Everything you need to know about importance of advertising. Advertising is an integral part of our economic and social life. As a power-ful technique of promoting sales, it has been doing wonders in the area of distribution.
The role of advertising can be analyzed from five different angles namely, manufacturers; middleman; sales force; customer and society.
For an organization, advertising is important both as a promotional and as a marketing activity. As a business activity it holds its importance for an economy.
Some of the importance of advertising are:-
A: Benefits to Producers and Manufacturers – 1. Successful Introduction of New Product 2. Creation of Regular Demand 3. Impressing New Uses of a Product 4. Enjoy Economics of Scale 5. Confidence in Facing of Competition 6. Creation of Corporate Image
B: Benefits to Customers – 1. Enhanced Knowledge 2. Planning before Shopping 3. Reasonable Prices
C: Benefits to Salesman – 1. Less Time 2. Easy Convincing 3. More Coverage 4. Ready to Receive
D: Benefits to Society- 1. Improved Standard of Living 2. Creates Employment Opportunities 3. Solves Societal Problems 4. Encourages Media.
Advertising has gained a significant place in the different areas of society. It has now entered the areas of politics, social achievements and economic growth.
Importance of Advertising: For Manufacturers, Middlemen, Consumer and Society
Importance of Advertising – With Benefits to Manufacturer, Middlemen, Sales Force, Consumer and Society
Advertising is an integral part of our economic and social life. As a power-ful technique of promoting sales, it has been doing wonders in the area of distri-bution. The role of advertising can be analyzed from five different angles namely, manufacturers; middleman; sales force; customer and society.
1. Importance of Advertising to Manufacturers:
Every manufacturer and producer, who wants to make available his goods to people at profit, do take full advantage of advertising to popularize their products and services.
The major benefits that are available to manufacturer are:
(a) Increasing Sales – Even the best product cannot be sold on its own, unless people know about the product. In today’s highly sensitive and competitive market, a firm cannot maximize its profit, unless it multiplies its sales turnover. A regular and frequent advertising helps the producer to obtain this objective.
(b) Helps in maintain existing market and explore new market – Every forward looking company eyes on future prospects without losing its current position. A company’s success is reflected by how it maintains its current position and future expansion. Advertising helps the manufacturer, in this regard, to face competition effectively.
(c) Helps to control price of product – Through advertising, it is possible to control price of the product especially in retail market. Very often greedy retailer charge higher price from the customer. The manufacturer can help them by printing the price on the packages.
2. Importance of Advertising for Middlemen:
Middlemen are essential link between producer and consumer.
The benefits which advertising offers to middlemen are:
(a) Quick Sale – Every retailer holds stock of different producer. Advertising, by making the range of products known to customer, helps the retailer to quickly sell its stock.
(b) Act as Salesmen – Advertising has been rightly described as salesmanship in print. Advertising perform task of travelling salesmen at least cost. That is why; most of the retail organizations do not employ large number of travelling salesman. Instead, they spend on advertising, which attracts customers to the shops, where counter salesmen cater to their need.
3. Importance of Advertising for Consumer:
Ultimate aim of all marketing efforts is to satisfy the needs of the customer by providing the goods and services.
Advertising is essential for consumer due to following reasons:
(a) Quick decision making and saves time – In today’s competitive world market is full of different types of product which satisfy needs and want. Every producer claims his product to be superior one. In such situation, advertising helps the consumer in comparing features; price; utility; quality etc. of the product, and select the best.
(b) Better Quality Product at Reasonable Price – Advertising promotes good quality product by printing their image in the minds of consumer. Due to this, bad product goes out of the market. Moreover, it increases competition in the market, which helps consumer in getting the product at reasonable price.
4. Importance of Advertising for Society:
Advertising is not only beneficial for manufacturer; retailer and customer but also for the society.
Various benefits offered by advertising to the society are:
(a) Uplift Standard of Living – Advertising has made it possible for general public to use those products which were luxuries of yesterday. Advertising increases the consumption pattern, it results in more production at least cost, which in turn increases earning of the society and thus, standard of living of the society.
(b) Generates Employment – Advertising generates gainful employment opportunities both directly and indirectly. It directly generates employment painters; artist; photographers; technician etc. Indirectly, it gives employment by supporting all those industries like – paper; colour; electronic etc. which supply inputs for the advertising activities.
Importance of Advertising – As a Promotional, Marketing and Business Activity
For an organization, advertising is important both as a promotional and as a marketing activity. As a business activity it holds its importance for an economy.
