The influence of type of advertisement, price, and source credibility on perceived quality

To test the effect of type of advertisement, price, and source credibility on perceived quality and purchase intention, a 2 x 2 x 2 factorial experimental design was developed. A fictitious brand name was created and compared with an established brand. The product category used was a video cassette recorder. A total of 127 subjects were assigned randomly to treatments, and 113 completed the research instrument. There was a significant main effect for type of ad on perceived quality. The direct-comparative ad had a more positive impact on the perceived quality of the new brand than the noncomparative ad. There was a statistically significant 3-way interaction effect of source credibility, price, and type of ad on purchase intention. Consistent with attribution theory, results suggest that there is no interaction effect of type of ad and price on purchase intention when source credibility is low.