Advertising as a sign of product failure?

By William Bakker | 02.28.11 | Comment?

artwork by Hugh MacLeod

Interesting post from Fred Wilson, a VC and principal of Union Square Ventures about advertising (he calls it marketing).

This quote stands out:

I believe that marketing is what you do when your product or service sucks or when you make so much profit on every marginal customer that it would be crazy to not spend a bit of that profit acquiring more of them (coke, zynga, bud, viagra).

I’ve often thought that advertising is what you do when a product is either mediocre or commoditized. If customers don’t love your product, give you repeat business and tell their friends, you’ll have to do the talking yourself through paid media. Big brands like Google, Facebook, Zara, Starbucks and Zappos though demonstrate that you can build large successful brands without much advertising.

The thing I could never reconcile in mind were the ads ran by companies like Apple. They have a cult following and products people love and rave about. Why bother with spending anything on paid media? The second part of Fred’s quote is brilliant and makes sense. Advertising can rally your base and pull people of the line.

I’m not claiming advertising doesn’t work. I’m sure that the amount of sham-wows, slap shops and collectable plates sold as a result of their TV Ads makes the producer a profit. But that doesn’t mean its a good product.

A good product sells itself. Don’t fix a mediocre product with advertising, fix the product instead.


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