Advertising could have following effects:
i. To generate awareness for the product.
ii. To impart knowledge about product to the customer.
iv. To induce trial behaviour for the product.
v. To have direct purchase action.
Advertising effects differ in different market situations. For a ‘less expensive frequently purchased product’ the use of repetitive advertising may cause trial purchase. In case the trial experience is satisfactory, it is expected to result into final purchase of a product. For routine or habitual kind of purchases like purchase of glucose biscuits, the mere exposure to an advertisement is likely to trigger a direct purchase action.
On the other hand, for the purchase of a product like automobile advertising is primarily used to generate awareness and impart knowledge about the product. Since such decision-making situation requires more of buyer’s deliberations, it is less likely that attitude change occurs due to advertising only. The use of repetitive advertising, however, provides reassurance like in the case of Surf Excel ads and helps in reinforcing the product choice.
Advertising holds its significance for decisions concerning other promotion tools as well as other marketing decisions concerning product, price, and place. The nature and scope of advertising for a product in turn depends upon the mix of various marketing tools in a given situation.
Product is at the very heart of an advertising programme. A, successful advertising programme requires knowledge about product attributes and a clear notion about its positioning. Packaging, trade mark and various other attributes of product as its taste, colour, texture, aroma, style and design are other essential elements of effective advertising.
The potential of these attributes in affecting product sale is analyzed before incorporating them in the advertising message. Though advertising does not add any intrinsic value to the product, it makes possible selling the product by informing the consumers. Advertising is one of the major parts of brand building exercise.
In case advertising carries a price tag, it helps in comparison between various brands also. Otherwise the media choice, the message content, and its execution for an advertising activity do convey a certain notion about the product price to the consumer. There is a perception about positive relationship between the product price and the level of advertising activity for a product.
Brands with relatively high advertising budget are presumed as charging premium prices and brands that spend less than their competitors on advertising charge lesser price. At each product life cycle stage the level and the kind of advertising is related to its price strategy. The positive relationship between high relative advertising and price level is supposed to be stronger for products in the later stages of PLC. This is especially found true for market leaders and for low cost products.
The level of advertising exposure is related to distribution objectives and strategies. Product distribution can be intensive or selective or exclusive. Advertising as a mass communication mode facilitates an intensive distribution of product. It works as a pull factor in the market and creates demand for the product. In case of selective or exclusive distribution strategy adopted for the product, advertising is mainly used to provide information about the product availability.
Advertising is often regarded as ‘salesmanship in print which pre-sells the product verbally and makes it comfortable for sales personnel to approach the target audience. Advertising facilitates the implementation of various sales promotion techniques in the market. Quite often, marketers make use of sales promotion tools like gifts, coupons, discounts, etc. to give immediate boost to the declining product sales or to counter the competitive strategy.
Advertising creates awareness about these tools and makes the environment conducive to bring success in terms of increase in product sales. Similarly, for public relation and publicity to be effective in their goals, advertising provides a viable platform to make people aware of such promotional initiatives.
In a nutshell, advertising appears to be one among many marketing activities being taken up to communicate with the customers. An insight into the interdependencies between advertising decisions and those on product design, pricing and dealer’s choice. Thus, the ability of advertising decisions to contribute to the goals of an organization depends on other decisions and also the coordination with these decisions.
The productivity of advertising decisions increases when the quality of decisions in other areas of marketing mix improves. There is some kind of communication which occurs at every phase of marketing and at the end product itself performs the principal and decisive act of communication.
But when advertising is used it generally assumes a dominant position in the overall marketing and promotional strategy of an organization. The actual aim of advertising is therefore not to ‘sell’ but to induce people to try the product or service offered and to prepare them for satisfaction in its use by ‘pre-sampling’ it verbally.
Over the years, advertising industry has witnessed the annual growth of over 15 per cent and it reflects the buoyancy and optimism in Indian economy. The booming stock market, price rationalisation across categories, exploding real estate and entertainment industry has opened up new markets for the advertisers.
Along with Telecom and Auto sectors the growth of advertising industry is driven mainly by advertising for new product categories including Mutual Funds, IPO’s, Aviation and also the increased ad spend for rural markets and the markets with low price points. There is reported an increase of 45.5 per cent in inbound traffic and additional earnings of Rs 8,274 crores in the year 2005 over that in the year 2003.
Advertising as a business activity also has its importance in an economy. The size of advertising industry, rate of increase in its profitability increased budget allocations for ad spend at the organizations level, and the multiplicity of products being advertised provide evidence in this regard.
Advertising informs consumers about the availability of substitutes and helps them in making informed choices of the products. Consumers learn about new and improved products and how to use the product innovations for their best purpose.
