Professional Documents
Culture Documents
4 Intro
4 Intro
1 Meaning of Advertisement
Advertising is a form of communication intended to persuade an audience (viewers, readers or listeners) to purchase or take some action upon products, ideals, or services. It includes the name of a product or service and how that product or service could benefit the consumer, to persuade a target market to purchase or to consume that particular brand. These messages are usually paid for by sponsors and viewed via various media. Advertising can also serve to communicate an idea to a large number of people in an attempt to convince them to take a certain action. Advertising has been defined as the dissemination of information concerning an idea, services or products to compel action in accordance with the interest of advertisers . !y, ". !aner#ee. Advertising consists of all the activities involved in presenting to a group, a non$personal, oral or visual, openly sponsored message regarding a product or services, or idea . !y, %tanton. &ommercial advertisers often seek to generate increased consumption of
their products or services through branding, which involves the repetition of an image or product name in an effort to associate related 'ualities with the brand in the minds of consumers. (on$commercial advertisers who spend money to advertise items other than a consumer product or service include political parties, interest groups, religious organi)ations and governmental agencies. (onprofit organi)ations may rely on free modes of persuasion, such as a public service announcement. "odern advertising developed with the rise of mass production in the late *+th and early ,-th centuries. "ass media can be defined as any media meant to reach a mass amount of people. .ifferent types of media can be used to deliver these messages, including traditional mediasuch as newspapers, maga)ines, television, radio, outdoor or direct mail/ or new media such as websites and te0t messages. In ,-*-, spending on advertising was estimated at more than 12-- billion in the 3nited %tates4*5 and 16-- billion worldwide. ( http788en.wikipedia.org8wiki8Advertising, ,*.**.,-*- )
Advertising is a communication tool used by the marketers to persuading the potential buyers to purchase certain product or service. It plays a pivotal role in achieving the financial and commercial ob#ectives of the companies concerned. The role of advertising is also vital in the cutthroat competitive environment and the mushroom branding in the present century. The challenges of the age demand a bit more of the marketers towards informing, educating and facilitating the customer as to how to have a timely access to certain product or a service in a novel and innovative way. The marketers are therefore devising ways to make advertising more effective. .espite the fact that advertising is an effective tool for the business along with its being an important element of the modern age and a fast growing industry, the public image of advertising is still a matter of great concern. (9:.onohoe,*++6). Advertising is critici)ed for its presenting misleading information, promoting adverse values, fake claims, subliminal seduction messages and persuading people to buy things they no longer need (;atona, *+<=/ >ollay, *+?</ >ollay and "ittal,*++2). Again, this industry is blamed of spreading unsustainable consumption patterns around the world over and encouraging e0cessive consumption. All the foregoing aspects are apt to hinder its effectiveness as well as efficiency as a marketing tool (!eales et al., *+?*/ &alfee and @ingold, *+?A/ >ollay and "ittal, *++2/ Bright, *+?<). Therefore, it is critical of the advertising concerns to follow the public opinion advertising for its for reaching impact on the economy, cultural values and on the business itself. (Bills and @yans/ *+?,). The students represent a si)eable segment of the society. They have dominating role in opinion making. That is why/ e0clusive studies on the students: attitude towards advertising are being carried out in different parts of the world today. To e0ploring the college students: attitudes towards advertising is important for several reasons. They are a large and ever growing segment of the populace. They have considerable amount of money at their disposal. They are the outstanding asset for the product and service sellers as they are the trendsetters and early adopters. They can influence the purchasing decisions of their peers and parents, establish brand loyalties that continue long after the college days, and ensure a higher standard of living after their graduation ("orton, ,--*/ @ussell, *++</ Bolburg and >okrywc)ynski, ,---).
