Warranty and Price as Quality Signals: The Effect of Signal Consistency/Inconsistency and Signal Unexpectedness on Product Perception

This dissertation aims at examining the effect of signal inconsistency and signal unexpectedness on a consumer’s evaluation of a product. Study one examines the effect of signal consistency/inconsistency on product quality, where consistent signals are those of the same valance. For example, high price is consistent with a good country of origin. However, a long warranty is inconsistent with a brand name that has a low quality reputation. We argue that when signals are inconsistent, consumers will engage in an attribution process to explain inconsistency. If consumers attribute inconsistency to persuasive motive, then perception of quality will decrease. If no persuasive motive is perceived, then consumers will tend to discount inconsistent signals and perceived product quality will not be affected by those signals.