Advertising affects the sensitivity of product’s demand to changes in its price. But there are no conclusive evidences that whether advertising reduces or increases price elasticity of demand. According to one school of thought advertising makes people to learn more about the product and it substitutes which may reduce the price elasticity of a product’s demand.
On the other hand, the counter view holds that advertising provides information about the alternatives and makes the demand more sensitive to differences in price across various alternatives. There is also research evidence which supports both the views and holds that ‘advertising not only provides information about which substitutes exist, it also provides consumers with recall cues so that they consider more substitutes at the time of purchase’.
From producers’ perspective, the increase in product demand due to advertising enables production at a large-scale. The large-scale production brings economy of scale and affects the cost of production and in turn the product price. In other words, advertising may be considered as a cost reducing exercise taking place due to a rise in product demand.
Advertising is not just demand catalyst; it leads to changes in people’s lifestyle too. Advertising mirrors fashion and design. The exposure to new and improved products, new consumption situations, new activities and new values encourages aesthetic sense in consumption decisions. Some of the products, through their repeated exposure at times, become a matter of lifestyle statement for its consumers.
In a nutshell, when economies achieve abundance, the situation where supply exceeds demand advertising informs and persuades its members with respect to goods, services, ideas, people and places and creates demand in the economy.
Advertising is the most important part of functioning of market economies. It helps firms to enter the market and facilitates the growth of market economic systems based on competition and availability of information. It is a useful tool for sustaining honest and ethically responsible competition which works as an impetus to the economic growth.
Growth of media, whether it is print or broadcast, undoubtedly is based on its content. To sustain its growth, media houses always attempt to improve TRP’s (i.e. target rating points which shows media preference among its audiences) of their programme/editorial content. There is an expectation that good TRP’s will attract advertisers. At times, the content is adjusted to the requirements of the advertisers to ensure the continuity in the flow of advertising revenue which usually is the major source of revenue for media.
Advertising has an immense potential for employment generation in the economy. It involves multiplicity of advertising activities involved in the development of an ad which add to its scale of operation in the economy.
It gives boost to creativity and creates more jobs for copywriters, art directors, film producers, researchers, analysts and many other people associated with advertising industry. The creation of more and better number of jobs lead to higher levels of income for the people and thus provides a more decent and human way of life for them.
Since its origin, advertising has undoubtedly been an integral part of economic and socio-cultural growth of any market based economy. Now there is a global concern about advertising for its role in saving the earth in the wake of deteriorating environment and the need for sustainable products. At the same time, ‘…. advertising has power to dictate. The cumulative effects of non-stop ads on television, radio, print, and outdoor ads can be overwhelming and there is an involvement of advertising in the increased popularity of socially questionable behavior-cigarette smoking. The evidence demonstrating the manipulative power of advertising is shaky because so many factors contribute to the choices we make. Still advertisers are not objective and often slant and omit information to their benefit.’
Importance of Advertising
Advertising has become increasingly important to business enterprises- both large and small. Outlays on advertising certainly attest to the management’s faith in the ability of advertising efforts to produce additional sales.
It would be difficult to conceive of a firm that does not attempt to promote its product in some manner or another. Most modern institutions simply cannot survive without advertising.
Non-business enterprises have also recognised the importance of advertising. The attempt by army recruitment is based on a substantial advertising campaign, stressing the advantages of a military career. The health department popularises family planning through advertising.
Even labour organizations have used advertising to make their viewpoints known to the public at large. In fact, it is reasonable to say that promotion now plays a larger role in business than it ever did in the past.
If for no other reason than that it is an activity that employs several thousands of people, advertising assumes real economic importance. More importantly, however, is the fact that effective advertising has offered to society benefits not otherwise available.
For example, the criticism that “advertising costs too much” views an individual expense item in isolation. It fails to consider the possible effect of advertising on other categories of expenditure.
Advertising strategies that increase the number of units sold stimulate economies in the production process. The production costs assigned to each unit of output are lowered. Lower consumer prices then allow these products to become available to more people.
Similarly, the price of newspapers, professional sports, radio and TV programmes, and the like might be prohibitive without advertising to share the expense. In short, advertising pays for many of the enjoyable entertainment and educational aspects of contemporary life, as well as lower product costs.
The criticism that “most advertising messages are tasteless” and that “advertising contributes nothing to society’s well-being” some-times ignore the fact that there is no commonly accepted set of standards or priorities within our social framework. We live in a varied economy characterized by consumer segments with differing needs, wants and aspirations. What is tasteless to one group may be quite informative to another.
