Don’t be alarmed with the title of this article. I don’t think this is a term that will be found in too many textbooks, but it is, nonetheless, an important concept in marketing. Will MBA students be studying about it at all? Unlikely.
It is a concept that is intuitively understood by all good marketers, and is used by customers all the time, though not always wisely.
So, then, how does it qualify as a marketing or management term?
Well, I have found the concept used often in professional interaction and I have found that when I use the term in conversations, people relate to it pretty well. So given this, let us say this is something that should find its way into marketing dictionaries
But what does this term mean?
Let me explain with an example of a patient who has developed fever and wants to consult a doctor.
Let us assume that there are two clinics near his house. One clinic is maintained in a spotless fashion, with nice flooring, good waiting rooms, cheerful posters, all tables and other surfaces spotless and so on. The other clinic looks a little like an old government office – not very well lit, fairly dusty, papers and files all over, and so forth.
Which clinic is the patient likely to choose? Or rather, which would you go to?
Should I assume that I don’t know who the better doctor is?
Excellent question! Yes, please assume that you are new to the area and you don’t know which clinic has the better doctor.
Well then, I would obviously go to the nice looking clinic. Anybody would.
And why is that?
Because I would feel safer going there. I mean, this is obvious, isn’t it? Am I missing something here?
No, don’t worry, you aren’t missing anything. What you would do is indeed what anyone would do in that position.
Preconceived notions
But does a good looking clinic automatically mean a better doctor? Are you sure of that? Is it impossible that there should be a terrific doctor who doesn’t care much about the appearance of his clinic?
Hmm….I guess I am working on preconceived notions here and it may not always be true
Exactly! And that is why I call it a quality surrogate.
You see, you are using the appearance of the clinic as an indicator of the quality of the doctor.
This is a slightly imperfect example of what I mean by a ‘quality surrogate’. The fact that the clinic is not bright and well maintained doesn’t really mean that the doctor doesn’t know his job. And the converse also applies.
But then, how else can a patient judge the quality of a doctor?
He needs some criteria, that’s true, and in the absence of any real knowledge about the doctor, he goes with these considerations.
Quality surrogates essentially become important because we keep dealing with businesses and entities in areas where we have no knowledge, and yet we have to form an opinion about the quality on offer in some fashion.
Okay, I get it. But why do you say it is an imperfect example?
Because quality surrogates need not be completely irrelevant.
For instance, there is no doubt that a clean and well-maintained clinic is likely to avoid further infection to the patient, and is also likely to make the patient feel better by making him cheerful; so the surrogates in this case do impact quality, even if only peripherally.
And we could also argue that the well-maintained clinic is making enough money to spend on maintenance, which in turn means that the track record is good, and so the doctor must be good. (But this logic, when applied by an earlier generation, will translate to “this business spends money on ambience etc, so must be charging premium rates, and so let us avoid it”).
Hmm…ok. Yes, very interesting. Does this concept apply everywhere?
Yes, indeed.
Universal applicability
Nowhere are quality surrogates more evident than in the field of professional education – engineering, management, for instance. There are so many private institutes which advertise the size of their campus, the fact that they provide laptops and foreign trips and so on.
A little bit of thought would convince the students and parents that all these are no guarantee of the quality of education. The only real factors that affect the quality of education are the quality of student intake, and the resultant ability of the institute to attract high-class faculty. To emphasise this point, it should be enough to look at the ads released by to-notch institutes, such as the IIMs, IFMR and others. I don’t think they talk about laptops and such, do they?
This concept does apply everywhere. And I am sure we can all think through the various transactions that we engage in and see what the surrogates used there are.
Now, to my usual question. Are quality surrogates good or bad?
And it will get my usual answer. If quality surrogates are used to cover up the product’s or service’s weaknesses, or to just make a more impressive sales pitch — then they are bad.
But if a good doctor or a good college or a good consultant doesn’t use relevant quality surrogates, and hence their services are not used by customers and patients when needed, well, that is also bad.
Quality surrogates are like advertising — when they are used to highlight the appeal of a good product / service, then they are good
And, last words: Smart customers should ensure that they are not taken in by the surrogates; they should use other means to probe the quality of the product.
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