Role of Advertising

Advertising is an integral part of our social and economic system. Advertising as a powerful technique of sales- promotion has been doing wonders in the domain of distribution because, it is quite capable of influencing the course of consumption, affecting the process of production, enlarging the exchange and diversify the distribution.

The Economic and Social Role of Advertising

Our newspapers, television stations, internet servers, streets and retail spaces and controlled by multinational corporate interest.

Advertising as a Business

Even in Nepal , the commercial potential of advertising in a growing number of publication and broadcasting media was recognised as early as 1960, when the frist advertising agency - Nepal advertisers- was set up. However, Nepal Advertisers was effectively limited to running a press clipping service. Three years later, another agency - Nepal Printing and Advertising - was set up and it began handlig ads of some major clients such as the janakpur Cigarette Factory, Royal Nepal Airlines Corporation and the Nepal Bank Limited ( AAAN: 1998). Another agency was set up in 1965, Kishor Advertisers which is still in the business. The advertisers willing to place ads, the media and advertising agebcies are the three main players that make up the advertusung business. The and use advertising agencies to place their advertisements in the media of choice.

The advertising agencies perform a number of functions. They keep track of the rapid changes taking place in the media industry, monitor and measure the reading and viewing habits of the people, advise the advertiser on the suitability of the media , write copy or produce video and audio clips, simplify and monitor accounting and expenses and also help to ease cash flow problems by allowing clients to defer payments, if only by a few days . Because the media garnt agencies commission for the work they do for their clients, the advertisers benefit from the use of their services almost " free of cost ". In 1997/98 advertising agencies had provided 85 percent of the advertisements that had appeared in the Kantipur daily, and only 15 percent had been obtained through direct marketing . Kantipur's turnover from ads the same year was Rs 115 million ( AAAN: 1998). By deducting 15 percent of the turnover, what is left is Rs 97.75 millio of which the agencies theoretically earn a 15 percent commission, which adds up to Rs 14.66 million. Thus what is evident is that there is something in advertising for everyone - the advertiser is able to get the message out and both the media and the advertising agency benefit.

Some of Nepal's major advertisers in Nepal include Nepal Lever Ltd. the makers of " health care products" which range from soaps and detergents to tooth paste and beauty care products; Surya Tobacco, the makers of cigarettes and the makers of instant noodles- Ra Ra, Wai Wai, Mayos, Rum Pum, etc. in the fiscal year ending july 2001 , Nepal Lever's advertising and promotion expenses was Rs 103 million, up from the Rs. 75 million the preceding year. In companies like Nepal Lever almost 50 percent of that money is spent on advertising. Other major advertisers are the banks and financial institutions and even government and its agencies, which communicate with the people through paid bublic notices in the media.

Criticism of Advertisement

Advertising does sometimes offend, and it is often the focus of criticism. To

summarize,

Criticism of advertising relate to the following arguments:

1. Advertising is intrusive
2. Advertising is Deceptive
3. Advertising Exploits Children
5. Advertising Demeans and Corrupts culture
6. Advertising persuades people to buy goods and services they cannot afford.
7. Advertising appeals to emotions, not our intellect ( So we don't make informed choices )
8. Advertising is reporting claims that may not be true.
9. Advertising is repetitive and boringly persuasive.
10. Advertising may also be subliminal, where not very clear or hidden persuasive techniques are used to get viewer attention

Defense of Advertising

But industry defenders argue that :

Advertising supports our economic system; without it new products could not be introduced and development in others could not be announced. Competitive advertising of new products and businesses powers the " engine " of our economy, fostering economic growth and creating jobs in many industries.

People use advertising to gather information before making buying decisions.Ad revenues make possible the "free" mass media we use not only for entertainment but for the maintenance of our democracy. By showing us the bounty of our capitalistic, free enterprise society, advertising increases national productivity ( as people work harder to acquire more of these products ) and improves the standard of living ( as people actually acquire more of these products).
Advertising research

Research conducted to improve the efficacy of advertising. It may focus on a specific ad or campaign, or may be directed at a more general understanding of how advertising works or how consumers use the information in advertising. It can entail a variety of research approaches, including psychological, sociological, economic, and other perspectives.

Importance of Advertisement

Advertising is vitally important force for several reasons. First it is a major means of competition among the firms. Secondly, ad is the primary means by which firms inform consumers about new or improved products. Third, ad supports for the media. Ad is a huge industry. According to Robert Coen the Insider Report, ‘the total expenditure on all media (excluding mail and telephone), in 2002, were more than $236 billion. The industry involves more than 21,000 firms and employed 302,000 people in 2000 (cited in Effective Advertising, Understanding When, How, &Why Advertising works, 2004). In the first decade of this century, employment in the advertising industry is likely to grow 30 per cent, compared with 15 per cent average for all industries.