1.1.2 Ty es of Advertisements
Cirtually any medium can be used for advertising. &ommercial advertising media can include wall paintings, billboards, street furniturecomponents, printed flyers and rack cards,
radio, cinema and television adverts, web banners, mobile telephone screens, shopping carts, webpopups, skywriting, bus stop benches, human billboards, maga)ines, newspapers, town criers, sides of buses, banners attached to or sides of airplanes (Dlogo#etsD), in$flight advertisements on seatback tray tables or overhead storage bins, ta0icab doors, roof mounts and passenger screens, musical stage shows, subway platforms and trains, elastic bands on disposable diapers,doors of bathroom stalls,stickers on apples in supermarkets, shopping cart handles (grabertising), the opening section of streaming audio and video, posters, and the backs of event tickets and supermarket receipts. Any place an DidentifiedD sponsor pays to deliver their message through a medium is advertising. 1.1.2.1 DI!ITA" ADVERTISIN! 2. Te#evision advertising $ M%si& in advertising The TC commercial is generally considered the most effective mass$market advertising format, as is reflected by the high prices TC networks charge for commercial airtime during popular TC events. The annual %uper !owl football game in the 3nited %tates is known as the most prominent advertising event on television. The average cost of a single thirty$second TC spot during this game has reached 3%12 million (as of ,--+). The ma#ority of television commercials feature a song or #ingle that listeners soon relate to the product. Cirtual advertisements may be inserted into regular television programming through computer graphics. It is typically inserted into otherwise blank backdrops4+5 or used to replace local billboards that are not relevant to the remote broadcast audience. 4*-5 "ore controversially, virtual billboards may be inserted into the background4**5 where none e0ist in real$life. This techni'ue is especially used in televised sporting events4*,5 4*25 Cirtual product placement is also possible./4*=54*65 Infomercials7 An infomercial is a long$format television commercial, typically five minutes or longer. The word DinfomercialD combining the words DinformationD E DcommercialD. The main ob#ective in an infomercial is to create an impulse purchase, so that the consumer sees the presentation and then immediately buys the product through the advertised toll$free telephone number or website. Infomercials describe, display, and often demonstrate products and their features, and commonly have testimonials from consumers and industry professionals. '. Radio advertising @adio advertising is a form of advertising via the medium of radio. @adio advertisements are broadcast as radio waves to the air from a transmitter to an antenna and a thus to a receiving device. Airtime is purchased from a station or network in e0change for airing the
commercials. Bhile radio has the obvious limitation of being restricted to sound, proponents of radio advertising often cite this as an advantage. (. On#ine advertising 9nline advertising is a form of promotion that uses the Internet and Borld Bide Beb for the e0pressed purpose of delivering marketingmessages to attract customers. F0amples of online advertising include conte0tual ads that appear on search engine results pages, banner ads, in te0t ads, @ich "edia Ads, %ocial network advertising, online classified advertising, advertising networks and e$mail marketing, including e$mail spam. ). *rod%&t #a&ements$Covert Advertising &overt advertising, also known as guerrilla advertising, is when a product or brand is embedded in entertainment and media. Gor e0ample, in a film, the main character can use an item or other of a definite brand, as in the movie Minority Report, where Tom &ruiseHs character Iohn Anderton owns a phone with the Nokia logo clearly written in the top corner, or his watch engraved with the Bulgari logo. Another e0ample of advertising in film is in I, Robot, where main character played by Bill %mith mentions his Converse shoes several times, calling them Dclassics,D because the film is set far in the future. I, Robot and Spaceballsalso showcase futuristic cars with the Audi and Mercedes-Benz logos clearly displayed on the front of the vehicles. &adillac chose to advertise in the movie T e Matri! Reloaded, which as a result contained many scenes in which &adillac cars were used. %imilarly, product placement for 9mega Batches, Gord, CAI9, !"B and Aston "artin cars are featured in recent Iames !ond films, most notably Casino Royale. In DGantastic Gour7 @ise of the %ilver %urferD, the main transport vehicle shows a large .odge logo on the front. Blade Runner includes some of the most obvious product placement/ the whole film stops to show a &oca$&ola billboard.
