The influence of perceived product quality, relative price and risk on customer value and willingness to buy: a study of private label merchandise

Abstract

Purpose: This study endeavours to examine the influence of perceived product quality, relative price and risk, respectively, on perceived product value and, ultimately, consumers' willingness to buy private label household cleaning products. Design/methodology/approach: Respondents (157) were recruited through an in‐store survey and the data analysed using partial least squares path modelling. Findings: The results are similar to those proposed by Sweeney, Soutar and Johnson. Strong relationships between perceived relative price and perceived product value, as well as between perceived product value and willingness‐to‐buy, were found to exist. A negative relationship was observed between perceived product quality and perceived risk. The results indicate that establishing a value perception is critical in the buying process. Tangible cues exhibiting high quality (e.g. packaging, shelf space, media placement) need profound attention. Furthermore, it is suggested that risk (which plays an important part in the consumer decision process) is minimised through optimal retail service quality and customer reassurances. Research limitations/implications: This study is limited in that respondents are consumers of a specific geographic region and demographic grouping. Findings may therefore not be generalisable, particularly with respect to other countries. Originality/value: This is one of the first studies investigating consumers' perceptions of value, using the attributes of quality, risk and price, in an emerging market setting.