Why Do Most Businesses Focus More on Marketing Than Quality?

Table of Contents

• Introduction
• Reasons for Prioritizing Marketing
  • Marketing Generates Faster Growth
  • Quality Improvements Have Delayed Returns
  • Incentive Structures Reward Short-Term Results
  • Lack of Competition Allows Cutting Corners
• Risks of Underinvesting in Quality
  • Declining Customer Loyalty and Retention
  • Damaged Brand Reputation
  • Higher Customer Acquisition Costs
  • Unsustainable Growth
• Examples of Marketing-Focused Businesses
• Best Practices for Balancing Marketing and Quality
  • Leadership Commitment to Quality
  • Culture Focused on Customer Experience
  • Quality Key Performance Indicators
  • Investments in Process Improvements
  • Empowering Employees to Drive Quality
• Conclusion

Introduction

A common trend across industries is that most businesses focus more resources and attention on marketing tactics rather than improving the quality of their products and services. Marketing delivers quicker returns on investment in the form of new customer acquisition and revenue growth. However, quality is still vitally important for retaining customers and sustaining long-term success.

This article will analyze the key reasons why marketing tends to be prioritized over quality, discuss risks companies face from underinvesting in quality, provide real-world examples, and outline best practices for achieving an optimal balance between marketing and quality initiatives. Though marketing offers faster growth, the two work best when aligned in the pursuit of an excellent customer experience.

Reasons for Prioritizing Marketing

Several interconnected factors drive management teams to devote more resources, finances, and staff toward marketing over quality improvements:

Marketing Generates Faster Growth

• Skillful marketing bring in new customers rapidly, whereas quality gains develop more slowly over time. This faster influx of new customers boosts sales and revenue figures quickly, which businesses heavily rely on as key performance indicators (KPIs) for success.

Quality Improvements Have Delayed Returns

• Initiatives to enhance quality like product R&D, process improvements, employee training, and testing take ample time to implement - sometimes months or years depending on complexity. Their impact on the bottom line can also be harder to accurately quantify until a longer period of time passes.

Incentive Structures Reward Short-Term Results

• Publicly traded companies are often hyper-focused on fast growth and near-term profits to satisfy shareholders. Executive compensation packages likewise hinge on driving quick revenue gains and cutting costs - not investing in employees, systems, and infrastructure for long-term gains.

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2015	$221
2016	$233
2017	$267
2018	$295

Lack of Competition Allows Cutting Corners

Some large, powerful companies enjoy monopoly or oligopoly positions in their industries. Without meaningful competition, consumers have few if any alternative options available. As a result, these behemoth firms feel less incentive to pour resources into enhancing quality to retain customers in the long run.

Risks of Underinvesting in Quality

Though purely focusing on sales and marketing initiatives can rapidly attract customers and boost revenues, this shortsighted strategy comes with an array of risks if pursued too aggressively or excessively over investing in enhanced quality:

Declining Customer Loyalty and Retention

As previously mentioned, inferior or low-quality products and services over time frustrates customers and erodes brand affinity and loyalty. Even once loyal, previously big-spending customers will eventually defect to competitors offering a better overall value proposition and experience. Ugly social media posts and caustic reviews can further damage a brand's reputation.

Damaged Brand Reputation

Reviews, social media complaints, negative stories rapidly disseminated online, and other forms of bad word-of-mouth marketing can indelibly stain a brand's reputation if widespread quality issues exist. Rebuilding this trust and affinity with current and potential new clients becomes harder and necessitates higher investments.

Higher Customer Acquisition Costs

If neglecting quality drives away prior customers faster than a company can backfill them with newly acquired clients, then customer acquisition costs inevitably rise over time. Growing marketing budgets will be required just to tread water - let alone grow by continually replacing lost customers.

Unsustainable Growth

Firms emphasizing marketing over product, service, and experience quality frequently exhibit a growth illusion. Sales and revenues artificially surge until the negative quality repercussions catch up in earnest by driving away customers in droves. This creates a boom/bust cycle that proves enormously difficult to escape.

Examples of Marketing-Focused Businesses

Several notable real-world cases studies showcase companies across industries aggressively focused on marketing and advertising tactics while often neglecting core quality:

Uber - The ridesharing juggernaut poured tremendous resources into rider incentives and glossy marketing campaigns as it raced to scale globally. But myriad quality and compliance problems have since emerged - from assaults against passengers and dangerous drivers to employment classification lawsuits from drivers seeking benefits. Brand sentiment suffered, and retaining loyal customers grew challenging amidst fierce competition.

WeWork - Under founder Adam Neumann’s charismatic yet erratic leadership, the co-working startup burned venture cash to lease real estate for chic shared urban offices. Marketing successfully targeted freelancers and startups. But huge losses mounted behind the scenes from excess overhead, poor expense controls, and difficulties filling locations over time. WeWork ultimately failed spectacularly in its goal of becoming a tech company and had to be rescued by a bailout.

Theranos - Charismatic CEO Elizabeth Holmes catapulted her blood testing startup to a $9 billion valuation on claims of revolutionary proprietary technology requiring just a single drop of blood. In reality, the tech never worked reliably. Whistleblowers exposed systemic quality issues hidden behind powerful publicity including profiles and covers features of Holmes herself on major magazines. Theranos collapsed in scandal and dissolved.

Peloton - With a slick high-tech image and star fitness instructors leading intense spin classes, Peloton experienced meteoric early growth. Yet myriad hardware and software defects plagued expensive Peloton equipment. Customer support response proved severely lacking. Continued product and experience quality woes have imperiled Peloton's initial dominant market position relative to lower-priced rivals. Management misjudged customer willingness to accept poor support just to access popular classes.

Best Practices for Balancing Marketing and Quality

While marketing is crucial for customer acquisition, quality retains them. Companies thriving over long periods skillfully balance the two by:

Leadership Commitment to Quality

• Instill a customer-centric ethos emphasizing consistent quality experiences among executives and the broader organization. Quality key performance indicators carry weight on par with sales and marketing metrics.

Culture Focused on Customer Experience

• Foster values and norms reinforcing product/service excellence and stellar support. Empower all employees to rapidly address quality breakdowns large or small that frustrate customers.

Quality Key Performance Indicators and Benchmarking

• Establish concrete metrics and rigorously gather data to monitor key aspects of quality - reliability, durability, support response times, Net Promoter Scores (NPS), etc. Benchmark against top performers.

Investments in Process Improvements

• Proactively fund projects to enhance quality assurance, remove failure points, streamline processes using approaches like Six Sigma and Lean. Go onsite to observe customer interactions and pain points directly.

Empowering Employees to Drive Quality

• Ensure all employees, not just leadership or specialized teams, participate actively in quality enhancement initiatives. Solicit their input into addressing problems and improving processes. Incentivize quality in reviews and compensation.

Conclusion

In summary, most businesses focus more heavily on marketing over quality because growing revenue rapidly requires extensive customer acquisition from promotional campaigns and selling skill. Delivering positive quality outcomes manifest more gradually. Executives with shorter tenure often gravitate toward marketing for quicker results.

However, neglecting quality has dire long-term consequences - frustrated customers, tarnished brand reputations, higher overhead costs just trying to replace lost business. Marketing and quality work symbiotically, not exclusively. Companies thriving for decades or more invest adequately in marketing and quality in tandem to provide a stellar customer experience worthy of loyalty.

Without quality baked into culture, systems and processes guided by leadership emphasis and benchmarking, dangerous cracks ultimately emerge to threaten the entire enterprise. But organizations balancing marketing and quality - while challenging - position themselves to prosper sustainably over the long haul.