Quality can be defined on two dimensions; market perceived quality and performance quality. Both are important concepts but consumer perception of a quality product often has more to do with market perceived quality than performance quality. The relationship of quality conformance to customer satisfaction is analogous to an airline’s delivery of quality. If viewed internally from the firm’s perspective (performance quality) an airline has achieved quality conformance with a safe flight and landing. But because the consumer expects performance quality to be a given, quality to the consumer is more than compliance (a safe flight and landing). rather cost timely service, frequency of flights, comfortable seating and performance of airline personnel from check in to baggage claim are all part of the customer’s experience that is perceived as being of good or poor quality. Considering the number of air miles flown daily, the airline industry is approaching zero defects in quality conformance, yet who will say that customer satisfaction is anywhere near perfection? These market perceived quality attributes are embedded in the total product, that is, the physical or core product and all the additional features the consumer expects.
In a competitive market place where the market has choices, most consumers expect performance quality to be a given. Naturally, if the product does not perform up to standards it will be rejected, it will be rejected. When there are alternative products, all of which meet performance quality standards, the product chosen is the one that meets market perceived quality attributes. Interestingly China’s leading refrigerator maker recognized the importance of these market perceived quality attributes when it adopted a technology that enabled it to let consumers choose from 20 different colors and textures for door handles and moldings. For example a consumer can design an off white refrigerator with green marble handles and moldings. Why is this important? Because it lets consumers update their living rooms where most of the refrigerators are parked. The company’s motive was simple: It positioned its product for competition from multinational brands by giving the consumer another expression of quality.
Quality is also measured in many industries by objective third parties. In the United States, JD Power and Associates has expanded its auto quality ratings based on consumer surveys to other areas, such as computers. Customer satisfaction indexes developed first in Sweden are now being used to measure customer satisfaction across a wide variety of consumer products and services. Finally, the US department of commerce annually recognizes American firms for the quality of their international offerings – the Ritz Carlton Hotel chain has won the prestigious award twice.
Maintaining performance quality is critical but frequently a product that leaves the factory at performance quality is damaged as it passes through the distribution chain. This is a special problem for many global brands for which production is distant from the market and /or control of the product is lost because of the distribution system within the market. When Mars Company’s Snickers and other Western confectioneries were introduced to Russia, they were a big hit. Foreign brands such as Mars, Toblerone, Waldbaur and Cadbury were the top brands – indeed, only one Russian brand placed in the top 10. But within five years the Russian brands had retaken eight of the top spots and only one US brand, Mars’s Dove bars, was in the top 10.
What happened? A combination of factors caused the decline. Russia’s Red October Chocolate Factory got its act together, modernized its packaging product mix and equipment and set out to capture the market. Performance quality was also an issue. When the Russian market opened to outside trade, foreign companies eager to get into the market dumped surplus out of date and poor quality products In other cases chocolates were smuggled in and sold on street corners and were often mishandled in the process. By the time they made it to consumers, the chocolates were likely to be misshapen or discolored – poor quality compared with Russia’s Red October chocolate.
Market perceived quality was also an issue. Russian chocolate has a different taste because of its formulation – more cocoa and chocolate liqueur is used than in Western brands which make it grittier. Thus, the Red October brand appeals more to Russia taste even though it is generally priced above Western brands. As evinced by this example, quality is not just desirable, it is essential for success n today’s competitive global market, and the decision to standardize or adapt a product is crucial in delivering quality.