Role Of Advertising In Economic Development
Economic role of advertising
The issue of advertising ' s contribution to the economy as a whole was and remains one of the most debated. Some consider it to be a vital and extremely effective means of placing new products on the market and maintaining awareness of trademarks. In order to understand the economic benefits of advertising, it is necessary to approach them from the positions of both sellers and buyers. As consumers, we want to know whether advertising provides true, important information so that we can find significant differences between the goods (in other words, differentiate them, as the producers seek). In addition, is advertising more effective than other sources of consumer information?
The second point is the seller ' s point of view. It cannot be said that these two positions necessarily exclude each other, but apparently the motives of buyers and sellers vary. They can be summarized as follows: the seller seeks to obtain the maximum profit, while the buyer seeks to obtain the maximum degree of satisfaction, most often at the lowest cost. For example, a statement about an American Association of Advertising Agencies initiative states that it is " called upon to develop and improve the process of designing and approving advertising budgets using performance indicators that are important for enterprise directors-general and finance. " Consumer satisfaction was undoubtedly one of those indicators, but it was important to reduce profitability, equity and other economic criteria.
Economic views on advertising
As we have mentioned, views on the contribution of advertising to the economy vary considerably. In order to objectively highlight the situation, we will consider the prevailing arguments for and against advertising.
Advertising arguments are summarized as follows: 1. The Declaration describes the quality, thereby encouraging the improvement of existing products and the development of new ones. Involuntary volleys to match competitors, companies offer products with better properties. The spiral of product improvement is beneficial to consumers.
2. The advertisement, providing information on the latest products and developments, helps consumers make the right purchase decisions. ♪ ♪