What Are The Economic And Social Roles Of Advertisements?

Advertising Services
Advertising Services
Advertising Services
Advertising Services

Advertisements are ubiquitous in this digital age, and hence there are a plethora of advertising services out there They are praised, as well as criticized due to their positive and negative impact on the viewers. Advertisements are described as something that teaches the viewers. Ads give information and entertain people, but it is not an entertaining tool. In short, these qualities can be encapsulated by the idiom “Every coin has two sides”. The purpose of this article is to investigate the economic and social role of advertising; read on to know more about them.

The Economic Role Of Advertising

The Effect On Price:

Advertisements significantly affect the price of products, some advertised products cost more than unadvertised products and vice versa. Besides, they increase the value of a product by educating the customer about its quality and other aspects. Often this is achieved with the help of images or videos, and this prompts them to buy it. However, this is not always true as some products do not require advertising because their exclusivity works like an advertisement. For example, Tesla electric cars, Koenigsegg sports cars, and other such automobiles.

The Effect On The Choice And Demand:

A good advertisement does not necessarily mean it should increase the demand and consumption of a product. It can only provide an initial push, and the rest is determined by the product quality and its value. For example, some of the highly sold products are uniquely different, or far better than the rest of the competition. With the help of good marketing and advertising services, their sales and brand value can be further increased.

The Effect On Business Cycle:

Advertisements have a significant effect on the business cycle, i.e. the upward and downward movement of the GDP. For example, if the sales of local products increase, the GDP increases. On the contrary, if products of foreign brands outdo and hinder the sales of local products with the help of successful advertising, then it negatively affects the GDP.

The Social Role Of Advertising


Deception is quite common in advertising products, and this creates friction between buyers and sellers. The buyer is happy with a product if their experience of using it matches with what the seller advertised.

Effect On Value:

Advertisements affect the value of products, and for this marketing and advertising services use various tactics. One such widely used tactic is celebrity brand endorsement for mass-market products like soaps and other such consumer goods. This can be either good or bad depending on what the product is offering.

We hope that the points discussed above gave you a better perspective on some of the aspects of advertisements.

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