate different acquisition and transaction values with the wristwatch than they associated with the calculator. Grewal et al. (1998) tested models involving the effects of price comparisons on consumers' value perceptions and behavioral intentions. In contrast to our conceptualization of value, Grewal et al. (1998) specified perceived value in terms of two separate dimensions-- acquisition value and transaction value. Acquisition value is defined as "the buyers' net gain (or tradeoff) from acquiring the product or service . . . which takes into account both price and quality" (Grewal et al. 1998). Transaction value is defined as "the perception of psy- chological satisfaction or pleasure obtained from taking advantage of the financial terms of a price deal" (Grewal et al. 1998). To the degree to which price differences across wristwatches (calculators) are large (small), acquisition value and transaction value may be more (less) important mediator variables in the evaluation of wristwatches (calculators).

Implications for Future Research

The results support the findings reported by Dodds et al. (1991) that indicate strong associations between extrinsic quality cues and perceived quality. Although the Dodds et al. (1991) findings suggested that the role of price as a quality cue may be diminished as additional cues are added, our findings indicate that the respondents contin- ued to rely on price as a quality cue in the presence of other extrinsic cues. In addition, the results extend the Dodds et al. (1991) findings by providing support for their hypothesized positive linkage between price and perceived

sacrifice and by indicating that both perceived quality and perceived sacrifice mediate the relationships between the extrinsic cues examined and perceived value.

The concept of perceived sacrifice was operationalized as a measure of monetary sacrifice. However, according to Zeithaml (1988), consumers may also incur nonmonetary sacrifices such as time, effort, and search costs. If consumers assemble durable goods, prepare packaged foods, or travel large distances to acquire products, they incur additional costs that might influence the assessment of product value. Future research should incorporate these nonmonetary sacrifices in the model of perceived value by develop- ing a formalized definition of perceived sacrifice and by empirically testing the model using measures based on the formalized definition. 5

The fact that the linkages between the extrinsic cues and perceived value may not be completely mediated by perceived quality and sacrifice suggests that there may be additional variables that mediate the linkages. One variable that could be examined in future research is perceived risk (Shimp and Bearden 1982). Wood and Scbeer (1996), for example, suggest that consumers' evaluations of a "deal" may be a function of perceived benefits, costs, and risk. A possible explanation for the differences in the results of the two experiments is that, for the students par- ticipating in the study, the effects of risk perceptions on perceived value may be stronger for watches than for calculators.

Given the nonsignificant findings concerning the country-of-origin moderator variable effects, a question for future research involves the degree to which the impact of country of origin as a moderator of brand, store, and/or price quality cue effects may be decreasing over time. With the increasing globalization of business and the ten- dency of manufacturers to locate production facilities in different countries to produce branded products, consumers may be increasingly likely to assume that the quality of an established branded product will be about the same regardless of production location. 6 On the other hand, some products may be less likely to be routinely or effec- tively manufactured in different countries. For example, the manufacturing of some complex, high-technology products may be perceived by consumers to involve manufacturing processes that are difficult to manage or that require a highly educated workforce. Consequently, the effect of a strong brand name may be diminished if the product is manufactured in a country characterized by questionable manufacturing or workforce sophistication.

The possibility that country of origin effects are product specific has been examined by Kaynak and Cavusgil (1983). In a study conducted in Canada, they found that consumers ranked countries differently for different products. Japan, for instance, ranks high in electronic products but low in food products. France, on the other hand, ranks high on fashion merchandise but lower on other product


classes that were examined. Even in today's environment where technologies and finns freely migrate across bor- ders, consumers sometimes assess higher quality to a product when they think that the country in which it is made is capable o f producing a high-quality product (Agarwal and Sikri 1996; C h a t 1993).

Grewal et al. (1998) specify and test models involving the effects of price comparisons on consumers' value perceptions and behavioral intentions. In contrast to our conceptualization of value, Grewal et al. (1998) specified perceived value in terms of acquisition value and transaction value. An issue that should be examined in future research is the effects of quality and value cues on acquisition value and transaction value. Grewal et al. (1998) argue that acquisition value is related to both price and quality. Qual- ity cues, therefore, can be expected to affect acquisition value via their effect on the perceived quality. Further- more, Grewal et al. (1998) argue that transaction value involves satisfaction derived from the price deal and that transaction value is a predictor of acquisition value. This causal linkage between transaction value and acquisition value suggests complex price-perceived value linkages. First, the results of our study suggest price cues may posi- t ive ly a f fec t acqu i s i t ion value ind i rec t ly via the price---~perceived quality--~acquisition value route. Sec- ond, the Grewal et al. (1998) model (Figure 2, p. 49) suggests that the price cue may negatively affect acquisition value via a negative direct effect on transaction value, which, in turn, is positively related to acquisition value. Third, the price cue may positively affect acquisition value via a positive linkage with internal reference price, which, in turn, Grewal et al. (1998) argue, has a positive linkage with transaction value.