An advertising strategy generally suffers from the averaging problem that escapes many of its critics. The one generally accepted standard in our society is freedom of choice for the consumer; customer buying decisions will eventually determine what an acceptable practice in the market place is.
Advertising has become an important factor in the campaigns to achieve such societal-oriented objectives as the discontinuance of smoking, family planning, physical fitness, and the elimination of drug abuse. Advertising performs an informative and educative task that makes it extremely important in the functioning of the modern Indian society.
Importance of Advertising – To Producer, Consumers and Society
Advertising has become inevitable in the contemporary business environment. It is necessary for producers, consumers as well as the society.
1. To Introduce New Products:
Advertisement of the new product is necessary so that consumers become aware about the product, its availability, its utility, its price etc., thus, advertising is crucial to promote the sale of a new product.
2. To Induce Potential Customers:
Advertising is one of the best means by which the sale of an existing product can be increased. For this purpose, the advertisement should emphasize the usefulness of the product, its quality, price advantages, etc., so as to win over the potential buyers and make them actual buyers.
3. Reminding Users:
In a competitive market, new products are introduced frequently. All these products are advertised in the market. As a result, old brands are likely to be forgotten by the consumers. To offset this possibility, manufacturers continue to advertise their products to maintain the buyers’ interest. Thus, advertise-ments are also designed to serve as a reminder to existing customers.
4. To Create Brand Image:
Business firms very often advertise for establishing an image for the product and creating customers’ loyalty for that product. When customers develop brand loyalty, they are unlikely to switch to other brands easily.
5. To Highlight Brand Character:
For certain products, consumers feel that a particular characteristic is very important. Its existence determines the buyer’s choice of a particular brand out of several brands. If the product has that feature, advertising is used to stress it and demonstrate its advantages.
6. To Educate Customers about New Uses of a Product:
Advertising is sometimes, used to convey new uses of an existing product to the customers or to draw their attention to some new features of the product. The basic objective of advertising in this case is to convince the customers about the superiority of a product in comparison with other products in the same line.
7. To Support Dealers:
Sometimes, the aim of advertisement is to provide support to dealers and distributors. Thus, there are many advertisements in newspapers in which the list of dealers and distributors is given along with the particulars of the product.
(B) Importance of Advertising to Consumers:
1. Improved Quality of the Product:
It is absolutely essential to improve the quality of the product to maintain confidence of the customers and ensure brand loyalty. Hence, advertised goods are usually of good quality.
2. Protects Consumers from Exploitation:
Advertising also acts as an information service and educates the consumer. It enables him to know exactly what he wants and where to get it.
3. Reduction in Price:
Advertising stimulates production and reduces the cost per unit. This reduction in the cost is generally passed on to the consumer and that is why price of well-advertised goods is found to be generally lower than other goods of the same quality which are not so well advertised.
4. Facilitates Direct Selling:
Advertising also makes it possible to sell direct to the consumer by Mail Order Business. Thus, consumers from remote areas can also enjoy the comforts and luxuries available only in the cities or towns. In this way advertising improves social welfare.
5. Improved Consumer Satisfaction:
As manufacturers control the price of well- advertised goods, price-cutting is not available to the retailers and the shopkeepers as they try to attract customers by giving better and more satisfactory service.
6. Enables Comparison:
Advertising helps consumers find best product for themselves by facilitating comparison among various products available in the market. When consumers are aware about the range of products, they are able to compare the price, quality and characteristics and pick up the best from among them.
(C) Importance of Advertising to Society:
1. Advertising helps in increasing awareness among people. Advertising dealing with social issues such as child labour, liquor consumption, female foeticide, smoking, family planning etc. and promotes social welfare.
2. Advertising provides direct employment to large number of people engaged in designing, writing and issuing advertisements. Indirectly, advertising increases employment opportunities by increasing the volume of production and distribution.
3. Advertising helps in improving the standard of living of people by promoting variety and quality in consumption. It educates people about new uses of a product and provides information for developing better ways of leading life.
Importance of Advertising – Marketing, Politics, Consumer Satisfaction and Economic Growth
Advertising has gained a significant place in the different areas of society. It has now entered the areas of politics, social achievements and economic growth.
Advertising assists in the realisation of marketing objectives of a company within a specified period of time. It is a form of communication which informs, persuades and reminds customers of the qualities of the product. Potential customers are approached through suitable advertising media.
The producer can put forth the appealing points of his product to influence and attract customers. Advertising can also evaluate the desires and needs of the people. The four functions of advertising are – creating demand, retaining the market for established products, increasing the use of the product, and image-building of the producers.
