Comparing three signals of service quality

Purpose – The purpose of this paper is to investigate a relatively new signal of service quality, third‐party evaluation of a service brand. Design/methodology/approach – The meaning of the third‐party signal to consumers was studied and the third‐party signal was compared with two other signals, word‐of‐mouth communication about a service brand and popularity of a service brand, for the ability to influence anticipated satisfaction with a homeowners' insurance product.The three signals appeared as factors in two experiments. The factor levels were favorable, absent, or unfavorable. Findings – All three signals exhibited significant main effects. Of the three signals, third‐party evaluation accounted for the greatest proportion of variance in the dependent variable, and this signal also had the strongest negativity effect. Also, a significant two‐way ordinal interaction was found between word‐of‐mouth communication and third‐party evaluation. The boosting effect of a favorable versus an unfavorable word‐of‐mouth communication was less in the presence of a favorable third‐party evaluation than in the circumstance where the two signals conflicted. Research limitations/implications – Quality signals other than those under study were excluded from stimuli in this investigation. The ability to generalize the findings of this study to the real world is limited by the fact that the effects of other quality signals (brand, price, etc.) on the three signals studied are unclear. Originality/value – This study strongly suggests that third‐party evaluation is perceived as a product quality signal by consumers. Incorporating a favorable third‐party signal into advertising may allay consumer uncertainty of service quality and increase the likelihood of service brand purchase.