Limitations

Important limitations of this study involve the mediation analyses. The findings involving mediation are exploratory and inconclusive and, therefore, should be interpreted with caution. First, the model tested in this study is incomplete and, therefore, underspecified (see Zeitham11988 for an alternative model specification). The findings of incomplete mediation, however, are consistent with the Zeithaml (1988) model. Second, the constructs, especially the perceived sacrifice construct, are not fully developed conceptually. Perceived sacrifice is conceptual- ized to be a unidimensional construct measured via two items. Research by Zeithaml (1988) indicates that perceived sacrifice may be multidimensional.

These measurement limitations represent a possible explanation for our findings suggesting incomplete mediation. Third, the use of summed scales for covariates that are measured with error can lead to incorrect inferences with respect to the effect of a manipulation (Huitema 1980).

ACKNOWLEDGMENTS

The authors thank the three anonymous reviewers and A. Parasuraman, the editor, for their numerous helpful comments on previous drafts of this article. Both authors contributed equally to this article.

NOTES

1. One respondent did not complete the questionnaire involving wristwatches. As a result, the sample size for the wristwatch experiment was 529.

2. Factor analysis of the wristwatch data indicated that the item "value for the money," although loading high (.69) on the intended factor, also loaded somewhat high on another factor (.42). Thus, the analysis reported in the article was repeated by using a perceived-value summated scale with this item omitted. This modification did not alter the findings of the study.

3. We specify specific two-way interactions in our hypotheses; thus, we focused our tests on these a priori specified interaction effects. We note, however, that the experimental design allowed the estimation of all possible interaction effects and that the four-way interaction was statistically significant. On the basis of Cohen and Cohen (1983), we do not at- tempt to interpret this four-way interaction--"Interaction IVs, like any other kind, should only he included if there is serious reason to believe that they ate real. Otherwise, the value of the conclusions from the research investigation.., is jeopardized" (Cohen and Cohen 1983:348).

4. As recommended by a reviewer, two additional analysis of covari- ante (ANCOVA) tests were performed--one entering quality only as a covariate and one entering sacrifice only as a covariate. The results involving wristwatches, which are presented in Table 2, indicate that, with the exception of a significant brand-by-store interaction (R < .05), entering only perceived quality as a covariate produced results similar to the two-covariate model. The results indicate entering only sacrifice as a covariate resulted in the country main effect and the brand-by-store interaction becoming significant (p < .01). The results involving calculators, which are presented in Table 3, indicate that, with the exception of a significant price-by-country interaction (p < .05), entering only perceived quality as a covariate produced results similar to the two-covariate model. However, the results indicate that entering only sacrifice as a covafiate re- suited in two additional significant main effects (/7 < .001)--brand (B) and country (C). In general, these findings suggest that perceived quality is a more important mediator variable than perceived sacrifice.

5. Research involving the linkages between exogenous cues, quality, sacrifice, and value is sufficiently mature to benefit from attempts to for- malize the definitions of the variables (see Teas and Palan 1997 for procedures and examples of the theory formalization process).

6. A recent editorial in The Economist CMercedes Goes to Motown" 1998) supports this proposition in a discussion of the Daimler/Chrysler merger by suggesting the following: "At a time when cars and compo- nents all resemble one another, a national identity has become a vital part of the brand. Those who buy Mercedes are baying German engineer- ing.., regardless of where the car is built" (p. 15).

REFERENCES

Agarwal, Sanjeev and Samir Sikri. 1996. "Country Image: Consumer Evaluation of Product Category Extensions." International Market- ingReview 13 (4): 23-39.

Baker, Julie, Dhruv Grewal, and A. Parasuraman. 1994. "The Influence of Store Environment on Quality Inferences and Store Image." Jour- nal of the Academy of Marketing Science 22 (4): 328-339.


Bearden, William O. and Terence A. Shimp. 1982. "The Use of Extrinsic Cues to Facilitate Product Adoption,' Journal of Marketing Research 19 (May): 229-239.

Bilkey, Warren J. and Edk Nes. 1982. "Country-of-Origin Effects on Product Evaluations,' Journal of International Business Studies 13 (Spring-Summer): 89-99.