1.1.2.2 *+,SICA" ADVERTISIN! 2. *ress advertising >ress advertising describes advertising in a printed medium such as a newspaper, maga)ine, or trade #ournal. This encompasses everything from media with a very broad readership base, such as a ma#or national newspaper or maga)ine, to more narrowly targeted media such as local newspapers and trade #ournals on very speciali)ed topics. A form of press advertising is classified advertising, which allows private individuals or companies to purchase a small, narrowly targeted ad for a low fee advertising a product or service. Another form of press
advertising is the .isplay Ad, which is a larger ad (can include art) that typically run in an article section of a newspaper. '. -i##.oard advertising !illboards are large structures located in public places which display advertisements to passing pedestrians and motorists. "ost often, they are located on main roads with a large amount of passing motor and pedestrian traffic/ however, they can be placed in any location with large amounts of viewers, such as on mass transit vehicles and in stations, in shopping malls or office buildings, and in stadiums. (. Mo.i#e .i##.oard advertising "obile billboards are generally vehicle mounted billboards or digital screens. These can be on dedicated vehicles built solely for carrying advertisements along routes preselected by clients, they can also be specially e'uipped cargo trucks or, in some cases, large banners strewn from planes. The billboards are often lighted/ some being backlit, and others employing spotlights. %ome billboard displays are static, while others change/ for e0ample, continuously or periodically rotating among a set of advertisements. "obile displays are used for various situations in metropolitan areas throughout the world, including7 Target advertising, 9ne$day, and long$term campaigns, &onventions, %porting events, %tore openings and similar promotional events, and !ig advertisements from smaller companies. ). In/store advertising In$store advertising is any advertisement placed in a retail store. It includes placement of a product in visible locations in a store, such as at eye level, at the ends of aisles and near checkout counters, eye$catching displays promoting a specific product, and advertisements in such places as shopping carts and in$store video displays. 0. Coffee &% advertising &offee cup advertising is any advertisement placed upon a coffee cup that is distributed out of an office, cafJ, or drive through coffee shop. This form of advertising was populari)ed in Australia, and has began growing in popularity in the 3nited %tates, India, and parts of the "iddle Fast.
7. Ce#e.rity .randing
This type of advertising focuses upon using celebrity power, fame, money, popularity to gain recognition for their products and promote specific stores or products. Advertisers often advertise their products, for e0ample, when celebrities share their favorite products or wear clothes by specific brands or designers. &elebrities are often involved in advertising
campaigns such as television or print adverts to advertise specific or general products. The use of celebrities to endorse a brand can have its downsides, however. 9ne mistake by a celebrity can be detrimental to the public relations of a brand. Gor e0ample, following his performance of eight gold medals at the ,--? 9lympic Kames in !ei#ing, &hina, swimmer "ichael >helpsH contract with ;elloggHs was terminated, as ;elloggHs did not want to associate with him after he was photographed smoking mari#uana.
