less advertisments = lower cost and better products ?

Question

just why do we have to see every thing everyone buys most all the time . this makes sense right ?

Answer 1

Unfortunately, not everything is so simple. Less advertising also means less visibility, lower number of buyers and thus inability to produce at an economical scale and higher production costs...

Answer 2

Actually, ideal (world) situation would include no advertisement. Why? Well, the only purpose of it is to make sales go up. Now, the good thing is that it currently employs a lot of people, but on the other hand, products are much more expensive and so, many people are poor or underprivileged just because of the fight between companies over the market share. Overall, ideal solution or situation would be that people (on a particular soil) agree what to make (for example, we all like beans, so lets find someone who will make it and also (and this is a crucial point) lets find someone who will work on upgrading been production - innovation center ) and then you would need no advertisement because you wouldn't have competition. However, I'm not proposing socialism, rather, a modified market economy (in a sense that some industries should be privatize) or regionalism (in a sense that concept of Country-Nation should be abolished and replaced with the term - regions), because that way we would have social justice without centralization of powers (which was the problem of socialism).

Answer 3

No. Advertising keeps the product in people's minds, therefore less advertising would lead to less sales. Companies would not spend fortunes on doing it if they received no additional sales as a result.

Take for instance the only baked bean I will ever buy - Heinz. They advertise even though they are the brand leaders. This is in order to ensure they stay there, and that other brands such as supermarket own, Branston etc do not eat away at their market share.

Answer 4

If a company advertises they will have more sales and therefore more income and can then take advantages of economies of scale. This means they can manufacture products of the same quality much cheaper than their competitors as they are producing much larger amounts.

Companies who advertise a lot will normally not be on the high end of the quality scale though because premium goods will be a lot more expensive to produce and therefore more expensive to sell and because of the expense will not have a mass market appeal. These producers will therefore target their advertising at rich people through magazines and sponsoring events where rich people will be.

That's why Sony will advertise on TV (they are average quality and reasonably cheap) whereas Bang & Olufsen (expensive and good quality) will advertise in high end magazines and quality newspapers.

Answer 5

Not exactally, it is the company's choice how many advertisements it will have, true less advertisment time means lower costs, but that doesn't mean they will spend the leftover money on making better products.

Answer 6

I'll take it as given that an individual company may benefit from advertising, but that you are suggesting it may be a drain on the economy as a whole.

That may be true. However, there are some theories as to the 'value' of advertising.

When I'm driving down the highway, I might feel more comfortable eating at a mcdonalds then at Jeb's burgers. Why? Because I'm pretty sure mcdonalds patrols their stores carefully to maintain quality standards. Mcdonalds spends many millions (billions even? I don't know) on advertising. If someone serves up say a rat in a burger in one outlet, its a devastating blow for them. Since I know they've invested so much money in promoting their brand, I'm confident they'll also spend money to avoid a potential bad experience for me as a customer, since it would damage their brand.

In some ways, we can view advertising spending as a 'deposit' placed by companies pledging to provide quality goods/service. Since as consumers we know they will not want to forfeit that 'deposit' (by damaging their brand name) we have more confidence in their quality control, standards, etc.

Answer 7

Advertisement is the soul of a business. Higher level of advertisement brings higher sales. But have you heard about network marketing? I guess, it brings about more higher sales without the company spending more.