I’ve talked about this idea in the previous post but, it’s just so crucial that I decided to write a whole post about it. Many companies seem to use advertising as a way to compensate for a bad or under-par product. The problem with this practice (and what companies are starting to realize) is that it creates absolutely no value for companies. They might argue that increased advertising will lead to increased sales, but I tend to think that they should reconsider. In fact, I believe that over time, this practice might actually lead to a loss of customers and potentially to bankruptcy.
In my opinion, no amount of advertising can compensate for a bad product. At first, the increased amount of advertising might lead to several new purchases, but, once the customers discover that the product is not what they say it is, doesn’t work right or doesn’t compare to the competition, they will not repeat a purchase. Companies will have lost their trust, and once that trust is lost it might never return. Remember that the majority of profits will be generated with repeat purchases. Once the consumer is loyal to a brand, he will generally continue buying the products (therefore increasing revenues), and the company will be spending far less money on convincing him that the product is good. In other words, reapeat purchases generate revenues long after the initial costs of convincing (converting) the customer have been amortized. Give a great product to your customers and everybody will be happy. They will continue buying and enjoying your products and your company will stay afloat.
David Ogilvy (founder of the Ogilvy & Mather’s advertising firm and one the most historically renown figures in advertising) truly embodied this idea in his book “confessions Of An Advertising Man”. He states: “Good products can be sold by honest advertising. If you don’t think the product is good, you have no business to be advertising it. If you tell lies, or weasel, you do your client a disservice, and increase your load of guilt…” All in all, companies should make sure that they have a product that stands by their words. Doing so should presumably increase their reputation and consequently lead to an increase in sales. If they know that their product could be better, they shouldn’t advertise to compensate. Instead, they should be thinking about investing the money in refining and developing it. Everybody will benefit!
