7 Functions and Effects of Advertising

Advertising is everywhere you turn. From the internet and television to newspapers and billboards, advertisements are borderline unavoidable. While print advertising was the initial form of advertising, the growth of the internet led the way to a shift in types of advertising and advertisement culture.

Increasingly, more companies are experimenting with the different channels of distribution– these are wholesalers, retailers, distributors and the Internet. Many companies now move their promotional strategy completely online. Marketing efforts online utilize several formats– such as social media– and allow the company to examine the most effective advertising for them.

The newer forms of advertising can reach more target customers, are cost-effective and more convenient. Regardless of how a company chooses to advertise its products and services, the underlying function of an advertising message remains the same: to attract more customers and increase sales.

The seven functions and effects of advertising all lead to this goal.

Companies advertise to communicate essential information to consumers about a particular product or service. These advertisements may convey what the product or service is, the various product features, where a consumer can buy it and the price.

By proactively communicating this information, a company limits the amount of outside research a consumer must do before making a purchasing decision.

More than anything else, advertisements serve as a means of persuading customers to purchase a particular product or service. Effective marketing communication takes a potential customer from being indifferent about a product or service, to purchasing the product or service.

Companies use carrot and stick motivations to persuade customers.

In one case, a company may highlight the benefits of a product to influence action, such as when GEICO declares that choosing its product will save a customer 15 percent. In another approach, a company may evoke fear or feelings of uncertainty in consumers to persuade them to take action, such as when Allstate says choosing its company helps a customer avoid mayhem.

Brand image is an integral part of a company's success and is often communicated to consumers by way of advertisements. With increased advertising comes familiarity with a company, its products, services and overall mission– what sales teams call brand awareness.

Skilled branding recognizes customer needs and presents a product as the solution that need. Consistently advertising to a specific base serves to create an emotional tie between the consumer and the brand. With brand loyalty comes consistent customers that a company can rely on for revenue.

One of the main functions of advertising is generating customer demand for a particular product or service. This is usually done through targeted campaigns that market to consumers who are the most likely to buy the product or service.

By aiming persuasive advertising specifically at certain customers and presenting a product or service as the ideal solution to fix a pain point in their lives, companies generate demand.

It is not enough to generate demand for a product or service; a company must also maintain customer loyalty to put itself in a better position for long-term success. By consistently advertising, companies can sustain the purchasing habits of current customers and attract new customers.

With an increase in loyal customers, a business can expect to grow not only by the impact of its advertisements but also by word-of-mouth.

When a customer is looking for a particular product or service, rarely does one company alone provide it.

Companies use advertisements to position themselves against their competitors, usually by highlighting what makes them the better option. This positioning is especially effective when there is a price gap because price is one of the primary factors in a customer's purchasing decision.

People typically do not like feeling left out of new trends. By playing on people's desire to be in the midst of the latest trends, companies can introduce new products and generally expect a good reception.

Advertisers showcase the most recent or improved products to highlight where an industry is heading and urge consumers to join them or be left with outdated products or services.