How Does Advertising Affect The Economy?


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Connor Sephton answered
Advertising affects the economy in five main ways. It makes jobs, reduces selling costs, increases company profits, increases company security and is needed to speed up consumption. Each of these effects plays an important role within the economy and can influence the way that consumers feel and think about individual companies. While advertising affects the employees and profits of a company directly, it can also affect the company's influence and presence.

The growing demand for products leads to a growing demand for advertising. With this growing demand for advertising come jobs. Companies require whole teams of people to determine the best advertising structure for them. The number of job titles and roles that are created within the economy for advertising has had a positive effect on unemployment. Reducing selling costs and increasing company profits come hand in hand.

Advertising can help turn a small firm into a huge company and goods or services can be transformed into mass-market consumptions. When this happens companies are able to reduce their selling costs by buying in larger bulk and, in turn, increase the margin and profits from their products. An increase in company profit can lead to bigger advertising campaigns that can, again, reduce selling costs and increase profits. Successful advertising can increase a company's security as it develops a brand that can be trusted.

One of the biggest examples is the 'Apple' advert campaign. Instantly recognizable, Apple is seen as a white, clean company that is always up to date and reliable. Once a company has a strong advertising campaign to back them up, they can feel much more secure within the economy. Finally it is argued that advertising is needed to speed up consumption. Whether this is a positive or negative affect is something that is largely up for debate. The increase in advertising has led to an increase in consumers' needs to buy new products and use new services. It is almost impossible to ignore advertising in day-to-day life and with new products being flashed in consumer's faces 24/7 consumption is constantly speeding up.

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