1.1.2.' OT+ERS 2. S%rrogate Advertising 1 Advertising Indire&t#y %urrogate advertising is prominently seen in cases where advertising a particular product is banned by law. Advertisement for products like cigarettes or alcohol which are in#urious to heath are prohibited by law in several countries and hence these companies have to come up with several other products that might have the same brand name and indirectly remind people of the cigarettes or beer bottles of the same brand. &ommon e0amples include Gosters and ;ingfisher beer brands, which are often seen to promote their brand with the help of surrogate advertising. '. *%.#i& Servi&e Advertising 1 Advertising for So&ia# Ca%ses >ublic service advertising is a techni'ue that makes use of advertising as an effective communication medium to convey socially relevant messaged about important matters and social welfare causes like AI.%, energy conservation, political integrity, deforestation, illiteracy, poverty and so on. .avid 9glivy who is considered to be one of the pioneers of advertising and marketing concepts had reportedly encouraged the use of advertising field for a social cause. 9glivy once said, DAdvertising #ustifies its e0istence when used in the public interest $ it is much too powerful a tool to use solely for commercial purposes.D. Today public service advertising has been increasingly used in a non$commercial fashion in several countries across the world in order to promote various social causes. In 3%A, the radio and television stations are granted on the basis of a fi0ed amount of >ublic service advertisements aired by the channel. ( http788en.wikipedia.org8wiki8AdvertisingLTypesMofMadvertising, ,*.**.,-*- ) ( http788www.bu))le.com8articles8different$types$of$advertising.html, ,*.**.,-*- )
to
To announce a new product or service To increase its sales by attracting new customers To create brand preferences To e0pand the market for new buyers To assist the salesmen in their selling efforts To warn the public against imitation of the product of the firm To prepare ground for new products !arring new entrance To make special offers through sales promotion To neutrali)e competitors advertising To enhance goodwill of the firm prospective customers. Its long$term ob#ective is to generate profit
9b#ective of any advertising is to communicate about the product and services the to firm. Keneral ob#ectives of advertising are to inform the customers about the attributes and uses of the product. (http788www.pharmainfo.net8reviews8role$advertisement$and$sales$promotion$ pharmaceutical$marketing$review)
It is a fact that advertising brings about products variety through real and psychological product differentiation.
offer is misleading if the trader claims the product is below cost , when the price is not below cost after discounts, rebates and other allowances it is misleading if the trader simply shows a fictitious higher price as normal selling price in the advertisement. o Advertisement must clearly indicate the total price of goods or services. All price comparison must be truthful and must not intentionally or unintentionally mislead the consumers. 3nder the Gair Trade >ractices Act, retailers have an obligation to ensure that they do not mislead or make false representations to customers with respect to price of the goods. The consumers who shop around and compare the prices of various products are less likely to be deceived by misleading claims consumers should also be aware of what is a reasonable price of goods and not take any advertised discounts at face value. o Bhile many sales are legitimate or genuine, the consumers should not get attracted to such sales offers i.e., DNurry...very few days remain for saleHH. The consumers should be aware of what to e0pect when retailers place items on sale and how to avoid being misled by discount advertisements. A marketer should take care to ensure that when goods or services are advertised to be available at a discount or as being on sale, it is a genuine discount or sale.
are generally placed at strategic breaks during the main programming and the few minutes until the top of the ne0t hour. Cisual as well as audio interest is very important in television advertising. Instead of employing a single voice$over actor to read the advertising copy over a musical bed, actors can create a visual image which further enhances the appeal of the commercial. Images of a happy family gathering around a dinner table can enhance the appeal of a new line of canned soups, for e0ample. An attractive man surrounded by beautiful models can suggest the se0 appeal of a new cologne as well. !ecause television viewers can easily discern a cheaply produced television commercial from regular programming, many television advertising agencies employ professional copywriters, directors and actors to produce professional caliber commercials that viewers will remember long afterwards. Fven if the images or copy appears to have little to do with the actual product or service, viewers often remember shocking or nostalgic or humorous imagery in a commercial. (http://%%%.%isegee&.com/%hat-is-television-advertising.htm!" 1.11. #1#"$
e0pensive media to advertise in because of its efficiency in bringing the message of the company across to their customers.
'"http://%%%.advertising(irst.com/a-)rie(-histor*-o(-television-advertising.html!" 1.11. #1#"$
TC reaches a much larger audience than local newspapers and radio stations, and it does so during a short period of time. It reaches viewers when theyHre the most attentive. It allows you to convey your message with sight, sound, and motion, which can give your business, product, or service instant credibility. It gives you an opportunity to be creative and attach a personality to your business, which can be particularly effective for small businesses that rely on repeat customers.