Advertising can develop the marketing system. New products are made familiar to consumers through advertising. Middlemen can increase their profits because advertising helps in the expansion of their sales. The consumers needs and wants are assessed so that suitable products may be provided for them.
The upgrading of marketing is possible through advertising. Today, the role of advertising has increased so widely that it has become an essential function of business. No business can succeed without suitable advertising, for advertising makes people aware of new products, and of the new want-satisfying attributes of these products. Advertising has become the backbone of modern national and international marketing.
The significance of the role of advertising in politics becomes vividly clear when political parties resort to different media of advertising to present their election manifestoes and promises to serve the public. The newspaper, the radio, the television and magazines are employed to project the democratic needs of the country, so that the public may judge their qualifications and integrity and cast their valuable votes for the most suitable candidates.
Many statesmen have appreciated the role of advertising in politics and business. Sir Winston Churchill once said that advertising brought together fertile unions. Man can set goals for better homes, clothing and food by selecting appropriate suppliers. Franklin Delano Roosevelt once said that he would go into advertising in preference to other kinds of business.
Advertising promotes consumer satisfaction. It helps them to select the more useful, cheaper and better quality products. The prices of the same type of product may vary from producer to producer. Advertising helps people to choose the best and the cheapest goods. Life style and value systems are modified by advertisements. In India, the materialistic attitudes have won over spiritual thinking through advertisement.
Advertising influences the economic growth of a country. The people, the producers and the working class are made aware of the government policies and plans for the economic development of the country. These policies and plans are delivered to the public through newspapers, radio and television with a view to ensuring their participation in the economic growth of the nation.
Advertising is considered a source of market power. It promotes competition, which is desirable for the growth of a free economy. It helps maintain competition and discourages monopoly. Prices are maintained at a competitive level to benefit the masses and producers.
Since customers and producers are well aware of the differing demands of society, economic development is channelised towards definite objectives and goals. Whatever is produced cannot be sold and whatever is in demand cannot be produced unless society and the economy can afford to do so. In this way, scarce resources can be exploited for more essential, purposes.
Importance of Advertising – For Manufacturer, Consumer and Society
In modern marketing, advertising plays a very important role in creating awareness and demand for the products.
Its importance can be explained as follows:
1. Role of Advertising Related to Manufacturers:
Advertising plays a very important role for manufacturers.
The same is explained as follows:
Advertising helps to popularize a product among the consumers. It builds a favourable image about the product in the minds of the consumers and hence enhances the image of the brand. This builds long term goodwill and reputation for the organization.
ii. Wider Market:
Advertising creates awareness about the products on a large scale. It also highlights the benefits, advantages and the method of usage of the product. Hence, a customer may get interested in purchasing the product. Advertising thus increases the demand for a product. Since advertising is done on a large scale, the demand of the product increases in wider and unexplored markets too.
Advertising helps in creating awareness about a product which leads to increase in its demand. However, the level of production needs to be increased in order to meet this increase in demand. The producer thus tries to introduce innovative production techniques to increase the level of production. The innovative production techniques not only help to increase the level of production but also improve the quality of the product. Most modern production techniques also ensure a reduction in the overall cost.
iv. Creation of Demand:
Advertising helps in keeping the consumers informed about the arrival of a new product. This arouses the interest of the consumers in the product and motivates them to try it out once. Thus, advertising leads to the creation of demand for the product.
Advertising helps the consumers in the following ways:
i. Quality Products:
Advertising plays an important role in the modern competitive market. It keeps the consumer posted about the latest products available in the market. Since the customer is aware of the products, he selects the product that is best suited for his needs. At the same time, advertising also keeps the producers updated about the competing products available in the market.
This enables a producer to improve the quality of his product in comparison to the competitors’ products. To ensure that customers are retained and new customers are attracted, the manufacturer has to adhere to quality standards and offer the best quality of goods to the consumers.
Advertising provides information about new products to the consumers. Thus, consumers can make an informed decision and buy a product that suits their preferences.
Advertisements provide detailed information about the product to the consumers. The consumer thus gets the detailed information effortlessly and does not have to spend any additional time and money in procuring the information.
Advertising helps in generating demand for the product. This encourages the manufacturer to increase production. Increase in production leads to lower cost of production per unit. This benefit is ultimately passed on to the consumers in the form of reduction in price.
Advertisements create awareness about the product. It promotes all the features and attributes of the product. Since the consumer is aware about the product, the manufacturer cannot supply an inferior product than what was promised. In case the manufacturer tries to do so, the consumers can seek protection under the Consumer Protection Act.