Chao, Paul. 1993. "Partitioning Country of Origin Effects: Consumer Evaluations of a Hybrid Product,' Journal of international Business Studies 24:291-306.

Cohen, Jacob and Patrieia Cohen. 1983. Applied Multiple Regres- sion~Correlation Analysis for the Behavioral Sciences. 2d ed. Hills- dale, NJ: Lawrence Erlbaum.

Curry, David J. and Peter C. Riesz. 1988. "Prices and Price/Quality Rela- tionships: A Longitudinal Analysis,' Journal of Marketing 52 (Janu- ary): 36-51.

Darling, John R. and Danny R. Arnold. 1988. ''Foreign Consumers' Per- spective of the Products and Marketing Practices of the United States Versus Selectexl European Countries,' Journal of Business Research 17 (November): 237-248.

Dawar, Niraj and Philip Parker. 1996. "Marketing Universals: Consum- ers' Use of Brand Name, Price, Physical Appearance, and Retailer Reputation as Signals of Product Quality." Journal of Marketing 58 (April): 81-95.

Dodds, William B. and Kent B. Monroe. 1985. "The Effect of Brand and Price Information on Subjective Product Evaluation,' Advances in Consumer Research 12:85-90.

- - , and Dhruv Grewal. 1991. "Effects of Price, Brand, and Store Information on Buyers' Product Evaluation." Journal of Mar- keting Research 28 (August): 307-319.

Erickson, Gary M. and Johny K. Johansson. 1985. "The Role of Price in Multi-Attribute Product Evaluations." Journal of Consumer Re- search 12 (September): 195-199.

- - , and Paul Chao. 1984. "Image Variables in Multi- Attribute Product Evaluations: Country-of-Origin Effects." Journal of Consumer Research 11 (September): 694-699.

Grewal, Dhruv, Kent B. Monroe, and R. Krishnan. 1998. "The Effects of Price-Comparison Advertising on Buyers' Perceptions of Acquisi- tion Value, Transaction Value, and Behavioral Intentions?' Journal of Marketing 62 (April): 46-59.

Hair, Joseph E, Rolph E. Anderson, Ronald L. Tatham, and William C. Black. 1995. Multivariate Data Analysis With Readings. 4th ed. Englewood Cliffs, NJ: Prentice Hall.

Han, C. Min. 1989. "Country Image: Halo or Summary Construct" Jour- nal of Marketing Research 26 (May): 222-229.

and Vern Terpstra. 1988. "Country-of-Origin Effects for Uni- National and Bi-National Product,' Journal oflnternational Busi- ness Studies 19 (Summer): 235-255.

Hanssens, Dominique and Johny K. Johansson. 1991. "Rivalry as Syn- ergy? The Japanese Automobile Companies' Export Expansion." Journal of lnternational Business Studies 22:503-526.

Hastak, Manoj and Sung-Tal Hong. 1991. "Country-of-Origin Effects on Product Quality Judgments: An Information Integration Perspec- tive?' Psychology and Marketing 8 (Summer): 129-143.

Hanser, John R. and Glen Urban. 1986. "The Value Priority Hypotheses for Consumer Budget Plans,' Journal of Consumer Research 12 (March): 446-462.

Huitema, B. E. 1980. The Analysis ofCovariance and Alternatives. New York: John Wiley.

Johansson, Johny K. 1989. "Determinants and Effects of the Use of 'Made in' Labels,' International Marketing Review 6 (1): 47-58.

, Susan P. Douglas, and Ikujiro Nonaka. 1985. "Assessing the Im- pact of Country of Origin on Product Evaluations: A New Methodo- logical Perspective." Journal of Marketing Research 22 (November): 388-396.

Kaynak, Erdener and S. Tamer Cavusgil. 1983. "Consumer Attitudes To- wards Products of Foreign Origin: Do They Vary Across Product Classes ?" International Journal of Advertising 2:147-157.

Lichtenstein, Donald R.. Peter H. Block. and William C. Black. 1988. "Correlates of Price Acceptability." Journal of Consumer Research 15 (September): 243-252.

; Nancy M. Ridgway, and Richard G. Netemeyer. 1993. "Price Perception and Consumer Shopping Behavior: A Field Study." Jour- nal of Marketing Research 30 (May): 234-245.

MacKenzie, Scott B. and Richard J. Lutz. 1989. "An Empirical Examina- tion of the Structural Antecedents of Attitude Toward the Ad in an Advertising Pretesting Context." Journal of Marketing 53 (April): 48-65.

