Managing Quality Perception Along the Customer Journey: A Behavioral Economics Approach

Abstract

Human beings are not completely and always rational and are influenced by several cognitive biases and heuristics in how they evaluate and perceive the quality of a product or service offered to them; moreover, their expectations and perceptions of quality varies along customer journey and product lifecycle. Therefore, professionals dealing with product development, marketing and selling cannot deliver results if they do not understand these two perspectives and how to manage effectively customer perception of product quality. The usual perspective of quality management on quality perception on the one hand, and behavioral economics – which deals with how cognitive biases and heuristics affect economic decisions of people in real-life – on the other hand, have been both researched extensively. Yet there are just few research publications proposing a structured knowledge at the intersection of these two domains. This paper proposes a conceptual framework on how to use behavioral economics concepts and understanding in quality management, bringing together these two domains in a synthesized and exhaustive manner. The paper focuses on the influence of cognitive biases and heuristics on how quality of products or services is perceived, and how this influence occurs across customer journey, and consolidates other factors which may influence expected and perceived quality. It proposes a structured approach to manage those perceptions. It provides readers from the quality management and new product development research areas with an exhaustive list of the behavioral (cognitive) biases and heuristics that influence how people (customers) perceive the quality of products and services, and it provides readers from the behavioral economics research area a new, deeper, perspective on quality perception and its role in economic decision making. The paper does not propose itself at this stage to test and demonstrate the theoretical contributions it makes, but rather to make professionals from these domains aware of the possible implications – hypotheses remain to be tested in future research.