The role of advertising related to society is as follows:
i. Employment Opportunities:
Advertising is a large function that needs the services of artists, painters, writers, designers, publishers etc., every single day. All the activities related to advertising need human resources to work creatively, efficiently and constructively. Thus, advertising creates employment opportunities for a large section of people.
ii. Standard of Living:
Advertising- helps in launching many new products in the market. Thus, the consumers become aware about the products available in the market. Purchasing these products helps in raising their standard of living. Also, advertising raises the demand for the product and hence the level of production goes up. This increase in the level of production leads to reduction in cost. Consumers can thus avail products at a much lower rate which helps in raising their standard of living.
Advertisements provide qualitative information about various products using facts, figures, slogans etc. This helps in educating the general public about the benefits of the products.
Advertising plays a very important role in highlighting the culture of a nation across various nations. Since the advertisements have educative value, they affect the thoughts, gestures and behavior of people.
v. Low Cost:
Advertisements help various media like newspapers, magazines etc., to cover a major portion of their costs. This cost benefit is passed on to the readers.
Importance of Advertising – With Direct Beneficiaries: Benefits to Producers and Manufacturers, Customers, Salesman and Society
Advertising is considered to be an important and compulsory activity on the part of manufacturers. They are compelled by the recent developments and the cut throat competition resulting into the question of survival. It has become promotional tool not only for producers but also for consumers and society at a large to know about the availability of goods and services. Mainly, the four groups can be identified who are the direct beneficiaries of advertising. They are the producers and manufacturers, customers, salesmen and the society as a whole.
Importance # 1. Benefits to Producers and Manufacturers:
Every producer introduces a new product or services to the consumers. Every product is distinct and unique in nature as compared to other competitors. Therefore, it is necessary for him to make it known to the users, convince and appeal to them to create demand. In this way, he finds to reach the consumers and operate profitably in the market. His survival and continuation depends on has best he reaches the users and makes them to buy his/her products.
Therefore, the following benefits accrue to producers:
i. Successful Introduction of New Product:
The advertising is undertaken to introduce an altogether new product. There cannot be 100% similarity between two products. A producer can introduce a new product by explaining the unique features of his product and can create awareness among consumers in order to gain their acceptance. Almost all producers introduce their products to market through celebrities who have powerful impact on consumers. An indelible impact can be created by effective advertisement which lays foundation for rushing of a product in any intended market.
ii. Creation of Regular Demand:
Advertising is helpful to create regular and steady demand for products. The public memory is short, if an advertisement is stopped, there are chances of consumers forgetting about that product and direct to other products which repeatedly appear before them. Production and marketing heed to be continuous and throughout the year, both in busy and off seasons. Therefore, manufacturers advertise about the usefulness of product in all the seasons.
iii. Impressing New Uses of a Product:
The consumer’s base is to be expanded. The more and more uses of a product are convinced, the widest base for product can be created. It warrants production on large scale to meet the demand of increased number of consumers. It is helpful in explaining how a single product is useful to every kind of customers. By promoting different uses of a product, advertising helps consumption of that product at a variety of occasions. This will result in increased product usage and the demand for the same. A producer can shift from small scale to medium and to large scale production.
iv. Enjoy Economics of Scale:
As advertising helps to create and maintain sustained demand throughout the year, the large scale production needs to be undertaken. With large scale operations, the cost of production decreases and results in increased earnings. Because, there are certain fixed costs which are incurred at all levels of production. If production is at small scale, the burden of fixed costs will be more and profitability would be lesser. On the contrary, the large scale production reduces the average cost per unit and increase earnings.
v. Confidence in Facing of Competition:
Advertising is an attempt to attract consumers. In most of the advertisements, the producers makes efforts to convince the superiority of products by comparing with that of competitors brand loyalty is created by highlighting the strong uses of one’s products. It is quite common that the products known to customers are demanded by them in market. Most of the children demand products in the market by being impressed and influenced by advertisement. Lack of information throws away any producers out of market.
vi. Creation of Corporate Image:
Advertisement is not only carrying messages of a product but also the history and culture of a firm. It helps in creating a good image and reputation for a firm and helping to fight competition in the market. It ensures repeated demand from the satisfied services provided by a firm. Majority of consumers can repeat the names of Tata, Reliance, Airtel, Sony, Vodafone etc. Because, they have created their corporate image and become household names.
Importance # 2. Benefits to Customers:
The customers in particular and the whole society in general shall be benefited from the advertisement. The advertisements not only provide information about products but also some of healthy lips, psychological changes, good behavior etc. This will enhance the understanding level and knowledge of remote areas.
