Why advertise? How does the cost of a product change?

by | Oct 5, 2013 | Advertising

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An advertised product costs more than one that has not used an advertising campaign for promotion. So why advertise? Many people wonder why they have to pay more for a product just to cover the marketing investments undertaken by the company, when they can find products with similar qualities at lower prices. But at this point, the question is: without advertising and marketing, can consumers find products?

So what are the benefits of an advertising campaign? To be fair to the readers, I specify that I deal with advertising and what follows will be a perhaps biased answer, but in any case argued according to objective criteria.

Advertising communicates the product and the brand. Let’s say you have two items for sale, A and B. both have the same qualities. A costs much more than B because it has done an advertising campaign on the Internet, on radio and TV and in magazines and newspapers. B’s marketing plan, on the other hand, only involves distribution to retailers and the creation of packaging made by the owner’s nephew who dabbles in Photoshop as a hobby.

The consumer finds A and B on the shelf. He knows everything about A because advertising and communication have explained to him what it is, what it is used for and what its main qualities are. He has been bombarded with messages that have made him aware of the product and reactivated his latent desires, so he is more likely to buy it because, if the advertising has been effective, he trusts it. B, on the other hand, is an unknown product, one among many. Maybe it’s worth as much as A, but how does the consumer know if no one has told him so?

Precisely for this reason, B has to compete in the C band which, hypothetically, has inferior qualities. Paradoxically, if C has invested little in the quality of the product and a lot in advertising, its cost can be equal to B and it can sell more because its few winning features have been communicated unlike what the competitor has done.

Communication and advertising are therefore used to communicate the winning qualities of a product. The cost is higher because the company has to increase the marketing budget, but this turns out to be a profit-generating investment. Not advertising means doing a lot of work for nothing because the sales potential of a product is reduced.

Luigi Nervo

Luigi Nervo

Digital Marketing Manager

Marketing, Seo and content expert (read the bio).

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Luigi Nervo

Luigi Nervo

Digital Marketing Manager

Marketing, Seo and content expert (read the bio).