Quality sells

IN business, profit often comes from repeat customers, usually those who bring colleagues and friends.

Big Business Ideas

Stephene Chikozho

There is an adage that quality sells.

Many companies believe the best way to attract buyers is to produce a superior product.

Businesses that put quality first believe other factors affecting demand — for example, marketing, advertising, customer experience, distribution and price — are relatively less important than the product itself.

At face value, this approach may seem irrational.

After all, in some Southern African markets, low prices are critical.

For instance, a regional airline’s competitive advantage over its rivals is based on its low-cost business model, which enables the company to charge lower fares than its competitors.

Yet some low-cost goods or services can represent a false economy for customers, especially if the products are of poor quality, as this often results in extra costs for the customer to repair or replace them.

Another way of boosting revenue is to increase the volume of goods sold.

Some companies attempt to achieve this goal by using advertising campaigns to wrest market share from their rivals.

However, the problem with trying to grow revenue through promotion is that it is usually expensive.

Offering a quality product is an alternative to these low-cost or high-volume approaches.

This strategy can achieve the same goal of boosting a company’s revenues and improving customer retention by offering clients a product of a high standard that they would want to keep or buy again and again.

What is quality?

In manufacturing, quality is achieved when a company is able to supply reliable and durable goods that meet or surpass consumer expectations and are free of defects.

High-quality products inspire trust.

Take, for example, high-quality car tyres.

They often have deeper treads than poor-quality tyres, making cars that have them less likely to skid in emergencies or bad conditions.

In this case, the quality of a car tyre could be the difference between life and death.

Superior-quality tyres, made from hard-wearing rubber compounds, also last longer than those of lesser quality, which means the driver will not have to face the cost and inconvenience of frequently replacing them.

Great quality is not just about using the best components. Design is also crucial to achieving a superior-quality product.

This is so because design can offer the consumer new benefits for which they are willing to pay a premium.

Businesses that have incorporated distinguishing features into their products can exploit the added value these features provide by charging high premiums on goods that are especially valued by consumers, leading to greater revenues and profits.

Brand loyalty

Quality can be an important selling point, even for low-cost products, since it helps build brand loyalty and ensure repeat customers.

In markets for fast-moving consumer goods (FMCGs), manufacturers use superior product quality to preserve and extend their customer base.

FMCGs are non-durable products that are bought frequently by households and consumed immediately.

Examples are beer, toothpaste, chocolate and breakfast cereal.

Since FMCGs are purchased regularly throughout the year, the sales volumes achieved by a successful product can be immense. A good example of an FMCG market is the one for toilet paper.

In a market like the Southern African region, even a small share will translate into millions in revenues. If consumers habitually buy the same brand, rather than switching between rival brands, their brand loyalty will be invaluable.

High-quality brands are more likely to win loyalty than those of an inferior nature.

For example, households are more likely to buy toilet paper again and again if the product is softer and stronger than the brands sold by its rivals, generating higher volumes of sales and greater revenues.

This means the business has increased its revenues without having to pay any of the marketing costs usually associated with acquiring customers.

Service and quality

Another indicator of good quality is provision of a service in a manner that exceeds customer expectations.

This might manifest itself as efficiency or rapid response to customer concerns.

Added value

Businesses can also create high-quality products by adding value.

The value added is the difference between a product’s price and the raw material cost of making the item.

Companies can add value to their products with new features, innovative functions or add-ons designed to benefit and appeal to actual and potential buyers.

Overall, quality is not only what the supplier puts in: It is what the customer gets out and is willing to pay for.

By anticipating present-day and future challenges for customers, businesses need to be agile, adaptable and customer-centric to navigate client pain points and proffer game-changing solutions to the market.

Stephene Chikozho is the managing director of Urbane Create Agency — a strategy, marketing and advertising agency. He writes in his personal capacity. You can follow him on social media (Instagram, Facebook, Twitter, LinkedIn) WhatsApp +263772409651 or email [email protected]