What is advertising for and what does it affect?

2024 Author: Howard Calhoun | [email protected]. Last modified: 2023-12-17 10:16

To understand what advertising is for, you need to understand how the market works. Whether it's a hair shampoo or a new-build apartment, with no choice of options, there's no need for advertising. When the buyer is offered only one type of goods, then everyone is forced to buy the same thing. When several types of goods or services appear on the market, there is a need for additional information: which one is better? This is exactly what advertisers are trying to convey.

Advertising and competition

A potential buyer can judge the quality of goods only by their appearance, and advertising provides additional information about certain of its properties. That's what advertising is for: with the help of promotional materials, a new manufacturer can enter an already established market, so advertising does not allow the market to stagnate andmonopolize. With it, new brands gain access to the buyer, providing a better offer than the existing one: a better or cheaper product, with additional useful properties or related services. As a result, the market is becoming more diverse and of better quality.

Advertising and freedom of choice

In a free market, store shelves are literally littered with a variety of goods, providing the buyer with an almost unlimited choice. Try to imagine the opposite situation: instead of thousands of different modifications and types, stores offer only one standard option. In this case, competition would disappear, the manufacturer would create only one product in large quantities, and advertising would not be needed. With no choice, buyers are forced to settle for what they have.

However, the needs of different people can be completely different, and what suits one may not be suitable at all for another. In conditions of free choice and the presence of many manufacturers, the buyer gets the opportunity to choose what he likes. Unclaimed goods lie on the shelves and are gradually withdrawn from circulation, making room for better items. When the buyer has a choice, there is a need for information. That's what advertising for goods and services is for.

Advertising and we alth

If the economy focused on the production of only basic necessities, humanity wouldwould still use horse-drawn equipment and foul-smelling laundry soap. However, this, fortunately, did not happen, and largely due to advertising. Wanting to live better, people created various items that made life easier, more comfortable and more enjoyable. Advertising informed consumers about new inventions created to meet a particular need. After all, how else could people know about the advent of cars, microwave ovens, computers?

Many believe that advertising makes people buy more than they need. In fact this is not true. It only informs potential buyers about new types of goods designed to satisfy any need. And it doesn't create new needs.

Some people think the market is saturated with "unnecessary" or "excess" goods. Someone is convinced that the presence of fashionable lipstick, high-speed computers, electric scooters are not real, but artificial, far-fetched needs that have arisen solely under the influence of advertising. However, under free market conditions, producers have the opportunity to produce goods of their choice, but no one can afford to do what is not in demand. Those people who do not need this or that type of product or service may simply not purchase it, because there is not only freedom of choice, but also freedom of refusal.

The economic laws of market development show that advertising stimulates consumer demand, which, in turn,turn leads to an increase in production. More production leads to cheaper products. Previously, buyers were forced to spend two months of income on the purchase of a refrigerator, and today only part of the salary for one month. If you refuse advertising, the level of sales will certainly decrease, which will lead to a rise in the price of most types of goods and services.

Promotion improves product quality

The existence of competition among manufacturers leads to improved product quality, as each brand tries to outdo its rival. That's what product advertising is for: when advertising new products, competition intensifies. And along with it, the consumer characteristics of things are improving.

Do I need permission to advertise?

No additional permissions are required to start advertising your product or service. The only exceptions are some types of outdoor advertising. Its placement is subject to local advertising tax, which varies by region.

That's what advertising is for: it stimulates demand, increases competition, increases production, which leads to better goods and services.