The role of perceived risk in the quality-value relationship: A study in a retail environment

Abstract

This study extends previous research on perceived value by including the role of perceived risk within a model of the antecedents and consequences of perceived value. The model was tested in a retail setting using a sample of consumers actively looking for an electrical appliance. The mediating impact of perceived risk on the quality-value relationship was specifically examined. Empirical results confirmed that not only do perceived product and service quality lead to perceived value for money in a service encounter but that these quality components reduce perceived risk. Perceived risk was found to play an important role in the perceived product and service quality-value for money relationship and was found to be a significant mediator of this relationship. Perceived value for money was also found to be a significant mediator of perceived quality, price and risk and willingness-to-buy. The results obtained have major implications for retailers as well as for future research in this strategically important area of consumer research.