"Mercedes Goes to Motown" 1998. The Economist, May 9, p. 15. Milgrom, Paul and John Roberts. 1986. "Price and Advertising Signals of

Product Quality" JournalofPoliticalEconomy 55 (August): 10-25. Monrr Kent B. and Joseph D. Chapman. 1987. "Framing Effects on

Buyers' Subjective Product Evaluations." Advances in Consumer Re- search 14:193-197.

~ a n d R. Krishnan. 1985. "The Effect of Price on Subjective Prod- uct Evaluation,' In Perceived Quality: How Consumers Hew Stores and Merchandise. Eds. Jacob Jacoby and Jerry C. OIson. Lexington, MA: Lexington Books, 209-232.

Rao, Akshay R. and Kent B. Monroe. 1989. "The Effect of Price, Brand Name, and Store Name on Buyers' Perceptions of Product Quality: An Integrative Review." Journal of Marketing Research 26 (August): 351-357.

Schmidt, Jeffrey B. and Richard A. Spreng. 1996. "A Proposed Model of External Consumer Information Search?' Journal of the Academy of Marketing Science 24 (3): 246-256.

Shimp, Terence A. and William O. Bearden. 1982. "Warranty and Other Extrinsic Cue Effects on Consumers' Risk Perception." Journal of Consumer Research 9 (June): 38-46.

Stokes, Raymond C. 1985. "The Effects of Price, Package Design, and Brand Familiarity on Perceived Quality." In Perceived Quality: How Consumers View Stores and Merchandise, Eds. Jacob Jacoby and Jerry C. Olson. Lexington, MA: Lexington Books, 233-246.

Teas, R. Kenneth and Kay Palan. 1997. "The Realms of Scientific Mean- ing Framework for Constructing Theoretically Meaningful Nominal Definitions of Marketing Concepts." Journal of Marketing 61 (April): 52-67.

Thorelli, Hans B., Jeen-Su Lira, and Jongsuk Ye. 1989. "Relative Impor- tance of Country-of-Origin, Warranty and Retail Store Image on Product Evaluation." International Marketing Review 6 (1): 35-46.

Tse, David K. and Gerald G. Gore. 1993. "An Experiment on the Salience of Country-of-Origin in the Era of Global Brands." Journal of Inter- national Marketing 1 (1): 225-237.

Wall, Marjorie, John Liefeld, and Louise A. Heslop. 1991. "Impact of Country-of-Origin Cues and Patriotic Appeals on Consumer Judg- ments: Covariance Analysis,' Journal of the Academy of Marketing Science 19 (Spring): 105-113.

Wheatley, John J. and John S. Y. Chiu. 1977. "The Effects of Price, Store Image, and Product and Respondent Characteristics on Perceptions of Quality,' Journal of Marketing Research 14 (May): 181-186.

Wood, Charles M. and Lisa K. Scheer. 1996. "Incorporating Perceived Risk Into Models of Consumer Deal Assessment and Purchase In- tent." Advances in Consumer Research 23:399-404.

Wright, Peter L. 1975. "Consumer Choice Strategies: Simplifying vs. Optimizing." Journal of Marketing Research 11 (February): 60-67.

Zeithaml, Valerie A. 1988. "Consumer Perceptions of Price, Quality, and Value: A Means-End Model and Synthesis of Evidence." Journal of Marketing 52 (July): 2-22.

ABOUT THE AUTHORS

R. Kenneth Teas is a distinguished professor of business in the Department of Marketing, College of Business, Iowa State Uni- versity. He received his Ph.D. from the University of Okla- homa. His areas of research include consumer behavior and decision processes, marketing research methods, services marketing, and sales force management. His articles have been published in numerous journals, including the Journal o f Marketing, the Journal of Marketing Research, the Journal of Consumer Re- search, the Journal of the Academy of Marketing Science, the American Journal of Agricultural Economics, the Journal o f Re-


tailing, the Journal of Personal Selling and Sales Management, the Journal of Occupational Psychology, and Industrial Market- ing Management.

Sanjeev Agarwal is an associate professor in the Department of Marketing, College of Business, Iowa State University. He received his Ph.D. from The Ohio State University. His areas of re-

search include multinational marketing strategies, modes of foreign market entry, and sales force management. His articles have been published in the Journal of Consumer Research, the Journal of International Marketing, International Marketing Review, In- dustrial Marketing Management, the Journal of International Business Studies, the Journal of the Academy of Marketing Sci- ence, and the Journal of Personal Selling and Sales Management.

The Effects of Extrinsic Product Cues on Consumer Perceptions of Quality, Sacrifice and Value

Documents

Transcript of The Effects of Extrinsic Product Cues on Consumer Perceptions of Quality, Sacrifice and Value