Some of the benefits enjoyed by customers are:
i. Enhanced Knowledge:
An advertisement gives many information relating to product, firm, nation etc. Such information increases the knowledge base of customers; who can develop the ability of evolution and analysis. The customers are educated about proper way of using a product, the comparative and competitive prices, promotional offers with limited time frame etc.
These will certainly help customers and general public to gauge the growth and sophistication of manufacturing sector, distribution efficiency and role of a firm in national development also. For instance, the water purifier advertisement enriches the knowledge of safe drinking water, motorbike advertisement tells about economy in oil usage etc.
ii. Planning before Shopping:
As the advertisements give almost every information about product, availability, prices offers etc, the customers can plan well before going for shopping. It may be about availability of family budget, how to bring a product, packing, payment, quantity needed etc. A planned shopping gives happiness and the unplanned results into either dissatisfaction or sadness. Where? When? How much? What? Who? Of the shopping can be precisely planned and executed.
iii. Reasonable Prices:
The advertisement facilitates quick sales and also increased demand. These will force to undertake production on large scale and this will reduce the per unit cost of production. The result of this will be in reduced prices and availability of needed goods at reasonable prices.
The personal salesmanship is not possible and not suitable also for all the products. It has limited access. This requires more time to convince all the customers personally about each and everything about product. Therefore, the advertisement reaches the customers much before a salesman visits.
The benefits enjoyed by salesmen are:
i. Less Time – They need to explain only those things not cleared by an advertisement. Therefore, the salesmen have to spend little time with customers.
ii. Easy Convincing – As the advertisements had done some part of giving information to customers, salesmen can very easily convince the customers.
iii. More coverage – The necessity of spending less time for each customer definitely helps salesmen in covering more number of customers in a single visit.
iv. Ready to receive – The brand image created by advertising prepares the ground for the visit of salesman. In fact, the customers wait for the visit of salesman to get confirmed about the advertised products.
While the manufacturers, customers and salesman are the direct beneficiaries, the indirect benefits will be for the whole society. Advertisements introduce new products and services. This will help in raising the standard of life of people. There will be peaceful life among the people when they regularly get what they wish. Advertising is emerging as a profession which offers vast employment opportunities. All Medias of advertising flourish in operations and provide solution to many of the societal problems.
The society benefits in the following ways:
i. Improved Standard of Living:
Advertisement introduces successfully the new variety of products and convinces about the reasonableness of prices. It also educated the people regarding the use of products, better ways of life, healthy family etc. The matured thinking about their life and acquiring new products will increase the standard of life. For example, Ola cab, Uber services have reached customers through advertisement and people prefer cabs to bikes or auto services. This makes their life comfort.
ii. Creates Employment Opportunities:
With the technological advancements, the variety of Medias has made their entry in advertising sector. Advertising agencies need designers, copywriters, graphic designers, media planners, production houses and many other agencies. Thus, the advertising sector generates direct employment to large number of creative and enthusiastic people.
iii. Solves Societal Problems:
In every society, there are problems like drug addiction, illiteracy, female feticide, gender bias etc. The advertisement helps in fighting there societal problems. The products are offered to all types of customers regardless of the caste, religion, and creed, such advertisements plead about eradication of casteism.
iv. Encourages Media:
Advertising is a good source of revenue which encourages entry of number of agencies. The press media gets sustenance due to good circulation of newspapers and at reasonable price. Press media cannot continue only with price paid by the readers, the advertisements bring sizeable amount revenues and it will be a strong financial support for the press.
Advertising is not only a provider of information about products, services, and availability at different retail loca-tions, but also an important link between the advertiser and the receiver of the message in the retail sector. Its imperativeness has increased in this era of ‘globalization and liberalization’ around the world.
It has certain ben-efits not only for the manufacturers and traders but for the retailers as well. Raymond, the apparel retail chain, primarily used television and print advertising to promote the experiential aspects associated with shopping at its stores.
The benefits of retail advertisements for customers are as follows:
i. It helps in creating awareness among the customers about the existence, prices, and availability of products at differ-ent locations
ii. It educates customers about new products and their diverse uses
iii. It increases the utility of existing products, and
iv. It encourages manufacturers to improve the quality of prod-ucts through research and development. Thereby it ensures the supply of products of better quality to customers.
