Outline the main benefits and costs to society from advertising. Does advertising necessarily lead to a higher price for the product?
Advertising is an important component of the promotion of the marketing strategy, along with direct marketing, PR etc. The aim is to promote business and communicate the information to the intended audience to increase sales. Businesses that continue to advertise regardless of economic times have a competitive advantage over businesses that trim their ad budgets. The whole process of selling products or services to the market is intimately concerned with understanding customers’ needs, motivating the sale of the product or service, and distributing it to customers – whether private consumers or industrial buyers and users. Advertising is that part of the process which is concerned with informing customers of the existence of the product and service. If you company invents and produces a product, no matter how excellent and desirable it is, it will not sell until people know about it. (Peter, 1989) Advertising is one element of the marketing mix. The marketing mix is generally accepted as the use and specification of the four Ps describing the strategic position of a product in the marketplace. The fundamental dogma of marketing typically identifies the four Ps of the marketing mix as referring to: •
PRODUCT - An object or a service that is mass produced or manufactured on a large scale with a specific volume of units. A typical example of a mass produced service is the hotel industry. A less obvious but ubiquitous mass produced service is a computer operating system. Typical examples of a mass produced objects are the motor car and the disposable razor. •
PRICE – The price is the amount a customer pays for the product. It is determined by a number of factors including market share, competition, material costs, product identity and the customer's perceived value of the product. The business may increase or decrease the price of product if other stores have the same product. •
PLACE – Place represents the location where a product can be purchased. It is often referred to as the distribution channel. •
PROMOTION – Promotion represents all of the communications that a marketer may use in the marketplace. Promotion has four distinct elements - advertising, public relations, word of mouth and point of sale. ADVANTAGES OF ADVERTISING:
There are various advantages of Advertising which are as follows: 1.Communicates information: it spreads the word about products and services efficiently and cheaply; it reaches a mass audience faster than word of mouth. 2. Provides reassurance: advertising adds value to good and services by giving them a brand personality; it provides consumers with confidence - people prefer branded goods to own-label products. .(Yeshin, 1993) 3. Stimulates competition to produce new products and improve old ones. As part of market economy, it helps to ensure choice for customers. 4. Expends media choice: money made from advertising funds a diverse and independent media (TV, press, radio and posters). Conversely, countries with little or no advertising environment have highly restricted and controlled media choice. 5. Fuels economic prosperity: advertising helps to create employment by opening up new growth areas. The world's most prosperous economies are those in which advertising is most heavily used.
It is suggested that advertising is not only beneficial, but also can be harmful to the consumers. First of all, it does not really inform the consumers, but persuades them. As Eric Clark puts it very well “advertising exists to inform – but even more so to persuade”.
Also, advertisers do not tell all the truth. Advertising is not obligated to tell the whole story (advantages and disadvantages of the products).Moreover, advertising has been dominated in the media in such a way that has the ability to be all-invasive. Kim Rotzoll says that advertisers are not in a...
Please join StudyMode to read the full document