Which type of risk involves the perceived danger inherent in a poorly performing product or service?

The type of risk that involves the perceived danger inherent in a poorly performing product or service is performance risk. This concept refers to the uncertainty regarding whether a product or service will function as expected and fulfill the user's needs. When consumers contemplate purchasing a product, they consider how well it will perform relative to their expectations and the potential consequences of a product that does not meet those expectations.

Performance risk can manifest in various ways, such as the possibility of a malfunction, lack of reliability, or failure to deliver the features that were promised. A strong connection exists between performance risk and customer satisfaction; if performance doesn't align with what was anticipated, it can lead to dissatisfaction and potential regret over the purchase decision.

Understanding performance risk is vital for marketers because they need to effectively address and communicate quality assurances, warranties, and guarantees that can help alleviate customer concerns. By doing so, they can create more confidence in their offerings and ultimately influence purchase decisions positively.