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Advertising: A Catechism

Q. Why do marketers of a range of products spend as much money as they do on advertising?

A. BecauImage result for Super Bowl clipartse they want to sell more products. You don't have to be Don Draper to figure that one out.

Q. But why does it increase the demand for the advertised products? Let's focus on broadcast commercials, and on competition within a particular industry: how does the radio/TV exposure cause people to want brand X rather than brand Y, assuming that they want the generic type of product to which both X and Y belong?

A. The marketers of X try to persuade people that X is better.

Q. Yes, I understand. But isn't the public long since jaded? How does persuasion work, if we assume that consumers are rational? [Rational consumers certainly would be jaded about the content of broadcast ads, would they not?]

A. One possible answer to that is that rational consumers, regardless of the content of the ad, measure the likely expense of the advertising campaign. The amount of money that the sellers of X are willing to spend on ads gives the impression that they are confident of quality. They are confident that if they can get you to try X once ("just one sip" in the case of a beverage) their quality will do the rest and make you a repeat customer.

Q: Ah, so the actual content of the ad, the clever slogan or jingle that ad people presumably obsess over, don't really matter?

A. Not on this hypothesis no, except of course to the extent that it indicates high production values, that is, high expense.

Comments

  1. Perhaps a consumer's mere exposure to a brand name of a product increases the likelihood that he or she will choose that brand. Isn't that the theory behind political billboards, lawn signs, and bumper stickers that state a candidate's name without offering a reason to vote for him or her?

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