television. ?, percent of their viewing is to normal, linear, broadcast TC without fast$ forwarding the ads. In the *? percent of TC viewing that is time$shifted (i.e. not watched as live broadcast), viewers still watch 2- percent of the ads at normal speed. 9verall, the e0tra viewing encouraged by owning a .T@ results in viewers watching , percent more ads at normal speed than they did before the .T@ was installed. The %ky Ciew evidence is reinforced by studies on actual .T@ behaviour by the !roadcastersH Audience @esearch !oard (!A@!) and the Sondon. 9ther forms of TC advertising include >roduct placement advertising in the TC shows themselves. Gor e0ample, F0treme "akeover7 Nome Fdition advertises %ears, ;enmore, and Nome .epot by specifically using products from these companies, and some sports events like the %print of (A%&A@ are named after sponsors, and of course, race cars are fre'uently covered in advertisements. Incidentally, many ma#or sporting venues, in (orth America at least, are named for commercial companies, dating back as far as Brigley Gield. Television programs delivered through new mediums such as streaming online video also bring different possibilities to the traditional methods of generating revenue from television advertising. Another type of advertisement shown more and more, mostly for advertising TC shows on the same channel, is an ad overlay at the bottom of the TC screen, which blocks out some of the picture. D!annersD, or DSogo !ugsD, as they are called, are referred to by media companies as %econdary Fvents (,F). This is done in much the same way as a severe weather warning is done/ only these happen more fre'uently. They may sometimes take up only 6 to *- percent of the screen, but in the e0treme, they can take up as much as ,6 percent of the viewing area. %ubtitles that are part of the program content can be completely obscured by banners. %ome even make noise or move across the screen. 9ne e0ample is the ,F ads for Three, which was broadcast in the months before the TC showHs premiere. A video taking up appro0imately ,6 percent of the bottom$left portion of the screen would show a comet impacting into the moon with an accompanying e0plosion, during another television program. KoogleHs Fric %chmidt has announced plans to enter the television ad delivery and optimi)ation business. This is despite the fact that Koogle lacks an immediate video production and network placement foothold. There are few details in place about how this may occur, but some have speculated that they will use a similar model to that of their business strategy directed at radio broadcast, which included the ac'uisition of operations system support provider.
9nline video directories are an emerging form of interactive advertising, which help in recalling and responding to advertising produced primarily for television. These directories also have the potential to offer other value$added services, such as response sheets and click$ to$call, which greatly enhance the scope of the interaction with the brand. (http788en.wikipedia.org8wiki8TelevisionMadvertisement, ,*.**.,-*- )
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Klobal marketing coordinates activities across different country markets Klobal marketing should be motivated by individual, organi)ational, and societal goals
Includes nonprofit and for profit activities, products, ideas, and services , activities that precede and follow the production process
Includes the four >:s and regards them each as e'ually important
Klobal Advertising .elivering a common message across countries E cultures Issues E &hallenges. Klobal Advertising Iob7
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Klobal Advertising means having more or less uniform advertising appeal, message, artwork etc all over the world. A truly global advertisement is difficult due to language, culture E @egulatory differences between countries
As with products, global advertising implies a level of locali)ation, but the brand name E message still being global
1.2.5.2 *rod%&t *#a&ement Bhat type of product became popular after the release of the *+?, movie DFTDP According to the "edia Awareness (etwork, the product FT loved to eat, which was chocolate$covered peanut butter$filled candy pieces, saw sales increase by <6T. The use of product placement is a common advertising strategy that reaches millions of viewers. In recent years, product placement has gained importance as an advertising tool due to the inventions of technologies that allow consumers to record their favorite shows and edit out the commercials. TC producers and advertising agencies work together on the use of product placement. 9ne techni'ue used for this type of TC advertising is basing the whole episode of the television show around the product being advertised. 1.2.5.' Dire&t Res onse Mar4eting .irect response marketing is a type of television advertising where a product is displayed, presented or discussed, followed by an invitation to order the product. .uring one episode of the television show DBill and Krace,D a character wore a pink polo shirt. After the show, a *-$second advertisement was run, showing the character wearing the pink polo shirt and inviting viewers to go to the website to order one. The website, run by a company partially owned by the network that produced DBill and Krace,D sold 12,--- worth of pink polo shirts in the days following that episode. In a more overt method, direct response marketing is the techni'ue used in television infomercials. (http://%%%.eho%.com/list.61 /#71.tv-advertising-strategies.html$
