Advertising is riddled with myths and misunderstandings. It is simultaneously believed to be both immensely powerful and immensely wasteful, to increase economic prosperity and to be morally questionable” (Fletcher, 2010). While all these elements are completely true, in order to reach a more complete and more nuanced perspective of advertising, one needs to better understand the motivating factors that drive most companies. The motivations for companies to advertise are largely multifaceted. The simplest reason companies advertise is because they want to sell their products and advertising creates awareness of their product (Green, 2012). Advertising allows companies to “launch new products, increase their market share at the expense of rivals and recruit new staff. When a major company launches a new product, it is often promoted through multiple channels. In the course of a single day, you might learn of a product on the radio, at the shopping center, on posters, on TV and on the Internet” (Green, 2012). At the same time it’s definitely a balance; companies need to push their existing products so that they bolster their portion of the market and ensure that the products they already have are marketable (Green, 2012). As some experts in the field have pointed out, consumers often don’t have the loyalty that they once did; “The National Retail Merchants Association states: “Mobility and non-loyalty are rampant. Stores must promote to get former customers to return and to seek new ones” (moneymailer.com). As a result of the fact that the market is so competitive, companies need to hemorrhage money into their advertising budget in order to hold on to the customers they’ve already gotten, lest other companies attempt to woo them away. Furthermore, a big part of advertising has to do with the fact that nowadays “shopping around” and engaging in constant price comparisons is a common part of the buying process; as a company with a product that is competing today, one needs a strong advertising concept so that one stays in the mind of the consumer during this journey (moneymailer.com). This alludes to one of the other reasons that companies have to advertise. They have to advertise because their competition is advertising; in this case, a failure to advertise would indicate giving the competition the opportunity to get a hold over one’s consumers. Furthermore, “Advertising gives you a long-term advantage over competitors who cut back or cancel advertising. A five-year survey of more than 3,000 companies found

Another crucial aspect of advertising is the necessity of creating a brand image. “Companies also advertise to improve their corporate image — to create a favorable impression with the public. Industries that may suffer from a negative image, such as oil companies and power companies using nuclear energy, spend large sums to convince us that their safety record is good or that they care about the environment” (Green, 2012). One could argue that so much about consumerism is about trust: it’s about the consumer putting their trust in a product. Consumers are trusting that a product will do what it promises it will do and that a consumer will like a product and the product’s consistency and reliability. So much of this aspect of trust originates with the company and brand image. Another way of thinking about this is along the lines that: “In a competitive market, rumors and bad news travel fast. Advertising corrects misleading gossip, punctures “overstated” bad news. Advertising that is vigorous and positive can bring shoppers into the marketplace, regardless of the economy” (moneymailer.com).

Conditions

While smart advertising can exist under a range of conditions, some of the most logical conditions are as follows. Firstly, product comparison can be a very effective means of advertising. “When trying to increase their market share, companies may directly refer to other brands and explain why the product advertised is superior” (Green, 2012). Consumers see this phenomenon all the time on commercials, where the voiceover or announcer will stress how their product is more wholesome, healthier, a better value or more reliable. This truly can be an incredibly effective form of advertising in that it anticipates the comparative thought process that the consumer goes through and calls the consumer out, explaining why he or she should purchase their product over another.

A situation which is less ideal, or rather more challenging, to advertise within is when one’s product exists in a marketplace full of comparable products. “For example, there are hundreds of different types of toothpaste on the market. Since these products are essentially similar many toothpaste companies successfully target their products at different groups of consumers, for example, young children, smokers, or people with sensitive gums… This is called positioning” (Green, 2012). Rather than feeling like the stiff competition between products is daunting and insurmountable, companies can use the presence of stiff competition as a means of highlighting the virtues and attributes of their product.

Rationale for Startups

Advertising is crucial for startups as they need to launch their name and their brand into the public consciousness. “A big example of the benefits of advertising is bringing potential customers to your store who might otherwise never know you exist. A storefront is only seen by people who walk past your door, but advertising can reach out to others in the surrounding towns and counties” (Keen, 2010). For start-ups, advertising is the equivlanet of extending one’s hand and saying “hello my name is…” Advertising for start-ups is the equivalent of making an introduction to the world and finding a way to put one’s name, brand and services into the public consciousness. This is crucial for a nascent company. For start-ups, the element of building confidence in one’s brand is completely essential and hard to do, particularly when no one has heard of one’s brand. Advertising can help bolster confidence in the minds of one’s public. “Business owners often don’t realize that one of the benefits of advertising is making potential customers feel more confident in a business they see advertised. It gives them the sense that the business is professional, stable and reputable” (Keen, 2010). The manner in which one advertises can have an impact on the element of confidence as well. For example, a radio spot seems far more reputable than a flier stuff under the windshield wipers of one’s car.

Rationale for Established Companies

The necessity of advertising is more complex when it comes to more established companies. The public is already aware of companies like Nabisco, Procter and Gamble and Toyota. The battle that these companies have that advertising can help them fight are ones related to staying fresh and staying relevant, and reminding customers that they already have as to why they should constantly be selected and reselected. The other part of the battle is reminding customers that they don’t have as to why they should jump ship and try their product over another brand. it’s too easy for established companies to forget that “Your market changes constantly. New families in the area mean new customers to reach. People earn more money, which means changes in lifestyles and buying habits. The shopper who wouldn’t consider your business a few years ago may be a prime customer now” (moneymailer.com). For example, according to the National center for Health Statistics, 5 million people will get married each year, almost one quarter of families will move and 4 million babies will be born (moneymailer.com). This clearly demonstrates how the market is rapidly changing, and how established brands need to bend and adapt to the changing market, the changing needs of that market, and the changing desires of that market. Furthermore, it seems as though each day, there’s a new brand on the scene that’s ready to compete and woo customers away. Established companies need to constantly remind their buyers about the relationship that they have, the trust that has been built and why their product is consistently even better. Furthermore, if any established company is bouncing back or recovering from a scandal or bad press, advertising can be the beacon by which one regains one’s footing. “In a competitive market, rumors and bad news travel fast. Advertising corrects misleading gossip, punctures “overstated” bad news. Advertising that is vigorous and positive can bring shoppers into the marketplace, regardless of the economy” (moneymailer.com). Advertising can divert the attention of consumer’s from a recent recall of cars, or a comparable product malfunction, emphasizing the positive aspects of their products and brand image.

In conclusion, today’s marketplace isn’t’ just competitive, it’s cutthroat. In order to exist, stay afloat and stay profitable, one needs to be able to effectively harness the tools of advertising to push one’s brand name and image over all others in a lasting and memorable way.

References

Fletcher, W. (2010). Advertising: A Very Short Introduction. New York: Oxford Press.

Green, J. (2012). Advertising. New York: The Rosen Publishing Group.

Keen, D. (2010, April 3). 10 benefits of advertising. Retrieved from Mademan.com: http://www.mademan.com/mm/10-benefits-advertising.html

Moneymailer.com. (n.d.). 10 Reasons to Advertise. Retrieved from Moneymailer.com: http://sites.moneymailer.com/mmdo/advertise.html

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