Importance of Advertisement – Introduction of New Product, Mass Appeal, Increasing Sales Volume, Providing Information to Customers and a Few Others
1. Introduction of New Product:
Advertisement helps to introduce a product to the customers by providing every detailed feature about the product. Customers are introduced with the new products available in the market and are induced to buy the new product available. Advertisement displays the features, uses and benefits of the new product. Advertisement draws the attention of the prospective buyers, creates consciousness among the buyer about the need for the product and creates demand for the product.
2. Mass Appeal:
Advertisement has a mass appeal and can create demand amongst a large number of customers and can stimulate the interest of the large number customers. This helps to create a large market base for the firm.
3. Increasing Sales Volume:
Advertisement creates and increases demand of the consumers for the product and thus helps to increase and maintain the sales volume. Advertisement also helps to expand the scope of the market geographically. Advertisement induces the current customers to buy the product and aims at retaining the current customers and also attracts new prospective customers towards the product and converts them into loyal customers. It not only assures maximising current sales volume but also improves future sales volume.
4. Providing Information to Customers:
Competitive business environment requires efficient communication of information to the customers about the product. This helps customer in their buying decision. It provides information regarding the quality, weight, price, size, packaging and the brand.
Advertisement is a cost effective tool for promotion of a product. Wide reach of advertisement – its ability to reach a large number of targeted customers simultaneously and its long lasting impact on the mind of customers makes this mode of promotion more cost effective in comparison to other promotional techniques like personal selling.
Advertisement is an audio – visual mode of communication and hence its impact on the customer is long lasting and people remember the product for a long time. This improves the popularity and familiarity of the product. This also enhances the goodwill of the manufacturer.
Advertisement helps to counter competition. When competition is intense and the competitor undertakes intensive advertisement to promote their product, it becomes essential for the marketer to advertise for their product. Advertisement helps to create product differentiation and build a favourable image in the mind of the consumer.
Importance of Advertising
Nothing except the Mint can make money without advertising. Mass production and mass distribution totally depend on all forms of advertising and publicity. We can tell numerous people about a product or service in the quickest time interval at the lowest possible cost.
Advertising by facilitating mass production and mass distribu-tion has provided immense employment opportunities to people. It is responsible for creating and delivering rising standard of living to innumerable people. It has made possible tremendous industrialisa-tion and economic development in many countries. It is the back-bone of modern national and international marketing.
Many modern amenities like refrigerators, motor cars, cameras, radio, vacuum cleaners, and other appliances are sold in mass markets at very reasonable prices —much lower than the prices at which they were initially introduced in the market. Modern advertising informs, guides, educates as well as project buyers, so that they can buy in-telligently and raise their standard of living.
In the marketing pro-gramme of a business enterprise, advertising is an indispensable tool supplemented by salesmanship and sales promotion. Advertising is to business what steam, electric or nuclear energy (motive power) is to industry. The wheels of industry and commerce cannot move with desirable speed without the propelling power of promotion-mix.
The importance of advertising lies mainly in the assistance that it provides to salesmen in the process of selling. Advertising allows manufacturers and sellers to place their products before the likely prospects, to attract their attention and awaken their interest. It provides the likely prospects with information about the product, and, by the use of apt words, and pictures attempts to persuade them to buy the product.
Advertising makes an appeal to the prospects to buy and use the product. This prior communication with the prospects makes the work of the salesman much easier and simpler. When the salesman goes to visit the prospect with a view to persuade him to buy the product, advertising has already prepared the customer’s mind to the uses and benefits of the product – conse-quently, the salesman does not have to educate the prospect. He has only to remove the objections of the prospect and apply the close. Advertising thus prepares the ground work for the salesman to com-plete his sale.
In recent times, the importance of advertising has increased many-fold due to many reasons. The complexities of modern distri-bution have made advertising very essential for successful marketing of goods.
One factor which has led to this increase in importance is the growth in the size of the market. Both numerically and geographi-cally, the size of the market has greatly increased, making it well-nigh impossible for manufacturers to reach the prospects through sales-manship alone. Salesman can only cover a limited market, while advertising can reach a very large and geographically widespread market with complete ease.
The introduction of a new product is also made possible by the use of proper advertising. Advertising prepares the way for the launching of a sales campaign or sales promotion campaign for the introduction of a new product. Creating awareness and interest among the public in respect of the new product is easily achieved through the use of advertising media.
In this era of fierce competition, advertising comes to the assistance of the manufacturer in facing the competition and creat-ing and maintaining the demand for his products. Many advertisers carry on advertising to create a brand image or an institutional image of their organization.
Advertising is also important for the role it plays in social education and welfare. Advertising can be successfully used to build up or change public opinion, to create awareness of social problems, and to introduce social reforms.