service for a variety of programs7 history, wildlife, music, and movie stations, and other special interests. >ublic television stations, like >!% in the 3nited %tates, have little or no commercial sponsorship, and receive support from viewers, corporations, or governments. These public stations do not contain commercial advertising. (http://eca.state.gov/(or+m/0o+rnal/)+s6)ac&gro+nd.htm$
Gor any business, customer is very important, and businessman attempt to communicate to all their target customers using means of communication like advertising and sales promotion. Advertising is a very powerful and most commonly used tool. Television ethics are derived from early professional codes of broadcasting that began in the late *+,-s and are grounded in problems and issues identified in early radio. Gor television these ethical systems came into their own and grew rapidly, in con#unction with the development of the new medium, during the *+<-s. !ut they now no longer e0ist as they once did. Sike radio for a previous generation, television had the ability to penetrate the private home and its potential obtrusiveness was the sub#ect of concern. It was, after all, a DguestD in the home and in that capacity it was able to serve the public interest$$informing, instructing and enlightening. It also had the ability, recogni)ed early on, for serving private interests driven by the desire for economic gain. The keen awareness of potential confrontation between service on the one hand, and the desire for laisse) faire operation on the other, led to another set of possible conflicts$$between self regulation and regulation by government. The broadcasting industry placed its faith and its interests in self regulation. The industry created its own &ode of !roadcasting which consisted of eight Drules.D Gour had to do with advertising and concern over Dovercommerciali)ation.D The other rules dealt with general operations and responsible programming7 no Dfraudulent, deceptive or obsceneD material. "any of these same ideas and even the language appeared again in the Television &ode established in the early *+6-s. (http788www.museum.tv8eotvsection.phpPentrycodeUethicsandte, Fthics And Television )
purchase the product. Advertisements are among the most visible of the marketing strategy and have been the sub#ect of a great deal of attention in the last ten to fifteen years. Advertisement cannot only change emotions but give subliminal message. Advertising today seems to be everywhere and ever present e0erting a far reaching influence on the daily lives of people. Advertisements develop self$concepts in order to induce purchase decisions. Television advertising employs attention grabbing trick such as catchy and pleasing music, lyrics, Iingles, humour and repeated messages. The impact of the advertisements is more on television than the print media or radio. These advertisements hold a great impact and effect on the viewers especially the young ones. "ost of the ads usually convey their message effectively in #ust a few seconds that the audience have unknowingly captured the idea and internali)ed it $ and the ne0t thing they know, they are in the malls, buying the newest shampoo or soap or makeup. The effects of television advertising may not look grave, but because of the subtlety of these effects, consumers #ust don:t know it but their minds are already absorbing it. (http788www.citytvweb.com8the$effects$of$television$advertising$to$society8,The television advertising to society ) Assorted techni'ues are enforced for persuading consumers that they want the product which is being advertised. These techni'ues usually give attention to the benefits that would be brought to the consumers rather than focusing on the actual products. Gor instance, an automobile advertisement adverting the mechanical attributes of a vehicle, most likely concentrates the e0hilaration, reputation and social progression it may bring to the buyer. This swarming advancement is habitually se0ual, or involving the opposite gender to attract the consumers with the glamorous women8menHs fancy car. There are various blames that advertising is causing a negative social impact on the lives. The chief unfavorable #udgment for advertising is that it hales the public to buy things that they are not their real want. It is arrogated that advertising plays with emotions and encourages people to think that buying and depleting are the activities of life. According to advertisers, they state that people are capable enough to set their mind and no one can force them to buy anything which they dislike or which they think is not a necessity. Advertisers also think that there are positive impacts of advertising on our society and culture. Gor e0ample, it can be used to generate awareness among the public that which product is 9; or to which they should say (9. In other words, advertising also acts as an effects of
