Marketing an inferior product may gain you market share in the short-term but won't yield future success.
This month I had the honor of speaking to the University of Alabama, Executive Masters in Engineering class. Most of the participants are professionals; the average age of the group was early 40′s and many own their own business or are involved in start-ups.
After the presentation, a student named Mikhail Mirov approached me with a question: Is it more important to have a real quality advantage or a perceived quality advantage?" The answer seemed obvious, but I needed to know the reason for his question.
He explained that he was familiar with a company that had spent considerable resources developing a true quality advantage in their product, but was not gaining market share against a competitor that had a perceived quality advantage. I made an assumption that the company with the perceived advantage had invested less in the product and more in their marketing in order to create this perception.
This issue is a very serious and potentially disastrous macro level issue in the U.S. Perceived anything is not sustainable. It is a monument constructed on a house of cards. In the short-run a company may in fact gain market penetration that would then allow it to go back and enhance its product. But at the root it is a fallacy. For example, the industrial revolution was a boom, we came late to quality, but mastered the world economy for a generation, while the Japanese determined quality was key.
Today quality can be seen coming from countries that were previously knock-off masters. Today most electronics are manufactured elsewhere. I attempted to utilize U.S. manufacturing, fabricating and assembly in my business only to learn the cost was prohibitive, AND there was no quality advantage. In some cases, we could not match the quality here in the U.S. for anywhere near the cost.
I want to manufacture in the U.S. I want to see domestic production of goods grow and provide jobs. The problem is I cannot afford to go out of business trying to make that work. If we are going to make it work, then everyone must recognize the value of quality and pursue it with a vengeance, while at the same time learning to be competitive on price. Not necessarily less expensive. If the quality advantage is there then get more for it. Just don't ask more and provide something less.
GLEN BLICKENSTAFF is the CEO of The Iron Door company, which makes high-end doors and windows. Glen has a track record of turning around and managing retail, building and financial companies. @glenblickenstaf