Impact of add on consumer
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IMPACT OF ADVERTISING
ON CONSUMER
IMPACT OF ADVERTISING
ON CONSUMER
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Advertising and Promotion Viewpoints
Creates consumer needs, wants Creates consumer needs, wants
Promotes materialism, insecurity, and greed
Promotes materialism, insecurity, and greed
More propaganda than informationMore propaganda than information
Provides informationProvides information
Creates jobs Creates jobs
Encourages higher standard of livingEncourages higher standard of living
Promotes competition Promotes competition Proponent argumentsProponent arguments
Critic arguments
Critic arguments
Helps new firms enter a marketHelps new firms enter a market
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Ethics in Advertising and Promotion
Not all issues can be regulated
Not all issues can be regulated
A marketing or promotion action may be legal but
not ethical
A marketing or promotion action may be legal but
not ethical
Marketers must decide the
appropriateness of their actions
Marketers must decide the
appropriateness of their actions
Ethics: Moral principles and values that govern the actions and decisions of an individual or group.
Ethics: Moral principles and values that govern the actions and decisions of an individual or group.
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Advertising and Children
Children's TV Watching Behavior
Children's TV Watching Behavior
Children ages 2-11 watch an average of 22 hours of TV per week and see 30,000 commercials per year
Children ages 2-11 watch an average of 22 hours of TV per week and see 30,000 commercials per year
80% of all advertising targeted to children falls in fourproduct categories:Toys, cereal, candy & fast food restaurants
80% of all advertising targeted to children falls in fourproduct categories:Toys, cereal, candy & fast food restaurants
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Perspectives on Ads for Children
Advocates Argue That Children:Advocates Argue That Children:
Marketers Argue Children:Marketers Argue Children:
Lack the knowledge and skills to evaluate
advertising claims
Lack the knowledge and skills to evaluate
advertising claims
Cannot differentiatebetween programs and
commercials
Cannot differentiatebetween programs and
commercials
Must learnthrough socialization
Must learnthrough socialization
Must acquire skills needed to function in
the marketplace
Must acquire skills needed to function in
the marketplace
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Social and Cultural Consequences
Does advertising encourage materialism?
Does advertising encourage materialism?
Does advertising make people buy thingsthey don’t need?
Does advertising make people buy thingsthey don’t need?
Is advertising justa reflection of society?
Is advertising justa reflection of society?
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..How is he ?....
Mr Sharuk khanMr Sharuk khan
Promoting his movie… on TV serials
Promoting his movie… on TV serials
After all this he earns above RS200 cr
After all this he earns above RS200 cr
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BRAND’S……!!!!
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Who all run Brand’s…..
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Do Advertisers Control the Media?
Advertising is the primary source of revenue for
newspapers, magazines, television and radio
Advertising is the primary source of revenue for
newspapers, magazines, television and radio
Advertisers may exert control over the media by biasing editorial content, limiting
coverage of certain issues, or influencing program content
Advertisers may exert control over the media by biasing editorial content, limiting
coverage of certain issues, or influencing program content
Media’s dependence on advertising for revenue makes them vulnerable to control by
advertisers
Media’s dependence on advertising for revenue makes them vulnerable to control by
advertisers
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They must report the news fairly and accurately to retain
public confidence
They must report the news fairly and accurately to retain
public confidence
Advertisers need the media more than the media need
any one advertiser
Advertisers need the media more than the media need
any one advertiser
Media maintain separation between news and business
departments “The Wall”
Media maintain separation between news and business
departments “The Wall”
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ARE SOME ADDS BENIFICIAL……
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Smoking kills
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CAN YOU!!!!
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SO HARD WORK THEY DO!!!
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Role of Advertising in the Economy
Makes consumers aware of products and servicesMakes consumers aware of products and services
Provides consumers with information to use to
make purchase decisions
Provides consumers with information to use to
make purchase decisions
Encourages consumption, fosters economic growth
Encourages consumption, fosters economic growth
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Economic Impact of Advertising
Effects on Consumer Choice• Differentiation • Brand Loyalty
Effects on Consumer Choice• Differentiation • Brand Loyalty
Effects on Product Costs and Prices• Advertising as an expense that
increases the cost of products• Increased differentiation
Effects on Product Costs and Prices• Advertising as an expense that
increases the cost of products• Increased differentiation
Effects on Competition• Barriers to entry • Economies of scale
Effects on Competition• Barriers to entry • Economies of scale
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Summarizing Economic Effects
Change consumers’ tastesChange consumers’ tastes
Reduces competitionReduces competition
Lowers sensitivity to priceLowers sensitivity to price
Builds brand loyaltyBuilds brand loyalty
Advertising Equals Market Power
Advertising Equals Market Power
Leads to higher pricesLeads to higher prices
Leads to fewer choicesLeads to fewer choices
Results in higher profitsResults in higher profits
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Summarizing Economic Effects
Provides useful informationProvides useful information
Pressure for lower pricesPressure for lower prices
Increases price sensitivityIncreases price sensitivity
Increases competitionIncreases competition
Advertising Equals
Information
Advertising Equals
Information
Forces inefficient firms outForces inefficient firms out
Pressure for high qualityPressure for high quality
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