educator in the sense that it educates people what is good and what is bad for them and puts a ceiling on the harmful products like smoking and drinking etc. (http788e)inearticles.com8P%ocial$and$Fconomic$Impacts$of$AdvertisingEidU<-?*+*, So&ia# 8 E&onomi& Im a&ts of Advertising9 Maa: I;.a#< Television advertising can have a powerful influence on adolescents, food preferences, consumption and behaviour. VAdvertising seen is measured by looking at Vimpacts.: Impacts provide a measure of advertising e0posure. 9ne impact is e'uivalent to one member of the target audience viewing one commercial spot. Around one in five of all of the T.C. advertisement seen by adolescents is for a core category product. The effects of television advertising are impressive, affecting everyone $ children, teens, and adults $ that self$worth and self$appreciation is slowly diminishing. It is because these TC ads point out the person:s lack of something, instead of the products: features. (http://%%%.&rep+)lishers.com/# -1o+rnals/122/122-16-#-###-###- ##/-3e)/122-16-1###-###- ##/-A)st-4e5t/122-16-1-#,1-#/-,11-6ot%al-7/122-16-1-#,1-#/-,11-6ot%al-74t.pd("$
conducted in ,--6 by Klobal Insight, demonstrated that advertising helps to generate more than 16., trillion in sales and economic activity throughout the 3.%. economy annually. That represents ,-T of the nation:s 1,6.6 trillion in total economic activity. This economic stimulus provided support throughout the economy for more than ,* million #obs, or *6.,T of the 3.%. work force. The purpose of the study was to 'uantify the economic and employment impacts of advertising. The study removed intervening effects (like consumers simply buying a product to replace an old one or a depleted one) to measure the role of advertising itself. Advertising plays such a strong role in the economy because it7 >rovides useful information to consumers that tells them about product and service choices as well as comparing features, benefits and prices. Bith more complete information, consumers and businesses often choose to purchase additional products and services. &auses an economic chain reaction that (a) generates a net gain in direct sales and #obs due to the promotion of the industriesH products and services, (b) generates indirect sales and #obs among the first level suppliers to the industries that incur the advertising e0penditures, and (c) generates indirect sales and #obs among all other levels of economic activity as the sales ripple throughout the economy. Klobal Insight. &ompanies spend money on advertising because it increases sales of e0isting products, helps grow adoption of new products, builds brand loyalty, and takes sales away from competitors. Although the e0act return on investment (@9I) varies tremendously across industries, companies, campaigns and media channels, studies have found that a dollar spent on advertising returns 12 to 1,- dollars in additional sales. To compete and grow in todayHs diverse, ever$changing marketplace, businesses must reach their target customers efficiently, 'uickly alerting them to new product introductions, improved product designs and competitive price points. Advertising is by far the most efficient way to communicate such information. The perspective called the economics of information shows how consumers benefit from viewing advertising. !y providing information, advertising reduces consumers: search costs (time spent looking for products) and reduces disutility (unhappiness or lost value) from picking the wrong products. Advertising provides information such as7 .escribing new products and what they do Alerting consumers to product availability and purchase locations/ %howing consumers what to look for on store shelves Nelping them differentiate among competitive choices/ Advising them of pricing information and promotional opportunities. 3ltimately, advertising also saves consumers money by encouraging competition that e0erts downward pricing pressures. Advertising is a ma#or industry. It contributes to the economy directly (via the #obs it creates to produce ad
messages) but also indirectly as it stimulates demand and provides information about other products and services. (http://%%%.(lat%orld&no%ledge.com/1.#/la+nch-advertising-and-promoti/ch-3-advertisingand-societ*/economic-e((ects-advertising"!"Economic"e((ects"o("advertising"$